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The Trader Who Donates Half His Pay

nytimes.com

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Re: The Trader Who Donates Half His Pay

#31

Post by amelius »

jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

Since he's in the financial business, I'm wondering why he isn't leveraging the effect of "money makes more money" before donating. Isn't it better to invest that money first, before donating it?

Take for example Bill Gates. If he had donated all his "surplus" money instead of building a business, he wouldn't have been able to donate the amount that he has; the amount wouldn't even be of the same order.

Re: The Trader Who Donates Half His Pay

#32

Post by willmacaskill »

bobcostas55 wrote: post #24
jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

Empirically speaking, aid is almost completely useless[0], no matter who administers it. So whether he gives it all to the "appropriate organization" or "wastes" some of it on an aid trip is ultimately irrelevant. [0] Easterly's book is great if you're interested in the stats: http://www.amazon.com/The-Elusive-Quest-Growth-Misadventures...

That's not true. There are hundreds of thousands of different aid project, it would be miraculous if all were entirely ineffective. E.g. you'd have to be crazily skeptical to suggest that the programs recommended by GiveWell aren't of positive expected value; there's just so much evidence to the contrary. In terms of the link between aid and economic growth - aid is just such a small part of developing countries' economies that you simply can't peer through the statistical fog; it's such a weak signal, and there are so few data points ,that it's not surprising that we can't detect a correlation. A nice even handed discussion is given by Owen Barder of the Centre for Global Development: http://cf.owen.org/wp-content/uploads/Can-Aid-Work-Owen-Bard...

Re: The Trader Who Donates Half His Pay

#33

Post by AndrewKemendo »

bobcostas55 wrote: post #24
jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

Empirically speaking, aid is almost completely useless[0], no matter who administers it. So whether he gives it all to the "appropriate organization" or "wastes" some of it on an aid trip is ultimately irrelevant. [0] Easterly's book is great if you're interested in the stats: http://www.amazon.com/The-Elusive-Quest-Growth-Misadventures...

Dead Aid is also a great book on why Aid to Africa is usually in vain.

[1]http://www.amazon.com/Dead-Aid-Working-Better-Africa/dp/0374...

Re: The Trader Who Donates Half His Pay

#34

Post by melling »

jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

You certainly could have chosen a path in life where you made a lot of money then donated it more efficiently. I know lots of developers who put hours into whatever games they enjoy. Leveling up that WoW character to level 70.

Most of us could be doing a lot more.

Re: The Trader Who Donates Half His Pay

#35

Post by maaku »

willmacaskill wrote: post #25
jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

What I find most amazing is when bright Ivy League graduates go and do manual labour, like building a school, in a poor country with massive unemployment. It's not exactly playing to comparative advantage.

Human beings are not absolutely focused, money-seeking, rational economic actors.

Re: The Trader Who Donates Half His Pay

#36

Post by willmacaskill »

amelius wrote: post #31
jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

Since he's in the financial business, I'm wondering why he isn't leveraging the effect of "money makes more money" before donating. Isn't it better to invest that money first, before donating it? Take for example Bill Gates. If he had donated all his "surplus" money instead of building a business, he wouldn't have been able to donate the amount that he has; the amount wouldn't even be of the same order.

This is a really tricky issue; there are lots of competing considerations either way. (e.g. the return you get from your money; but your donated money also generates a 'social return', which can be much higher than what you get in a bank. And you'll learn more about how to do good later on; but the world is also getting richer so there might be fewer outstanding opportunities in the future. Etc etc.) There's a summary of blogposts on the topic here: http://www.effective-altruism.com/ea/4e/giving_now_vs_later_...

Re: The Trader Who Donates Half His Pay

#37

Post by jtbigwoo »

I talked about this on HN a few years ago, but my friends and I planned to be this guy. In college we talked about all the money we'd make and how much we'd be able to donate. We all had a job offers for $32 - 42k/year. That was amazing! We were living on less than $1k/month in college. We had plans to give away 20%, 30%, or 50% of our income. We would barely even notice. Some of us even managed to do it for a few years. The world got to us, though. You start to notice that the coworkers that dress nicer and go to happy hour get promotions. One guy married a social worker and had four kids. One guy got tired of living in a studio apartment in New Jersey. One guy became a junior high science teacher. Twenty years later, I suspect that our average charitable contribution is down to around 5% of our income.

It is really hard to be counter-cultural like Mr. Wage. Especially when your plan requires you to remain completely immersed in the culture. It feels like there's a constant friction to overcome--like every choice takes a bit more willpower than it should. I think this is part of the reason that truly counter-cultural people and movements tend to segregate themselves from the rest of the world.

I don't mean to degrade Mr. Wage and his project. I hope this works out for him, but it's a very difficult road.

Re: The Trader Who Donates Half His Pay

#38

Post by nashashmi »

willmacaskill wrote: post #25
jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

What I find most amazing is when bright Ivy League graduates go and do manual labour, like building a school, in a poor country with massive unemployment. It's not exactly playing to comparative advantage.

That's pretty much how they become brighter. These kinds of hands-on experience are far more transformative and contribute to higher efficiency than if they were to simply donate more money.

Re: The Trader Who Donates Half His Pay

#39

Post by goodJobWalrus »

bobcostas55 wrote: post #24
jrlocke wrote: post #6

This may be an unpopular opinion, but I've always felt it selfish when people of means partake in 'aid trips' over sending money to an appropriate organization. If you care to help, leverage your abilities efficiently; make the money doing what you're best at, and let others administer the aid.

Empirically speaking, aid is almost completely useless[0], no matter who administers it. So whether he gives it all to the "appropriate organization" or "wastes" some of it on an aid trip is ultimately irrelevant. [0] Easterly's book is great if you're interested in the stats: http://www.amazon.com/The-Elusive-Quest-Growth-Misadventures...

Function of aid is not to cause economic growth. Function of aid is to have a child not die of malaria.

Re: The Trader Who Donates Half His Pay

#40

Post by willmacaskill »

jtbigwoo wrote: post #37

I talked about this on HN a few years ago, but my friends and I planned to be this guy. In college we talked about all the money we'd make and how much we'd be able to donate. We all had a job offers for $32 - 42k/year. That was amazing! We were living on less than $1k/month in college. We had plans to give away 20%, 30%, or 50% of our income. We would barely even notice. Some of us even managed to do it for a few ye…

I think this is a really important concern. Btw, 5% is still quite a bit more than the average, so good work!

We're attempting to overcome this worry through community and behavioural economics hacks. E.g. I take every opportunity that I can (like this one) to say publicly that I'm planning to give away the majority of what I earn, which makes it a helluva lot harder for me to back out. Similarly for Matt - it would be embarrassing for him to renege on his commitments when he's been so open about it. And it feels like a much smaller sacrifice (if it's even a sacrifice at all) when most of your friends are doing the same thing - and some, like Jeff and Julia in Boston (http://www.givinggladly.com/2013/06/whats-it-like-to-give-ha...) are doing much more.

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