Art Carden  

You're Not Pushing Paper Across A Desk. You're Saving the World.

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In my profession as an economics professor and through churches I have attended, I've been around a lot of people who want to "make a difference." They almost inevitably equate "making a difference" with "working for a government or a non-profit organization like a church that is dedicated, at least in part, to helping poor people." Rarely do I hear anyone say "I want to work in accounts receivable for a company that makes faucets--or worse, a company that just sells faucets and other sundries."

But here's the irony: I suspect that you will probably make a bigger, albeit harder to see, difference in the lives of many by working in accounts receivable for Amalgamated Faucets than you will on your two-week summer mission trip or in your career as a relief worker. First, I paraphrase my advisor John Nye and offer you this insight from Yoram Barzel's 1974 article "A Theory of Rationing By Waiting": it is very difficult to give away money in ways that actually benefit the objects of your charity (here's an old article in which I discussed better charity). You consume resources in order to make transfers, and you give people incentives to consume resources seeking to get transfers. It's possible that the entire value of the transfer gets consumed by people standing in line to get "free" stuff.

Cleanliness, while not necessarily next to Godliness, is at least a few more steps removed from filth and the associated disease transmission. One quick and easy way to improve the lives of the people around you is to make sure you wash your hands carefully after using the restroom. By helping the faucet company run a leaner operation, you can help them expand and improve their faucet offerings. This in turn helps people wash their hands carefully. This in turn reduces disease transmission. Reduced disease transmission means less tragedy and higher productivity. It might not seem like much, but congratulations: by helping Amalgamated Faucet produce more, better, and cheaper faucets, you're reducing the probability that someone, somewhere gets sick.

Is it romantic? No. Will people write books about you and give you humanitarian achievement awards? No. Will you be recognized in church? Sadly, almost certainly not. Shouldn't you follow your heart? You've been told to follow your heart, but note what the Bible says about the heart in Jeremiah 6:5: It is deceitful in all things, and desperately wicked. If you want to help poor people, don't follow your heart. Follow your comparative advantage.


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COMMENTS (9 to date)
Paul writes:

About 10 years ago I was talking to the sister of a friend of mine. She was a finance person in Nokia (a bit higher than accounts receivable). She was thinking of leaving to join a non-profit to "make a difference." I pointed out that cell-phones in general, and Nokia in particular with (then) 30% market share, was making more of a difference in Africa than all the charities in the world put together.

F. Lynx Pardinus writes:

I'm a fellow Christian and I've really struggled with issues like this. I have some friends who seem to feel guilty about succeeding at careers or building wealth. I have other friends who work at ethically dubious or rent-seeking jobs so they can "give lots to charity later" ("later" never seeming to come). I'm not satisfied by either extreme, though I take solace in Ruskin's quote:

Any given accumulation of commercial wealth may be indicative, on the one hand, of faithful industries, progressive energies, and productive ingenuities: or, on the other, it may be indicative of mortal luxury, merciless tyranny, ruinous chicanery…. One thing only you can know: namely, whether this dealing of yours is a just and faithful one, which is all you need concern yourself about respecting it; sure thus to have done your own part in bringing about ultimately in the world a state of things which will not issue in pillage or in death.

Scott M writes:

Amen!

I ask at each periodic performance evaluation (if I get one) - "am I making a difference?". I am surprised how often I receive a blank look.

I am a project manager. The number one bottleneck/obstacle that I see is that people don't talk to each other. They have a task dependent on the other guy and yet they wait for something to happen, and they rarely communicate when they are done with their own task activity. I spend 70% of my time asking if something is done yet. And it yields results. And I make a difference, "saving the world one meeting at a time". :)

Joe Cushing writes:

Paul,

After reading your comment, I was left wondering if she stayed or if she went to work for a non-profit. If she stayed, did she still feel that longing?

Joe Cushing writes:

I remember reading or hearing somewhere that the best way to help the poor is to not become one. I think there is sound logic to this. If everyone made decisions that prevented them from being in poverty, then poverty would be greatly diminished. Of course not everyone can do this because outside forces beyond their control can sometimes put them into poverty but I suspect the number of times this happens is far fewer than people like to admit. This is especially the case for any developed nation and for a lifetime verses a moment. I've certainly had my moments of poverty but I have not lived a life of it. Any time I've been down, I've looked and looked until I found a way out, even it if took a year to find, I never gave up and never gave into a life of poverty when it would have been easy to do so.

Tammy Nguyen writes:

I experienced myself as my Mom is a principle of a middle school. And of course she is not rich, not too poor. We are just the middle-class family. But my Mom has an warm-heart, and exactly means she is helping poor people by "comparative advantage". Even a non-profit company needs money to operate. Then, where the finance comes from if people just working in it without paying attention to incentive.

Well, my Mom is not in U.S. She is in Vietnam, got retired but still helping poor students with education. She did charity by teaching poor kids without tuition fees in the evening classes and weekend. By that I meant people need money to run business, but not give up all to do charity unless working hard for money first. Otherwise, devoting all your time for saving the world also face trade off: you probably lose a chance to get a good job and earn more money to improve your standard of livings. To conclude, helping people is fine but stable and enrich yourself before volunteer and involve social works. Also, do follow "comparative advantages", which differs from people to people.

John Zipps writes:

FYI, the link to the Barzei article is a 404.

JKB writes:

Those who transformed the world, brought billions out of poverty, ended the starving of multitudes are generally unknown to most. The certainly aren't read in the Liberal Arts program, or listed in the histories except by passing reference.

Watt, Bessemer, Tesla, Tantlinger are just a few who "made a difference", a real difference, global difference but did it while using their comparative advantage in pursuit of profit.


I saw this quoted by the Adam Smith Institute blog from a study on the cost of regulation

Regulation’s overall effect on output’s growth rate is negative and substantial. Federal regulations added over the past fifty years have reduced real output growth by about two percentage points on average over the period 1949-2005. That reduction in the growth rate has led to an accumulated reduction in GDP of about $38.8 trillion as of the end of 2011. That is, GDP at the end of 2011 would have been $53.9 trillion instead of $15.1 trillion if regulation had remained at its 1949 level.

So if you go to work for government or a non-profit to "make a difference" by constructing regulation, all you really are doing to making everyone poorer by 2/3rds and damaging the poor most of all.

Dan Carroll writes:

http://www.christianitytoday.com/ct/2013/june/want-to-change-world-sponsor-child.html

Charity is worthwhile if well spent, but, despite the title of the article, it won't change the world. However, it can change a life.

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