charity

Saving administration costs or saving lives?

By Lucius Caviola & Nadira Faulmüller

Imagine a car company advertising as follows: “90c of any dollar you pay for your car goes directly to building cars. Only 10% of our expenses go into planning, designing, and advertising them.” Such a campaign strategy would seem patently bizarre; when buying a product few of us are interested in how much went into administration, all we care about is what we get for our money. Overhead ratio (the proportion of money going into administration) is irrelevant; only cost-effectiveness matters.

This common sense approach to purchasing goods or services does not seem to translate into the non-profit sector, however. Consider the following advertisement by the organisation CARE:  “More than 90 percent of our expended resources – among the highest of all philanthropic organisations – support our poverty-fighting projects around the world. Less than 10 percent of expended resources go toward administrative and fundraising costs.” Continue reading

People and charitable causes are importantly different things

Like Prot – the lovable character played by Kevin Spacey in the underrated movie K-PAX – you’re an intelligent benevolent extraterrestrial who has just been beamed to Earth.  Sadly, unlike Prot, you have no return ticket.  The good news for you is that just moments after hopping off of your beam of light, you found a briefcase stuffed with $3 million.  Being benevolent, and having concern for the inhabitants of Earth, you decide to give nearly all of this money to charity.  Being completely new to the planet, however, you do not yet have any special concern for anyone here – no friends, no loved ones.  Having this equal concern for everyone, you want simply to do the most good possible, and so you decide to give this money to the most cost-effective charities you can find.

Exit science fiction scenario.

One important difference between each of us and this Prot-agonist is that we do have friends and loved ones; we have rich shared histories with them, we care deeply about them, and, crucially, the level of concern we have for them is not on a par with the general concern we have for strangers.  If your fiancé were drowning in a lake to your north, and ten strangers were drowning in a lake to your south, and you could either rescue the one to your north or instead the ten to your south (but not all eleven!), you’d probably head north.  Whether this constitutes morally good behavior on your part is a matter of controversy among contemporary ethical theorists.  But let’s assume the commonsense view that it’s not wrong of you to save your fiancé over the ten others.  This degree of special partial concern is, we’ll suppose, justified.

Continue reading

Banking as an ethical career

The High Pay Commission today published a report denigrating the salaries of executives in the city.  This isn’t unusual: it’s common to see the high pay of bankers and other city workers is reviled in the media.  But there’s a flip side to bankers’ earnings, which often gets neglected.   Wealth, of course, can be spent on champagne and yachts and private jets.  But it can also be spent on helping people.  In fact, there are reasons for thinking that, if you spend your money wisely, you can do much more good by taking a lucrative career such as banking than by pursuing a conventional ‘ethical’ career such as charity work.

 

First, as a banker, you could earn well over £6million.  By donating 50% of those earnings, you could pay for several charity workers.  So you’d do several times as much good than if you were a charity worker yourself.

Second, if you decide not to be a charity worker, someone else will take your place, and so the benefit you provide would have happened anyway.  In contrast, if you take a lucrative career and donate your earnings, your donations provide a benefit which would not have happened anyway.

Third, as a philanthropic banker, you can put your money anywhere.  So you can fund only the very best causes.  In contrast, as a charity worker, you are much more limited in your choice of where to work.  Some causes are thousands of times more cost-effective than others, so this can be a big deal.

 

Between these three arguments, it seems pretty compelling that one can do far more to help others by taking a lucrative career and donating a substantial proportion of the proceeds, than by pursuing a more conventional ethical career.

 

Over 40 people, including many here at Oxford, have been convinced by these arguments and have formed a community called 80,000 Hours.   Members of this community support each other in their pursuit of a high-impact ethical career, trying to use the 80,000 hours of their working life to help other people as much as they can.  Members pursue careers in what we call ‘professional philanthropy’, careers in which they’ll have a big influence, and careers in which they can research highly important but neglected areas.  Each member of 80,000 hours can expect to save over 10 000 lives in the course of their career.

 

We have a finite time on earth, but, if we’re willing to think hard about how to best use the hours of our working life, we have a tremendous ability to do good in the world.

 

For more information, my research is discussed today in a BBC news article (http://www.bbc.co.uk/news/education-15820786) and I was today was interviewed for the Today program (http://www.bbc.co.uk/iplayer/radio/bbc_radio_four/20111122, 10 minutes from the end).

For more info on the organization, you can check out 80,000 Hours at: www.80000hours.org

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