At first you may find this distasteful. “Come on Cappy, how can you go after something like charity.” But remember, for anybody who dared to criticize housing or education, they were equally lambasted because “housing should be a right” and “you can’t put a price on education.” But need I remind you of the Great Recession and the problems the millennial generation is facing with their un-repayable student loans? And if you think these are/were problems, just wait till the charity bubble bursts. Regardless, the key point to be made about the “charity bubble” is that its origins hail from the exact same origins as the housing and education bubbles. Mispricing.
But the question is “the mispricing of what?”
And the answer is “the mispricing of stupid decisions.”
Awesome and scary article. Maybe the Shiny Selfie should read it and learn something other than how his hair looks today.
We are faced with troubled times.
I think I’d have to agree with this. But, our governments (Canada, US, UK, European or wherever) are going down this road whether I like it or not.
It would have been an excellent article if you had any understanding of the profound difference between Charity and the Welfare State.
I agree with Oz. Charity, by (and forgive me if this offends)Biblical standards, is a private, considered donation, by one individual to another individual, like the good Samaritan. It is not done for public recognition – there is no virtue signalling. And the donor bears full responsibility for the action – no one else knows or is aware.
The welfare state, in the words of F.A.Hayek, treats everyone unequally in order to make everyone equal.It robs from those with means to fulfill the perceived needs of others through taxation. And to get elected, it promises more and more in an unending cycle that ultimately fails. And why does it fail? Because it mistakes equality of opportunity for equality of outcome under the guise of the word “Fair”. Equality of outcome can never be achieved as all people have free will. Some people can win a million dollars in a lottery and yet end up penniless because of their own bad decisions when the opportunity that they were given represents a lifetime of earnings for most people. And then there is the problem of individuals being unequal in ability. You could give two people equal plots of land and tell them to farm it and one will figure out how that is done, and the other won’t. And then there is the problem of government picking winners and losers. Consider the original owner of Casa Loma in Toronto who lost everything that he had worked for when the government of the time decided to privatize his industry and steal all of his resources for the greater good.
Private charity is ethical – state sponsored charity is always ineffective and corrupt.
There’s a key problem in the article, and it’s this one:
“Understand that bar charities for cancer, disease, etc., the vast majority of charity is simply bailing out stupid, irresponsible people from their stupid, irresponsible decisions.”
Some of the worst, most inefficient charities are precisely those for “cancer, disease, etc.” Without getting into specific names here, some of the largest charities have less than 10% of their receipts going to the cause they supposedly support. The bulk of their financing is in fact supporting the administration and fundraising.
I agree completely with Cap that charities in effect avoid the pricing of bad decisions. However, there’s no avoiding it. If state socialism for relieving disparity is unacceptable, and charity has the same effect, then one is left with the proposition that there will be people literally dying in the streets every day. This too is unacceptable. So the question becomes, how can extreme poverty on the part of those unwilling to work be managed? Or put differently about a different group of people, how can unacceptable levels of poverty be avoided by those whose income is insufficient to provide a minimum standard of living?
Ooooz, and to educated a religious idiot like you, charity and welfare are two branches of the same tree, a tree that has it’s roots in the church. Both are emotionally based, destructive organs. This points to the fact that socialism has it’s roots in traditional religion.
Cappy, to sum up your article in one word….Venezuela
I was sitting watching the news with a relative in Toronto’s Princess Margaret Hospital while he was getting his chemo. One item ranked cancer charities…Princess Margaret was last. Anyway, it didn’t kill him and he’s still around, but we both had a (then) much needed laugh about it – I guess you have to understand my family’s sense of humour.
A few years ago I think I read that here in Ontario there were over 70,000 registered charities. Now that would include local sports teams, etc., but c’mon…
The difference between the housing crash and the impending education crash is that house prices actually fell and people lost their homes. If and when the education system crashes and is bailed out by government, tuition will not fall, teacher’s salaries will not fall, there will not be layoffs – just a payoff.
OZ is correct. There is DEFINATELY a difference between charity and the welfare state. And for the most part it is a question of scale. Charity, has been traditionally meted out person-to-person, or in the largest scale parish-to-person. Charity was a PERSONAL transaction. For the most part you KNEW who you were giving to, and why. This is why, when someone had made a poor personal decision and ended up needing charity, they felt at least some measure of shame in receiving the charity. And as much as our modern society abhors emotions like shame, it was a very valuable response to (some) needs for charity. Shame was a strong motivator for change. It is why most of us grew up with fathers who said that would rather die, than suffer the embarrassment of taking welfare (see: most everyone during the Great Depression).
There is no more shame in receiving charity. Esp. when it is meted out by “the government”. In fact, our government has done everything in its power to disguise charity. I used to stand in the grocery store line and see shoppers tear-off food stamps from their food stamp coupon book. It always made me feel “sorry” for those people, and to hope they would find work or whatever they needed to improve their lot. But now, food stamp recipients receive a “debit card” in lieu of food stamps. The EBT card disguises the “shame” of tearing-off pages of your food stamp booklet. I am sure the Food Stamp bureaucrats, who have spent the past 8 years literally advertising their FREE STUFF to increase the ranks of recipients, feel proud of themselves for removing the “stigma” of receiving government assistance.
As I like to repeat here so often, our welfare state is screwing with Darwinism and the natural order of things. We are literally PAYING uneducated women who grew up in fatherless households in abject poverty (save for multiple welfare benefits), to breed even MORE offspring born into this socioeconomic disaster. We are rewarding negative behavior … and only beginning to see the consequences, i.e. the weekend DEATH toll in Chicago. One thing that nature has taught us is that when you screw with Darwinism … bad shit tends to happen. So Cappy, I am in complete agreement with you … when the Charity bubble bursts … it is going to be UGLY. Imagine 3/4 of the worlds population behaving like “Syrian” refugees … yep … you better build a bunker to go along with that wall.
Not teaching children the necessity of foresight and self-governance is nothing short of disastrous. During the 1990s New York School Board struggle against the progressivist agenda of superintendent Fernandez, Irene Impellizeri made exactly this point. There is a great quote from her in an article in the Spectator by William Tucker, in which she says that (I paraphrase) to teach a child that he no longer has to heed society’s rules and prudential advice and that he may choose for himself with impunity whatever path he wants objectively pushes him into the lower class.
So true. Welcome to idiocracy.
Oz is partially correct. Leftists appeal to the Christian belief and doctrine of charity whilst misquoting Jesus and most of the Bible (as a matter of course but specifically here) and think they’re doing “God’s Work” while taxing everyone to provide the bureaucracy, er, programs to implement it.
Christianity is a tool used by the Left while Christians actually believe God’s Word and desire for His followers to do charity. The problem is that gov’t based charity dries up with over-taxation. It’s hard to keep giving to others in larger amounts when you keep cutting cheques to Queen Selfie.
it was a REAL eye opener to me in my academic career to hear that foreign aid was notorious for DEMOLISHING the markets in those areas receiving the aid. hard to compete with all the free stuff. basically, it entrenched and reinforced the need for aid. a vicious circle if there ever was one.
a real eye opener.
Charity is not the same as confiscation enforced by property seizure and loss of liberty.
Another scam charity is academe itself. Much of the construction on campuses is funded through private donations and a lot of those buildings simply aren’t needed. They’re built because some administrative pooh-bah decided that their institution needed a brighter and shinier facility than their competitor in order to attract revenue–er, students.
So how do universities pull it off? Often, senior administrators chat up some moneybags who is just itching to find another tax deduction. Donations can be used to offset the amount that has to be paid. Don’t kid yourself–few of them really care about higher education and are more concerned about paying less tax and doing so openly and legally.
Another way is to create a phony crisis. I remember some university munchkin at my alma mater calling me up with a crocodile tears story about how if I didn’t make a contribution, the place would be suffering a multi-million dollar shortfall. The way she put it was that if I didn’t fork over some cash, the lights would be going out for good.
The provincial government has always allocated basic operating funding for the educational institutions. Those places can still keep the lights on and the buildings heated and/or cooled during office hours. The real story was that the city was bidding to host some major event later this decade and my alma mater was to be one of its showpieces.
Consequently, it needed to add more bells, whistles, and frou-frous to show just how bright and shiny it was and, therefore, put the city in a good light. That “shortfall” that Miss Munchkin was nearly in tears over was–ahem–the bill for how much those new bows and frills would have cost.
Shortfall, my fanny…..
It used to be that around this time of year, the university would call me and the only reason for doing so was–you guessed it, folks!–$$$$. A few years ago, I told them to take a hike and I haven’t heard a peep from it since, including its dreadful alumni rag. (The only reason I ever read it was to catch up on class news, if there was any, and to see if anyone I knew had died. It turns out that I can find all that out from the uni’s alumni website.)
Well Duhhh. Nothing new here. Maybe rename yourself “Captain Obvious”?
Educational institutions (which I have detested all my short life) are incredibly inefficient. I would say 30% of the kids could learn mostly on their own via the net with just occasional teacher interphase and in fact when given the chance to work at their own pace easily outpace the curriculum. (I was one of those kids). I hated school so much that I dropped out at Grade 10 and finished the last 2 and a half years by correspondence a full year earlier than the other kids all while travelling around Europe and Asia and working full time when not travelling.
Next, get rid of all the dumb courses that are useless. That is another 30% easily. In fact I bet 50% the stuff being taught does not need to be and just wastes everyone’s time but I am being “charitable”.
There I just cut costs by 60%. And I barely got started. I bet I could chop education costs by 75%.
I have another story about academic money-harvesting gone awry.
At the post-secondary institution where I used to teach, the president who was in office some 20 years ago had a dream and that was a brand-new building. That facility was to be funded entirely by private donations, largely from alumni and corporate benefactors.
As the time to begin construction drew nigh, the required funds weren’t on hand. People and companies, I guess, weren’t of a sufficiently charitable disposition and didn’t donate enough.
The president, however, was undeterred and went ahead with the project anyway. Guess who made up the difference? You guessed it–the teaching staff. The prez used the excuse of “government cutbacks” to justify shorting us in the upcoming contract and, sure enough, the reduction in our paycheques corresponded, proportionally, to the reduction in funding from the provincial government. (Somehow, I don’t think the upper administration had to suffer too much. No matter how hard the times were while I was there, the offices in their area always seemed to be in pristine condition, complete with new carpeting and such.)
When the building was finished, which just happened to be at the time that our contract was up for renewal–surprise! surprise!–our paycheques went up by the amount they went down earlier. The explanation for that, if one could believe it, was a “surplus”, increased government funding, or some such thing. I don’t think too many of my colleagues bought the story. I certainly didn’t.
Sometimes there’s more to an institution’s fund-raising program than one is led to believe…..
I agree, and Oz said it briefly and clearly.
Hayek did indeed write it the way you describe.
It is better for a man to be taught how to fish rather than constantly providing him with fish for free. It is better for your pocket book and better for his self worth.
From the story…This price is very important because it measures, precisely, what the real value (and cost) of a product or service is.”
The price for a product is what someone is willing to purchase it at. That simple.
In the real world, people not some manufacturer making widgets makes the world go round. Bigger the population, the bigger the market. Does not matter one iota if they live in poverty, it is a huge market waiting to be tapped and exploited. Human capital. That simple.
I have always known that stupid has a price. good article.
Give a man a fish and you feed him for a day.
Teach a man to fish and you force him to buy a fishing licence.
“But now, food stamp recipients receive a ‘debit card’ in lieu of food stamps. The EBT card disguises the “shame” of tearing-off pages of your food stamp booklet.”
I seriously doubt that’s the reason a card replaced the booklets. It’s probably just more cost effective to manufacture and distribute.
Whatever personality disorder so floridly plagues “Captain Capitalism”, it does not mask the underlying problem: he’s a crank who isn’t remotely as brilliant as he and his local echo chamber presume. Cruel, vicious and shallow is not a great combination when you’re not that intelligent.
Monies doled out through social welfare programmes do not constitute charity in any way; they are simply government expenditures sourced from the treasury.
Taxpayers fund these programmes whether they want to or not. No one can be compelled to support a charity if they do not wish to.
Foreign aid provided by a private organization or group through voluntary donations is charity. Foreign aid provided by a government is not.
As an aside, if, say, all the faith-based charities in Canada (which rely almost entirely on the generosity of parishioners and the work of unpaid volunteers) ever decided to call it quits in the face of yet more petty regulations and sneering forced secularization, governments would be in a difficult spot indeed. A municipal government gets a free ride with, for example, the dear old Sally Ann and would have a tough time indeed raising the taxes necessary to replace its work in the community.
“Whatever personality disorder so floridly plagues ‘Captain Capitalism’, it does not mask the underlying problem: he’s a crank…”
Yes, I have some trouble with his perspective too. In my view, there are too many out there who seem to associate conservatism with the Malthusian worldview of an unreformed Ebenezer Scrooge:
“Are there no prisons?”
“And the Union workhouses?”
“The Treadmill and the Poor Law are in full vigour, then?”
“‘If they would rather die,’ said Scrooge, ‘they had better do it, and decrease the surplus population.'”
The past errors that doomed Detroit & Michigan. The Republicans who are closet Socialists
Mitt Romney & his father believed in the European model
“competitive cooperative capitalism” George W Romney
Hard to believe the anti-Trump folks have a Conservative AMERICAN theme
https://en.wikipedia.org/wiki/George_W._Romney
I suggest you read the very first (topic) sentence of this article …
http://www.thestar.com/news/queenspark/2015/03/19/ontario-set-to-replace-welfare-cheques-with-debit-cards.html
You might learn something
I found the Irene Impellizeri quote (From “A Revolt in Queens” by William Tucker):
Self-discipline is not an instinct; it is learned from adults, sometimes subconsciously, sometimes painfully. Even when learned in childhood, it often falters in adolescence, when desire takes on new forms and an anarchic intensity, and when the young brain is awash with hormones and with the erotic imagery of popular culture. The adult who tells an adolescent “You have the right to obey your impulses” is guilty of treachery to the adolescent as well as to the community. . . .
I found the Irene Impellizzeri quote (from “A Revolt in Queens” by William Tucker):
[The problems of indiscipline] may not seem so pressing to the rich, who have a long way to slide, though not as long a way as they may think. But if the children of the poor are taught that they need not be constrained by the social order and its civilities and its prudential demands; that they have the right to set their own standards, or no standards at all; that they are mysteriously able to “think for themselves” without serving any apprenticeship to reality, without in fact learning to think-as distinct from feel or want–they will never, never escape poverty. . . .
The underclass is not really a class so much as a caste; it has its own way of life; it has the strange cultural property of reducing members’ desire to escape. . . .
If we accept youngsters’ feckless or undisciplined behavior on the grounds that it cannot really be prevented – “You know they’re going to do it anyway” – we objectively (as the Marxists used to say) push them towards the underclass.