My great uncle Cuthbert remembered me in his will, to the tune of about a hundred mil after taxes. I’m putting aside some to live off of, and giving the rest to charity, because who needs that kind of jack, amirite?
Is it better to give $100 million to one charity, or $1 million to each of a hundred charities? Assume for this thought experiment that every charity has been thoroughly vetted and found to be on the up-and-up.
Discuss.
That’s a hell of an assumption.
I suppose the difference would be what effect you want to have. For some charities, $1M is world-changing. For some, it’s a rounding error. So which charities you pick is going to have a big effect, even if they’re all legit charities.
My guess is that $100M is going to go to a capital project that will have a more lasting benefit, while for larger charities $1M is just going to go to operating expenses. One large lasting project seems more impactful to me than 100 budget directors not sweating where the money for the flyers is coming from this year. YMMV,
It’s better to get the most that you can out of the $100m. The tricky part is defining “most” and even once you’ve defined it good luck measuring it.
I suppose there are some more objective things. You could look at the charity’s record of admin expenses versus how much money goes to those actually in need. A naive approach would be to find the charity with the best “score” using those sorts of guidelines and give all the money to them. But of course if they’re a charity used to getting at most $100,000 a year throwing them $100m all at once will likely be a disaster.
My approach would be to try turn that $100m into the largest reduction in suffering possible. But that’s a hugely complex task, and involves looking at many perhaps contradictory studies and yes more likely than not falling back on my own philosophy and ideology where the scientific evidence isn’t clear cut. At some point you’ve got to decide you’ve done enough research and commit to a decision but personally I’d never be completely sure I’d done the most optimal thing.
Maybe something specific like local access to clean water will free up a huge number of hours in the day, leading impoverished people to have the time and energy to start businesses and the path out of poverty. Maybe basic health services will have the biggest bang for the buck.
Or maybe taking the long view and investing in lots of different experiments to see what works will have the best long term results, because even if a lot of the money is wasted the better data at the end of it will have hugely positive impact on how a lot more than $100m is spent.
$100m to one charity versus $1m to 100 charities is the means to the end. It’s better to start the discussion talking about the end.
Like it’s been said, it depends on the charities, but I would guess the 1M to 100 would do more good in the long run. 1M is a lotta money and in the right charity’s hands it could do a world good better than dropping 100 mil into 1.
What about traveling around the world to little volunteer charities, asking them what they need, and then buying it and giving it to them? Why give $1M or $10M or whatever to a big charity so they can have a bigger office or better ads?
Give the $1 million to 100 different charities, especially small ones.
This. Think the starfish parable. (That’s the one with two people on the beach, and one tosses a starfish back into the sea. The other says, "There are millions of other starfish. You aren’t really making a difference by saving one.
“I made a difference for that one.”)
One $300 hookerbot? Or 300 $1 hookerbots?
How about an endowment so that the money isn’t just gone. $100M could produce a nice return each year and keep doing so, even given market ups and downs.
How about you invest in business so that the money can create jobs for people. Seriously straight up capitalism has created far more prosperity than any charity ever will.
If you give a million to 100 different charities, you’ll have 100 charities calling you continuously for your next donation.
Pick a good hospital, buy a new wing for them. You’ll have excellent medical coverage for the rest of your life.
The larger an organization (generally) the more they save on overhead, because they can work at scale and more finely tune their workforce to the workload that they are presented with. So, in general, giving the full lump sum to the biggest charity is going to see it used the most efficiently.
But, a lot of charities are doing work that hasn’t ever been demonstrated to actually make life better for anyone. They’re like doctors before they started using control groups, simply assuming that what they are doing is beneficial and fearing that by taking the time to run a control group, they’re just letting people die/starve/suffer/etc. One book that I read, about charities that performed control tests, the only thing they found that had any positive effect on the communities was to provide social workers who would talk to women, privately, at their homes about contraception and similar topics. A good dozen other attempts were all, at best, money pits that made no lasting difference.
So if you actually wanted to help out the most people, you would want to find the largest organization that was providing services that had been scientifically demonstrated to be helpful.
I agree that’s a major dilemma in charitable giving as in giving to the needy. The further problem is that in ‘social science’ the assumptions and worldviews of researchers often find their way into results IMO. So I’d add on top the uncertainty that ‘scientifically demonstrated’ really means a whole lot in this context.
I distinguish ‘giving to the needy’ because some other things which qualify as ‘charities’ for tax purposes don’t specifically tackle the intractable problem of ‘how can you really help poor people?’ If you give to a museum it might make museum admission more affordable for poor patrons but in general everyone accepts that the value of museums to society is a matter of opinion. Nobody (I hope, because it’s pointless) is seeking to ‘scientifically demonstrate’ how museums make people’s lives better. Not to say less ‘needy oriented’ charities are better places to donate but they tend to do things the value of which everyone accepts is a matter of opinion.
I now contribute one big % of my giving to an international aid org focused on the poorest countries, with good stats on low % of overhead. I don’t think I can solve the question of ‘what really helps?’ (in Africa say, where this like other similar orgs does a disproportionate share of its work). But they try with programs which seem reasonable, I’m helping them try. A similar big % goes to my undergrad college which has a special mission I believe in. My local parish gets the third biggest chunk, somewhat smaller than the other two. Then a few miscellaneous polite small donations to other stuff when asked.
If I could scale that up to $100mil, the problem I’d see with spreading it to a 100 different things is that there’s some objective hierarchy of efficiency as in % of donation spent on programs, and transparency too (small efforts are not as transparent, the intl aid org I contribute to for example is also a conduit for US AID money, so under that microscope also). On a list of 100 you’d have to accept ones which score lower. I might expand from my current 2-3 but certainly not 100. The other positive for more things though would be attracting less attention.
Definitely the former, not the latter. Allow me to introduce myself, my name is One Charity…
Is that kind of discount legal?
Why wouldn’t it be? Hospitals aren’t required to charge according to any government schedule and can and do adjust prices depending on the patient. Honestly though I wouldn’t expect them to actually give a discount so much as the fact that you’ll always be treated by the department head and won’t have to spend much time in waiting rooms.
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A surprisingly simple answer: Call the Bill & Melinda Gates Foundation & give it all to them. They are exactly in the business of doing do-goodery smartly. Not just dumping dollars into the bottomless pit of corruption or administration or feeding the poor instead of teaching them to farm or fish.
Warren Buffet was facing the same challenge of how to make the great bulk of his large fortune do the most good once he’d decided to mostly give it away. Rather than re-invent the method for deciding how & where to donate he went to the experts. He gave it all to BMGF.
Those are two seriously smart independent-minded dudes doing industrial scale good in the charitable world. And therefore in the larger world.
One could do much worse than to follow their lead.
But the Bill and Melinda Gates Foundation already has tens of billions of dollars. Your $100 million is just a rounding error for them, or a few weeks of investment return. For the same reason, giving it to Harvard or Yale universities wouldn’t have much impact. But if you gave it to a small liberal arts school or community college, it could have a much larger impact.
Larger impact, sure, but a better impact? I don’t agree with that. Harvard has a large endowment because it’s a good school. French Poetry U has a much smaller endowment because they aren’t as good of a school. Why throw good money after bad?
Harvard also has expensive professors and administrators, fancy buildings and other overhead costs well above the norm. A small school or a community college has cheaper professors, plainer buildings and less overhead. So a given amount contributed to scholarships can support a greater number of students at the small school or community college.