Compassion and the Private Sector

Compassion & the Free Market

Proposal for creating/sparking a non-profit grassroots organization promoting the private sector as the best arena for solving social problems.



Create and grow a new branch of the free-market movement that explores, showcases and celebrates private sector ideas and solutions for social problems and the ways in which people and organizations voluntarily demonstrate compassion, create community, and help others constantly.  Change perspectives on compassion and the free market – to be measured by counting participants, followers, and people who respond to outreach efforts (measure likes, audience, reach, shares, donations, press, interviews). Aim for 50,000 year one.




Government is widely and mistakenly seen as a benevolent provider of compassion and also as the only means in which to help those in need. The paradigm that “government is good and the free market is bad” is widespread and damaging.

Viable solutions and tangible results are overlooked, and often wither and die despite being valuable to society. There is a lack of awareness that the private sector encompasses individuals, non-profits, for-profits, and social enterprises, all of which regularly contribute resources towards solving and reducing social problems. This lack of understanding results in many people endangering the innovation, freedom and creativity needed to address social problems. Codification in a government function dooms us to a slow rate of change, de-humanization of charity, waste, and the same types of failure that existing in the free market, only longer lasting and more damaging. (cite Mark Pennington)

To date, ”pro-market” organizations and people have battled to communicate the message that the free market provides more well-being to everyone and is the best structure to ensure all citizens prosper. Many organizations are advocating a reduction in the functions handled by government and its growing presence in all aspects of life.

However, their standard arguments do not penetrate most people’s minds, as they fail to get past the  belief that somehow government is the only conduit for ‘good intentions.’ Benevolent intent behind new bills and pieces of legislation trumps reason every time, (cite Arthur Brooks). They tend to focus on government’s inefficiency, its coercive nature, discussing whether a particular bill will actually do what it is intended to do, etc. Alternatively, they will approve of people’s freedom to shape their own destinies on an individual level and leave it at that. They rarely showcase or promote free market alternatives to a particular issue in question, but instead reject government as a solution and leave the alternative at ‘the free market will sort it out.’


“Economic freedom produces unimaginable material prosperity, but it’s also the only economic form that encourages individuals to freely pursue their destinies, develop the character of self-responsibility, and strengthen communities.”

— Congressman Paul Ryan

“Only free enterprise encourages and allows each of us to define our destiny and earn our success.  Only free enterprise encourages true fairness based on merit and opportunity. And free enterprise is the only system that can lift up the vulnerable and those who have fallen on hard times by the millions—by rewarding entrepreneurship and encouraging charity.”


—  Arthur Brooks

I believe that most of us who live beyond survival mode, those with enough resources for food, shelter, and basic security, are compassionate by nature to others. Both Paul Ryan and Arthur Brooks above mention community and helping others, but don’t go so far as to contrast what is seen in the voluntary part of society to that which is legislated or run by government.


I believe human beings have a moral and instinctive desire to help our fellow man. Fellow man may mean family, colleagues, peers, the local community, people in other countries. But in any case, evidence is widespread that human beings who prosper at some level voluntarily do contribute to their wider community. Very few of us are true individualists, able and willing to live entirely for our own benefit. These examples, existing all around us are the area that requires study, encouragement, publicity, and attribution to individuals acting freely, ergo as part of what we call the free market.


Supporting community, charity, compassion and helping others is something that lives and breathes and thrives in the free market in millions of ways every day. The free market means the part of our society where individuals voluntarily create and exchange.


Examples of Free Market solutions to explore, showcase and celebrate as part of private sector:

–       Toms Shoes – social enterprise that has embedded into its for profit company a core goal of helping poor children around the world in a practical way – providing shoes. Voluntary exchange, voluntarily created organization. Buying a pair of their shoes is also a contribution.

–       Beito – From Mutual Aid to the Welfare State – historical analysis of how some current social need functions of government (i.e. unemployment benefits) were handled successfully by the private sector.

–       Churches, Synagogues, Elks, Kiwanis, Rotary, Girl Scouts, soup kitchens, homeless shelters, corporations (Starbucks gave $250,000 to Oklahoma tornado relief last month), religious organizations…

–       Non-profits such as Care International, Oxfam, Catholic Relief Services –offering  microloans through village savings groups (Mutual Aid societies of modern day? ) that create sustainable cycle and fund more loans (social enterprise)



  1. Spark conversation, dialogue, and discussion on the ways individuals and groups of individuals (through non-profits, social enterprise, for profits) are helping to address social problems and have alternatives to government codified programs.
  2. Create and disseminate materials and a structure for others interested in this topic to use to start discussion groups, meet ups, grassroots organizations, pages.
  3. Create a way for people to contribute content, stories and examples of free market compassion that can be shared and explored as examples of innovation and results.
  4. Create and expand this premise into a body of work that can be published on this topic – Compassion and the Free Market
  5. Tap into grassroots for engaging, innovative content – video, audio, humor – crowdsource effectively messages that will resonate with people.



  1. I am looking for people interested in working on a team to develop and expand this premise and also look for and possibly counter objections. Also looking to determine the best for-profit parallel organization to create a sustainable income stream beyond donations
  2. I need a research assistant who can verify sources, examples, stories and ensure our work has integrity and doesn’t become simply another blind belief system.
  3. $200,000 – funds for 12 months for initial research, outreach, organization. 2 people…



“Doing nothing for others is the undoing of ourselves.”
― Horace Mann


“Compassion is not weakness, and concern for the unfortunate is not socialism.”
~Hubert Humphrey


“Why are the Agreeable Anti-Market?”  – Bryan Caplan blog post


Humans – naturally happier when they help others?


Helping those in Need – Arthur Brooks


Liberals and Markets – Bryan Caplan


“Homeless to Harvard” – a community came together to provide for a high school student, outside of government. Example of human nature and compassion


Portrait of a Modern Feminist: Amity Shlaes – historical analysis of Calvin Coolidge as president and prosperity from reducing government





Poverty Relief – government programs vs. private

Mark Pennington.  Robust Political Economy

My notes on reading the part on Poverty Relief –

Universal system of poverty relief vs a mosaic combining private mutual aid societies and charity.

Common objections against private sector –

won’t be enough charity and help. People won’t voluntarily help.

Won’t be the right kind of help – community – people fund their local community, not poorest that need most help. people/communities who need help may not be good at getting it (I’m thinking Mountain View PTA here vs. other schools, Malcolm Gladwell’s bit about middle class teaching their kids to get what they want and Oppenheimer example).

People won’t help themselves. People forced to pay social security for example, won’ t have discipline on their own to do it privately (will spend it, not save for old age).

Moving welfare aid back to private sector – Steve DeCanio’s thought:  it’s too late; no savings, no family ties, bad schools, people not used to looking after themselves and won’t be capable of doing it.  A lot of what helped people in the past no longer there.

Is poverty alleviation a collective good? with a small number of causes? Or an individual condition that takes individual action to alleviate? Is a “War on Poverty” a damaging paradigm that de-emphasizes individual effort?

Voluntaristic form of collective action = less susceptible to moral hazard. Gov’t schemes – you get vested interests needing status quo,  and supressing innovation

gov’t vs private anti-poverty schemes.

1. countries with no gov programs do not necessarily have more poverty:

Hong Kong (no gov’t) – same as Sweden (high gov’t relief)

Sweden (high gov’t relief) has less poverty than France (comparable gov’t relief)

“A voluntarist approach combining mutual aid, one-to-one assistance and donations to charitable bodies would enable a plurality of actors, each with specialized knowledge, to tailor their poverty alleviation efforts to specific individual contexts” p 164

universal solutions stifle innovation and macdonaldize the issue. Like healthcare. (Alternatives to status quo very difficult to test and even more difficult to take hold. Would Kahn Academy,, Tom’s Shoes,  ever have been possible through gov’t?)

Compassion and the Free Market part 1

Here is what I wrote September, 2011…Going to pick it up again now!

Compassion and the Free Market

1. The Free Market is perceived as brutal – ignores losers
It seems to me that the free-market rationale debunking government intervention, entitlements, and the ‘I’m here to help’ government role is missing something. Free market arguments while logical and supported, comes across as brutal – while the free market brings greater benefit/prosperity to people overall, the losers are usually dismissed without being addressed. I find this a bit of a paradox, as here we are, understanding that more people will be helped overall, but not addressing how the losers (the Detroit auto workers, the unemployed who will have to stop watching TV and get a shitty job J, the uninsured) will be taken care of by the private sector if the public sector doesn’t do it.

So while free market solutions are usually the most compassionate options, it rarely shows. This struck me years ago watching Johan Norberg’s “Globalization is Good” video – he shows us people in Kenya, Taiwan, etc., but it would have been even more compelling if he addressed the losers of globalization – perhaps contrasted a Detroit autoworker or manufacturing worker in the US and what they were going through after losing their job, what resources they had available, what options they had, compared to the Malaysian rice paddy worker if they lose their job.

2. Compassionate people support government solutions
I think that so many of the well-off stick with the Liberals because their perception is that Liberals provide the more compassionate choice, the only choice that helps out those less fortunate.  And I don’t see anything out there offering them better, free market alternatives for their compassion, ones that actually go beyond ‘feel good’ and provide evidence or results.

3. The Free Market is perceived as inadequate for charity/assistance
Usually I hear a general argument that private charity is sparse and most people are selfish, so people will be dying on the streets if the government didn’t fund/entitle/help out.. But haven’t we seen a massive shift in the last 2 decades, in terms of ‘corporate social responsibility’, the number of charities and non-profits popping up, shown on every soup can and cereal box?  You can hardly buy a product nowadays without some $ going to charity. Is this still true that private charity wouldn’t be enough? While morally I am against government force being used to take from people to give to others against the donors’ will, can’t we also make a case for private doing charity better and thus more compassionately than public sector?

4. Little awareness or discussion of existing compassion in free market.
When I check out Cato, Reason, the Independent Institute, and when I search online for ‘Compassion and the Free Market’ very little is there apart from an obscure blog or two.

Some of what David Beito looked at in The Voluntary City (mutual aid societies, private insurance) would relate to this idea, certainly. But I’d like to take it step further – you have to give people a clear vision of what’s possible, correct? From my vantage point, there is no positive vision today showing what it would look like if we curbed Soc Sec or government healthcare, beyond a vague understanding that it will be brutal and harmful.

I’m interested in research that gives examples and a future vision as to how the private sector (be it profit/non-profit) would handle or cope with entitlement-type goods transitioned out of government control. How about something studying the Kahn Academy, offering free training/learning videos, living by volunteers and donations, and contrasting that to what the gov’t provides in terms of retraining for the unemployed? How about something contrasting what Father Boyle of Homeboy Industries is doing for gang members (“Jobs, not Jails”), teaching them to function in society and see new possibilities, contrasting that to the kind of help they get from government sources? What about something painting a picture of how American society might look if we actually were able to dismantle/repeal various institutions?  What kind of effective, grassroots solutions exist today  that could be grown, if we all had more money and lost the idea that government should be involved?

So Compassion and the Free Market is a project/study area I want to develop so that we can paint an honest picture that appeals to those who do care about fellow human beings, but don’t understand ‘free market’ beyond its brutal reputation.

I’d like  to change the national paradigm, dialogue, framing of issues, so true compassion shines through.