I’ve Got a Theory

Continuing from last time about the false dichotomy of service vs. advocacy. Call this one, “Notes for a theory of social investment.”

You have $1,000 of discretionary money. Your bills are paid, your family’s bills are paid, there are no emergencies in your life. You want to make the world a better place. What can you do with that money?

  • You can contribute to a political campaign: I’ve written about fundraising and campaigning before, wondering what it is the political donor gets out of their donation. Part of it in some (many?) cases is a hope that a certain kind of world come into being, or be preserved.
  • You can invest in a big business: put it in the stock market. There are lots of ways to do that. What does that accomplish? It may make you some money, it may lose you some money. Presumably, you help, um, create jobs or something. Keep the economy strong. But it’s all very abstract.
  • You can invest in a small business: you may want to help your local community. You like the local record store, or church, or coffee house. There aren’t good ways to plunk small, private, one-time change into such endeavors. That’s part of the reason why Kickstarter is so interesting; it opens up that space. I put down $50 to reopen the Parkway Theater in Oakland, a Bay Area favorite where I had many a fun time noshing pizza, drinking beer, and watching a movie or an NFL playoff game. I want the Parkway to exist, even if I don’t live in the Bay Area anymore, because I want the kind of world where it exists. So I do my little part. Through Kickstarter, they send me update on how it’s going (no lease yet – come on, Chengs), and I feel satisfied with that investment.
  • You can give to a nonprofit organization: can make a direct difference in people’s lives. But good luck with getting a sense of the difference the organization makes with it (hint: outputs – meals served – aren’t the same as outcomes – kids kept off the street). Good luck getting communications that tell you about the impact. And so many choices, with not many aggregating sites. No mutual funds, like in investing in business – other than things like community foundations, which in this light may be a good option.
  • You can pool your money to give with others: I’m in a giving circle, and my $365 (or so) per year are leveraged into an annual $10,000 grant. Without my part, that doesn’t happen. And it’s very concrete. I see who benefits, and why that matters.

What determines which is the best course for you? Part of it is familiarity, knowing that this menu of options is actually available to it. Part of it may be your comfort level with abstractness. If you want more direct impact, a giving circle, hands-on, may be good for you. If abstract is fine, a political campaign or investing in the stock market may work. But the point is, we don’t have a good sector-agnostic theory for what makes a useful social investment.

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One Response to “I’ve Got a Theory”

  1. The Blog Briefly Known as "Democratizing Philanthropy?" » Blog Archive » Don’t Stand So Close to Me Says:

    […] The Blog Briefly Known as "Democratizing Philanthropy?" BETA version, new title in the works. New post each Tuesday, Wednesday, Thursday (for now). « I’ve Got a Theory […]

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