Thursday, 28 February 2013

Charity: Chalk and Cheese

by Roger Williamson

I went recently to the launch of the   The Future World Giving project. The initial report can be found on the CAF website. This sharpens the approach of the World Giving Index 2012.

The meeting was arranged by the Charities Aid Foundation (CAF) and hosted in the Houses of Parliament by Nick Hurd, the Minister for Civil Society. He produced the statistic that the British public spend as much on charity as on cheese – 0.4% of the weekly household spending.
The Index itself looks at three dimensions of giving – money, time and help to a stranger in the last month, and averages out the responses. These are recorded as percentages of population not totals of eg money or time given. The data is part of the Gallup Worldview survey – an amazing source of information on 100 different questions of how people look at the world – whether the economy is getting better, whether climate change is a serious threat and so on. 

As the basis for this report, it records the responses of 155,000 people giving a snapshot of 146 countries. We pressed the CAF researchers on the methodology – in particular the enigmatic “helping a stranger”.  One MP said she nearly always points a stranger in the direction of the Houses of Parliament at least once a week, but she hardly thinks this is what is intended by the question. We are left with self-reporting and the understanding of the respondent. Perhaps because it is vague, it is far ahead of the other categories globally, with “giving time” at the bottom in percentage terms.
This is where the chalk and cheese comes in. I am fascinated by the three categories – giving money, time and helping a stranger. There has been a double dip in giving in parallel with the global economic crisis. It is easier to imagine the reasons money donations declining than for the other two aspects. There is no direct reason why people should give less time when the economy is struggling – perhaps mood matters. We need a deeper understanding of altruism.  We need to understand more profoundly the relationship between giving and wellbeing.

It is a strength of the index that it does not only focus on money, because it could well be that making time available (seemingly the most difficult commitment) is the one which potentially makes most difference. At the meeting, Lord Phillips regretted the decline in pro bono work by the legal profession.  Particularly now with the new technology of giving on line, there is no necessary community involvement - perhaps we find it easier to pay up for a good cause than invest ourselves more deeply and in a more costly relationship through commitment of time. Perhaps it is time to look again at the work of Staffan Burenstam Linder, The Harried Leisure Class,  who asked forty years ago why we feel we have less time as we get richer. The economics of time is funny. As we get richer, if we view time as money to “spend” the value of it (or the exchange rate time-money) increases and we become less ready to “give time”. But if we begin from a concept of “enough is enough”, once you have earned that total (easier at a higher hourly or daily rate), you have more time for good unpaid causes.

Further information presented at the meeting stressed the rise of the global middle class and the increasing importance of the economies in the Asia-Pacific region.  If the global middle class gave at the same rate as UK donors (0.4%), by 2030 an extra $224 billion a year could be generated – far more than the figure calculated by Jeffrey Sachs as essential for poverty eradication.
In the Bellagio Initiative on the future of philanthropy and international development in the pursuit of human wellbeing  , we also explored  many dimensions of these issues, including values and human wellbeing by Tim Kasser, and the care economy  by Rosalind Eyben and Marzia Fontana.

Economics as a social science and needs to be seen in a more inclusive light.  As Daniel Kahneman stresses in  Thinking -  Fast and Slow,  the atomised, individualistic, rational homo economicus does not describe either real world or the desirable economic actor.
I would add, we need anthropologists on giving (Marcel Mauss et al.), Richard Titmuss on The Gift Relationship (Tony Hancock may be more fun on blood donors, but this is a serious exploration of disinterested help); Axelrod on The Evolution of Cooperation; Onora O’Neill on A Question of Trust – to name but a few.

Back in the real world, where people give and help their communities, the recommendations made by the CAF report (pp 6-7) on proper frameworks to assist giving in a national context are valuable.
Three parts of my biography make me want something more radical – the academic (see above); my faith-based career choices, because the contribution of the major faiths to the understanding and discipline of training in altruism is part of all the major faiths ( see for example the paper by Mariz Tadros on Islamic Philanthropy  ; and also the campaigner – I was head of policy and campaigns at Christian Aid and am in favour of the Tax Justice campaigning which many NGOs are now doing.
Widespread reactions to the current crisis (see the BBC commentator Paul Mason’s Why It’s Kicking Off Everywhere) suggest that many people are fed up with the behavior of a rich elite (of banks, firms and individuals) which has largely detached itself from the social obligation to pay their way. There is a desire for a fair tax system to tie them into financing public goods. The state cannot abdicate its responsibility to get the rich to pay tax and hope that middle class generosity or solidarity among the poor will pay for everything in the real world, while the unpaid taxes of the mega-rich sit in bank accounts and mansions in tax havens. The good exceptions of Bill Gates and Warren Buffett do not let the super rich off the hook.  As Adam Smith says in The Wealth of Nations: “It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more in that proportion.”

The recent book by Chrystia Freeland, The Plutocrats gives an insight into how the world looks from the commanding heights of wealth – one quote even suggesting that the “top 1% probably contributes more to making the world a better place than the 99%” This view is countered by Joseph Stiglitz: What worries me is the idea that we’re in a vicious cycle …. Increasing inequality means a weaker economy ,which means increasing inequality, so the ability to stabilize the economy gets weaker”. (See Sunday Times, Culture, 28.10.12, pp. 42-3).

However, in a time of middle class expansion  and huge human need,  it is surely also a good strategy to set up a framework to support and encourage the generosity of those who give. The Asian Tigers’ development model suggests that one key element has been a high domestic savings ratio. So it seems entirely sensible to establish an enabling framework, ensure that charities and foundations adhere to basic standards and can be trusted to use money appropriately, and individuals encouraged to give through tax incentives. The social discipline of saving (pushing up the domestic savings ratio) and personal planned giving are related.   Malaysia – from the top of government has done this and is encouraging (   Successive British governments have also done this and people who want to do good do think increasingly about tax efficient ways of giving. Internationally, it needs a new way of thinking – governments need to establish ways to ensure that the rich pay tax even if they don’t want to, and the rest of us see our money go further because of concessions to charity. Tax money is not “government money” – it is our money that the government should use for the common good.

Internationally, our Prime Minister has a major chance to leave his legacy through chairing the Panel on “what comes next after the Millennium Development Goals”.  CIVICUS reminded us that transparency and accountability had been major themes at the UN High Level Panel on Aid Effectiveness in Busan last year. An active civil society is vital for good governance and keeping standards high.

 The Big Society concept has not delivered as hoped here at home – but Prime Minister Cameron has a chance to ensure that the international “Big Society” delivers on development pledges.   Interestingly, all three co-chairs come from countries which score well in World Giving Index ( Indonesia, Liberia and the UK).

In the Bellagio Initiative it was clear that the challenges of human need will not be met through ODA alone – there is a need for the development system skillfully to employ whatever resources can be mobilized and coordinated – individual decisions to give time, money and  be altruistic should not be hindered (or even persecuted by) government. Government can develop and guard the space in which the initiative and commitment of ordinary people can achieve huge amounts of good. Governments should not shirk this responsibility and withdraw. CAF have encapsulated the key headings as follows: accountability and transparency; independence and sustainability, and incentives. To illustrate transparency and accountability by a quote – once more from Adam Smith:  “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public.”

Finally – if you want the headlines – Australia, Ireland, Canada and New Zealand score high on the Index – and Liberia’s high score is very interesting. But read the reports, make the connections, decide for yourself.