Via NotGeniuses, I came across this interesting post about charitable giving among the wealthy
- Why tax the well-off? Because, two recent studies suggest, it’s practically the only way to persuade them to spend money on anyone but themselves. Philanthropy isn’t the answer: a survey from The Chronicle of Philanthropy reports that Americans making $70,000 or more dispensed a paltry 3.3 percent of their earnings to charitable causes; in contrast, those making $50,000 to $69,999 gave 5.6 percent, and those making $30,000 to $49,999 gave 8.9 percent. Only at death does the tightfistedness diminish?but even then it’s the threat of the estate tax that awakens the philanthropic spirit. Or at least that’s the conclusion of another new study, which predicts that deathbed donations will drop precipitously if the Bush Administration succeeds rolling back the estate tax. The study finds that the cost of such a repeal, in lost donations and bequests, could be as steep as $10 billion a year?the equivalent of the grants doled out annually by the nation’s 110 largest foundations.
A few points to make about this one :
The disparity between the charitable contributions of the wealthy and the middle class seems like a microcosm of the disparity between the U.S. and every other industrialized country in terms of foreign aid. While we’re the richest country on Earth, we give a lower percentage of our GDP in foreign aid than just about anyone else. According to a 2001 poll, most Americans think we spend 24% of our GDP on foreign aid, when we really spend < 1%. As with foreign aid, the rich may give more in terms of actual dollars, but they aren't nearly as generous as the middle class.
While I’m a big fan of the estate tax (as well as just about every other tax on “unearned income”), I don’t know if I support the idea of the estate tax as an effort to “persuade” the wealthy to give more to charity. After all, you can’t make someone not be a selfish jerk.
What does it say about our society that the biggest incentive for many people to contribute to charity is that they can write it off their taxes? What would happen if we suddenly ended any tax incentives on contributions to non-profit entities? Would all the soup kitchens close? Would the Red Cross have to sell their bloodmobiles? It’s sad to think that the main reason people give away their money is to get out of contributing to our government and look like much more compassionate people than they really are.
posted by greg on September 29, 2003 @ 6:50 pm
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Charity begins at home.
Comment by pills — October 10, 2003 @ 10:46 am