Donations that make a difference

Imagine this: you’re walking down the street and stumble across an envelope with a cashier’s check for $25 that can only be endorsed by a charitable organization (I don’t know if such a check exists, but bear with me). To whom do you donate the check?

My friend Ross, in his thoughtful and eloquent comment about Maimonides and the 8 levels of tzedakah touched on this question implicitly. He said:

“I like learning about new charitable organizations and initiatives, and I balance my giving among local, national and global organizations. It’s not always the biggest foundations that need my money the most – I can perhaps make a bigger difference with my contribution to a small local effort.” [emphasis added]

This sense that “big = probably less in need of a donation” is appealing. Put another way, wouldn’t a gift matter more to a small, struggling organization than to a big, established one?

At the extremes, I suppose this is true. A brand new organization with a $50,000 annual budget really does need a $100 donation more than UNICEF, with a $1 billion annual budget. But unless we want to create tens of thousands of little non-for-profits, this logic falls apart pretty quickly. (In some sense, it seems like that’s exactly what we want, since there are now nearly 1.5 million not-for-profits in the United States). Scale does matter, and while big definitely doesn’t necessarily equal effective, we can agree that a certain minimal size is required to achieve some basic efficiencies. And if gets harder, not easier, to raise money as a non profit as you grow, then as a society we are erecting barriers to creating new, innovative organizations that make a large-scale impact.

The way many not-for-profits have addressed this question is to break down what they do into bite-size pieces. For example, Heifer International’s donation page breaks out donations into the cost of a heifer, a water buffalo, a goat, a sheep… you get the idea. You can match the amount you want to give to the cost of one of these animals, and get the sense of something tangible coming from your donation.

Of course, in reality it doesn’t work quite like this, and then there’s the inevitable backlash when someone discovers that your dollars don’t buy an actual heifer, or a water buffalo; they just go into a general fund.

To me, the problem with this approach has nothing to do with whether Heifer literally gives a cow or puts the money in a fund that purchases livestock for families, which in turn improves their ability to earn a steady income. The problem comes from the expectation that funding is an on/off switch for creating something out of nothing in the world. Fighting poverty is just more complicated and more important than that.

Here’s another approach: think about your giving like you think about voting, as an expression of who you are and what you believe in. Think to yourself, “This non-profit does great things. I want to support an organization that does great things, so I’m donating. Here are 10 great things this non-profit did last year, which I helped to support. I’m proud to be a part of that.”

It’s really not a question of who’s big and who’s small, and where a gift will “make the most difference.” If you want to give, find an organization whose people, values, mission, and approach align with your own. Evaluate the organization, make sure they are efficient and responsible stewards of your money. And then give. If you trust the people and the organization, don’t feel obliged to take that extra step to say, “this is how they used the money.”