Sunday, March 30, 2014

Private charity fails to replace social programs

As I've noted before, charitable giving is "pro-cyclical," meaning it decreases during a bad economy when it's needed most.  

Hiltzik also points out that very little of charitable giving is aimed at the needs of the poor; and the rich are more miserly givers than the rest of us:

The smallest allocation of philanthropic giving to basic needs of the poor was made by the wealthiest donors, those with income of $1 million of more, who directed 3.8% of their giving directly to the poor. For the $100,000-$200,000 income group, that allocation was 12.4%.

"The existing evidence doesn't support the idea that wealthy donors will step in" to replace government transfer programs, says Rob Reich, an expert in philanthropy at Stanford. As he wrote last year, "Philanthropy appears to be more about the pursuit of one's own projects, a mechanism for the expression of one's values or preferences rather than a mechanism for redistribution or relief for the poor."

The largest single recipient of philanthropy is religion — 32% of the total, according to Giving USA. But only a small portion of that goes to outreach to the needy; more than three-quarters of donations to religious organizations is spent on "congregational operations," including facilities upkeep.

So here's the upshot:

What all this shows is that there's an unspoken subtext when people like [Representative Paul] Ryan complain, as he did during the 2012 presidential campaign, about "cold social programs from the federal Department of Health and Human Services" built by a government that "took away much of our greatness."

Ryan is evoking a golden-hued fairy tale of a past that never existed. In the real world today, those "cold social programs" from HHS and other federal agencies keep people fed and housed, and alive, and give their children opportunity.

By Michael Hiltzik
March 30, 2014 | Los Angeles Times

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