Showing posts with label charity. Show all posts
Showing posts with label charity. Show all posts

Thursday, July 17, 2014

Kayfabe Rules Everything Around Me (K.R.E.A.M.)

The BLS estimated that Hurricane Katrina produced about 1.8 million evacuees.

Take you time with that link. Savor the tables, the figures, and the charts. Investigate the summary statistics. Here's one of the better ones: 16.4% of evacuees reported "less than HS" for education. You may not have a calculator handy, so let me multiply that for you. That's roughly 295,000 people who had to leave their homes because of a violent exogenous shock with not so much as a high school diploma to show for it.

And disease? Katrina was responsible for a West Nile outbreak.

How about labor force participation? Go back to the BLS link; look at Table 6. Victims of Katrina were involuntarily disemployed in 2005-2006, and with public assistance measures, by gum, they were a net burden on the welfare state.

And no one complained. Well, at least no one complained as roundly and vociferously as they are now about a group of children roughly the same size as a small-to-medium sized American town (Chico, CA has about 60,000 residents, for example). If the American public applied the same moral intuition-&-kayfabe to displaced residents of the Big Easy as they commit to a far smaller band of Central American refugees, each of the 1.8 million residents who chose to flee the terrible disaster of Katrina would have been forced to tie up their bindle and head straight back to the wards from whence they nearly drowned.

Thankfully, ordinary Americans aren't even close to being that cruelly obtuse. Indeed, communities recognized that people in need deserve if not commonplace charity, then at least the temperance to keep from violently preventing others from pursuing their charitable instincts.

Sadly, the nationalist zeal which appears to be the sole residual difference between today's Guatemalan children and yesteryear's Katrina survivors erodes my confidence in the accuracy of the following (deservedly famous) passage from Adam Smith:
Let us suppose that the great empire of China, with all its myriads of inhabitants, was suddenly swallowed up by an earthquake, and let us consider how a man of humanity in Europe, who had no sort of connection with that part of the world, would be affected upon receiving intelligence of this dreadful calamity. He would, I imagine, first of all, express very strongly his sorrow for the misfortune of that unhappy people, he would make many melancholy reflections upon the precariousness of human life, and the vanity of all the labours of man, which could thus be annihilated in a moment. He would too, perhaps, if he was a man of speculation, enter into many reasonings concerning the effects which this disaster might produce upon the commerce of Europe, and the trade and business of the world in general. And when all this fine philosophy was over, when all these humane sentiments had been once fairly expressed, he would pursue his business or his pleasure, take his repose or his diversion, with the same ease and tranquillity, as if no such accident had happened. The most frivolous disaster which could befall himself would occasion a more real disturbance. If he was to lose his little finger to-morrow, he would not sleep to-night; but, provided he never saw them, he will snore with the most profound security over the ruin of a hundred millions of his brethren, and the destruction of that immense multitude seems plainly an object less interesting to him, than this paltry misfortune of his own. To prevent, therefore, this paltry misfortune to himself, would a man of humanity be willing to sacrifice the lives of a hundred millions of his brethren, provided he had never seen them? Human nature startles with horror at the thought, and the world, in its greatest depravity and corruption, never produced such a villain as could be capable of entertaining it. But what makes this difference? When our passive feelings are almost always so sordid and so selfish, how comes it that our active principles should often be so generous and so noble? When we are always so much more deeply affected by whatever concerns ourselves, than by whatever concerns other men; what is it which prompts the generous, upon all occasions, and the mean upon many, to sacrifice their own interests to the greater interests of others? It is not the soft power of humanity, it is not that feeble spark of benevolence which Nature has lighted up in the human heart, that is thus capable of counteracting the strongest impulses of self-love. It is a stronger power, a more forcible motive, which exerts itself upon such occasions. It is reason, principle, conscience, the inhabitant of the breast, the man within, the great judge and arbiter of our conduct.
The kayfabe over the non-euvoluntarity of refugee children tells me that many of my fellow citizens would indeed snore with the most profound security over the ruin of sixty thousands of human lives when indeed it would cost him far less than the value of his pinky-finger to allow his fellow countrymen to relive their great suffering.

I strain to explain such a clear and obvious abdication of conscience without at least three mutually-bound rhetorical parts. Nationalism is the soil tilled by the plough of partisan kayfabe into which the seed of non-euvoluntarity is sown. The weed that there grows is a poison thing that would send children to rack and ruin. This infamy corrodes the public character and shames a great and mighty nation.

Thursday, November 1, 2012

Mortgage Refinancing

Suppose the reason you're wandering in the desert is that you're on the way home from buying an engagement ring for your sweetie with the cash you got as an unexpected bonus you won from a raffle you forgot you entered, and you took a wrong turn. Instead of a thousand dollars in your pocket, you've got a diamond ring you just paid a thousand dollars for. Jorge is willing to accept the ring for a bottle of water.

Suppose instead that you're lost in the desert with totally empty pockets, but you just happen to find a diamond engagement ring lying in the sand. Being the expert appraiser you are, you correctly estimate the value of the ring at $1000. Again, Jorge wheels on by and is willing to take the ring in trade for a liter of water.

Are these scenarios different? If so, why? Which one is closer to euvoluntary? Kahneman and Tversky did quite a bit of very good work describing the endowment effect, where the simple act of possessing a thing increases its relative value to the holder. The Bird in the Hand theory, if you will. How about emotional freight? In the first circumstance, the ring carries with it special significance, but is that significance relevant to third parties?

I ask because I'm still puzzling over contaminated charity and to a lesser extent, commercial transactions. If I raise money for breast cancer research by holding a wet t-shirt contest, should I be surprised if the recipient turns it down? Can the Sierra Club accept donations from known polluters in good conscience? How about going into hock? All else equal, is there any moral difference between on the one hand pawning a ring from a broken engagement and on the other hand one handed down from grandma?

And what of the use of the proceeds? The reason the kid in China who sold his kidney to buy an iPad made international news was that his purchase was pretty widely regarded as frivolous. If he'd have done it to make a mortgage payment or two for the family home, I don't think there would have been as much outrage. I think I've made a case here for regret aversion by proxy as being a reasonable source of much paternalistic sentiment, but what other proxy sentiments might have bite? Prudence? Propriety? Dignity? Cleanliness? How much of this sentiment rules beliefs over the first two conditions of EE: conventional ownership and conventional capacity to exchange?

Also, forgive the misleading title. I'm interested to see if I get more spam comments from bots. Consider it a test of sorts.

Friday, October 5, 2012

NGO PBJ

I caught a bit of a piece on NPR about a project in Haiti to combat malnutrition. There's a process for making enriched peanut butter that provides high-quality protein (this means that the protein contains all the essential amino acids, a rarity in plants) and enough lipids and glucose for basic nutrition.

So a charity organization called Meds and Food for Kids (MFK) builds a processing plant in a little town on the North Coast of Haiti, Cap-Haitien. Another charitable organization, Partners in Health (PiH) also builds a factory, this one bigger and up in the highlands where the peanut farms are. Both of these ventures are quasi-private, supported by charitable donations. Both NGOs insist on buying local peanuts, despite higher prices, using similar reasoning underpinning most locavore movements (keeping the money in the community or something).

Most economists would agree that this is inefficient, but opinions might be split on whether or not the inefficiency is tolerable. The Duflo argument that poverty and malnutrition retards growth opportunity is compelling and Haiti is well-known as a development basket case. Foreign businesses in Haiti have a storied history of being charged with exploitation, so this is an interesting test case for euvoluntary intuitions.

Since MFK and PiH are quasi-charitable orgs, how do you imagine wealthy westerners would react if Rosefield Packing Co Ltd would open a for-profit venture on the island? Suppose that this firm, which has been making peanut butter since 1933, produces the peanut paste at lower cost, using its international supply chain. Would it be euvoluntary or would folks cry exploitation once again? In equilibrium, what would the BATNA be? Bear in mind that MFK is already complaining that the PiH plant is threatening their operation. How would Skippy change the moral landscape?

Thursday, September 13, 2012

Webinar

So, did a "webinar" with the wonderful Sarah Straw of IHS, on the subject of EE and non-worseness.  Very interesting experience, several good questions.  Co-blogger Sam Wilson showed up, and that was nice!

But near the end, a young woman named Andrea posed this question:


Your “ice after the hurricane” example: people object to price gouging because the exchange was necessary for life, etc., and this means that the parties are not contracting on an even footing. This means that non-euvolentary exchanges are prevented from occurring that would have helped the worst off. So, how can we overcome this moral smugness in order to help people? Charity is always allowed, as you said, but it is less efficient than market transactions. Is this dilemma resolveable? 

Wow!  Brought tears to these old eyes.  Because she understood perfectly every aspect of the argument, and the problem.  That's the best short summary I have seen of why I think EE is interesting.  Bless you, Andrea!