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Comment by cwan | Hacker News Reader

There's probably something to that. I do wonder whether for economists look at something like Walmart and see them doing more social good by making goods more affordable than XYZ charity (and arguably they do). I think when most of us think of "social good" we tend to idealize not for profits more than for profits, but there shouldn't be any reason why profitability doesn't equate to social good - in fact, arguably it does given that revenues by definition require that people want a service/product enough to pay for it.

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This reminds me of something I think about quite a bit. Right now I'm in Los Angeles for just a couple more days before heading off to Taiwan. I've spent a little under a year here in LA, and - there's a lot of homeless people here. Good weather plus forgiving vagrancy laws plus charitable people makes Los Angeles something of a homeless mecca.

I see people giving homeless people a dollar or two all the time. Then I see the same homeless guy getting an 89 cent taco at Taco Bell, or a $1.60 coffee at Starbucks. This whole thing seems like a tremendous waste to me.

Consider someone who gives $1 per weekday to homeless persons. That's $260/year. That buys something like 116 tacos and 81 cups of coffee. Which is nice.

Except - you know how many tacos a proper homeless shelter can cook with a $260 donation? You know how much coffee costs in bulk? I know I was making coffee that averaged me 4 cents/cup for decent stuff in bulk, and it wasn't a crazy amount of bulk. You can prepare a decent full meal for under 50 cents if buying rice, beans, lettuce, tortillas, and meat in bulk. That's a full meal as compared to one small taco.

So y'know, that sucks. It also encourages begging, which is demeaning for the beggar, and can scare, intimidate, and upset people passing by. It's a bad gig all the way around.

So how come people give out $1 per day instead of cut a check for $260 to a shelter? My thought - and it's somewhat cynical - is that people get a "hit of good feelings" when they give the buck away. Writing a check for $260 once a year doesn't give that same hit when you make $50,000. It feels very small. But a dollar every weekday? Oh yeah, that's 260 hits on the "I'm a good person" pipe.

Now, being an economics-minded individual, I'm not going to explain it like this to people who patronize panhandlers. Oh no, I'm quite sure it wouldn't work. Instead, I'm curious to ask - "How could we get people donating to shelters instead of passing out change?"

Hard question. Maybe - just maybe - when you donate, the charity could give you slips of paper to print from your computer to give to homeless people letting them know that food and comfort is nearby. Or maybe we could encourage people to save up and help a specific homeless person get an inexpensive hotel room, shave, haircut, shower, and set of clean clothes once every few months instead of a little petty change every day. Something like that.

It's something I roll over in my mind a fair bit - every time, in fact, that I'm at the Westwood Taco Bell or Starbucks. It just seems like a tremendous waste, as I've volunteered at shelters before and know they can get a heck of a lot better economies of scale and make a heck of a lot more of a difference. And paying people to beg sucks - begging must be miserable for a person's self esteem, and has negative effects on people around too. Much better to give that money to a charity and let a homeless person know where they can get help.

From an economic standpoint begging is just another low paying job. It might look like they are incapable of working in the real world but there is a reason it's not wall to wall beggars in high traffic areas. It's fairly violent and dangerous to keep a high traffic area so I suspect the homeless person feels much the same as a carnival worker. Smile, play nice, and take the chump for all he's worth.

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