Who should direct social spending?

Individuals, Corporations, or Governments?

Suppose that a fixed 10% of GDP was to be spent altruistically. Who would you want directing this process? Compare three salient (though non-exhaustive) alternatives:

1. The government (via higher taxes).

2. Corporations (via higher prices).

3. Individuals (via their savings from lower taxes and prices; or high taxes that are returned to them as philanthropic vouchers).

The ideal choice here presumably just depends on empirical details about who would tend to make better decisions. If we could trust the government to do a good job of it, they could save individuals a lot of bother. (I take it that this idea is what underlies the common view that it’s the government’s “job” to take care of foreign aid, etc., and thereby discharge our duties of beneficence for us.) Sadly, political pressures often militate against this, with foreign aid spending being one of the most unpopular parts of the budget, and government-government aid having a poor track record of effectiveness (though I’m not sure how average individual philanthropy compares; it’s not like most people are following GiveWell’s recommendations, alas).

People often like the idea of “Corporate Social Responsibility”—like corporate taxes—I guess because having corporations (magical money trees?) nominally paying the expense serves to hide the cost, whereas the opportunity costs of individual spending and government taxes are more intuitively transparent. This very fact may make corporate philanthropy more politically feasible to selfish voters and consumers, which may be a reason to favor it to some extent even if corporations tend to be worse at selecting charities than either governments or individuals. But if we could specifically choose between a certain amount of CSR or an equivalent corporate tax that went entirely to philanthropy (but directed by citizens or their representatives rather than by businessmen), it’s a bit obscure to me why anyone would favor CSR as the locus for directing society’s altruistic efforts.