Generosity vs Fairness

I recently read the book Principles by Ray Dalio, and one of the principles he discusses struck me as something we deal with almost every month in our lives. Here are the principle and my thoughts on it.

Ray Dalio’s Principle 2.2B: Make sure people understand the difference between Fairness and Generosity.

This principle has applied so many times in my own life, in my children’s lives, and in our business. We have often tried to be generous and it is often taken by some as not being fair. It is easy to mistake generosity for not being fair. For example, this Christmas we decided to be generous by finding one person in each of our businesses that needed or could use help with Christmas. We allowed the team leader at each business to find that person and decide what to do for them and involve the other team members in helping. This went very well in most businesses, but there were a few that considered it “unfair.” They thought we should do the same for everyone. This thinking mistakes an act of generosity for entitlement for everyone.

These are very different things. If we decide to use “our money” or “our resources” to help someone, that does not entitle everyone or anyone to the same thing. Some years ago, we offered gifts to some of our team members for great work they performed and because we, as a company, we’re doing well we chose to share that prosperity with those who helped get us there. After about eighteen months of this sharing, we ran into a substantial cash crunch. We no longer had anything to share. The same folks who enjoyed our generosity for some time apparently came to expect it, and when we stopped they cried out, “It’s not fair!” The reality is, we had no obligation to share, to begin with, but we chose to be generous.

It is even confusing for my own five children at times. One of them will need something, or Pam and I may choose to do something for them. That can, and has, make us think maybe we are not being fair to all of them, or maybe they will think we’re not being fair. This would assume that there is some obligation to be fair with our gifts and generosity. The reality is, we didn’t have to give any gift at all… so stop complaining.

As Mr. Dalio points out, we are very generous with our companies and personal life, but I feel zero obligation to be equal in our generosity. Equality thinking leads to entitlement thinking. Generosity is good and wholesome. Entitlement is evil and cancerous. I could not agree more with this principle, although, at times, I have been guilty of “fairness” thinking as well. It’s an easy trap to fall into. When you give to the homeless, should you give a lot to one or less to all? I think we must do what our heart tells us. We must be generous as we feel touched to be. We must be careful to be generous in all we do, but there is no obligation to be fair.

Living Every Minute,

Dr. Tim

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