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Home » Opinion » Book review
How charity projects go awry and miss their targets
By Wan Lixin |
September 11, 2010, Saturday
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WHEN I went home from the office by bus on Wednesday, the usual 20-minute ride easily stretched to an hour during rush hour.
As the bus inched its way to Pudong, all standing passengers were waiting patiently, apparently long accustomed to such indignities.
One seated middle-aged saleswoman was talking excitedly to her friend about her commercial exploits, citing examples to illustrate how she made a killing by selling air-conditioners at the highest price.
The overwhelming tone was one of pride.
But at the Pudong section of the journey her story began to take on a tragic note, as she related how her husband, who has been idling for a decade, has managed to wheedle, extort, or steal money from her.
He has been buying lottery tickets for 10 years without ever hitting the jackpot, and she attributed his bad luck to his bad renpin (character).
Although she was abusing the man mercilessly and vowed that in the future she would guard every penny jealously, the woman impressed me as extremely charitable.
I am less sure if she was doing something good for her husband, or if her philanthropy has had "unintended bad consequences," as suggested by "Money Well Spent" by Paul Brest and Hal Harvey.
Should she be held responsible for the sorry state of her ne'er-do-well husband?
According to the book, nonprofit enterprises make up a multibillion-dollar sector of the US economy, yet their funding decisions are often shots in the dark, and inspiring projects fail to achieve positive or measurable results.
Hence the need for "strategic philanthropy."
Bill Gates and Warren Buffett intend to teach newly minted Chinese tycoons the value of philanthropy at a dinner scheduled on September 29 in Beijing, after successfully persuading many of their billionaire peers in the US to give.
In recent years some young tycoons have spent millions of dollars to have dinner with Buffett for investment tips, but this time, response is cool.
Some declined the invitation, while many called to ask whether they would have to pledge a donation at the dinner.
Letters have been sent to the invitees reassuring them that they would not be put on the spot.
I do not share prevailing views lashing China's rich people as being stingy.
All tycoons love money, and even easy money is mostly stained with blood, sweat, or tears.
The aforesaid saleswoman made her job the envy of the whole bus because she was a visionary optimist.
But all successful money makers are realists, and to give money away is fundamentally inconsistent with the capitalist instinct to possess.
Seen under this light, donations can have different implications.
"Philanthropy is a field with poor feedback and messy signals -- and those signals are often distorted by the pervasive flattery that colors many transactions in the money-giving business," Brest and Harvey say in "Money Well Spend."
In China charity is usually practiced by shrewd tycoons as marketing stunts to buy influence.
In Western countries, tax and legal complications can also be major considerations. Most charitable donations are tax-free.
The trouble with donations is that it is very difficult to foresee or gauge the impact of money, given the many uses (mostly unnecessary) money can be put to today.
Even some of the most high-minded purposes can be suspect.
Some tycoons dedicated their money to fight cancer or other deadly diseases.
That's very philanthropic -- but is further extension of human life as important as saving of other species in this human-dominating, overcrowded world?
It is said charity begins at home. The wisdom of this practice is that at home one can better assess who deserves to be helped, and in what way. It would be terrible to give money to a gambler, a substance abuser, or a fashion chaser.
Outside the home, it is difficult to measure the intended positive effect.
"Some programs lend themselves better to metrics than others, and some not at all. It would be a tragic error for a philanthropist to distort his or her mission in order to seek only measurable outcomes," the book cautions.
The likes of Gates and Buffett are idolized for their money -- and the truly wonderful thing about the duo is that they help cast money in an aura of sanctity.
As the bus inched its way to Pudong, all standing passengers were waiting patiently, apparently long accustomed to such indignities.
One seated middle-aged saleswoman was talking excitedly to her friend about her commercial exploits, citing examples to illustrate how she made a killing by selling air-conditioners at the highest price.
The overwhelming tone was one of pride.
But at the Pudong section of the journey her story began to take on a tragic note, as she related how her husband, who has been idling for a decade, has managed to wheedle, extort, or steal money from her.
He has been buying lottery tickets for 10 years without ever hitting the jackpot, and she attributed his bad luck to his bad renpin (character).
Although she was abusing the man mercilessly and vowed that in the future she would guard every penny jealously, the woman impressed me as extremely charitable.
I am less sure if she was doing something good for her husband, or if her philanthropy has had "unintended bad consequences," as suggested by "Money Well Spent" by Paul Brest and Hal Harvey.
Should she be held responsible for the sorry state of her ne'er-do-well husband?
According to the book, nonprofit enterprises make up a multibillion-dollar sector of the US economy, yet their funding decisions are often shots in the dark, and inspiring projects fail to achieve positive or measurable results.
Hence the need for "strategic philanthropy."
Bill Gates and Warren Buffett intend to teach newly minted Chinese tycoons the value of philanthropy at a dinner scheduled on September 29 in Beijing, after successfully persuading many of their billionaire peers in the US to give.
In recent years some young tycoons have spent millions of dollars to have dinner with Buffett for investment tips, but this time, response is cool.
Some declined the invitation, while many called to ask whether they would have to pledge a donation at the dinner.
Letters have been sent to the invitees reassuring them that they would not be put on the spot.
I do not share prevailing views lashing China's rich people as being stingy.
All tycoons love money, and even easy money is mostly stained with blood, sweat, or tears.
The aforesaid saleswoman made her job the envy of the whole bus because she was a visionary optimist.
But all successful money makers are realists, and to give money away is fundamentally inconsistent with the capitalist instinct to possess.
Seen under this light, donations can have different implications.
"Philanthropy is a field with poor feedback and messy signals -- and those signals are often distorted by the pervasive flattery that colors many transactions in the money-giving business," Brest and Harvey say in "Money Well Spend."
In China charity is usually practiced by shrewd tycoons as marketing stunts to buy influence.
In Western countries, tax and legal complications can also be major considerations. Most charitable donations are tax-free.
The trouble with donations is that it is very difficult to foresee or gauge the impact of money, given the many uses (mostly unnecessary) money can be put to today.
Even some of the most high-minded purposes can be suspect.
Some tycoons dedicated their money to fight cancer or other deadly diseases.
That's very philanthropic -- but is further extension of human life as important as saving of other species in this human-dominating, overcrowded world?
It is said charity begins at home. The wisdom of this practice is that at home one can better assess who deserves to be helped, and in what way. It would be terrible to give money to a gambler, a substance abuser, or a fashion chaser.
Outside the home, it is difficult to measure the intended positive effect.
"Some programs lend themselves better to metrics than others, and some not at all. It would be a tragic error for a philanthropist to distort his or her mission in order to seek only measurable outcomes," the book cautions.
The likes of Gates and Buffett are idolized for their money -- and the truly wonderful thing about the duo is that they help cast money in an aura of sanctity.
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