Monday, February 22, 2010
First point: Behemoth governments and agencies with their one-size-fits-all mindset too often create proposals that limit the diversity and independence of the charitable world. When the now jailed Eliot Spitzer was NY's Attorney General , he proposed a prohibition on foundations with less than $20,000,000 in assets because there were too many of them for the government to monitor and police. In 2007, a top IRS official proposed that the IRS evaluate the effectiveness and governance of public charities and foundations. Late 2009, the Congressional Research Service published a report calling for a NEW oversight agency for charities and foundations. [Do we really need more federal employees?]
The second threat is the argument that foundation assets are"public money" and that decisions about grant-making are subject to political control. Democrat Congressman, Savier Becerra of CA, calls the tax-favored treatment of charitable giving a "$32 billion earmark" and wants Congress to ensure that philanthropic assets advance the public good. [Or does he want to tax these charities??????] Charities do have public purposes and state attorneys general do have some power to enforce adherence to respective charitable purposes. BUT, this does not mean charities must serve the same objectives as government or that the government can intrude on their decision making. [Can government agencies perform charitable acts as efficiently as private charities? Highly doubtful. And, how much money do charities save taxpayers? Billions - that's a number followed by a minimum of nine zeroes (000,000,000)].
There is a historic covenant that has governed foundations - they must use their assets for charitable, not personal purposes.
The final threat to the freedom of American philanthropy comes in the form of proposals that would define what kind of giving is charitable. A growing number of them would like to confine charitable deductions to direct help for racial minorities and low-income families and communities, only. The problem with this? Americans of all races, creeds and income levels can benefit from giving to or receiving from religious institutions, colleges and universities, hospitals and medical research, the arts, environment and other causes that fall outside of these proposed, limited restrictions. Government should NOT be picking winners and losers.
American charitable giving is a strong indicator of economic freedom. In turn, economic freedom is an indispensable means toward the achievement of political freedom. [Milton Friedman].
Again, article sourced is the January 2010 Imprimis published by Hillsdale College.
Thursday, February 18, 2010
Regarding the religious aspect: Americans who attend church or synagogue or another form of worship once a week give three times as much to charity as a percentage of their income as do those who rarely attend religious services. Annually, about $100,000,000,000 goes to religious institutions of all faiths. These same donors also give more to secular charities than those who never or rarely attend religious services. The book, Who Really Cares, by Arthur C. Brooks, thoroughly documents amounts, percentages and types of giving (including blood donations and volunteer hours) to support this concept. A review of the book, here, summarizes many of the key findings.
The freedom angle: Historically, Americans did not wait for the government or the local nobleman to solve problems - we often solved them ourselves. A forthcoming movie, The Little Red Wagon, tells the story of a six-year-old boy in Tampa, named Zach, who wanted to help families who had been left homeless. He took his wagon door-to-door for four months and collected 27 truckloads of supplies. This is a great example but there are also 1000s of examples of Americans helping others in need via churches, community food drives, packages for soldiers, etc. - people just taking action on their own as part of their community. These events happen all the time in America.
American corporations give through their own programs. One local example is the 5% pretax operating profit give-back of Target Corporation. Other companies assist schools, support athletic teams and scout programs. Included also are volunteer fire departments (Bloomington, MN has one of the largest volunteer fire department in the US.) Historically, there is Andrew Carnegie who founded US Steel and took his wealth to establish public libraries all across America. Bill Gates of Microsoft is working to eradicate malaria. The list is endless. Why? Freedom. Americans simply give back, voluntarily, to the society that gave them the opportunity to succeed.
And, an interesting aspect: while many people in the upper quintile of earnings give more money to charity, those in the lowest quintile give the highest percentage to charity. Go here for a summary.
Update - I thought this had been posted; this will address some of the issues raised by commenters on I of III. Janet
Friday, February 12, 2010
The basis of this information is a speech given in Washington, D.C. on January 8, 2010 by Adam Meyerson, President of The Philanthropy Roundtable. My source is Imprimis, a publication of Hillsdale College. (A free publication - go here to register to get your monthly articles.)
In 1859, a professor and preacher named Ransom Dunn started a horseback journey to raise funds for a young institution of higher learning, Hillsdale College, in southern Michigan. 6000 miles later, Dunn had raised $22,000, the equivalent of about $500,000 today. The sources of his success: rural families of the upper Midwest. The largest donation was $200. What does this even show?
Charitable giving in America has never been exclusively limited to the wealthy. Throughout America's history, Americans from all walks of life have given generously. When giving is calculated as a proportion of income, the highest percentage of givers is the working poor. Secondly, Professor Dunn, did not play on guilt, too often the ploy of today's charity solicitors. Dunn appealed to people's ideals, aspirations and religious principles.
This charitable aspect of Americans is central to our free society. Hillsdale was the second American college to grant a four-year liberal arts degree to women. Hillsdale was the first American college to prohibit any discrimination on the basis of race, religion or sex. These unique components would have been difficult, if not impossible to implement if Hillsdale had had to rely on public moneys.
The 19th century was a great age in America for the creation of colleges. Every town in the decentralized America of that time wanted its own college to promote economic opportunity and encourage citizen leadership. (In 1880, Ohio [with 3,000,000 inhabitants] had 37 colleges; England [with 23,000,000 people] had four degree-granting institutions.)
Today Americans give over $30,000,000,000 a year to support higher education. Even state universities depend upon private contributions. In addition, private charity sustains museums, orchestras, hospitals, clinics, churches, synagogues, animal refuges and habitats, youth programs, grass-roots problem solvers, etc. Private charity makes possible great think tanks, left, right or center.
Our awareness of charity is usually low, until there is a disaster. During Hurricane Katrina, Americans gave $6,000,000,000 and in 2009, Americans gave $300,000,000,000 to charities. This final amount is about twice what we spend on electronics equipment, three times what is spent on gambling and 10x as much as spent on professional sports.