Not trying to “trip you up”, but you said your org had “far less income”—surely you know that reserve size is inherently correlated with income.
I don’t feel tripped up. Surely you know (your phraseology) that massive increase in reserves can only come from massive income, and that assessing the size of a necessary reserve has little to do with income but lots to do with fixed outgoings. I’m asserting the reserves are being kept for reasons stated in their own report which are not justifiable by a charity. The reserves are excessive. My point was to counter the false assertion above that such degree of reserves is necessary by any organisation.
A reserve fund like this [of this size relative to expenditure] is critical for operating any entity.
Not critical. Not even usual. Not any entity. Not at 4+ years fixed operating expenses even if no further income ever arose and all staff were retained.
What motivates me is a horror of people making and accepting large expenses from charitable funds. That people accept large salaries to work in the charitable sector because perhaps they could earn as much elsewhere is a different question, it’s the expenses entertainment travel accommodation paid for and accepted instead of the mosquitto nets etc which is very distasteful.
The CEA was merely a prominent example of charitable funds being retained for non-charitable purposes. But I may take up your suggestion in that regard, thanks.
But your headline point, that I seemingly don’t understand “patient longtermism” is I think unwarranted. Two major reasons given by the CEA for the retention of massive reserves are (1) survival in the case of reputational damage and (2) the loss of a major donor.
Neither of these are good examples of “patient longtermism”. They’re bad examples.
What motivates me is a horror of people making and accepting large expenses from charitable funds. That people accept large salaries to work in the charitable sector because perhaps they could earn as much elsewhere is a different question, it’s the expenses entertainment travel accommodation paid for and accepted instead of the mosquitto nets etc which is very distasteful.
I’m not sure I understand this position. Money is fungible. If you think it’s morally acceptable for EA charities to offer high salaries so people take less of a paycut to work in them, then it should also be acceptable for EA charities to offer other perks (directly financial or otherwise) to make their organizations more appealing to work for. (Alternatively, perhaps neither is morally acceptable). At any rate, I’m not sure why catered meals or flights is categorically different from high salaries here, and in the case of in-office meals and flights there’s at least a plausible business justification for them.
I also think this comment from someone else with experience in the (non-EA) charitable sector is illuminating:
I’ve spent time in the non-EA nonprofit sector, and the “standard critical story” there is one of suppressed anger among the workers. To be clear, this “standard critical story” is not always fair, accurate, or applicable. By and large, I also think that, when it is applicable, most of the people involved are not deliberately trying to play into this dynamic. It’s just that, when people are making criticisms, this is often the story I’ve heard them tell, or seen for myself.
It goes something like this:
[Non-EA] charities are also primarily funded by millionaires and billionaires. But they’re also run by independently wealthy people, who do it for the PR or for the fuzzies. They underpay, overwork, and ignore the ideas of their staff. They’re burnout factories.
Any attempts to “measure the impact” of the charity are subverted by carelessness and the undirected dance of incentives to improve the optics of their organization to keep the donations flowing. Lots of attention on gaming the stats, managing appearances, and sweeping failures under the rug.
Missions are thematic, and there’s lots of “we believe in the power of...”-type storytelling motivating the work. Sometimes, the storytelling is explicitely labeled as such, serving to justify charities that are secular, yet ultimately faith-based.
Part of the core EA thesis is that we want to have a different relationship with money and labor: pay for impact, avoid burnout, money is good, measure what you’re doing, trust the argument and evidence rather than the optics. I expect that anybody reading this comment is very familiar with this thesis.
It’s not a thesis that’s optimized for optics or for warm fuzzies. So it should not be surprising that it’s easy to make it look bad, or that it provokes anxiety.
This is unfortunate, though, because appearances and bad feelings are heuristics we rely on to avoid getting sucked into bad situations.
I don’t feel tripped up. Surely you know (your phraseology) that massive increase in reserves can only come from massive income, and that assessing the size of a necessary reserve has little to do with income but lots to do with fixed outgoings. I’m asserting the reserves are being kept for reasons stated in their own report which are not justifiable by a charity. The reserves are excessive. My point was to counter the false assertion above that such degree of reserves is necessary by any organisation.
Not critical. Not even usual. Not any entity. Not at 4+ years fixed operating expenses even if no further income ever arose and all staff were retained.
What motivates me is a horror of people making and accepting large expenses from charitable funds. That people accept large salaries to work in the charitable sector because perhaps they could earn as much elsewhere is a different question, it’s the expenses entertainment travel accommodation paid for and accepted instead of the mosquitto nets etc which is very distasteful.
The CEA was merely a prominent example of charitable funds being retained for non-charitable purposes. But I may take up your suggestion in that regard, thanks.
But your headline point, that I seemingly don’t understand “patient longtermism” is I think unwarranted. Two major reasons given by the CEA for the retention of massive reserves are (1) survival in the case of reputational damage and (2) the loss of a major donor.
Neither of these are good examples of “patient longtermism”. They’re bad examples.
I’m not sure I understand this position. Money is fungible. If you think it’s morally acceptable for EA charities to offer high salaries so people take less of a paycut to work in them, then it should also be acceptable for EA charities to offer other perks (directly financial or otherwise) to make their organizations more appealing to work for. (Alternatively, perhaps neither is morally acceptable). At any rate, I’m not sure why catered meals or flights is categorically different from high salaries here, and in the case of in-office meals and flights there’s at least a plausible business justification for them.
I also think this comment from someone else with experience in the (non-EA) charitable sector is illuminating: