Occasionally there are stories that finally help you connect and ground thoughts swirling around in your head. A RadioLab piece on the game show called “Golden Balls“ did that for me this week. In the show, contestants are faced with a Prisoner’s Dilemma. They each have two golden balls, one that reads “split” and one that reads “steal.” If both contestants choose split they split the jackpot, if they both choose steal neither get the money. Yet, and this is the part where it gets interesting, if one person chooses “split” and the other person chooses “steal” then the person who chose “steal” gets the entire jackpot. Most of the times it goes down like this:
Each contestant assures each other they will split. The man in the clip above has swindled people earlier in the game so, Sarah, the female contestant, doesn’t trust him to choose split. They plead with each other and Sarah assures him that “everyone who knew me would just be disgusted if I steal.” It looks like it is going to be a split and then it is revealed Sarah, the sweet girl we all assume will make the altruistic choice, chooses steal. Jad Abumrad explained this phenomenon:
If you analyze all the outcomes, which social scientists have done, what you see is that a majority of the time something like what I just showed you happens…They stab them in the back. They are grandmas, policeman, etc. Here’s my theory, it’s not that they are mean people. It’s that they don’t want to be that guy slumped on the table. They don’t want to be the sucker. The fear of being the sucker far overwhelms their desire to do good to their fellow contestants.
It’s that last sentence that made me shout “Yes!” when I was listening to this while running in the streets of Baltimore, assuring passerbys that I wasn’t a complete lunatic. It is our fear of being suckered that impedes our desire for social change.
Let me explain by taking you back to an experience I’ve written about before. About a year ago, a homeless person in Fell’s Point asked me for money. I told him I didn’t have cash so he suggested I could pay with my card for food at a subway.
I agreed and while we were waiting for the sub, he says to me “It’s a shame you didn’t have cash, we would have been able to get cheaper food.” Now my first thought was something akin to “You ungrateful SOB,” but then I realized he was right and in fact being a good steward of my charity. If I had given him the seven dollars I spent at Subway he might have been able to go to the corner store where he could have gotten a decent meal for $4 and still had $3 to put toward his next meal. If I wanted more bang for my buck in terms of impact on his empty stomach I should have just given him cash.
We give to companies who pollute the land, mistreat people, and foster inequality every day, mostly without a second thought. Yet most people are more worried about what a homeless man will do with the $7 than what Subway will do with it. Why? We don’t want to be a sucker and our fear of being suckered far outweighs our altruism.
In a for-profit business transaction the result is mainly assured. If I give my money to a business, they will give me back a good or service. There are accountability systems built in to ensure that I get what I paid for. I give you money and you give me toothpaste. If you want me to buy your toothpaste you generally appeal to my self interest. The toothpaste will give me a cleaner mouth which will make me happier, perhaps help me find love. Regardless, I know if I choose to share my hard earned money with a company selling toothpaste that I’m going to walk out of the transaction with the product I want. Giving money for social good is a bit more like Golden Balls. I don’t know if the homeless man I encounter on the street will use my money for food or to get high. I don’t know if the child I give money to in India is controlled by beggar masters who deliberately cripple children to make more money from other people’s charity. I don’t know if the money I’m giving to disaster relief will help people or is just a ruse to siphon off our bleeding hearts.
We’ve talked before on ChangeEngine about problems that result from nonprofits who can’t innovate because donors expect them to have low overhead and immediate results. I think the reason we hold nonprofits to a higher standard of accountability is because, like in Golden Balls, the benefit is not ensured. That means the potential for being suckered, by which I mean us giving money to someone and receiving no benefit (both the intended benefit to the supposedly worthy recipient, or the benefit of personal satisfaction at having done good in the world), is much higher than an interaction with a for-profit business.
On one hand, we have to get over our fear of being suckered. I once worked with a guy who was in charge of building systems to make sure no one misused a local food bank’s services. While it costs more money to set up the systems then it saved by eliminating fraud, donors were reluctant to give to any place where there was a chance of their money being misused. “It’s insane,” he told me, “it’s like not giving a dollar to a starving child because you’re worried they will drop a penny.” We need to spend less time worried about how nonprofit employees are compensated or how every penny of our donation is spent because even if there is a penny lost, those donations are doing far more good than some of our purchases to major corporations.
On the other hand, the social change community needs to help eliminate the fear of being suckers in their donors by changing the way we talk about social change. Instead of emotionally manipulating people into altruism, perhaps we need to start showing how investing in social change will guarantee benefits to them. We need nonprofits that are evaluating and measuring their results, who can talk about the impact they have in deep and quantifiable terms, not in pictures of cute puppies or one-off stories. We need to show people there is a real return on investment when you contribute money to social good beyond just a “good feeling.”
The title of this post is famously, though wrongly, attributed to P.T. Barnum, who, although he made his living by swindling others, was also one of the many who didn’t want to be swindled in doing good. When he used some of his money for social good, he used a method called “profitable philanthropy.”
“I have no desire to be considered much of a philanthropist…if by improving and beautifying our city Bridgeport, Connecticut, and adding to the pleasure and prosperity of my neighbors, I can do so at a profit, the incentive to ‘good works’ will be twice as strong as if it were otherwise.”
When we donate to a social change project we are choosing the “split” golden ball and choosing to share the money we have. In return we expect nonprofits to “split” so that not only do they get money, but some benefit returns to us. If we want to involve more people in social change, we have to find ways to return their investment, either monetarily through social entrepreneurship or show tangibly through evaluation and research how their donation returns to them in the form of a better community, more economic opportunity, etc. If you can ensure people there is little chance of losing, little chance you will steal their money without giving them a return, they are more likely to share. To overcome the fear of being suckered, we have to make social change seem about as risky as buying a tube of toothpaste, an act we are sure to get some reward from.