As we are still in full crisis mode post Sandy, the idea that Americans are the most generous in the world is on full display in the hard hit areas of the Eastern seaboard.? And while on one hand that demonstrates the idea that we are there when the proverbial shit hits the fan; however, it also means that without subsequent Governmental support, either direct as in FEMA and loans, or indirect as in offering flood insurance as private industry does not or in the generous tax deductions available for non profits and individuals which to avail themselves to encourage said generosity, there would be no real massive outpouring nor support by many organizations/individuals formed to do such. What is not discussed is how much is really given by Americans and how much of it actually helps those in need when a crisis hits.? In an economy that has long demonstrated income inequality and stagnant growth in wages over the last 3 decades, it would be nice to find oneself without having to rely on safety nets on any other time other than emergent ones.? But for many Americans that is becoming increasingly less so and in turn those safety nets are showing the wear of age and excessive use.
The article below discusses the problems with the current philosophy and economy of this idea.? My favorite quote is from this gentleman:
Roy Niederhoffer, a hedge fund manager who lives on the Upper West Side and who has been delivering aid across the area, suggests that private citizens have a big role to play. ?We can?t rely on the government for all of this.?
But this is not the first time Mr. Neiderhoffer has made an appearance in the New York Times, from the Society to the Business pages, Mr. Neiderhoffer is a quote ready Plutocrat who offers this insight into how charity should work in the 21st Century, like the 19th Century when Plutocracy was at its nadir...
A hedge fund manager from the Upper West Side, Roy Niederhoffer, gathered a network of 40 friends through Facebook who helped load a U-Haul truck and several cars with canned corn, batteries, LED lights, over-the-counter medicines and other supplies.?I really don?t think it?s the government?s job to take care of all this,? Mr. Niederhoffer said. ?I wanted to see if it was possible for individuals to rally the way they used to. You know, in the 19th century when we had natural disasters there was no FEMA, but people still sent money and food to help.?
The issues addressed are ones I have said many times. The rich give to the rich and if the poor benefit then that is a secondary bonus.? Day to day giving as in living wages, job opportunities for training and growth, decent and affordable homes, medical care and education however are not part of the plan for modern society nor for the Richs to really help The Poors.? But when it feels good just do it and then only when cameras are rolling and the press is there to record it.? Charity?s Role in America, and Its Limits?
By EDUARDO PORTER
Published: November 13, 2012
Anyone doubting Americans? charity should visit the Rockaways in Queens. Volunteers from all over the city and beyond have descended upon the devastated communities, providing cash, supplies and assistance to locals marooned in waterlogged homes without food or power. They are helping to fill a void in the government?s sometimes plodding response to the disaster wrought by Hurricane Sandy.
Charitable Giving?The government is doing its own thing,? said Brett Scudder, a community advocate from Far Rockaway who has been walking up and down the boardwalk, helping coordinate the relief effort. ?They must get things approved. We don?t have time for that now.?
Roy Niederhoffer, a hedge fund manager who lives on the Upper West Side and who has been delivering aid across the area, suggests that private citizens have a big role to play. ?We can?t rely on the government for all of this.?
Ten days after the big storm hit New York, donations to aid the relief effort exceeded $116 million.
The outpouring of support highlights how central a role charity plays in our social contract ? we Americans view ourselves as generous, yet we mistrust the government to help those in need. Our trust in charity is uniquely American. We pay less tax as a share of our income than citizens of virtually every other rich economy in the world. But we contribute more to charity than citizens of any other country.
When Democrats attacked the Republican presidential candidate Mitt Romney for paying only 13 percent of his income in taxes last year, his allies pointed out that the Romneys had given nearly 30 percent of their income to charity.
Support for charity has a partisan bias. Republicans much prefer charity to taxes. Democrats are more tolerant of bigger government. Still, 95 percent of all Americans say they donate to a church or other charitable institution.
Earlier this year, Bank of America and the Institute on Philanthropy of Indiana University published their annual survey about charitable giving among high-net-worth households and found that faith in the government to help society was rather limited. Of the respondents, 91 percent said they trusted nonprofits? ability to solve societal problems. Only 56 percent trusted the federal government to do so.
Our confidence in the power of philanthropy may soon be tested. If a set of spending cuts and tax increases kick in on Jan. 1 in the absence of a budget deal between Democrats and Republicans, the size of government will shrink considerably.
Those actions would cut nearly $900 million from the Federal Emergency Management Agency. The budget to teach English to immigrants would lose more than $700 million. Special education and rehabilitation would lose $1.3 billion. There would be $140 million less for financial aid for poor students.
Even if Democrats and Republicans agree on a more gradual way to reduce the deficit over time, it seems that many important programs will be reduced.
Philanthropy, then, seems more important than ever. Looming cuts to federal programs and shrinking state budgets mean that charity will have a bigger void to fill. But one of the things that induces people to give to these causes is a break on their taxes. It is legitimate to ask whether a government pressed for money should be forgoing $40 billion a year in tax breaks mostly pocketed by the rich for their charitable donations.
Should the government raise more money by cutting the charitable tax deduction for the wealthiest Americans, as President Obama has proposed, even if philanthropy itself took a hit from reduced contributions? Or should we stand by the Republican Party platform, which says that because of charities? vital role ?fostering benevolence and patriotism,? their tax preferences should not be touched?
Whatever its merits, charity is small relative to the potential need. Total charitable contributions in the United States were under $300 billion last year ? less than 2 percent of the nation?s economic output. Doubling that amount wouldn?t fill the hole left by deficit reduction ? which experts estimate at about $500 billion a year in the long term.
For all the trust we put in big philanthropists like Bill Gates and Eli Broad deploying vast resources for the public good, private charitable contributions have been stuck around 2 percent of personal income for years, according to the Center on Philanthropy. Corporate donations have never increased much above 1 percent of pretax profits.
Indeed, the vast growth of the nonprofit sector since the 1980s has been fueled not by donations but by fees and payments from the government. In 2008, philanthropic contributions provided only 12 percent of nonprofits? revenue. Fees and grants from government accounted for about a third.
There is another, perhaps more fundamental argument against turning to charity to provide the kind of social assistance that a shrinking government cannot. Most philanthropists, generous as they may be, don?t usually see replacing government services as their job.
The nation?s philanthropists tend to prefer charity to taxes because they get to decide which cause is worthy. The flip side is that philanthropy is pretty much unaccountable to society. Unfettered by democratic controls and dictated by the preferences of donors, it doesn?t have a great track record of devoting itself to our most pressing social needs.
Religious organizations receive about one-third of the nation?s total charitable contributions, not including donations to religious hospitals, schools and social charities. Donations to human services charities, by contrast, which work to ease poverty, feed the hungry and the like, amount to less than 12 percent of the total.
Charity can achieve some social goals. George Soros, who has donated some $8 billion over the course of his career, credits the work of his Open Society Institute for a vast jump in the retention of children in Baltimore public schools. ?One harmful consequence of the ?No child left behind? program is that principals are trying to meet the requirements by putting troublemakers directly into jail,? he said. ?The state is doing something which is harmful. We are trying to correct it.?
Mr. Soros notes that philanthropy can innovate more than government and can offer alternative approaches to challenges ? setting examples and developing standards to determine the success of initiatives. Still, he concedes, ?there are a lot of excessive claims about what philanthropy can and should do.?
In fact, a small portion of philanthropic efforts are aimed at helping those who most need it. A study by Rob Reich, an associate professor of political science at Stanford University, concluded that only a small share of charity redistributes income from the wealthy to the poor. A big chunk of the $40 billion donated last year to educational nonprofits went for new buildings and new programs at someone?s alma mater. Donations to schools in affluent school zones tend to help their own children, not those on the other side of the tracks.
As the government grapples with how to address the nation?s deficits over coming decades, Americans have an opportunity to reassess the role of philanthropy in addressing the nation?s problems. Should we continue to provide lavish tax breaks? Should we demand that in return for preferential tax treatment, programs target more clearly the needs of the poor?
Many Americans might think that keeping tax breaks for donations to build, say, a new university football stadium when so many poor students can barely afford college, is not the best way to spend scarce resources.
Source: http://www.greengoddess-vidaverde.com/2012/11/the-rich-vs-poors.html
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