Below is the comment, emphasis my own.
Regrettably, for a typical project - in a ‘great’ case - the amount of funds given by donors that directly goes to the intended ground beneficiaries is around 30%. Mostly, it is around 10%. And... if the recipient involves the government where corruption is serious, that may dwindle to 5% or less. Now that is quite discouraging if you expect that at least around 50% would go to the intended beneficiaries. Now this has been very hard for me to accept and has caused great disillusionment for several years (I had no idea about this before I was promoted to a manager). How I tried to ‘console’ myself with the circumstances was twisting my expectations. It’s quite sad in a way that I have come to believe that international charity/non-profit should be understood as a primarily job creation and economic stimulus tool (instead of the overt stated objective of helping the poor and unfortunate). It actually creates jobs and income for the few lucky local people who are employed to implement or supply goods to the project. While these are usually middle class people and far more fortunate than those poor people whom the project intends to help, they still benefited from the salary, income and development opportunities that existed thanks to the project. Now that leads me to the next conundrum.... which is highly debatable. Some would say that these ‘beneficiaries’ (staff and vendors of the project) are not only the intended beneficiaries but they also do not deserve the jobs and income. I am undecided as to who deserves help or benefits more. I mean ... am I to say that the hotel whom the project paid to provide a big biz dinner and creating jobs for waiters, cooks etc do not deserve the extra business opportunity created? What do you think? In society, do the poorest and unfortunate who have made bad decisions and are ‘lazy’ deserve more help than the richer person who is industrious and hardworking? How do we know which poor/unlucky person is deserving or not? Is it realistic to assume that everyone is born different but equal? This is a complicated question which I struggled with for a long time. If you have some thoughts about this, please do share in future posts! Thank you very much!
Ok there are a couple of points to talk about here.
1) Charities and the beneficiaries
2) Who deserves help?
3) Are we equal?
I pretty much already knew that the split was 70/30 or less for sometime. Where 30% or less goes to beneficiaries. And 10% is a more realistic number.
Mathematically it also makes sense. Any non-profit organization is still an organization.
In a typical business, a company manufactures stuff/products/services, sells the services, pays rent, pays staff, pays for marketing expenses and other expenses. The resulting profit is around 10%-30%.
In any non-profit organization, it's the same.
The product is somewhat iffy. It's unknown. Some people feel good donating, some people want to help, whatever. But the company/non-profit organization is pretty much trying to sell this intangible product.
Donations are the revenue, and after we minus off the expenses... the "profits" go to beneficiaries.
Now, this sounds pretty sick. I'd admit.
So if we think about it...
30% goes to staff wages, 20% goes to rental, 20% marketing, 20% other expenses, 10% beneficiaries.
Let's say I'm a Singaporean, and I see an advert for poor kids in Thailand for example.
I donate $100..
$30 goes to staff like Kuriko and other employees and the CEO.
$20 goes to landowners who are rich anyway.
$20 goes to marketing which employs people and generates the economy.
$20 goes to other expenses which employs people and generates the economy.
$10 goes to beneficiaries.
So around $70-$90 goes to churning the economy and $10-$30 goes to beneficiaries.
(From here on I'll just use 80% and 20%)
I'm a bit split on the feelings behind this.
Cos... on one hand, I think doing something is better than nothing. Also, to do more, I believe that it is necessary to be a big organization.
It is probably easier to find 100 people to donate $1 than to find 1 person who is willing to go and get their hands dirty and go down to a beneficiary to pass them $20 directly. Not to mention that as an organization, it is scalable meaning they can handle even larger amounts of funds as donations increase.
But the idea that I could just take $20 cash and pass it to any less fortunate person and that would do around the same as what the organization would with $100... that feeling is just so wrong.
This also COULD mean that 80% goes to products and services that might never have been consumed.
And as Kuriko rightly pointed out. Are the main beneficiaries, the economy and other members of society? Creating more jobs? More consumption? Adding to a GDP number for the Government to showcase to the world?
Then also another question would be... is charity a consumable good? Do we are people/donors... are we consuming this as a product like everyone else?
We don't like to clean up our house. So we hire a helper/maid, or a part-time maid. It's called out sourcing.
We don't like to do,or say we don't have time to help people, so we hire a charitable organization to help us do charitable work? And so the organization takes a cut of the donation as a "service fee" to help do the charity FOR YOU. Just that most people don't realize that the service fee is 80%.
Now, I'm not saying anyone is doing anything wrong, this is just how this "business" works.
If you look at it another way, the beneficiaries are like the shareholders of an organization. They take what's left after everyone else is paid.
Next point... Who deserves help?
Ok there's 2 sub points here.
1) Who deserves help in the scenario of charities and beneficiaries.
Are the secondary beneficiaries, such as services and products which the organization consumes which support the local economy, do they deserve the jobs created and money earned? Considering that none of these jobs and services would exist without the presence of the organization?
For this question, I don't think too much about it, cos this is just the way the system works. It's the same question as why people would pay $10,000 for a handbag.
I think many governments like non-profit organizations, cos it's win-win for them. They get to generate the economy, get tax dollars from the secondary beneficiaries, and don't need to spend tax dollars to support whatever initiative the organization is supporting.
So I don't really ponder too much upon this cos... I can't do much about the system. I can only decide whether to donate or not.
2) Who deserves help in general.
This question, I think a bit more. Cos it determines what I want to do or how I want to help someone.
For me, I believe I want to help someone who wants to help themselves. If someone poor needs a couple of shirt and pants so that he can go for an interview and work and get himself out of his situation, I would gladly give him some of mine. I'd unlikely buy him a new one though, but I can likely spare 3 sets if the size fits.
But if someone approaches me at the hawker center and says he is homeless. (True story)
Someone was asking the people in the queue one at a time saying he was homeless and wanted $2.
One of the folks offered to buy him a meal, he rejected it. He just wanted the cash...
In this case, no thanks, I have no intention of helping people like this.
So for me, I think, I'd like to help someone who has the intention of getting themselves out of the situation.
I don't want to be a donor as part of their daily "operations", basically, some folks take up a low paying job, don't earn enough, stay in a rented one bedroom, and uses donations and help to supplement their lack of income. And they remain reliant on the donations cos it is part of their daily routine.
I have a strong belief that most people are poor cos of poor decision making and a lack of desire to change/adapt to get themselves out of the current situation. Which is why in my previous article, I suggested...
Let's say we had a program, where rich people could "mentor" a poor person for a period of time.
In return of being "mentored" the poor person has to take up whatever job which is available, get cleaned up, and the mentor will dictate how the poor person is to spend any money earned.
But I do believe that a bulk of the low income/poor people are there due to poor decision making and the willingness to change to improve their situation.
** I have an interesting idea I want to test out, but my wife would definitely not allow it. To intentionally be homeless, leave the house without a cent, with only a couple of t-shirts and shorts. And see how long it takes to get back on my feet again, with a regular job, renting a cheap bedroom. Without using my degree or driving license and without asking for help from friends and family. I estimate to take around 2-3 months.
This is to prove that with the right attitude and determination, it is always possible to get back up again.
Nonetheless, this experiment would likely not happen. **
Last point... are we all born equal but different?
I am fully aware that we are all different.
So what does it mean that we are equal? To me, to be equal is to have equal rights.
Such that a poor man or rich man SHOULD be treated fairly in the name of the law and will be punished in the same way for the same crime.
Or a person will have equal opportunity to excel and chase their own dreams. That they should be paid fairly with the amount of productivity in comparison to their counterparts.
That a woman should be treated fairly and not be harassed in her work place due to the size of her boobs.
And let me be brutally honest. This utopia is bullshit. It doesn't exist and will NEVER exist.
Humans are different and it is these differences that make us interesting and unique. But these differences are also the things that divide us. Different cultures, religion, facial features, more handsome, prettier, smarter, etc etc. And we will naturally group ourselves into groups with these labels and will we not treat people whom are similar to us better than people who are not similar to us?
This is what it is to be human. Humans, emotions and politics go hand in hand.
To put this in perspective of who deserves help...
Everyone should be helped if they need help. But help is a finite resource, would you rather give this resource to someone who will make better use of it and get himself out of the cycle?
By creating more jobs by creating an "imaginary" charity to spur consumption, does this provide an additional opportunity for the poor to find more jobs? IF they are willing to take up these jobs?
But I think, no one deserves help ALL the time. That's what help is, and I think many people mistake what help is supposed to be.
If I ask you to help me carry my bag, usually it's for a period of time, and after that, I'm expected to carry the bag again.
If I ask someone to help me out of the water cos I can't swim, the person helps me out of the water. The rescuer doesn't hold me in the water indefinitely just to keep me from drowning.
So what is equality in society?
Basically, if any of these people joined a company they should all be hired IF they have the same qualification, assuming they are all fresh grads from the same school, and assuming no interview process.
An ugly person, a person of differing race, a handicapped person which handicap doesn't affect the job, a well dressed person, a person with different sexual orientation, etc...
Although they might all be hired, they will all NOT be able to do the same job as well as someone else. There will be those who can do the job better.
Thus, we are all different.
And if anyone loses the job due to lack of ability, that is also cos we are all different.
This goes the same as charities. If a charity helps someone and finds that he is squandering excess money on drugs, cigarettes, women. Should the charity continue to help this person?
Gender equality isn't just about holding doors open for girls.
It's also about equal pay for the same amount of work done.
It's about equal opportunity to work and rise to the rank of a General in the Army IF the person is qualified.
Gender equality is also about men being allowed to cry without being judged as wimps.
Similarly, doing good isn't all about donating money or working for charities.
It's also not all about giving free money to beneficiaries.
More often than not, the less fortunate have other issues, mental issues, disciplinary issues, lack of self esteem, and I think many times, these are also missed out.
But also, IF this person is undeserving of help, just like a company can fire a person who is under-performing, a charity can remove someone from help as well.
Anyway conclusion of my thoughts.
Charities create more consumption which in turn generate more jobs and bring people out of poverty. This is probably somewhat true although in an indirect way.
Does this mean that if we increase consumption by 10%, then there would be so many other jobs that the poor can take up? If so, then there would be no more poor.
But I highly doubt this is the case. I rather believe that, more often than not, being poor is a state of mind a lack of knowledge and an unwillingness to change.
The world doesn't treat each other the equally, I try not to work against the flow. I recognize it and try to be as fair as I can in whatever that I do. But I think people who help themselves should get a main bulk of the help available.
But hey! Think about it this way... just by existing as a non-profit organization, you have created additional demand and created more jobs which resulted in a number of people who were never poor due to the availability of these jobs. (Just an example...) It's like spending Singaporean money to spur the Thailand economy.
Although I think it would be interesting to consolidate a 10 year track record of an organization to see what they have accomplished.
X amount collected
Y amount spent on wages
Z amount spent on paying rental
B amount spent on marketing
C amount spent on building D number of schools
E amount spent giving to beneficiaries
Number of people enrolled in the program, number of people who graduated from the program and managed to become independent.
I really really wonder what the numbers would look like.
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