The Rich get Richer?

by Fred Showker
An article on NPR yesterday caught me quite by surprise -- in fact I had to turn up the volume. The announcer's voice said that "Americans gave $300 billion to charity last year."

Why did it catch my attention? I've been looking for a source that would shed some light on how much money is donated by philanthropists these days. It reminded me of an unsettling conversation I was recently pulled into.

The conversation was about how the democrats would "spread the wealth" and how bad rich people are because they avoid taxes -- getting richer while the poor get more poor. (Or, poorer if that's actually a word.) The group of middle-aged people seemed to be harboring great disdain for anyone who is wealthy. Now, I'm not wealthy by today's standards -- I'm comfortable, but not what one might consider wealthy. I do my share of giving to the poor and volunteering for charitable organizations. But these were supposedly my friends and the conversation riled me to the point of retort.

"If there weren't rich people," I fired back, "There would be no Salvation Army! There would be no Goodwill stores, no habitat houses, no soup kitchens or others. You could also kiss goodbye to Public Radio and Public TV, not to mention most art galleries, and museums. Your public schools would suck, and universities and colleges would be useless shells."

My reply was met with yet more anger. That wasn't good enough. They still seemed to think the woes of society, the homeless and jobless, are caused by rich people. I retorted again...

"What about the jobless??? Who will they turn to, looking for a job? Poor people?"

That's why yesterday's NPR story gave me a boost. So now we know, at least for 2008, more money was donated to charities than Obama's stimulus plan. Next time I'm in a group of so-called social conscience do-gooders, I can send them to this article:

Amid Recession, Nonprofits Feel The Pain

This article by Wendy Kaufman gave resources tracking what Americans would lose if there was no philanthropy. Wendy writes:

Americans gave $300 billion to charity last year. While it's a big number, it's less than Americans gave the year before. Charitable contributions are expected to be down for the next few years.

300 billion of anything is a lot; a whole lot. I was also pleased to pickup a second reference which is now bookmarked in my browser: The Chronicle of Philanthropy. This is the newspaper of the nonprofit world and a wealth of statistics and background information about the enterprise of philanthropy. Which is a good enterprise to say the least.

Sure, there are certainly bad rich people. But hey, without them the world would certainly be in a far worse condition than it is now. And for those who think the government or the current administration is the cure for rich people consider this: I once heard a 'rich' person complain that

"... the family estate had to write a check to the IRS that could have built 230 Habitat for Humanity* homes in Katrina-stricken* New Orleans."

We saw how well big government handled that one. No, don't knock rich people. Encourage them all you can.

Thanks for reading.

Fred Showker

Go see this National Public Radio: www.npr.org
Go see this National Public Radio article: Amid Recession, Nonprofits Feel The Pain
Go see this The Chronicle of Philanthropy
Go see this Nearly 30% of Nonprofit Leaders Took a Pay Cut This Year

Don't forget ... we encourage you to share your opinions, observations, rants, raves, and praise. Just comment below, contact me here, or give me a tweet at Twitter/DTG_Magazine

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Comments

On March 27th, Anonymous said:

yea.....

well the funny thing is that.... in the end you said that a rich guy said that he did not want to pay taxes so he can help katrina? Ok, now lets just go with the assumption that we can trust someone with such wealth to do that. if the rich guy decided to pay his taxes AND build those homes for poor, disaster-stricken people, instead of buying that huge mansion and those luxury cruises and the rent for his golf course, then not only will his goal of helping those in need be met, but also the government will be able to send relief shipments and help to katrina, DOUBLING his total output to people.

Of course, this rich person could not do that, because he MUST buy all those luxury non-essentials for himself, because for some reason, channeling the worth of others labor and wealth to himself, he is "helping" the world.

Anyway, what you were saying about without rich people there would be no salvation army, or any of those goodwill stores or universitys etc. first of all, without rich people we wouldn't need the salvation army, goodwill and so on. why do you think there are poor people? Second, the government funds public schooling, so they would not necessarily "suck", in fact, they would be much better as the government would spend less money bailing corporations out and, more money supporting the educational system. as being a 9th grader, public schooling is very important to me and my future goals.

also many universitys are funded by the government. while tuition bills actually make up a small percent. art galleries could be, run by the artists. eliminating all the wealth that flows to the CEO that sits all day and accumulates other peoples wealth. also, for jobs? how about someone opens a shop? runs it by himself or with a partner? instead of corporations sucking up all the wealth.

On March 28th, Fred said:

Let me clarify:

The person who noted the Homes for Habitat -- was referring to a check he had to write to the IRS out of the estate for a deceased relative. This person was neither rich nor wealty -- the relative died, and the IRS took everything -- enough to build 230 new homes for Katrina victims. That was the point : no one saw the IRS building new homes for Katrina victims -- and the person who had to write the check would have gladly built them with the money.

And yes, to set the record straight -- people with wealth generate more wealth by virtue of their investments. However, at the end of the year, they Hhave a 25 to 55% tax liability -- so, they can a) do something charitable with the money, or b) give it to the IRS.

I think if you'll check the records and history -- private individuals are much better at handling money than the Federal government.

Thanks for writing -- we look forward to everyone's comments!

Fred

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