Monday, April 15, 2013

Question "Charity"

"Charity" isn't working, and it never was designed to end socially or collectively resolvable suffering. 

There. I've said it. 

Yes, I dare to question the ideas about charity that have infused themselves into our societies and culture. I know, major religions take great and noble stands on the necessity for the "better off" to give charitably to the "less well off." They have gotten things crossed. The ideas and practices about charity prevents us from reorganizing ourselves into better ways to coexist with one another.They are in the way.

I will frame my comments by responding to Josephine Lowell’s definition of charity. I need to say up front that I admire Lowell a great deal and appreciate that her heart was well schooled by her abolitionist parents.

In her 1884 book, Public Relief and Private Charity, Lowell gives 4 facets to her definition of charity (pp 88-90)—

“1st. It must be voluntary.” She notes that the exchange of material resources resulting from the use of force may transfer property from the wealthy to the poor, but it’s not charity.

“2nd. It must be free in another sense. The person to whom we exercise charity cannot have an acknowledged personal claim upon us.” For Lowell, relationships like parent-child, or employer-employee establish channels of service and support that cannot be labeled charity. Often there’s a duty implied, and charity and duty don’t mix; one is supposedly voluntary and free and the other has shades of moral obligations.

“3rd. Charity must go further than kind feeling—it must be kind action—it must accomplish good to the object of it. No amount of good feeling can convert an injurious act into a charitable one.”

“4th. Charity must be exercised towards a person in inferior circumstances to those of his benefactor. We cannot be charitable to our equals—in the sense of the word with which we are dealing.”

Let’s let Lowell sum up her argument: 
“Charity then, as I define it, must be a voluntary, free, beneficent action performed towards those who are in more destitute circumstances and inferior in worldly position.
“By this definition, all official and public relief is put outside the pale of charity, since it lacks the voluntary element.”

She is not the only thinker to focus on the voluntary, giving side of this exchange. The 13th century Jewish Rabbi and doctor, Maimonides, posits 8 levels of Giving. (The word tzedakah is the Hebrew term for justice or righteousness. It is often translated as charity.)

  1. Giving an interest-free loan to a person in need; forming a partnership with a person in need; giving a grant to a person in need; finding a job for a person in need; so long as that loan, grant, partnership, or job results in the person no longer living by relying upon others.
  2. Giving tzedakah anonymously to an unknown recipient via a person (or public fund) which is trustworthy, wise, and can perform acts of tzedakah with your money in a most impeccable fashion.
  3. Giving tzedakah anonymously to a known recipient.
  4. Giving tzedakah publicly to an unknown recipient.
  5. Giving tzedakah before being asked.
  6. Giving adequately after being asked.
  7. Giving willingly, but inadequately.
  8. Giving "in sadness" (giving out of pity).

All of Maimonides' levels imply voluntary giving, simply in more variety that Lowell dealt with. 

The rest of this post will take a closer look at Lowell’s first point: It must be voluntary.

I picture 2 people, Ms. A who is feeling in a charitable mood, and Mr. B, who is feeling in need of help. Ms. A certainly has an option to provide some or all the help Mr. B needs, and can do so voluntarily. Mr. B’s condition may not be so voluntary; in fact he may be in extreme distress.

By addressing only one side of this exchange, Lowell overlooks that charity involves at least two people, or two parties. It may also involve the tax collector, and this third element introduces the possibility of the person offering the charity, Ms. A, may want to benefit from the tax write-off.

On the other hand, Mr. B may have claims on his income which he seeks to avoid. His hard-up, hard-luck situation may be more a voluntary choice than entirely the result of circumstances.

Somewhere in the middle is the psychology of both those that offer and those that receive. Lee Stringer in Grand Central Winter—his memoir of life on the streets of New York City—captures in a brief sketch this dance of motives and actions.

Stringer had been working the subway cars, selling a weekly newspaper sold by homeless people to earn a few dollars. He had made his pitch but did not get any sales. Before departing, a woman wishes more people would buy a copy to “help the homeless.” He offers her a complimentary copy. She refuses, because he could “sell that.” Stringer writes:
            “This gets me slightly ticked.
            “’I may be on the street,’ I tell her. ‘But if I couldn’t give something to someone every now and then, wouldn’t that make me poorer than I am?’" … 
            He pleads with her to take the paper (“all kinds of things riding” on it, he notes.)
            She instead digs out 97¢ for the paper, “there you go,” she says triumphant. “But it’s her victory alone.”(Emphasis added.)
           She goes into the next car and leaves the paper for him before she exits. He finds it when he enters that car.

It was her "victory alone" because the shadow side to Lowell’s feeling that charity must be voluntary is the sense of shame, humiliation—even stigma—that the recipient may experience. Is this what was Stringer hints at by his side comment that "all kinds of things were riding" on her accepting his offer of a free paper?
In the spirit of never critiquing something without offering a suggestion, I would rewrite Lowell’s first point to read:

People have multiple motives for giving and accepting help.

Somehow I personally have always intuited this feeling of shame from receiving assistance. As a tutor at a youth center in New York, I often encountered middle and high school students who knew they needed help but felt uncomfortable that they needed it! After we had completed any necessary paper work, I would ask them, “What are you going to teach me?”

This caught them off-guard as they felt they were “empty” or "broken" and had to be “filled” or "fixed" with the understanding or knowledge that tutoring offered. To be asked to teach something back right away established our relationship as one that was closer to being one among equals: I knew a little more about composing an essay and was happy to share with them—they knew more about things like Chisanbop (Korean method for doing math calculations using your fingers) which I wanted them to share with me.

If we can get past hidden motives—it isn’t charity if there’s a mutual give and take. 


Comment 4.29.13 
Interesting area to be exploring.  I remember reading somewhere that there is a great difference between when you are giving from your abundance or giving from a place requiring some level of sacrifice.  I found that provocative.


Saturday, March 2, 2013

Write Down what you Spend, Save, & Share!

It's a form. A basic form. Write down the month, day, what you bought, the amount the purpose you put the money to: Spending, Saving, or Sharing. The last column is for a memo or note. Basic—8 columns.

The challenge is consistency: writing down every expense, every time. Cash, check, card, even the spare change or dollars handed out to panhandlers (check the share column).

That's it. It works. The question is can you work it so it works for you!

Look what some bloggers have posted on this technique if you don't believe me.

From: Prime Parents Club

#DoIn52 Week 3: Become More Aware of What Your Family Spends

For our third week in Do In 52, we want your entire family to become more aware of what you spend in one week by tracking it–all of it! So, grab a notebook and an envelope for each family member who is old enough to spend and get at it. Just have people log what they bought and the amount.
The rules are easy:

Save a receipt or write down in your notebook every single thing you spend money on for seven days straight.

Spend $120 at the grocery store? Write it down. Spend $20.01 at the gas station (come on, we know you go over when trying to stop on the .00 mark), save that receipt. Pay the electric bill? Log it. Buy a pack of gum at the school event concession stand? WRITE IT DOWN. (Yes, we are totally serious.) Order an Amazon book that auto-bills your account? Yep, you have to track that, too. Anything that comes out of your personal funds, you need to track it for the week.

Part of the reason that people have such a hard time with budgeting and saving money is that they don’t realize exactly what they’re spending, especially on little things that can add up fast. At the end of your seventh day, collect all the receipts and notebooks from everyone and add it up. We’re pretty sure that you’ll find some corners you can cut immediately, and then probably some things you can work on longterm.
So … get to tracking!

From: ReadyforZero

One thing that I’ve personally found is that if I force myself to enter my spending daily or at the very least 3-4 times a week, I really feel the pain if I enter something that I know is bad for my budget or if I go red in a category. This helps me make smarter purchasing decisions and avoid over spending. Alternatively, it feels great when I do make my budget for the month or only ‘stray’ within a few dollars. It’s almost like a game that helps me accomplish my goals.

So, get started, keep it quick and manageable. At the beginning don't worry about getting every expense recorded, just focus on building the habit of writing a note or sitting at the computer with receipts and bills.

The more mindful, the more moneyful!

Sunday, January 20, 2013

Pay Down Higher Interest Debt First

Look at the illustration carefully. If, as Sheri O. Zampelli says paying interest is like buying nothing, you buy more nothing over time with higher interest.

If, for example, Abe and Abby, twins, take out separate $1000 loans in July of 2012 by using their credit cards to get tickets and rooms for a long planned family reunion. Abe's card had a 20% interest on the unpaid balance, and Abby's card charges her 10%. Neither of them will make more purchases on their cards until these are paid off.

Both of them will pay a $20 minimum payment each month, at least at the beginning.

When will each loan get repaid and how much interest will that cost? 

To answer that it helps to have some basic concepts in mind. All loan repayments have two parts: the principal, meaning important or main part, is the amount borrowed. The most principal Abe and Abby will pay back is $1000 because that's the amount they borrowed.

The other part is interest: an extra amount returned to the lender (the credit card companies) for advancing money to the borrower. This area is where lenders can really put a hurting on borrowers if there are no reasonable caps or limits on the extra they can charge. Excessive interest is called usury. Communities either by custom (only charge high interest to outsiders), culture (our people never take advantage of anyone), or law (charge more than the law allows and the government will shut you down) declare what amount of interest is reasonable. The creative greed of lenders then find ways to get around those limits. And so the merry-go-round works.

The important thing to remember is as long there is an outstanding principal the lender will add interest. But as soon as that amount is repaid, the lender is "made whole" and the loan repayments end. 

Back to Abe and Abby. In a little over 5 years Abby will have her 10% loan paid off, and have incurred $299 in interest, for a total expense of $1299. 

Abe will continue to pay for an additional 4 years on his 20% loan and pay $1168 in interest for a total of $2168 for his original $1000 charges.

I will share some links if you want to learn more, especially if you have multiple loans at different rates. But first, a couple of warnings. You may see from time to time a blogger say a payday loan "is designed for quick access to cash but not for long-term use," or words to that effect. Don't believe them! Payday loans are a trap and the lenders want you to use them long-term, though you think you're only needing their "help" for 2 weeks. They are not a help to "underserved" communities because the profits leave the community, and even the wages paid are to people who often live elsewhere than the poor communities that are the targets for these storefront lenders.

Another warning: some of the articles discuss finally paying off the principal loan amount like its the only point of emotional or psychological happiness. Think of the ritualized moments in plays and movies where people burn their mortgage agreements after the house is finally paid off.

The thing is, we can set our own interim success markers! I like to compare this power we always have held to how fans of sports team react. Let's say our football team is currently losing by 10 points. It has the ball and scores a touchdown. Are fans quiet at this point? No, they are cheering! But why? They are not ahead yet, they still are behind by 3 points. However you understand why they are cheering, use that for yourself.

So, let's back to Abe. He talks to his sister and realizes he needs to get a credit card like hers! But first, he wants to pay off this $1000 faster than the credit card company wants him to. They both know that anything over the minimum is subtracted from the principal.  Remember, the longer he takes to pay it, the happier (or wealthier) the credit card company becomes. The opposite is also true: the faster he can pay the better off he is.

Abe does some calculations on a napkin while having lunch with his sister. He buys coffee and sometimes a muffin or scone about 3 times a week, that's adds up to over $60 a month. He also was going to add a couple of personal days to a business trip to see the sights—he can forgo that but keep the time off and rest so he won't feel the need for the coffee. He's been Mr. Party impressively buying rounds for his friends sometimes at happy hour. That's going to stop. An so on. He commits to his sister to finding at least $100 of savings a month and putting that money on his loan till the $1000 is paid off. And, to get started, he tells her he is not buying her lunch today as he usually does, they will have to pay 50-50. Actually, Abby instead buys him lunch as her contribution to his goal.

Abe can feel good each month now if he achieves at least $100 in savings to add to his loan payment and not wait till the full $1000 is repaid to feel good.

Okay, you've been warned. Here are some sites with alternative ways to go about repaying your debts.

As with most things, knowledge adds to your strength. Remember to read the fine print and take your time before agreeing to terms.