We have
discussed multiple ways that philanthropists can approach donating their money.
As I scrolling through a Google search on philanthropy, I came across a Wall
Street Journal article (http://online.wsj.com/news/articles/SB10001424127887323372504578466992305986654)
that discussed a relatively unheard of fund that took a very nuanced approach
to giving. The Laura and John Arnold Foundation, started and primarily funded
by a couple bearing the foundation’s name, uses an approach referred to as the
“Moneyball” approach. In short, the Foundation tackles issues whose results
cannot necessarily be given a number at the end of the project. They discuss
their work with obesity, the Huston Food Bank and pension reform.
This week during
class, there was a poll question about whether we wanted our class to focus on
affecting a few people in the short-term or more people in the long run and
another question asked if we preferred to own the project or contribute to an
ongoing project. In my opinion, the “Moneyball” approach focuses on long-term
projects that they create themselves. Is this combination the most effective
way to achieve the best results? Will this approach do more good in the world
than conventional methods? And if this is not the best answer and you argue
that the traditional approaches are not working, what approach or combination
of approaches will be the most efficient?
I found it
interesting that the article does address some of the drawbacks of this type of
approach. One that they mention is that none of the projects focus on immediate
concerns. Again, this goes back to the question of whether or not philanthropy
should be focused on the short run or long run. Another concern that was
brought up was the degree of failure by the projects that are being undertaken.
John Arnold acknowledges that many of the projects will not go anywhere but he
states that without risk there is no reward. However, there is a lot of money
at stake. Should risks be taken that involve millions, sometimes billions, of
dollars? Or is that equivalent to throwing money out the window?
Our class
obviously does not have the billions that the Laura and John Arnold Foundation
have, but could we take a “Moneyball” approach to donating our money? Should we
be taking an action like this? Is it even possible to take the “Moneyball”
approach when you aren’t a top-dollar philanthropist?
This article was a fantastic read! I always love reading about uncommon opinions or strategies on issues because they're very thought provoking, just as this read was.
ReplyDeleteI do not think this method of philanthropy exclusively will be sufficient. I believe there is no single method that is so effective all others can be stopped. However, "moneyball" philanthropy is definitely an approach that should be used. A tangentially related discussion came up in class a few separate times, when we talked about "implicit philanthropy." Are we okay with our money being used for advertising? For a medical study? Some say no, but I say of course because those investments will likely bring results in the future. Those results just can't be quantified as easily so philanthropists are often more wary of them.
Discovery rarely comes with a practical purpose. Scientific discovery starts from "I wonder if this is true" or "Let's see what this does," and although often those questions lead to failures, sometimes they lead to gigantic successes. When Alexander Fleming discovered Penicillin, it was a total accident while he was working on a topic totally unrelated to antibiotics and made a serendipitous observation that turned out to be revolutionary.
Okay that was kind of a tangent...oops. The point is, knowledge is power. The results of the study this "moneyball" approach would fund can potentially revolutionize the treatment of obesity...and someone has to be willing to fund it. We can't put it off forever. Unfortunately as a class I don't think 10,000 dollars is enough to use this approach to the scale its being used in the article, but it's definitely worth considering while evaluating charities.
I also really enjoyed this article. I was one of the people that Richard mentioned who did not believe that implicit philanthropy is nearly as effective as meeting the immediate needs of a population. This article forced me to reevaluate my thinking. Since my philanthropy is largely motivated by empathy, I am interested in providing immediate relief to those who are suffering. However, this has caused me to disregard the potential merit of investing in a larger cause that may not produce any "numbers."
ReplyDeleteWhen reading this article, I was easily won over by the Moneyball approach. Richard makes a good point when he says that this method exclusively would not be sufficient. It seems that most people, like me, like to see the immediate effects of their donations so they can justify their sacrifices and/or feel more satisfied. This is not necessarily a bad thing, as some causes, such as relief aid after natural disasters, require immediate attention.
Arnold seems to make investments rather than donations, but this surprisingly does not bother me, as he is investing in causes that could ultimately be revolutionary. I believe that more people should follow his lead, as research in certain fields, such as medicine, will have a larger impact over time.
I think that the Moneyball approach could work, even for people who aren't billionaires, as many small donations can add up to fund significant research. As for our class, this may not be the most effective and satisfying way for us to use our money, but I would not have a problem with it.
I am glad that you both enjoyed the article! It is interesting that you both liked the "money ball" approach so much. As my post sort of hinted, I am a little skeptical of the idea of putting such massive amounts of money into sometimes untested waters and controversial topics. That being said, I agree with Richard that those types of investments are the future. I just believe that the funds for projects should come from governments and smaller research grants from private donors.
ReplyDeleteMartha's comment about investments instead of donations made me question whether or not donations and investments are the same thing. In the article , it almost appears that they are used interchangeably. So, can you use them interchangeably or are they two separate things with very distinct and strict definitions? My answer to that question is that it depends on the scenario. In a case like this, they can be interchangeable but if you are giving cans of soup to a soup kitchen, you are not investing in the soup kitchen. You are donating to it,
I like the way that you both approached the question of whether or not you could use the "money ball" approach with smaller donations. I agree with both of what you said, as I do not think that a small donation cannot but used to fund a project such as the ones the Arnold's are donating to but multiple donations could. Perhaps, if we had people match our smaller donation to a charity we could take the money ball approach. Like Martha said, many donations add up.
I agree with Richard and Martha in that large donors should definitely use the Moneyball approach. This article reminded of the story where there are people drowning in a river. One man jumps in the river to save them while another runs upstream to try to stop more people from drowning. The Moneyball approach is more like the man that runs upstream to find the cause and stop it, without providing immediate help. Although there is always the risk that the man will not be able to find the cause or be able to stop the drowning people, there is the possibility that the man could end the problem all together. The other man saving the drowning people never has the chance to actually stop the problem, just alleviate it.
ReplyDeleteThis is why I think that the Moneyball approach is a good idea because the reward is so large, despite the risk involved. Arnold has the capital to address the issues of obesity and pension reform, which otherwise would not able to be researched without such a large magnitude of money. Like many of you already mentioned above, our $10,000 as a class would not be sufficient enough to take the Moneyball approach because research to completely take over an entire problem requires more than that. $10,000 using the moneyball approach would do a lousy job. With the potential to find no results, the research needs to be done correctly.
Also, in regard to Nick’s question about the long-term versus the short-term approach to philanthropy, I think being able to make a difference in the long term is very important. What’s the point of helping someone for a few days or even a year if the problem is just going to come back to hurt them? This isn’t to say that short-term philanthropy isn’t important either though. Like Martha said, immediate relief is sometimes needed such as in times of natural disasters. Relating it back to the river story, the man saving the drowning people is providing short-term relief, but he is still saving lives. A balance is needed between the two, although I think the long-term approach is at times more important.
John Arnold has a very unique story, and it is surprising to hear about someone that made so much money so young and actually want to make a difference, and not in the typical way that most billionaires do, as ‘grateful-recipient’ donors. They want to fund an enormously expensive project to solve some of the US’s biggest problems, and they attracted to the way in which they will attempt to solve them because the results will be quantified, meaning there will be results that they will be able to see on paper through data analysis and science.
ReplyDeleteI really like the “Moneyball” approach to philanthropy. However, it is not an approach that I would like to take during this class. I like that the approach will eventually achieve great success in whatever it is trying to better. However, I would like to witness and feel the difference that I have made while being in this class since this will be the first time that I will be actually experiencing a philanthropic change.
I definitely do see the importance of their style of giving, and there needs to be more philanthropists like John and Laura. I also see why some are opposed to the “Moneyball” approach, those opposed to it argue that many individuals and local organizations need direct help immediately and could greatly benefit from the billions that the Arnold’s are pouring into these certain scientific studies. But, it is their money, and they are passionate about the cause that they are funding, so I say let them be. Its allows for something very interesting to look forward too once the results begin to surface whether they turn out positive or negative. Also, whether they are positive or negative will influence other donors that donate through the “Moneyball” approach as well.
One thing that Laura said in the article that made me think a lot about philanthropy was, “We don’t have a bunch of smiling kids and graduation pictures. That’s not what we’re about.” They decided very early on that their foundation would not pick the “low-hanging fruit” of philanthropy”. Of course, the organizations that need immediate help are equally as important as those that will create big change later on, I think what the Arnold’s are doing with their money is the best idea. They have the billions to focus on systemic problems; most do not have this kind of money. They can create dramatic change in the future, which will create a better society. I fully support what they are doing, and find it extremely compelling. But once again, I do not want to take this approach in this class because I want to be able to see the difference that we make and frankly I do not think that $10,000 is enough money to create the type of change that they may be able to make or fund a project similar to theirs.
Great article. I agree with most of what has been said, most importantly the fact that efficient short and long term philanthropy should consist of a balance. We all understand the importance of short and long term relief. Two things really struck me about the article and the Arnolds' methods in particular.
ReplyDeleteFirst, I applaud the couples' conscious choice to tackle long term issues in important ways through their money ball approach. It is imperative that people focus on the future and try and solve problems rather than just accepting them and alleviating. Here is where the balance between the long term money ball approach and the short term giving play an equally crucial role in philanthropy.
Second, I completely disagree with the couples' obsession with data and statistics. I agree with Gayle Fallon, that "not everything of value can be measured." It seems that the Arnolds' relentless spending on extravagant amounts of data and studies does not really solve any problems. It would seem that the more data they acquire the more complicated the problem becomes. Lets take the example of obesity. We all can agree that the issue of obesity has a very simple and obvious way of being solved: exercise and diet. We all can agree on this can we not? My argument then is instead of spending $26 million on yet another nutrition study, spend that money to educate and promote physical activity within society, or fund a free exercise program for any obese person.
Now I am not trying to argue the overall validity and furthermore importance of data and science. We all know that some of this knowledge is required and furthermore beneficial. What I would like to draw attention to is the overwhelming excess of information that the Arnolds are trying to acquire. In an age where the notion that information is power reigns supreme the human component seems to be lost in favor of numbers. What is really lost is the intimate human interactions that take place during the philanthropic process. Instead it seems to be boiled down to another statistic the Arnolds' evaluate instead of story of the human condition.
What the Arnolds' are doing is very important in the grand picture of philanthropic giving. But what drew us to this discussion? A story. It was not the vast numbers of the couples' giving, or they're adivertising scheme, or even their investment in research. Simplified, we are having this discussion because someone took the time to create a narrative that is supported with data. I would encourage the Arnolds to look beyond the data and focus more on the stories associate with philanthropy. Once more I am not disagreeing with how they are donating their money. I am disagreeing with their craze over data.
First, I agree with the idea that $10,000 isn't enough to fund a project that would have the same impact on an issue as the Arnold's had on obesity, but this does not mean that I am against putting our money to use in long-term solutions like theirs. I don't believe we can have the "Moneyball" effect on any issue, but I do believe that our money can support an organization who can. Why not team up with a program that already exists to make our donation a part of something bigger?
ReplyDeleteSecond, I disagree with notion that the Arnold's obsession with data and statistics is negative/wasteful. Through my own personal experience, I can attest to the fact that often times data and statistics have had a huge impact on my belief in an issue. Not that I didn't believe that the issues in question existed, but I had no idea of the extent that they were prevalent, widespread, growing, etc. Statistics provide a great outlet to prove the point that is being argued and can have an extremely positive impact on the support that an organization receives. Actually, after doing the reading about scanning for this weeks class, I believe they can be crucial in gaining support from funders especially. Statistics are easy and trustable, and give you a well-rounded and concise explanation of what the organization is solving and how they have succeeded thus far.
There are some very interesting ideas brought up in all these comments! I also liked this article for many of the same reasons that were stated.
ReplyDeleteI definitely agree with Juliette that data and statistics should always be considered by a donor. Not that you have to base everything on the data, but after narrowing down what organizations work on something you are passionate about, much of the effectiveness of the program can be determined by their numbers.
I am happy to see that a super rich couple, the Arnolds, was able to identify a problem and use their resources to best research all in hopes of solving that problem. I can commend them for taking such a great risk, and definitely do not think it is wasteful of them to donate to research efforts. When we are donating we can't always say "well this donation might not help this person have a better life, so I won't donate the cause." Life is all about taking risks, and like Richard said sometimes the possible outcomes out weigh the risks, even if the risk is a loss of money.
In each story of someone else's donating theories, no matter how different our circumstances are.