26 March 2013

Wealthy Americans donate only 1.3% to charity

In 2011, the wealthiest Americans—those with earnings in the top 20 percent—contributed on average 1.3 percent of their income to charity. By comparison, Americans at the base of the income pyramid—those in the bottom 20 percent—donated 3.2 percent of their income. The relative generosity of lower-income Americans is accentuated by the fact that, unlike middle-class and wealthy donors, most of them cannot take advantage of the charitable tax deduction, because they do not itemize deductions on their income-tax returns...

But the researchers also found something else: differences in behavior among wealthy households, depending on the type of neighborhood they lived in. Wealthy people who lived in homogeneously affluent areas—areas where more than 40 percent of households earned at least $200,000 a year—were less generous than comparably wealthy people who lived in more socioeconomically diverse surroundings. It seems that insulation from people in need may dampen the charitable impulse.

Wealth affects not only how much money is given but to whom it is given. The poor tend to give to religious organizations and social-service charities, while the wealthy prefer to support colleges and universities, arts organizations, and museums. Of the 50 largest individual gifts to public charities in 2012, 34 went to educational institutions, the vast majority of them colleges and universities, like Harvard, Columbia, and Berkeley, that cater to the nation’s and the world’s elite. Museums and arts organizations such as the Metropolitan Museum of Art received nine of these major gifts, with the remaining donations spread among medical facilities and fashionable charities like the Central Park Conservancy. Not a single one of them went to a social-service organization or to a charity that principally serves the poor and the dispossessed. More gifts in this group went to elite prep schools... than to any of our nation’s largest social-service organizations, including United Way, the Salvation Army, and Feeding America (which got, among them, zero).
Via The Atlantic.  The author of this text has written a book on the subject.

10 comments:

  1. This is perhaps slightly beside the point, but -- an alternate explanation for the behavior in the second paragraph above is that wealthy people who are inclined to make donations are also more likely to choose to live in socioeconomically diverse locations. In that case, living in isolation from people in need would not necessarily dampen charitable giving, but an inclination toward charitable giving would reflect a generally different set of priorities that are also relevant in making decisions about where to live.

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  2. It's funny that so many people see the vanity donations given to ivy league schools, museums etc. as truly charitable or altruistic. It's just another form of conspicuous consumption really. You can just imagine the extremely wealthy at parties: "Charles just donated a new wing in his name at the Ivy League U" Keeping up with The Joneses one percenter style..

    It seems that insulation from people in need may dampen the charitable impulse.

    This isolation generally breeds all kinds of negativity. Nate Silver had a very interesting talk recently on how isolation, bad town planning etc. plays into voting habits, "fear of the other" and so non. Very interesting:

    http://blog.ted.com/2009/04/24/picking_apart_t/

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    1. Exactly. Somewhere in the New Testament, if memory serves, it says charity should be done in private. Public charity isn't charity, it's an exchange of money for attention and praise.

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  3. I'm not sure it's fair to put colleges and universities in category of only catering to the elite. They offer scholarships to pay the way for students not able to afford tuition. What better way to help change your economic situation than a great education?

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    1. ...and what better way to make sure your numbskull children and grandchildren will get to attend the same university that you did.

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    2. Taxing these elites at a progressive rate and making college free or very affordable as it is in more progressive countries and used to be in this country. Charity and vanity charity is no substitute for a fair and egalitarian society.

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    3. The need for "Charity" is a sign of a society that fails

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  4. Billionaire Koch brother tips his doorman $50 a year...

    http://video.pbs.org/video/2296684923

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