Archive for the ‘Poverty’ Category

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Diana Ayton-Shenker: Fast Forward to a Better World

Wednesday, December 22nd, 2010

Diana Ayton-Shenker is uniquely* passionate about investing in social change… that is, literally investing in social change. She runs an organization that is all about hooking up young investors with worthwhile social venture projects. It’s one of those win-win-win endeavors.

We’ll let her tell you about it, in less than a minute:

* Fun fact: When Diana was 18, she saved up for a vacation in the sunny Soviet Union, where she spent her time meeting with human rights activists and Jewish Refuseniks.

How To Mess Up Your Holiday Giving

Monday, December 20th, 2010

It’s holiday giving time! People who – oops – forgot to donate to charity all throughout 2010 are now scrambling to give away enough money to score some sweet tax breaks before the end of the year. But according to some lady at the Wall Street Journal, there are a lot of stupid things you can do when you engage in last-minute philanthropy.

gift-house-by-howard-dickins.jpg
credit: howard dickens

Let us count the things you should not do, according to Ms. Shelly Banjo:

1. Give impulsively. Newsflash: Charities are falling over themselves trying to get your attention. Good for them, but don’t be a philanthropic sucker. Think about what’s really most important to you, decide how much you want to donate, and engage in some thoughtful charity.

2. Donate stock you’ve held for less than a year. Did you know you can donate stock to some organizations? Did you also know that you can only get a tax deduction for doing it if you’ve owned the stock for more than a year? Now you know.

3. Donate stock that’s lost a lot of value. You can actually claim the money you lost on that stock as a tax deduction, which might lower the taxes you have to pay on the investments that did make you money. If you hold onto the stock and donate cash instead, you get double the deductions!

4. Think you can claim the cost of a fundraiser ticket as a charitable donation. Okay, actually you can do this. But you can only claim the cost above what the ticket is actually worth. (So if you bought $1,000 Knicks tickets to benefit a charity, but the tickets are actually worth $200, you only get to claim the $800 as a donation.)

5. Donate stuff (instead of money) to an organization that won’t use it. This is something only your accountant understands. Basically, the amount you can write off on stuff donations depends on the mission of the organization you’re donating it to.

6. Donate something called a “gift annuity” when interest rates are really low (i.e. right now). Gift annuities are basically donations to charities that earn you a little money on the side. The charity keeps the money you’ve given them, but they pay you interest every year on the amount you donated. So low interest rates mean your payments will also be low.

7. Obsessively stick to charity ratings. Rating sites like CharityNavigator.org and GuideStar.org are helpful when it comes to sorting through the jillions of charities out there. But they can basically only give you numbers. (And numbers liiiiie!) It’s up to you to get the full picture before you shell out for a particular organization.

8. Give to a charity that rents or sells your personal information. (duh)

9. Donate to the wrong donor-advised fund. Donor-advised funds are a complicated way of pooling your money with other investors so that you all save big on taxes while your money or investments go to organizations you all believe in. You don’t have much control over where the money goes after you put it in the fund, so make sure you’re a believer before you join a specific donor-advised fund.

10. Don’t get insurance if you’re on the board of an organization. Congratulations! You’re on the board of an organization. Now you’re partially responsible if that organization does something stupid. Directors and officers insurance exist for a reason.

Now that you’re paying attention, here’s a picture of two Christmas cats hugging to get you in the philanthropic mood:

christmas-hugs-by-tuija2005.jpg
credit: tuija2005

Aww.

Facebook Founders Pledge To Give Away Most Of Their Assets

Thursday, December 9th, 2010

Why wait until you’re dead to make your mark on the world?

  • Mark Zuckerberg and Facebook co-founder Dustin Moskovitz are the latest billionaires to sign on to “The Giving Pledge.” They’re part of a growing number of wealthy individuals choosing to get involved in philanthropy while they’re still young.
  • The Giving Pledge was thought up by Warren Buffet and Bill Gates, who are on a joint mission to get other billionaires to donate the majority of their wealth to charity before they die.
  • Internet and technology billionaires like Gates and Zuckerberg have a special motivation to give – they’ve already built their wealth by trying to change the world.

Facts & Figures

  • More than 50 billionaires have signed onto the pledge so far
  • In 2008, donations in the U.S. totaled $315 billion; in 2009, that number fell to $303.75 billion
  • Zuckerberg recently pledged $100 million in donations to Newark public schools

Best Quote

“Wealth is an advantage, but it also is frankly a responsibility.” – Nicolas Berggruen, Investor, recently signed on to The Giving Pledge

Jumo Picks Up Where Facebook’s “Causes” Left Off

Monday, December 6th, 2010

Jumo.com wants to “do what Yelp did for restaurants.” But do people want to connect with nonprofits as badly as they want to eat tasty food?

  • Chris Hughes, one of Facebook’s founding fathers (and if you watch the movie, they’re alllll fathers), has started a new kind of social networking site all about connecting people to the issues they care about.
  • Jumo indexes charities, projects, and causes to help users learn about them. It also gives charities big and small easier access to potential supporters.
  • Users sign up with their Facebook account, so sharing donation announcements and favorite causes/ organizations with friends is easy. The site also has some familiar Facebooky features – users can share and comment on pages, and see which organizations their friends like.

Facts & Figures

  • Hughes was the Chief Digital Organizer for Obama’s presidential campaign in 2008
  • Only 9% of the $300 billion in donations in 2009 were submitted online
  • Jumo launched with over 3,000 issues and organizations on the site

Best Quote

“It’s still not clear whether or not followers translate to volunteers and donors. But people that are more engaged with nonprofits are most likely to become a donor or support them in another way.” – Steve MacLaughlin, Director of Internet Solutions at BlackBaud, a tech consultancy serving nonprofits

Microfinance Hits A Wall In India

Wednesday, November 24th, 2010

The great microcredit experiment in India was a wild success… but now it’s on the verge of collapsing entirely.

  • Politicians in India are accusing microfinance institutions of taking advantage of poor borrowers, and encouraging borrowers not to pay back their loans.
  • Microcredit is one of the only ways that poor people around the world can get loans to start small businesses. And in India, microfinance has become a booming industry in recent years.
  • Unfortunately, many people who receive microloans won’t be able to pay them back. So the loans tend to be really small, and their interest rates are really high. That means that entrepreneurs who do pay back their loans cover the cost of those who don’t pay.

Facts & Figures

  • Indian banks have about $4 billion tied up in the microfinance industry
  • In the past few weeks, less than 10% of borrowers made loan payments
  • SKS Microfinance charges a 24% interest rate on its microloans

Best Quote

“The money lender lives in the community. At least you can burn down his house. With these companies, it is loot and scoot.” – Reddy Subrahmanyam, Senior Official of the Indian Government

Kiva Partners With Accion To Microlend In The U.S.

Monday, October 25th, 2010

Poor entrepreneurs are everywhere, so why limit U.S.-based microfinance operations to overseas customers?

  • Kiva.org, an online nonprofit that helps anyone make microloans to foreign businesses via local institutions, is expanding its scope to include entrepreneurs in the United States.
  • Through a partnership with Accion Texas-Louisiana, Kiva will start to offer microloans to new and existing business owners in those states. Kiva’s model is a kind of “crowdfunding,” which allows lots of small donors to make a big impact.
  • Microfinance helps poor entrepreneurs get access to loans. These individuals are usually seen as too risky for traditional bank loans, so microloans can greatly increase their chances of success.

Facts & Figures

  • Accion is the third U.S. microfinance institution Kiva has partnered with since October 2009.
  • Less than 1% of the borrowers featured on Kiva’s website are based in the U.S.
  • The average U.S. microloan is about $7,000.

Best Quote

“Awareness of microfinance is really low here.” – Premal Shah, President of Kiva

They Wanted The World To Change, So They Did It Themselves

Wednesday, October 20th, 2010

Ever been frustrated by how slow things are to change, when people are suffering right now? If you’re anything like the latest crop of social entrepreneurs, you may be able to turn your frustration into something much more meaningful.

  • Today’s social entrepreneurs are taking on the world’s problems a bit at a time. Their successes show that it’s not necessarily the biggest, wealthiest organizations who make the small incremental changes that matter.
  • These individuals tend to identify specific problems and then do whatever they can to meet the need. One invented microfinance. Another is focused on making menstrual supplies available where a woman’s period causes her to miss school and work. And another pressures U.S. companies to stop buying from African warlords, effectively funding terrorism and horrific violence directed at women in Congo.
  • They’re often naive at the beginning, expecting too much and consulting with local people too little. And success is never assured. But the rewards are real – both for entrepreneurs and the relatively small number of people whose lives they are changing.

Facts & Figures

  • DoSomething.org provided $100,000 to help 23-year-old Maggie Doyne build a school in Nepal.
  • Lisa Shannon carried 45,000 pennies to Intel’s headquarters, offering to pay the extra penny it would cost Intel to source their materials outside of Congo and avoid 45,000 more violent deaths at the hands of warlords.
  • $300 sends a Nepalese child to Maggie Doyne’s school, with health and dental care included.

Best Quote

“If your own children were born orphans in Nepal, you wouldn’t wait for the U.N. or the government to do something about it while they were hungry and cold and breaking rocks by the side of a riverbed.” – Maggie Doyne

Rising Income Inequality Hurts Everyone

Monday, October 18th, 2010

Research shows that inequality is bad in any number of circumstances. So why are we so reluctant to look at the effects of excessive wage inequality in the U.S.?

  • Unlike economists throughout history, modern economists seem unwilling to address the negative effects of rising income inequality. There is no convincing evidence that shows it supports economic or individual success in America, but experts in this case avoid making value judgments when it comes to money.
  • Studies show that money can buy happiness – up to a point. But because of hugely inflated wages for the extremely wealthy, Americans become trapped in a cycle: their peers spend ever-increasing amounts of money on their lifestyles simply because they can, and everyone who can afford it follows suit.
  • This cycle trickles down from class to class in “expenditure cascades,” until soon enough everyone feels the psychological distress of never having enough. This distress results in higher divorce rates, longer commutes, and voters who are less interested in spending on public services like road rehabilitation.

Facts & Figures

  • In 1976, 8.9% of the country’s income went to the top 1% of earners.
  • In 2007, 23.5% of the country’s income went to the top 1%.
  • Between 1976 and 2007, the average hourly wage went down by more than 7%.

After AIDS, Bringing The Fight To Cancer

Wednesday, September 29th, 2010

“Rich country problems” are starting to be recognized in the developing world.

  • Even though aid money to developing nations has typically been spent fighting contagious diseases like HIV and malaria, public health workers are now confronting a rise illnesses like diabetes, heart disease, and cancer.
  • The fight against noncommunicable diseases isn’t as well-funded, but funding for it has increased since 2004. Even organizations that focus their work on U.S. victims of cancer and heart disease are starting to expand into international aid.
  • One obstacle to greater funding for noncommunicable diseases is simply that donors are used to fighting AIDS and tuberculosis, not heart disease and cancer. Contagious diseases are also easier to prevent than non-contagious ones. The UN’s Millennium Development Goals don’t even address this type of illness.

Facts & Figures

  • 60% of deaths in developing nations result from noncommunicable diseases.
  • Only 3% of the $22 billion dedicated to health aid around the world is for fighting noncommunicable diseases.
  • The United Nations is holding its first high-level conference on noncommunicable diseases in 2011.

Best Quote

“We happily see declines in infectious diseases and unhappily see increases in non-infectious diseases, and donor funding has just not come close to responding to that changed health profile. There is a huge and glaring disparity.” – Rachel Nugent, Deputy Director for Global Health, Center for Global Development

Development Goals In Africa May Not Be Met By Deadline

Monday, September 20th, 2010

The U.N.’s Millennium Development Goals were created to fight poverty and stimulate economies in Africa between 2000-2015, but whether the project will be a success remains to be seen.

  • Several new reports are suggesting that U.N. Millennium Development Goals will not be met by their deadline unless leaders of both developing and developed nations step up their involvement and investment.
  • The goals for Sub-Saharan Africa, which were agreed upon by 190 countries in the U.N. in 2000, include reducing poverty, hunger, disease, and early deaths by a certain percentage by 2015.
  • There are many reasons why the initiative is in danger of failing: Donors have failed to fulfill their pledges, some African leaders have been uncooperative, and many African governments have failed to increase health spending to the mandated 15% of their gross domestic product.

Facts & Figures

  • The death rate for mothers has barely shifted since 2000.
  • The total number of people living in poverty has grown to more than 400 million.
  • The U.S. has pledged an additional $63 billion to improve healthcare in target countries, $3.5 billion for agricultural initiatives, and $30 billion to help countries prepare for global warming.

Best Quote

“Unless an urgent rescue package is developed to accelerate fulfillment of all the MDGs, we are likely to witness the greatest collective failure in history.” – Oxfam

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