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Effective Altruism Is Good - Changing the System Is Better

05/08/2015 22:36 BST | Updated 05/08/2016 10:59 BST

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People deserve to earn a fair income for their labour so they don't have to rely on charity. Americo Cordoba, worker at Finca Altamira banana plantation © Rogier Fokke

Effective altruism, the smarter way to do charity, is trending. The essence, as argued in William MacAskill's new book Doing Good Better, is to put your money where it will have the greatest impact in terms of lives saved or significantly improved.

So far, so good. The causes that the effective altruism movement champions are among the least sexy, most often overlooked, but most crippling to the world's poorest people: malaria reduction, de-worming, iodine deficiency. This approach places human lives equal in value and has us consider carefully how we can make the greatest difference, regardless of whether the recipients are in our own neighbourhood or a slum on the other side of the world. Take as much care, urges MacAskill, in donating your money as you would in buying a computer. Sound advice.

What is more, MacAskill urges young people to think of innovative ways to make a difference to the world, including through social entrepreneurism. But then he takes the argument one step too far: Why work for a charity trying to change the way the world works when you could be an investment banker and donate more cash?

The critical problem with this approach is that it is strangely naive and blind to political economy. It does nothing to address the underlying structures of power that keep the poor poor and the rich rich. This will leave us forever in a world where the privileged few earn copious amounts of money and then choose how they want spend it, even if to benefit the needy - who are left relying on the goodwill of others forever. This is a charitable version of Peter Mandelson's famous phrase that he was "intensely relaxed about people getting filthy rich - as long as they pay their taxes."

But in all my travels, in all my conversations with hundreds of farmers from all over the world, I have yet to meet one who would favour this approach. The opposite. As Rosa Guamán, inspiring leader of the indigenous women's cooperative Jambi Kiwa in Ecuador, said forcibly: "We don't want charity, we want dignity."

Farmers and workers want to earn a fair price for their labour. Just as much as your investment bankers, they want to make their own decisions about how they will invest in their farms and families, cooperatives and communities according to their greatest needs and priorities.

"Pay us a fair price for our coffee, and we will make poverty history for ourselves," Raymond Kimaro of Kilamanjaro Native Co-operative Union famously told the G8 delegation in 2005.

What is more, research is piling ever higher to show the negative consequences of being relaxed about uncontrolled wealth creation - because it is creating a world so imbalanced that it is simply unsustainable. It is not just Oxfam and the Pope, but also the likes of World Bank, OECD, World Economic Forum and IMF who are now coming out against income inequality.

According to a ground-breaking report the IMF released in June, not only does "trickle-down economics" not work, but extreme income inequality actually slows economic growth. It leads to under-investment in education, health and infrastructure - all of which boost productivity and benefit the poor. And the larger the income gap the less social mobility there is, so the poor stay poor and the wealthy keep their wealth, thank you very much.

You only have to listen to HSBC wondering aloud in the UK press about whether they will stay in London given all the taxes, to feel their power over government. Or to look at London housing prices to see what happens when some people have so much wealth that they drive prices out of reach for most people.

MacAskill says that trade unions may not like it but sweatshops are good for jobs. This again ignores economics in practice. Sweatshops are not a stepping off point for people to work their way into the middle class. They keep people trapped in a cycle of poverty. Therefore trade unions, and human rights organisations, a growing number of economists, and Fairtrade International, believe that workers and economies do indeed need jobs - but they need better jobs, with proper health and safety, paying proper wages. Which is perfectly possible because we can all afford to pay a little more for our clothes.

Then workers would not need charity, they could simply earn a proper wage. And then you can create a more balanced society because people would have their own earning power, all of which they would spend in their local economy thus generating more jobs and more growth.

So let's all keep donating, and donating more wisely in ways that will bring the greatest good to the most people. But let's not stop there. Let's all keep thinking of how to challenge the systems of power that keep marginalised people from receiving their due. Let's listen to and work alongside them, rather than 'for' them. Let's get active working for a cause that can help bring lasting transformation in society. And let's keep reaching for Fairtrade!