VC > EA

Venture Capital is a more effective route to a better world than "Effective Altruism".

Let me immediately say that purchasing mosquito nets for the third world is fine. It’s not evil. There’s nothing bad about it. But if one has $1000 or more to “do some good” with, that might not be the best way to improve the world if it’s lives you want to save, people you want to help, the flourishing and overall well being of the world that you wish to increase over the longest time frame and so on. Including, perhaps especially, if you grant the premisses of the EA community.

I have written about “EA” before: http://www.bretthall.org/blog/effectively-altruism-isnt-generosity and have found that it is motivated by very religious notions of how to live a good life: http://www.bretthall.org/blog/mainstream-morality Particular kinds of religious practise and doctrine are indeed a stabilising force in the world; deeply implicated in the explanation for why some societies remain stable despite rapid progress over time while others fall into stasis and extinction. It is of course possible to have too much of a bad thing. The point is with a system as complex as a human civilisation, much like a biological ecosystem: there remains much work to do to actually explain what allows for rapid change - in particular change in the right direction that we call “progress” without the whole thing falling into ruin. A sprinkling, or in some cases an entire cupful, of religious culture may help things along while we figure out how everyone can do without any part of it. In the meantime culture - including aspects of religion - contain "inexplicit knowledge" in the same way many other institutions do. We cannot always explain how it works - we can just notice that it does, and when those institutions are absent, things are objectively worse.

But for my purposes here and now that is all a side issue. It is only connected to my claim here insofar that not all residual religious doctrines do good work in the world. The main one that undermines the intellectual “atheist” culture is their deeply rooted belief in the facility of altruism. The idea that one should give, then give a little more until it hurts. Or to give without hope of anything in return. Now at best this can indeed be good for a limited number of people for a limited amount of time. But once that money is given away it is spent and gone…if it is not an investment. 

One might well say that, for example, purchasing mosquito nets amounts to investment in the creative potential of a person. Perhaps. But how many people involved in, for example, the EA efforts to do this good work follow those lives saved through to their flourishing potentials? Does such a system, to use that modern piece of jargon “scale”?

What if we wanted to do more good for more people that did “scale”?

If you had asked me two years ago what “VC” even stood for in finance, I’d have had no clue. I'm not a finance person. I knew about EA though. I guess it depends on what circles one moves in. But “charity” is absolutely something that every child learns about on mother’s knee and in the classroom no matter how young. “Investment” is, at best, a technical term left for economics class in senior school: if that. And it’s something only the very wealthy apparently do. And more than all of this, it is, at best, morally neutral - so we learn. It does not have the social and moral cachet that “charity” does. Charity is virtuous. Investment is polluted by profit. Profit is a dirty word in socialist circles. In many places it is almost indefensible. Why should anyone ever possess more than the bare minimum when others go without? And what are they doing with it anyways? Why don't they give it to charity?

And yet it is, and always has been, investment that has made the great strides in progress. These days those who invest in start ups - those who look for return on investment so that interactions are positive sum and no one thinks they are getting “something for nothing”. Charity might be good as a stop gap when looked at from the widest possible view if what one is interested in is the improvement of civilisation and the overall well being of people. But as with social services, if charity comes to be seen as something like a natural feature of the urban environment, people will become reliant upon it. Whole societies may. And no material improvements made - or rather far slower progress made - as people move from day to day without seeing the world around them and their lives in particular getting better - but rather just survive rather than thrive. We should observe, of course, rather too many people are told over and again that their lives are no better year on year or generation on generation. Even the conservatives make this point - erroneously. They claim "real wages" or some such have not increased meanwhile everyone carries a wireless supercomputer mainlined into the entirety of global knowledge in their pocket and able to order food utilising a Global Satellite System to locate them anywhere on the planet.

Investment is the thing that enables us to not just get through the day but to see what tomorrow can bring. There is a goal. Superficially both charity and investment might seem similar: someone is getting some money from someone else. But charity and social welfare expect nothing, or at least nothing but some bare minimum. Investment is money that says: I’ve listened carefully, I’ve heard you and I agree that you’ve a good, creative and interesting way of how to make things better for everyone: you and I included. This is a plan for progress, not stasis. You've found an interesting solution.

Venture Capital and investment more broadly is what helps provide the wealth to fuel progress. It does not simply give people the means to tread water. It does not pretend that the person drowning in the shallow pond beside you is identical to the person suffering on the other side of the world. It actually has behind it a philosophy of wealth creation and progress that says: if we want to improve the world thereby eliminating all suffering eventually - then solving the problems that lead to suffering is not merely a matter of gifting money to those less fortunate. It means creating the conditions in the world where knowledge and technology is created here so that it has great reach even into the lives of the people one will never meet and one never intended to help except as a side effect. And, the key here is: it works so much better when you don't concentrate just on "helping people". Steve Jobs was not primarily interested in "helping people" with computers and smartphones. But he has helped far more people than the projects of EA ever can. 

We - by which I mean human civilization - can now feed almost everyone on the planet. Almost no one is starving. And whatever number is starving is decreasing all the time and will continue to decrease to zero as long as people are not thwarted from creating wealth. This problem of "starvation" like so many others, has not been solved by trying to be more effective in our altruism and gifting charity to where it is “needed most”. It has been achieved by investing in the solutions of how to produce more food more efficiently on land previously incapable of being productive. And that has taken knowledge. And the production of that has taken investment. 

That’s the lesson. And that’s why VC >> EA.