This is the second in a series of articles on the economics of Ramadan.  The other two focus on Ramadan-induced inflation and the externalities of Ied exodus.

Begging on the street is haram—forbidden by divine sanction—and beggars will be cracked down by the authority.  At least that is what’s going to happen if the Indonesian Council of Ulemmas (MUI) and the Indonesian government can have it their way.

It appears that only several days into the holy month of Ramadan, major cities all over Indonesia are already flooded with seasonal beggars.  Seemingly as a response to that, the government announced that they endorsed all efforts to take beggars off the streets, including MUI’s move to declare begging haram.

I’m quite certain there will be people who would highlight how the MUI and government are misguided with their plans.  So allow me to focus instead on what I believe to be one of the main reasons—although most certainly not the only one—why we have the whole problem with beggars, especially the seasonal ones, in the first place: ourselves and our perverse sense of charity.

Let’s start from the beginning and make one thing clear: begging is a job.  Beggars may be officially referred to as the unemployed, but by all economic definitions, they are service providers.  Begging requires capital, time, and hard labor.  If you don’t believe me, try waiting on the side of the street for eight to ten hours a day in the baking sun, inhaling toxic fumes, while soliciting potential “clients.”  It also provides service; beggars supply us with a venue to delude ourselves that we’re helping the poor, compensate our sense of guilt for not helping enough, and—this is my personal favorite—help us secure a nice spot in heaven.  Ramadan allegedly doubles that last benefit; this perception, as we’ll soon see, pushes behavior with some unintended consequences.

Individuals choose jobs based on their personal cost-benefit analysis.  Beggars choose begging because it’s the “best” job for them; the job provides them with the highest return per unit time, taking into account the condition of the job market, the resources available to them, and the skills that they have.  The higher the return gets, the higher the attractiveness of begging as a job.  And many of us have done plenty to make that return really high.

While academic research is lacking, various journalistic investigations indicate that begging can bring up to Rp. 100,000 in one day. That’s about Rp. 2,500 per 15 minutes for a ten-hour day of work, which is quite a reasonable figure.  That income generation can increase dramatically during Ramadan, in which somehow a lot of people believe their alms are more valuable than in the rest of the months in the lunar calendar.  As a comparison, a car mechanic earns about Rp. 50,000 in average per working day.  Even if a person has other employable skills, begging would still be a very lucrative job.  So you can stop wondering why we have hordes of beggars, seasonal or otherwise; you might very well contribute to the phenomenon.

If that’s all there is to it, there should be no problem.  If begging is a legitimate job, let beggars beg.  But there are at least two serious consequences of seasonal begging.  First, they crowd out the urban poorest, who unlike the seasonal beggars have absolutely no alternative but begging.  Second, there is an increased use of children, either as beggars or as props, thus denying them of time for education and exposing them to extremely hazardous condition.  Many people’s tendency to give more alms to children and baby-carrying beggars is certainly not helping either.  Your alms during Ramadan, even if they really do increase your chance of going to heaven, end up depriving the poorest of the poor and endangering children back here on earth.

At this point I wish to make a disclaimer that I’m not making a case against giving.  Rather, I’m making a case against giving incorrectly.  My real contention is that it’s almost always better to channel your alms through respectable charity organizations than to give the same amount of money directly to beggars—at least if your intention is to really help the poor.

Charity organizations that channel alms can do so more effectively than individual alms-givers.  The pooled alms that they manage are significantly large that they can use them to fund well-planned programs, both short and long-term, that are more sustainable.  Most of such organizations do more than simply help the poor survive day by day; they also have an eye on the horizon, providing financial assistance for education and even capital to start small businesses.

If you still prefer giving directly to beggars because they’d get all your money without having to pay the service of a middle man, think again.  Like any underground economic sector, seasonal beggars are organized.  And they have to pay a fee for the “organizers.”  Under such arrangement, a beggar would typically get a meager 30 percent of what they earn.  An accountable charity organization would spend most of your alms on their targeted beneficiaries; and they would show you their financial report to prove it if you asked for it.  Give directly to beggars and you’d most likely give less.

At the end of the day, perhaps the best litmus test is your own conscience.  So the next time you feel the impulse of giving small change to street beggars instead of giving the same amount of money to a respectable charity organization, ask yourself, “Am I doing this because I really want to help them and I’m certain that my petty coins would bring a significant impact to them, or am I doing this simply to make me feel good about myself and perhaps increase the probability of securing a nice place in the afterlife?”

Then again, if MUI and the government push forward with their respective plans, we might not have the opportunity to ask that question at all.

An edited version of this article is featured in Jakarta Globe