Categorized | Economics

Charitable Donations Reach Record Level

Charitable Donations Reach Record Level

A troubled economy hasn’t stopped Americans from donating their money to charity organizations, shows an annual report from the nonprofit Giving USA Foundation.  In fact, charitable donations reached a record level of $300B in 2007.

This fascinates me.  The existence of this type of generosity offers both philosophical and practical justifications for America’s sole remaining unique political legacy, which is hanging on by a micron-wide thread right now: the preference for small government. 

On the philosophical side, some statists/socialists (that would be most people you know—Democrats, neo-conservatives and most political-types outside the US) justify government intrusion on our economic freedoms (income tax, welfare, nationalized healthcare) by arguing that without such intervention, the poor would not be fed, the sick would not be healed, the masses would not be educated, etc.  However, many of these doomed-to-be-inefficient adventures by the government (especially the federal government) have historically been taken care of by friends, family, churches (synagogues/mosques/etc.), community centers, and PRIVATE CHARITIES.


So, on the philosophical level, for those who see a need to address financial inequality in the world, charity is the proper route that employs voluntarism and freedom of choice rather than mandated bureaucracy.


On the practical level, charities also hold up, as they are vastly more efficient than the government: most (if not all) charities are audited by independent bodies and the results are released to donors and potential donors–if a charity were inefficient, say siphoning off more than a quarter of its revenues toward administrative costs, no one would give (and the administrators would probably end up going to jail for fraud).  Yet we continue to elect politicians who siphon off more and more of our money because we don’t trust ourselves or each other enough to determine what to do with OUR OWN MONEY.


Sometimes I wonder: when did the American people decide it was acceptable to divorce our economic freedoms from the rest of our freedoms that are also guaranteed in the Constitution/Bill of Rights???
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pete - who has written 1 posts on The Freedom Factory.


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6 Responses to “Charitable Donations Reach Record Level”

  1. I wonder what those charities are. Church run charities tend to tie their aid to membership in the congregation, or at least to following in organized prayer sessions. Believe it or not, they often don’t actually help the people who most need it.
    Another category of charity that tends to get a lot of support is anti-choice charities that masquerade as teen pregnancy advice organizations. I would love to see exactly what percentage of this surge in charity goes to that type of group.
    The final category of false charity is the save a child type. While a few of these are legit, many of them actually give all of their aid to the child you sponsor, which means that one child in a village of starving children has medicine and food. They are typically ostracized and often beaten or killed, a cruel fate brought on by well intentioned westerners who don’t take the time to understand the reasons for their living conditions.

  2. Rob Viglione says:

    Traverse,

    I agree most with your last sentence about the importance of understanding the root causes for poor living conditions. Simply throwing money at problems is no solution, whether it be government welfare or private charity.

  3. pete says:

    I think you need to provide evidence to back up your first and third claims. But to take them in order:

    - As a church-goer, I am fully aware of many people outside my current and past congregations who have benefited from church-supported charities. Anyway, it is not wholly relevant since my original point was that a house of worship is one of many organizations that is better equipped to help people in need than the federal government.
    - Although I personally feel that organizations that convince young women not to make the decision to end the lives of their unborn children are doing legitimate community service, this is also not entirely relevant since the article was talking about an INCREASE in charitable giving. So, if pro-life (I think “anti-choice” would be more appropriately applied to a situation that didn’t involve the taking of a human life, such as drug use) organizations counted in 2007, they presumably would have counted in 2006.
    - Again, not sure where you got information about children sponsored by the international charities being ostracized and beaten, but I’d be interested to see that.

    The fact is that my aim was to discuss what the proper role of government is, which appears to be a taboo topic in these times of the bankrupt, bloated, nanny-state. In some circles they would call the current government a “self-licking ice cream cone”—Democrats and Republicans maintain their duopoly (rather slyly) while pursuing whatever political, economic, or military adventurism they wish without fear of retribution from the uninformed, unquestioning, or unenthusiastic voters.

    Anyway, thanks for your response—definitely worth some consideration.

  4. pete says:

    By the way, one of the third party presidential candidates makes the same point about the role of government vs. private charities in helping those in need:

    http://www.bobbarr2008.com/issues/entitlement-programs/

  5. There are several things here… the first is that just increasing the amount of giving to charity doesn’t mean that charities are encompassing the same needs that government based welfare does. It doesn’t mean it isn’t, just that your article in no way demonstrates that the increased giving to charities is decreasing the need that welfare addresses. If you are putting money into anti-abortion organizations, that will actually increase the need for welfare because there will be more teenage mothers in the short term, and more children who grow up in poverty and end up on the welfare rolls in the long term (by the way, each of those children is more likely to end up having several children…)
    As to the church charities and putting conditions on the aid they give: Sure, some church charities are great, there is a united church near me that is situated next to a homeless shelter. They have a soup kitchen, give away donated clothes, etc. It is a great organization. However, I spent part of my teenage years homeless (and the other part in the third world) and would avoid any shelter that made demonstrations of a faith that I did not posses a requirement of a bed and a meal, choosing a heating grate over those charities on many occasions. Many of the other street kids I knew at the time did the same. I can’t point to a study of this, so anecdotal will have to do until someone does that sort of study. However, it is anecdotal from someone who lived that life and has known hundreds of others who lived that life. This is a case of charitable giving (some of those dollar increases you are talking about) that doesn’t alleviate the problems to any measurable degree.
    As to the children’s charities that operate in the third world: CCF actually makes it a specific point to mention in every ad that they help the village the child is in (I am an atheist, but I believe that the CCF is a good organization) because of the backlash in the nineties against organizations that did exactly what I talked about. It was a pretty big scandal in the nineties, but you would have to look up the details for yourself. I have seen the results first hand as well, especially in Papua New Guinea. Again, this is first hand information, but the backing info was available in the eighties and nineties.
    My real point though, is that there is no valid evidence that charitable donations are a valid substitute for government programs. The article from Bob Barr is ridiculous, as it lumps welfare (an incredibly small sum in terms of percentage of government spending) with medicare and medicaid (which are due to incredibly bad policy decisions on the part of the US the second most expensive piece of the US budget… second only to military spending). The actual problem with the US health care system is in fact a result of privatization, not that these are pork products. Look at per capita health spending here in Canada (and then compare the level of service that Canada received before cuts to health spending and after… turns out the cuts actually made the system cost more and not work as well).
    I think you need to do a little more research on the actual cost of social programs, what that money is spent on, and what charities actually provide.

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