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Most effective altruists probably aren't and probably never will be millionaires or billionaires. This means that the amount of money they can individually donate is far, far smaller than what the super rich (millionaires and billionaires) could give.

This can make the prospect of giving to effective charities if you are not extremely rich rather demoralising. This has been discussed on the Effective Altruism Forum before, with Benjamin Todd arguing, basically, that you should donate anyway because a small effective donation is still better than not donating at all, and that small donations can support high-potential individuals or projects that wealthy grantmakers had overlooked.

I agree with these points, but there remains a problem. Iason Gabriel has argued that "even without the contribution of small donors [the funding needs of charities recommended by effective altruists] are likely to be met". Although I don't know how true this is, even if just one or a few of the top charities are (nearly) fully-funded by the super rich, we might still have a problem:

If a very cost-effective charity would get fully funded (ie. their funding gap is closed) by millionaires and billionaires (or 'large donors' as they are sometimes called),[1] should middle-class donors (or 'small donors' as some call them) still donate to this charity?

Here are two possible answers to this question - though I would love to hear what your response would be:

  1. Middle-class individuals (ie. donors who are not millionaires or billionaires) should not donate to this charity anymore - the rich are already doing it.
    1. Potential problem: if all cost-effective charities were to be funded by millionaires and billionaires, then there are no more effective charities to which you, as a middle-class giver, could donate to. Completely giving up effective donating (unless you are very wealthy) would be very bad for the effective altruism movement: "making donations [...] helps to build the effective altruism community, since it’s a hard-to-fake symbol that we’re serious about doing good, and that helps to get more people on board", and donating can help one "stay committed to doing good more broadly i.e. it’s a self-signal too" as Todd noted.
  2. Middle-class individuals should still donate to this charity, because additional donations might still be put to good use later or elsewhere (Todd has essentially also argued for this point).
    1. Potential problem: it is very difficult to tell which charities could most cost-effectively use resources after already closing their funding gaps.

 

Possible implications of this discussion

Effective altruists should advise middle-class donors differently from how they advise the wealthy. Knowledge about funding gaps is important to any donor, but middle-class donors might especially benefit from knowledge about what their (relatively small) donation can still achieve even as the wealthy already donate a lot to it. The 'neglectedness' and 'tractability' criteria need to be expanded to include not only the size of the funding gap and the cost-effectiveness of donations until the funding gap is closed, but also cost-effectiveness of donations after closing the funding gap.

What if charity A is more cost-effective than charity B before their funding gaps are closed, but after closing funding gaps, charity B is in fact more cost-effective? In that case, charity B might be a better option to donate to for middle-class donors.

What could donation advice tailored to middle-class effective altruists look like? For example, GiveDirectly appears to be a particularly promising charity for non-wealthy individuals to donate to. William MacAskill already wrote in 2015 that "the potential for GiveDirectly to scale up [...] in future years is very great"[2], and in 2020 GiveWell noted that "cash transfers have the ability to absorb large amounts of funding". So even if GiveDirectly closed its funding gap every year using funds from the wealthy, donations from middle-class individuals to GiveDirectly could still reasonably be expected to greatly help someone in the near future, if GiveDirectly were to expand its operations, for example.

Additionally, effective altruists should consider whether small donations by middle-class individuals, even if they achieve less than massive donations from the wealthy, are in fact not more morally praiseworthy. For a millionaire, donating $1000 requires no effort whatsoever, whereas for a middle-class citizen, donating $1000 is a pretty great sacrifice. There is very nice section in the Bible (Luke 21:1-4) where Jesus says that compared to wealthy philanthropists, a poor widow who donated the little she could "has put in more than all the others". Praise for donations that are small in absolute terms yet relatively large compared to the donor's income, might encourage more people to support effective altruism and give to effective charities.

I am very happy to hear your thoughts on this matter!

 

  1. ^

    I understand that, if I am not mistaken, effective altruist philanthropic foundations have policies against providing 100% of the funding that effective charities need. But there are probably at least a few charities whose funding gaps already get almost fully closed by highly wealthy donors. So what I am describing here is more than a mere thought experiment. In any case, I don't know why it would be impossible that the super rich one day cover all the funding gaps of all the most cost-effective charities anyway.

  2. ^

    William MacAskill, Doing Good Better (ebook version) (London: Guardian Books and Faber & Faber, 2015), 376.

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I think there is a misconception here - when it is said that these charities will be fully funded anyway, what that can mean is that they will try to fundraise for a certain budget (perhaps with high/medium/low targets) and larger donors will often choose to fill the remaining gap in their fundraising late in the fundraising process.

This means you are often not really giving the charity extra on top of their budget, but in practice funging with the largest donors. The largest donors will then often give slightly less to them and give to their next best option instead.

As an individual, you are in this case redirecting funding from an organisation which agree with your priorities to whatever their next best option is.

For example, I personally made some donations to animal welfare charities this year which very likely funged to some extent with the EA Funds animal welfare fund. What that means is that the counterfactual effectiveness of my donation might be equivalent to whatever the last thing they chose to fund was (which I think is probably quite good in expectation).

Hello, thank you for clarifying. I didn't know that the fundraising process is coordinated in this sort of way. I get the impression that many introductory materials on effective altruism don't really explain this too well, leading to the sort of misconception I may have had when I wrote my question.

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Charles Dillon
1y
I think a lot of this coordination is implicit rather than explicit, and I don't think it's very well publicised (and there's room for marginal donations to change whether the org gets funded to their high Vs medium target for example, and signalling value that individuals think this is good, so I do not mean to say that this is the only consequence of a donation).

Hi Maxim, thanks for your question. Just a very quick note that (1) Iason's claim is unlikely to be true, at least in many cases (see e.g. GiveWell on the funding opportunities they expect to find in the coming few years and the extent to which they expect them to be filled here), (2) his claim seems to stem from 2016 (so I'm not sure whether he would still support it).