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Saturday, November 18, 2017

Policies That Make Philanthropy Less Effective

Philanthropy is about more than just giving away money. It's also about not getting in the way.

Thanksgiving and Christmas are arguably two of the most philanthropic times of the year. As the holiday season approaches, the spirit of giving will begin to consume the minds of the public. However, unique to this year will be the degree to which politics might permeate the holiday season more than ever.

Therefore, it is appropriate to talk about how politics and private philanthropy are inextricably intertwined. Ironically, it is the morally indignant progressive movement that promotes policies that end up hindering voluntary efforts to help those in need.

Zoning Regulations and Affordable Housing

Any homeless individual would rather be guaranteed the chance to share a room with another than have a 50% chance at a room to themselves. Providing the homeless with free or reduced-cost housing is a prime example of philanthropic efforts that are constrained by progressive policies. There are a plethora of shelter homes and reduced-cost housing units for the homeless and working poor. These housing units provide a much-needed escape from the cold of the winter months and the basic human dignity that comes with a bed.         

Common sense would dictate that the more people that can be provided with a bed to sleep on, the better. Yet, it is the zoning regulations implemented by progressive politicians that restrict the supply of these housing units to the poor. By regulating every facet of residential buildings and restricting the number of people per room, zoning laws not only place burdensome costs on these housing units but artificially limit their supply.          

Any homeless individual would rather be guaranteed the chance to share a room with another individual than have a 50% chance at obtaining a room to themselves. Yet, by limiting the number of people per room in housing units, zoning laws unnecessarily limit the scope of this form of philanthropy.

Minimum Wage and Skills Training         

The minimum wage turns this scenario into an all or nothing game. Moreover, the reason someone may be homeless could be their inability to find or hold down a job. Fortunately, there are many training programs that help unskilled workers gain computer and administrative skills that would normally be sufficient in gaining job prospects. Yet, in states such as California, the minimum wage is so high that it would take excessive amounts of resources to train any significant amount of people at a high enough level to mandate the minimum wage.         

Without the minimum wage, job training programs could provide minimal skills to a vast amount of people, and every hour of training would translate to an increase in productivity and, therefore, prospective wages. Yet, the minimum wage turns this scenario into an all-or-nothing game. Either unskilled workers are trained to be as productive as the minimum wage mandates, or every hour they just spent training yields no prospective income at all.          

Not only are the lives of the unskilled workers made worse, but the philanthropic efforts of the trainers are thwarted by liberty-restricting, poverty-entrenching economic policies. It is important to remember that progressive policies restrict the freedom of those in need as well as the people trying to help.

Occupational Licensure and Entrepreneurship  

Obtaining a license to become a food vendor requires hundreds or even thousands of dollars in permits and paperwork. Just in case a person in poverty decides to circumvent the minimum wage and become self-employed through some entrepreneurial efforts, progressive politicians devised occupational licensure laws in order to limit mobility on every front. More advanced philanthropy could come in the form of investment, where a person lacking resources has a profitable skill that requires a small initial investment.          

Oftentimes, even a middle-class American could provide the start-up costs for a small business that sells handmade items or starting a food stand. Yet, occupational licensure laws increase these start-up costs so high that not only are philanthropic individuals less likely to be willing to invest but a lesser number of poor individuals will be funded due to increased costs and limited philanthropy.     

Obtaining a license to become a food vendor requires hundreds or even thousands of dollars in permits and paperwork. Without these unnecessary laws, the start-up costs of a food vendor business would be so minuscule that investment in tasty, authentic food would undoubtedly be widespread.       

As the holiday season approaches, we should be aware of how our efforts to give back to our community might be affected by public policy. We must accept that we cannot change policy overnight, so finding ways to help the poor in a way that circumvents the restrictions of progressive policies is a good start.

I’ll end with my favorite quote from the brilliant documentary, Poverty Inc. “Having a heart for the poor isn’t hard. Having a mind for the poor, that’s the challenge.”

  • Jordan is a 3rd-Year Biochemistry and Cell Biology Major at the University of California, San Diego.