Big Dogs and Big Asks 

Walking down Ambrose Avenue with Baxter at my side, I spotted another dog walker coming up the street towards us.

This was my first time walking Baxter since he was a puppy. I didn’t know what to expect, so I cinched up the lead.

Baxter is big and strong – so strong that when he jumps up on people, he often knocks them down. When the doorbell rings, he barks like a mad dog. He’s got a deep, ferocious bark. It’s scary.

But on our walk so far, he evinced none of these traits. His mood was pacific. His gait, like mine, more than an amble but less than a stride. And for an untrained animal, he accepted the lead very well.

Still, I didn’t know how he would respond to this approaching dog. If he lunged at it, would I be able to hold him back?

Welcome, again, to my morning slog, where I work out problems I’m having with all kinds of things, especially the 28 books on my to-finish-before-I-die list.

Today, I’ve been working on a book I started in (maybe) 2008 called The Challenge of Charity. It’s meant to be a series of essays about the very real “challenges” of charitable giving.

 I’m not sure if the following essay will make its way into the book. Any feedback you can provide will be appreciated.

The Challenge of Charity: Why I Don’t Give (Much) to Big Charities 

He’s a good friend of mine. His project – helping recently released convicts return to the “real” world – seemed, on the face of it, a worthy cause.

He launched the program with a friend, a wealthy woman who funded it. But that funding was discontinued after a year. He wanted to know if we (our family foundation) would take it on.

As I’ll explain in a minute, I don’t contribute to large charities. But when friends are involved, I give a token amount, usually $500 to $1000, as a gesture of support.

In fact, I had donated amounts like that to this friend once or twice before, so I was thinking he was looking for a donation in the same range.

He wasn’t. He was asking us to fund the program’s entire yearly budget. “How much was that?” I wanted to know. It was $50,000.

Fifty grand a year is a big ask.

“Isn’t your program part of a larger foundation?” I asked.

It was. A 50-year-old organization with a budget of more than $30 million a year.

“Fifty thou is a tiny percentage of that. Why don’t you ask them to fund you?”

“We asked, but they declined.”

“They turned you down?”

“They did, but they really like us.”

I suggested that they might be bluffing. “What if you said if they didn’t fork up the cash you’d have to close down the program?”

“We tried that. They said they would be sorry to see us go.”

Something was awry.

What was going on?

Here was a seemingly good program run by an intelligent person with a passion for it – and he was asking the foundation for only one-sixth of 1% of their $30 million budget.

To me, the denial meant one of two things: Either they didn’t believe in the program but were too dishonest to say so. Or there were dirty politics involved.

I asked my friend lots of questions about the foundation. He had very few answers. “That’s the frustrating thing,” he explained. “They aren’t forthcoming with that sort of information.”

This is one reason I don’t believe in donating significant amounts of money to large, public non-profits.  Their internal logic is not visible to outsiders (notwithstanding the reports they are legally required to file).

Another, more important, reason is that I cannot control what they do with my money.

These may seem like bad reasons. I don’t think they are. Let me provide an analogy.

If you have read anything I’ve written about wealth building, you know that I have two sacrosanct rules for directly investing in individual businesses:

* Do not invest in a business that you know little or nothing about.

* Do not invest in a business over which you have no control.

Breaking the first rule will often (almost always) result in disappointment. Something will happen – something I didn’t expect because of my ignorance – that will cause the business to underperform or fail completely.

Breaking the second rule will mean that even if I anticipate a practice or policy that could hurt the business or see an opportunity for growth, I can only suggest it. I won’t have the authority to make sure it is pursued or even taken seriously.

Following these two rules has saved me millions by keeping me from putting serious money into dozens of exciting business ideas that have been pitched to me over the years.

Because non-profits operate very much like a business, I’ve found that the same two rules work with them. I want to know how the charity works from the inside out before I consider “investing” in it. And I want to have some control over what they do with my money.

I do that because of a fundamental belief I have about giving people money: More often than not, it is a bad idea. The benefit it gives in terms of financial relief is more than offset by the damage it does in terms of entitlement, dependency, and other unintended consequences.

These are not theoretical deductions drawn from things I’ve read. They are conclusions I’ve come to after dozens (if not hundreds) of personal experiences with charitable giving.

So as much as I wanted to please my friend, I wasn’t going to give him a big yes to his big ask. I could have told him what I just told you, but I was afraid he would see that as disingenuous. He might think it was an excuse I was coming up with because I was either critical of his program or just plain cheap. I needed to shift the conversation. I needed to take another tack.

To be continued with my next slog. 

Meanwhile, back to Baxter…

As it turned out, Baxter didn’t flinch. The other dog, a cocker spaniel, started barking furiously and charging at him. But Baxter acted like, “You are too small for me to even acknowledge.”

On the way home, there were other similar “attacks” – all by smaller dogs. It seems to me that smaller dogs are generally more aggressive than larger ones.

Is that true? And if it is, is it also true of humans?