Intro to EA/Giving What I Should

Update 11/19/14: I had the format of the pledge wrong.  Read Jonathan’s correction here, more comments on the bottom of this post.

People often ask me what EA is.  I tried describing it as “trying to make charity as effective as possible”, but that’s kind of implies that everyone not in EA is not doing that.  Like evidence based medicine, it’s either obviously correct or horribly mislabled.  I can say “we believe in randomized control trials”, but a lot of what I do in the local group is push for everything except RCTs.  And my favorite part of GiveWell is not their research into existing charities, although that is excellent for specific problems, but their deliberate seed funding of projects to find the best way to approach unsolved problems.  That they picked something I’m passionate about (criminal justice) is a bonus, but the principle would stand either way.  So I think that I will describe EA, or at least my interest in EA, as “generating and advertising the evidence for evidence based charity.”

Recently my EA group talked to Jonathan Courtney from Giving What We Can.  Giving What We Can has two functions: assessing charities, and taking and monitoring pledges individuals make to give 10% of their income.  On charity assesment, they’re basically Pepsi to GiveWell’s Coke.  They tend to agree with each other’s research but make slightly different recommendations based on differences in their beliefs about the future.*  GWWC also encourages people to register a pledge to donate 10% of their lifetime pre-tax income to what they (the pledger) believes to be the most effective charities for helping developing countries.   The pledge is not legally binding, and deliberately refers to lifetime income and not income in a given year (so you can consumption smooth), but they do ask people to log their giving, and perform audits of pledgers at the end of the year.

My EA group had a really great discussion about this, and my tentative opinion is:  it’s hard to fault them for what they’re doing, but I sure hope they’re an incremental step. GWWC’s main selling point, simplicity, is also an enormous limitation.

GWWC’s main goal is to head off decision paralysis by giving you a simple number.  A subset of this is giving people who feel equally guilty/anxious about retaining 2% and 45% of their earnings because even 2% is better than living in the Democratic Republic of the Congo, but really don’t want to live on 2% of their income so default to giving nothing.  Solving that problem is not insubstantial, and I give them credit for that.

The downside is that 10% is unlikely to be the best number for everyone.  If you’re childless, in perfect health, and earn $5 million a year for 40 years and have no extenuating circumstances, I think you should give more than 10%.  If you take a 50% paycut to work for a good cause**, I think you get to count all of it.  How does volunteering count?  How is that changed by whether it’s Effective Volunteering or Personal Satisfaction Volunteering?  What if you’re receiving a ton of charitable and government aid for your disabled child?

On the other side of it, I worry about the emphasis on money.  Lots of things require mass action that can’t be bought- like the Ferguson protests, or lobbying for net neutrality.  Western society has a personal connection deficit, and one of my big concerns with EA as a whole is that it commodifies altruism and in doing worsens the connection deficit.

Lastly, there is fear.  I have been out of work for five months due to dental work, and it could easily be another two months before I can start even part time work.  I was originally told my (astonishing) disability insurance (that I’m incredibly lucky to have) would cover at most a week of of that time, because “seriously, no one gets that much time for that small a problem”.  I eventually prevailed***- last week.  That’s 4.5 months without a paycheck, plus the immense cost of the dental and medical care I’ve received.  If I hadn’t had the money to wait that out- and to know I’d survive even if I was never paid- I would have had to handle it much differently, and I honestly don’t know how.  Beg from my parents (an option very few people have)?  Drug myself up to the gills so I could show up at the office, at the cost of, at best, a much longer recovery, and at worst never truly getting better?  Debt?  Forgo the physical therapy and IV nutrition, at the cost of, at best, a much longer recovery, and at worst never truly getting better? Even if I never actually had to do these things, just worrying about them would have been a huge tax on me when I had very little to spare.  At a gut level, I see this pledge as a threat to the sense of safety my savings gave me.

Proponents frequently counter with “It’s not legally binding, you can always withdraw.”  But I don’t want to take a pledge on the condition I don’t have to uphold it.  That seems wrong.

What I find a lot more appealing is a private consumption tax.  For every dollar I spend on things, or things excluding certain expenses, or all things after a certain amount of money, I have to donate.  This fits really well with how I donate now, which is often based on a need to restore balance.  I use the library a lot, so I give them some money.  When I got my shiny new job, I found a family on Modest Needs that needed money to move to a better job.  When I got expensive designer antibiotics for SIBO, for which even a diagnosis is a sign of privilege, I donated to a food bank.  After a lot of dental care I donated to families needing dental care on Modest Needs****.  When I’m feeling especially privileged about how my parents supported my education I donate to Treehouse, which is dedicated to giving foster kids the same support I had.  And when I just generally feel rich or need to use up my remaining employer match, I give to GiveDirectly*****.  These sound a lot like indulgences, but indulgences buy off the guilt from things you shouldn’t have done.  I don’t think anyone thinks I shouldn’t have access to the medical care or library books I do, the problem is that other people don’t have them.

These aren’t exactly consumption taxes.  Often what I give is based on what I didn’t have to pay because I have amazing insurance.  Actually, that feels really fair to me.  There’s an overwhelming amount of evidence that being well off is actually cheaper than being poor, in part for exactly the reasons I listed in the fear paragraph.  If my savings (that I was able to accrue due to an incredible amount of privilege) saved me a bunch of credit card debt, paying half of the hypothetical interest on that debt seems pretty fair, and avoids the “I’m punished for being successful.”  I’m not being punished, I’m just not getting to keep all the gains for something that was partially given to me out of luck.

Okay, so some sort of sharing of the benefits of privilege (for when I get things everyone deserves, but many people are denied), generally going to share that specific privilege with others, plus a consumption tax, because living in America is a privilege in ways I will never fully consciously comprehend.  Either a low general consumption tax, or a higher tax on luxuries.  This seems right.  I will need to figure out exact numbers and how I will calculate spending, but that is a practical problem.

*E.g. GiveWell no longer recommends giving to the Against Malaria Foundation because they already have a large stockpile they’re unable to move without lowering their ethical standards, GWWC recommends them because they believe a larger stockpile will serve as an incentive to make partners meet their ethical standards.  GiveWell doesn’t even advise against the AMF, they just believe there are three charities that are better.  Both sides sound plausible, and there’s no way to know who’s right without a control universe.

**And you’re doing it because you believe it’s the best way to help the world, not because it’s a better work environment.  There are EA charities devoted to this question.

***Despite a dentist so incompetent at paperwork I was beginning to suspect malice.

*****Although I haven’t for this round, possibly because none of the previous care actually helped

*****GiveDirectly ends up getting by far the most financial support but the least thought.

Update 11/19/14: it turns out the pledge is 10% every year, the year you earn it, not accumulated over time.  In defiance of all rationality, this makes me feel less anxious about it.  I need to give this more thought and then it probably gets it’s own full entry.

9 thoughts on “Intro to EA/Giving What I Should

  1. Some thoughts:

    1) The GWWC pledge is actually intended to be yearly, rather than letting people give nothing this year and give 20% next year, for example. Their website doesn’t spell it out but I’ve asked organizers about it in the past.

    2) My experience is that a simple pledge (e.g. 10%) has the benefit of being easy to talk about, but many people find the details are trickier. My husband and I had a complicated system (all of my income except work expenses, a base amount of his income plus a percentage of the rest) and recently decided to change it to a simple 50%. We keep noticing weird cases where the percentage method gives perverse incentives (for example, if you invest in something that lets you earn more, the pledge doesn’t account for the cost of the investment. In our case, investing in daycare for our daughter so we can both work).

    3) I know people who took the 10% pledge as a minimum but count it differently for themselves – e.g. donating everything over a certain threshold, or donating a base amount and a percentage of all earnings above that. I think the 10% figure is useful largely in talking to other people rather than for personal finance, so if your actual system is complicated you can still describe it as “I give at least 10% of my income.”

    4) The pledge allows for students, unemployed people, and retirees to donate 1% of their spending money. I took the pledge because I believed that even if I were unemployed, I would still be able to do that. https://www.givingwhatwecan.org/about-us/frequently-asked-questions#8

    5) I can imagine extreme circumstances in which I would be so strapped for money that I would not even be able to give 1%. I think it’s very unlikely, though, and I decided the small chance of needing to back out of my pledge temporarily was not worth refraining from taking the pledge at all.

    6) I like your idea of donating as a consumption tax. It seems to me, though, that giving to something like GiveDirectly would be more effective than giving to Americans who lack the particular thing you’re enjoying right now. I imagine the families in Kenya need the money to move to a better job (or whatever they use it for) more than the American families do. But if giving to more specifically-themed charities is kind of a bonus thing that you wouldn’t otherwise do at all, go for it.

    7) We have so many interests in common that I can’t believe I didn’t find your blog before this month.

    1. Re 1: Are you sure/could that be in flux? Because Jonathon made a point of saying it was averaged over a lifetime. Although it’s 10% of total lifetime earnings, not an average of 10% giving over many years (e.g. you can’t donate the $1 you earn one year and not give anything for 9 years you earn $100,000).

      Re 6: I’m unconvinced about my targeted donations too. Objectively the GiveDirectly beneficiaries are worse off, and a given dollar has a greater utility to them. I have a lot of different explanations for why I still give to American charities, but the truth is I made the decision first and came up with reasons later.

      Overall I think we are on the same page that the pledge is a useful thing with some limitations. I would never discourage someone from taking the pledge, but there were enough “buts” at my EA meeting that I wanted keep poking at it. It’s worth noting that I think the federal government should tax consumption rather than income as well (if we can work out the implementation), so this may be a reflection of how I think about money.

  2. Hi All,

    Apologies for not posting on this sooner- and double apologies for the confusion surrounding what the pledge entails!

    In the vast majority of cases, Julia’s interpretation is right. The spirit of the pledge is that it is something one is intended to fulfil every year. That being said, there have been cases in the past where people, due to extreme financial hardships, have had to reduce the amount they were giving, but then compensated for that amount the following year when their complicated situation was resolved. We are happy with being a bit flexible in these cases. That said, someone would not be fulfilling their pledge, for example, if they didn’t give anything for their entire life, and then left the equivalent of 10% of their career income in their Will to the most cost effective charities. We want the pledge to be something that people are actively contributing to throughout the course of their careers. We think this is valuable for a number of reasons, not the least of which is that it signals that EA’s are serious about having a big impact on the world and are willing to put their money where their mouth is (so to speak). At the same time, we don’t want to be entirely dogmatic about this, and we are happy to accommodate cases where individual’s have to momentarily lower the amount they give, insofar as they commit to compensate for this as soon as they can.

    Hopefully that resolves some of the confusion on that point! In regards to the rest of the post, I suppose I would echo much of what Julia said. I think that 10% represents a simple threshold to use when communicating with other people, it also represents an amount that most people could give to charity without having a significant impact on their wellbeing. Indeed Andreas has argued that giving away 10% of your income without any sacrifice to one’s wellbeing (http://www.givingwhatwecan.org/sites/givingwhatwecan.org/files/attachments/giving-without-sacrifice.pdf). So we are happy for people to come up with more complicated calculations for how much they are willing to give (say based on consumption), but we think 10% is a nice lower bound. It also has the benefit (as Julia mentioned) of being a lot easier to mention in conversation. This might seem like a trivial point at first, but if you are interested in getting more people on board (which presumably all EA’s are) having a simple message is a virtue.

    In the end it sounds like we all agree that an ideal formulation would be something a bit more complicated than a flat 10%. In practice I think it is great for people to have their own systems for calculating how much above 10% they should give (clearly if you are making seven figures you should be giving more than 10%!), That said for simplicity of message, and for establishing a reasonable lower bound we think it is a good idea to have the pledge start at 10% of one’s career income.

    1. Hey Jonathan, thanks for your thoughts. I’ve got a reply with some questions below (didn’t see that I could reply directly to your comment). Would be curious what you think!

  3. Hi Jonathan,

    I’m surprised to hear you say that giving 20% every other year would not be in the spirit of the pledge.

    My understanding when I took the pledge earlier this fall was that it was about giving 10% of one’s career income, just as you summarized at the end of your comment above.

    I can see how giving nothing and then willing away the equivalent of 10% of what one had earned could be considered against the spirit of the pledge — it wouldn’t represent a lifetime of giving, or a lifetime of thought into how to do the most good (though being able to give away 10% of one’s career income at the end of life would represent an impressive commitment to saving), but I’m having trouble seeing how those concerns would apply to a more flexible schedule, like 20% every other year.

    And there are benefits to being flexible. Giving opportunities can vary from year to year, and so can other opportunities to spend income, in particular, investment opportunities. In fact, GWWC’s sister organization 80000hours, has recently released a blog post discussing whether it makes sense to give now or invest and give more later, concluding: “The model and our views of the key parameters suggest focusing mainly on investing to give later, especially at the start of your career” (with caveats that there are some reasons based on indirect effects why one might decide to start giving early).

    Would you consider 80000hours’s advice in that post (https://80000hours.org/2014/10/should-you-wait-to-make-a-difference/) to be incompatible with the GWWC pledge?

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