This is a guest article by Kevin who writes at Invest It Wisely.
What is the difference between receiving aid from a charity, and receiving aid from a government? Are they both the same, or is there a qualitative difference between them? Without going too deep into the differences, one can say that the most significant difference between the two is that one is given freely from the heart, while the other is given from people who contribute because they must.
What is the difference between volunteerism and forced giving? Read on to find out more and read about Mickey’s adventures, as he grapples with both.
A Tale of a Traveler, a Poor Woman, and a Scheming Farmer
Once upon a time, in a very distant land, there was a man named Mickey who lived on an island. Every week, he traveled from his house on one side of the island to the market in the town of Silenia, on the other side. One day, a series of heavy rains washed out his normal route, so he was forced to take a side route to the market.
As he walked down the road, he came across a poor woman living in a dilapidated hut. There were three dirty children playing outside, and some empty whiskey bottles lying nearby in the ditch.
“Sir, won’t you please help us? I have barely anything to eat and the kids are hungry!” she called out to Mickey. Her name was Denise. Mickey saw that the kids could use a bit of food, and his heart went out for them, but he didn’t have much food to spare. He also didn’t like what he had seen in the ditch, so he didn’t want to enable the woman’s habit by giving her coin. “Ma’am, I have but some dried bread and meat to spare, but I know of a charity in town that will be able to help you out; I know that they will help your children, and they will ensure that your needs are met.”, Mickey told her, and after sharing his food with her and the children, he was on his way again.
An hour later, Mickey passed by a corn field. The farmer was sitting outside his house, next to a stand of corn and a strange looking machine. “Sir, you look famished! Come over here and have some corn!” the farmer called out to Mickey. Mickey was curious, so he stopped on by to talk to the farmer. The farmer, whose name was Gorian, welcomed Mickey, and offered him some freshly steamed corn.
“Sir, would you like to invest in a great money-making opportunity? You see this machine here? Well, corn goes in one end, and ethanol comes out the other!” the farmer told Mickey. This was the time when gasoline-powered automobiles were starting to be used, but many people (like Mickey) did not yet own one. “You can mix that on with gasoline and power your car with that! No need to import from Zorland!” Gorian said.
Mickey’s curiosity was now stoked, so he asked Gorian if he could write up a business case for him. “Well, let’s see here, I put in this corn, and the price of gas is this much, so I can sell my blend for this much and make a profit!” the farmer told Mickey with glee. Mickey deliberated over the numbers, but didn’t feel quite at ease. “Now, wait just a second… you didn’t consider costs for fertilizer, or for plowing the field and harvesting the corn. Once you add in all of those factors, I would be surprised if you have any profit left over at all!” he exclaimed. “I’m sorry, but I’m just going to have to pass. If I were you, I’d keep that corn around for food!” he told the farmer as he continued on his way.
Mickey went into town, got what he needed at the market, and stopped by his favorite charity to donate and to let them know of the woman. They promised that they would help her and see to it that her children were well fed. Mickey then headed back home the same way that night, and did not see Gorian or Denise on the way back.
A week passes…
As the week passes by, the charity visits Denise, and works with her to help her get back on her feet, kick her habit, and provide for her children. She appreciates the help, but resents the charity’s moralizing. “What kind of right do they have to tell me how to live my life? It’s my business to decide, and nobody else’s!” she thinks to herself.
The week wasn’t great for Gorian. He managed to swindle some money out of an investor, but the investor has subsequently sued him, and he now has a court case in a few weeks. “Forget that court! Don’t they see how important it is to reduce our reliance on Zorland’s exports?” he thinks to himself.
Some other people traveled the same path during this time, and one of them was a scheming thug named Borat. He came upon Denise, who approached him in the same way that she had approached Mickey. “Sir, spare some change for the children, please…?” she asked. “Bugger off woman…” he replied. “Sir, please!” she begged. Borat thought for a bit, and then had an idea.
“Woman, I’ll get you some money… but in return, I want some tribute. You don’t have much to spare, but you have two hands. Every time I pass by, you shine my shoes and give me a nice shoulder massage. In return, I’ll get you some coin!” he told Denise. Denise was reluctant, but then she thought to herself “Well, at least I won’t have that pesky charity moralizing at me and telling me how I should live!”, and with that, she accepted Borat’s offer.
“Has anyone else passed by these parts lately?” he asked her. “Yes, there was one man who passed by last week, but he only gave me a little bit of food.” she told Borat. Borat then continued on his way.
Borat then approached Gorian, the ethanol-peddling farmer, and rejected his investment idea. “Promise to feed me some corn and give me some of that ethanol every time I pass by these parts, however, and I’ll find a sucker for you!”, he told Gorian, and another deal was struck. “You know what, there’s this one guy in particular… he came this way last week. Maybe he’ll come this way again…” and Gorian gave Borat Mickey’s description and name. Borat then camped out a little ways down the road past Gorian’s farm, and spent a couple days there camping out, waiting.
An unsuspecting traveler travels down the same way…
It was the end of the week, and it was time for Mickey to make his trip to the market, again. He filled his purse with coins and headed down the same way he took last time, as the other road had not yet been repaired.
He passed by Denise again and noticed that the hut was improved and the kids looked cleaner and healthier. He again gave her some food, but due to her habit, was again reluctant to give her actual coin.
Mickey passed by the same farmer as before, but this time, instead of an offer of free corn and an investment pitch, he received nothing but a scowl and a warning to stay off his land.
Mickey was nearing town when a tall, burly man stepped out into the middle of the road, forcing him to a halt. The man was Borat; Borat had been waiting for Mickey to pass by. “What’s the trouble, man?” Mickey said to Borat. “The problem is that you are a very greedy man, Mickey. Yes, I know your name and I know who you are. Twice now have you spurned that poor woman and her family, and you refused to help Gorian! Don’t you know how important it is for us to be independent of fuel imports from Zorland?” he boomed at Mickey.
“Well, I, uh… well, I’ve helped that woman plenty! I had a charity provide her with direct aid, and as for that farmer, his business is nothing but a scam! Wasteful of resources, I tell you!” Mickey said in disbelief. “I’ll now be on my way sir, if you don’t mind!” he said to Borat, as he tried to walk around him.
“HOLD IT RIGHT THERE!!!” Borat yelled in a rage, as he pulled a shotgun off his back and aimed it directly at Mickey’s chest. “I’ll make you an offer you better not refuse. You give me half of all your money right now and I’ll let you walk. Otherwise, you can kiss the tip of my shotgun right here and say goodnight, and I’ll just take all of it!” he said to Mickey, in a deadly calm voice.
“What right do you have to do this!? You have no right to take my money!” Mickey said in a rage. “Yes, as a matter of fact I do; do you remember Denise and Gorian? Well, I work for them, now, and anyone who passes through these parts has to pay up!” Borat said. “What! I never agreed to that!” Mickey replied. “Well, you better believe it! I believe it’s 2 against 1, so it looks like you gotta pay up, buddy!” Borat said, as he pushed the shotgun into Mickey’s chest. “Well, I guess I have no choice in the matter.” Mickey said, as he emptied out his coins. There were 20 gold coins in there, and he handed 10 of them over to Borat. “Thanks, my friend, and I’ll be keeping an eye on you!” Borat said, as he smiled in triumph. Mickey walked on toward town, feeling nothing but disbelief, disgust, and rage.
A distribution of ill-gained rewards
Borat was quite happy with himself, as he whistled to himself as he walked down the road. “You know, I can’t do this thing forever. Denise and Gorian might tire of paying me tribute, or Mickey might come after me seeking retribution and revenge. I think I had better keep 6 of these coins for myself. I’ll let Denise have 2, and give the other 2 to Gorian.” Borat thought to himself.
He saw Gorian first, and gave him his two gold coins. “What, that’s it?” he exclaimed. “It’s better than nothing. You better take it and keep your trap shut, if you know what’s good for you!” Borat said in reply. “All right, all right… I’ll let you have more of my corn if you can get me more coin! With this coin, I can lower my prices and compete!” Gorian said, as Borat walked off.
Borat then passed by Denise, and handed her two coins. “Wow… you know how many bottles and how much jewelry I can buy with this?” she said to Borat. “I don’t care, woman, so long as you pay me your tribute every time I pass by!” Borat said, as he went off into the night.
He was feeling good about himself; he had managed to improve the lives of a couple of his fellow citizens, as well as gain a nice nest egg for himself. Borat was considering whether to keep the money around for his retirement, or simply go into town and have a wild night. He continued to fantasize as he disappeared into the distance.
Mickey was already taking his case up with the court, but it turned out that the “thug” was well connected and could not be touched. He forced himself to take the washed-out path home, even though it was muddy and slippery. “How dare that thug rob me like that… no respect for my rights at all!” he thought. The next time he saw a poor family, he was so embittered by his experience that he shoved them out of his way. “I’ve had enough of you and your kind!” he said in disgust.
Moral of the story
This story shows the difference between how a charity operates and how a coercive agency operates. There is a difference between giving aid and money voluntarily, and being forced to give it. Borat is the most simplified example of redistributing wealth by force, instead of it being redistributed voluntarily.
We can see this kind of difference in our everyday lives, as well. For example, we have many charities around the world today, to which we can voluntarily contribute. We also pay taxes to the government, which is then used for various social goals. The difference between government aid and charity is that charity is voluntary and given by willing people to those in need. Government aid is simply pooled wealth that has been collected under penalty of jail time and asset confiscation. There is a moral difference between the two.
Wealth redistribution by force causes issues for both the giver of wealth and the receiver of wealth. The giver of wealth is forced to support programs that he/she may not necessarily agree with, such as programs to drop bombs on other countries, programs to subsidize corn ethanol production, and programs to erect huge tenements for the poor in the name of social segregation and planning. Some people would take offense to this, while others would support it, but there is no choice in the matter.
The receiver of wealth also has to deal with some moral issues. If I asked you if it is OK to accept charity from a thief, what would you say? When it comes to accepting government aid, you need to also accept the fact that people were forced to give up some of their wealth in order to provide that aid for you. Some of those people might not necessarily agree with that, but they had no choice in the matter.
We are dependent on each other, but the best way to promote a healthy balance between that dependence and individualism is by respecting property, encouraging voluntary interdependence, and by nurturing a mutual respect for each other. It’s important to keep the moral distinction between voluntary aid and coerced aid in mind lest people equate the two.
When it comes to government aid, the best you can do is ask yourself if the money will be put to better use than it would have had the government spent the money on something else, since the money has already been taken from the people. What you can’t do though is ever compare it to help and money given voluntarily, by a willing person, out of the kindness of their heart.
As fellow blogger Joe Plemon said on his blog post Four Lessons From Some Wealthy Beggars, “One element of volunteerism that is totally lacking in government assistance is the four letter word “Love”. With volunteerism, the giver is offering love and the recipient feels loved. With government aid, the giver feels like he has been hi-jacked and the recipient feels entitled.”
For that reason, voluntary giving will always be superior to government aid, because it is given out of the freedom of the will, rather than taken from people who may be willing or not. Nothing can beat the feeling of voluntarism, whether you are the giver or the receiver. Indeed, being the giver can be the best feeling of all.
Kevin currently lives the white collar lifestyle, but his real dream is to get out of the rat race one day. He enjoys exploring unvisited places around the world and gaining new experiences. He believes that by properly managing our energy and time, we can learn to invest our lives wisely.
