I read at the abcnews site that Warren Buffett and Bill Gates have been on a crusade to convince some of the billionaire families to give half of their vast fortunes away to charities. Apparently they were successful.
Some of the money being given away is even old money that has been in families for generations.
You might think that this is great, but I don’t. It’s not that I think those extremely rich families and individuals should hoard that money. No, it’s more that I hate do see people become more and more dependent upon others. Our country is already creeping toward socialism (unless some big changes happen in the next elections), and I’m afraid that the people of the U.S. and the world for that matter are become more and more dependent upon handouts.
I can see us losing a decade or longer, when people become lazy by being too dependent on other. What if those charity dollars actually prevent some great things that would have happened but won’t now? How can a small fledgling company compete with the dollars that a big charity with pocket stuffed full of dollars?
You can think of a charity as a business that already has made its money and now is trying to create the product. There is no sense of urgency and no risk. But with a small company without the dollars… well, they would be hungry and desperate to make things happen.
The problems with charities is that you never see that effect they have on such small businesses. I think in small business cases (and farmers), charities are the dream killers.
Now I could be wrong, maybe I’m being too heartless… I just think that we really don’ t know the true casualties of the various charity organizations.
An example of the potential damage is that continuous charity giving to Haiti (not the earthquake charity work!), has kept the Haiti people dependent on handouts. Some Haitians claim this has actually hurts the Haiti farmers and other local economic development!
I know this is a controversial viewpoint, and I don’t expect many people to agree with me, or that even I agree 100% with this viewpoint. My goal with this post is to make you just wonder if it’s a possibility.
Do you have any stories where charities have done more harm than good? Do you think my theory is way off base?
UPDATE: After some more focused thinking about what bothers me. I think it’s the spending the money then it’s gone. Currently, I’m trying to build up dividend funds to provide a small stream of income, and the giving away of this money sounds like a spending spree. The frugal side of me thinks that the money should be invested, then a portion of the dividends push towards charity.
Along with most of the commenters below, if the charity does something constructive with the money, I’m okay with the spending. But of 70 to 90% of the money goes to the running of the charity or wasteful spending, that’s what bothers me.
I really like Sandy L.’s and BFS’s idea about the money going towards the creation of infrastructure and something constructive… where the charity teach people to fish, instead of giving them a handout.
-MR
Well, I think Bill Gates gives a lot of money to provide vaccines, which I think is a fantastic thing.
However, I do get your point. There are plenty of people that are more than willing to sit on the couch and accept a handout instead of being proactive to improve their situation.
I know one thing I used to hate regarding charity was when my former employer used to basically strong-arm you into donating to a certain charity. I give to the charities I believe in and I don’t need pressure from work to tell me where to put my money. (Plus, I was not fond of this particular charity.)
I can see both sides of the argument. Perhaps if the money is donated to charities that encourage and enable people to provide for themselves….of course I don’t happen to know which charities those are at the moment, but I know they exist!
My charity pet peeve is Africa relief.
So many celebrities have donated billions to that country. I’ve been there twice and there isn’t even the most basic of infrastructure in most of the continent. Things like like roads, plumbing, sewers, hospitals. I have no clue how people still continue to send money there when it just evaporates and no progress is made.
I think some of these benefactors should actually spend some resources to police where the money goes and how and where it’s being spent.
I agree that giving money away can proliferate the problem. Build a factory instead and pay people wages. Build a school and teach people a trade. There are lots of great ways to use money. I’m all for giving money to charity..just police it better and don’t just give it away…make people work for it.
I think it depends on the charity. The ones that provide medicine and water wells to countries that give their citizens neither don’t seem to be fostering the idea of handouts…just empathy.
The ones that fund programs that pretty much only allow people to mooch are the ones that probably shouldn’t receive billions of dollars – that would just produce more moochers.
I like the charities that I’ve heard of so far that Bill Gates supports, so we’ll see whether they are teaching people to fish or just handing out the pre-caught stuff. 🙂
@Everyday Tips
I hear you on the charity bullying! I never though of it like that, but that’s what it is!
Yeah, I think the Bill and Melinda Gates Foundation is probably a pretty good charity. But some of the other charities are boarderline scams. with as low as 10% of the charity money going to the cause, and the rest going to the people running the charity.
@Car Negotiation Coach
I agree with that concept 100% 🙂
As I was commenting on Everyday Tips comment, some charities are borderline scams… And other just give a person fish instead of teaching the to fish. We need more charities that teach people to fish 🙂
@Budgeting in the Fun Stuff
Lol, I just used the fishing analogy with Car Negotiation Coach! Too funny!
But yes, I also agree with what you said 100% too!
I’m sure the Bill and Melinda Gates foundation invests their money in wise charities that aren’t scams…
@Sandy L
Great points. I’ve never been to Africa, but I remember reading of corruption at the high levels. The money never makes it down to the intended audience. Sad…
Sandy, the uses you identified are perfect. Even in the U.S., that money could build an alternative energy infrastructure to help expedite getting us off of fossil fuels!
Or maybe clean the ocean of the huge mass of plastic mess in the Pacific!
I heard about this too… I wonder if the return of the estate taxes has anything to do with it, or perhaps its a goodwill gesture to fend off the hounds?
Either way, I somewhat agree with you. It all depends on how they give to charity and what the money will do. If the money is used to found some non-profits that work at actively making things better and not just given as handouts, that might help things.
What most poor places need anyways is a better environment of robust rules and less reliance on corrupt government. A robust private sector with a rule of fair law will go a lot further than even a ship full of grain and bread.
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@Kevin@InvestItWisely
I think it’s primarily the work of Bill and Warren. Both are huge charity contributers! It they didn’t give so much money away, Carlos Slim would still the the 3rd rich man in the world instead of the 1st as he is currently.
I’m somewhat glad that we are all thinking along similar lines with respect to charities. I though someone was really going to rip into me. Perhaps a very left liberal, but so far the comments have been much better than I expected 🙂
Thanks for the great adds to this conversation!!!
Its very fantastic to hear.
How I wish that billionaires from
the 3rd world countries will emulate
from them
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@Payday Loan,com
I agree, it could really help those 3rd world countries! I think most of the money from Warren and Bill effort are going global. So at least the 3rd world countries will get a lift from their activities.