Orb.. I think you missed the point that this guy is on one of the new servers that is only about 1 week old.
Taking that into consideration, 4k is a sizable donation, and it is reasonable to assume the others on his island should have donated at least this much too!
If this was the case, his mill should be about level 7 and his lux mine at level 4. Seeing as this only employs 114+66 = 180 workers, donations are still highly valuable to those with a level 4+ town hall (read EVERYONE!)
There is a decent problem that even the better players still don't see the value in donations at the very early stages of the game. Sure, there is some merit in slinger raiding for wood to nearby islands, but material is hard to come by early on, and it can easily be protected by warehouses until one reaches 5 cities or so. While even a level 12 tavern or level 6 Museum provides a better ROI than a level 8 Sawmill upgrade (if done alone).. If 10 players donated to the sawmill, leveling the sawmill to 8 would be better than the level 3 museum or even a level 4 tavern! (though those with plenty of wine may disagree).. the point to all of this is that constant early donations to the resources means good growth in the early game.
The problem is that many do not see the value in donations, nor do they understand that building up buildings that provide little or no real value early on is a waste! Instead, they click on every building they can "afford" because it is "cheap" thinking that sooner or later they will have enough material to continue to grow. Instead, the better plan is to build only what one really NEEDS (academies/warehousing/town halls/barracks/tradeport/shipyard/taverns/hideouts/museums/carpenters/productions and prolly an embassy) and not to build them too high until needed. Instead, try to make certain to donate as much wood to the sawmills/mines at least until they get to the level 10/7 mark (even the level 10 sawmill has < 3 day payback on it with 10 people).. at this level you would employ 306 people and prolly need a level 6-7 town hall.
The problem, as the OP clearly states, is getting the "other 9" to realize this
In all other RTS type games, people have understood the concept of building up their economy (booming) before spending time on the military (rushing) or defenses (turtling), while the 3 are a little bit "rock/paper/scissors", noone can deny the need to at least build the economy up to a "substantial" level before pursuing their "main" strategy. Unfortuantly, with Iraiam's "shared resource" structure (one of the more intersting aspects mind you) this concept seems to get lost.
A good way to deal with this is education and "deal making".. point out WHY its needed for everyone to donate so everyone can grow fast enough to keep up with the "neighbors", and even setting up "deals" such as donation limits. with enough people sharing this idea, you might even find help from others willing to "enforce" these limits. While many others may remember that I tend to speak out against "harassing leechers", this was only when they could not benefit from the extra capacity. In the early game, this usually does not exist as even a level 6 Town hall can still benefit from a level 10 sawmill or so. Experience and history has shown that setting up strict donation policies and enforcing them might sound "harsh", but is the key to long term success. generally those who start leeching somehow think they are getting away with something (they are not) and will continue until they learn better or are forced otherwise.
So education on the merits of donations for THEIR OWN good.. and the need to keep up with or surpass their neighbors economically, combined with decent, but fair, donation requirements that are hopefully enforced by several members on the island should hopefully ensure continued and aggressive growth for everyone. In past servers, there have been instances of several people (usually in the same alliance) binding together on shared islands and maintaining and growing high economies. You will find it was theses players who continued to be successful as a good economy tends to attract the better players and leads to even more growth and good games for all who participate. Allowing others to "leech" off of a decent economy when they otherwise *should* be helping will only slow growth and lead to a downward spiral. Correcting the problem early is essential so it doesn't become even worse (nothing will kill your game faster than a "dead" island), so getting people to see the value in donations is key, and then supplementing it with force in necessary, is the only way to make sure your game isn't hampered either (as a last resort, you can always pack up and leave to a better island).