Charitable intentions

By Ezra Butler on June 26th, 2012

The information superhighway to hell is wired with good intentions. Over the past few weeks, two internet charity drives have garnered insane amounts of both media attention and cash over here in the United States. The first is The Oatmeal’s charity “Bears Good, Cancer Bad” charity campaign to help bears and fight breast cancer and the second is the campaign to give a bullied school monitor, Karen Huff Klein, a well-deserved vacation.

It must be stated, at the outset, that I understand why Matthew Inman and Max Sidorov, the progenitors of the campaigns, took action. Mr Inman sought to end a ridiculous lawsuit in an amicable way. Threatened with a defamation suit, he offered to donate the money to charity instead. Mr Sidorov saw a bullied woman and wanted to show that people can do good as well as bad.

Both campaigns were launched on Indiegogo, aiming for $20,000 and $5,000 respectively. They both flew past the intended sum at a breakneck speed, and continued to climb higher, attracting the attention of bloggers and traditional media alike.

The two campaigns share a commonality. Perceiving an underdog, the community has overcorrected by a wide margin. Reading through the comments placed, publicly, next to donations by Indiegogo, one is shocked by how many donors mentioned that despite financial hardships of their own, they are giving what they can. Were it just the early donors, one could understand. But these include donors who donated after the campaign had passed the $100,000 mark.

A needy donor’s $5 would not do a lot, but he now has a story he can tell about how he helped a bullied grandmother purchase a small bully-free island. And yet, how many conventional charities will have lost out thanks to our hard-up donor’s need for public recognition of his virtue? How many vaccines did his vanity cost?

The two cases are also quite different. In Mr Inman’s case, he was himself the reason people donated in the first place. In the bullied 68-year-old grandmother imbroglio, Ms Klein is the main attraction. When Mr Inman saw the influx of money, he decided to spread the donations to more charities. When Mr Sidorov suggested a similar route, he was overruled by the donors, even though his suggestion was to fund anti-bullying education for schoolchildren. All the money will go to Ms Klein.

Indiegogo has a financial incentive to push donations, not only for the advertising dollars. From fully funded drives, Indiegogo collects 4 per cent of the proceeds. That means that from Ms Klein’s public embarrassment, Indiegogo has earned more than $24,000. If the amount collected reaches a million dollars, they will scrape off a tidy $40,000.

In 2010, The United States Supreme Court ruled that, in effect, money equals speech. Just as the First Amendment to the Constitution give freedom of speech to all, without fear of fine or imprisonment, so can citizens now make as large a political donation as they’d like, under the aegis of “freedom of speech”.

It seems like the glut of political petitions which filled the internet of yesterday have been replaced with these viral charitable campaigns, because they seem to donors to accomplish more. People are voting for the apparently downtrodden with their credit cards: a dollar for Ms Klein, in the mind of the masses, is a dollar against bullying. Will political fundraising suffer, as it fails to provide the same warm glow of self-appreciation to donors?

Every time there is a big ticket lottery winner, newspapers race to interview financial experts who, without fail, regale the journalist with stories of lottery winners who frittered away the millions they won. In the case of Ms Klein, the question must be asked: who will ultimately benefit financially from her windfall? Will it be to Ms Klein’s ultimate benefit or detriment? Were the vacation to be redefined as retirement, would she ever be able to spend the tax-free million dollars she will probably receive from this campaign? Or will it ruin her life and relationships?

Ms Klein is now informing interviewers she will purchase automobiles for her children, invest and probably donate to charity. Some donors are expressing manufactured outrage at the thought their hard-earned money will finance a car for the children of this newly viral celebrity. But what did they think would happen when they carried on donating long past the fundraising target?

It is Ms Klein’s right to spend her money in whatever way she sees fit. It is alas not the donor’s right to complain that a 68-year-old woman who previously earned $15,000 a year doesn’t know how to blow a million dollars on one envy-inducing world tour.

Mr Inman may have proved his case in the court of public opinion by raising over 10 times the request of the original lawsuit, but do the charities he has selected need the money? The American Cancer Society is the wealthiest charity in the world. Its chief executive earns $2.2 million a year. 28 per cent of their fundraising efforts are earmarked merely for “future fundraising, management and general administration”.

Meanwhile, the National Wildlife Foundation enjoyed revenues of nearly $100 million in 2010, with roughly 20 per cent going to “support services”. Are they underdogs, or a convenient punchline to a joke?