Good Charities

I always found the decision of giving money to charities a difficult one because of so many charities and the different things they do. First you need to be concerned that the non-profit organization will do what they say, that it even exists. Then you think about the part of the money that actually goes to the cause instead of being spent on administrative and advertising stuff. Finally you also wonder how they will address the cause, how efficiently. This article in the last edition of Significance Magazine discusses the how efficient part. The so called relentless logic is covered in details in this book and commented in the article. The "relentless" part comes from the fact that the idea is to transform the results of the actions of the organization into money, or quantify it using currency values, which is sort of disgusting. But anyway, the argument is that it is valid if it leads to better use of the received funds.

But to me the very fact that transforming such results into monetary value does not sound good is what explains why it should not be done. They are different things in such a way that some of the values coming from the results of this type of work as well as what people gain by just giving, is not quantifiable in any simple way.

Their first example, where I almost stopped reading, was about quantifying the dollar value of bringing back to school the high school drop outs. They say that researches say that in average high school graduates earn $6500 per year more than high school drop-outs. I see two problems with this value: 1) This value is certainly controversial among the scientific community. If the causes of Global Warming, which has a sort of priority status in the scientific agenda, is still nowhere close to a consensus, then imagine the effects of a high-school graduation. 2) Even assuming that the figure is correct, there is likely a bias because $6500 is relative to high-school graduates, not to drop-outs that ended up re-enrolling and became at least high school graduates. You may think that I am being unreasonable, but I do believe the later may have some important differences that leads to different earnings compared to the former.

But in any case these are not the reason I almost stopped reading. It has to do more with the idea of doing this type of quantification. For example, maybe I did not have the chance of getting a high school diploma because I was forced to drop out to help at home. Nevertheless, I succeeded financially speaking and I made a commitment to myself that I would help the drop-out cause. There is a value to that in such a way that it does not matter if you tell me that based on your math and your assumptions, helping hungry kids is a more efficient way to give money. Or maybe I was helped by foundation X, which avoided that I dropped out of school, so now I want to pay back. It does not matter if you tell me that foundation Y does the same thing more efficiently.

These may be very specific cases, but even if I dont have reasons to help any specific cause, I will have my opinion about different causes.  When politicians promise things before election, like individual A promises to do things for the children and individual B promises to combat global warming, we see that people will have their own opinion as to which is most important, there is no effort to quantify anything, or they are next to useless in convincing people, likely because such quantification is far from correct and based on too many assumptions and approximations.

So, I read the paper, but I think it is great that we have such diversity of opinions among human beings, so that every cause has their supporters. Quantifying effects is important because it forces improvement but I not sure it helps much on advising folks as to where they should put their money. It should guide improvements for the good organizations and it should help the not so good ones to make an effort to follow the path of the top organizations.