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Archive for the ‘Charity’ Category

Charity: Should You Donate Aid to Japan?

Wednesday, March 16th, 2011

We have all seen the horrifying pictures from the quake and tsunami in Japan. Many affluent individuals are wondering whether it is a good idea to donate money to Japan helping out the victims.

Felix Salmon, a blogger at Reuters, says no: His main argument is that Japan is a wealthy nation and there are other, better causes on which the money would be much more effectively spent even though these causes get less public attention.

Tyler Cowen, an economics professor and blogger, says yes. He argues that with Japan the chance that the funds are usefully deployed are much higher than normally with aid. He also adds that it is not realistic to expect that people will donate to another cause instead of donating to Japan.

Both sides make valid points. On balance, I think Tyler Cowen’s point that people won’t give to a substitute makes the strongest argument.

 

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Friday, September 11th, 2009

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Is Philantropy Politically Incorrect?

Sunday, August 2nd, 2009

Traditionally the US government has encouraged charity by exempting donated Dollars from income tax. Yet in February the Obama administration has proposed to reduce the charitable tax deduction for the highest two income brackets by as much as 30%. The economist Martin Feldstein has calculated “thatPresident Obama’s proposal to limit the tax deductibility of charitable contributions would effectively transfer more than $7 billion a year from the nation’s charitable institutions to the federal government”.  Feldstein has also estimated the impact of the tax increase on the overall amount of charitable spending. He suggests that spending could decrease by 10%.

Increasing tax on philantropy is one thing. But there are other assaults on charitable organizations. David Billet writes in Commentary Magazine:

“The most notable campaign against the philanthropic status quo has been waged by the California-based Greenlining Institute, a nonprofit that seeks greater “racial and economic justice” by attempting to force greater minority representation in government, commerce, and higher education, mostly by publicly shaming or suing companies into doing the right thing… After a Greenlining study found that a mere 3 percent of private grant money in California went to minority-led causes, the group waged a concerted campaign on behalf of state legislation to require foundations with assets over $250 million to disclose the race, gender, and ethnicity of board members, staff, business contacts, and individual grantees (at one point sexual orientation was also included), and to report the amount and percentage of grants to organizations in which 50 percent or more of board members and staff were minorities.”

It seems that there is a line of thinking in the government that charitable tasks are the responsibility of the government and that private organizations have no right to play a role in the area of social justice. At least, the role of private organizations, charities and philantropic societies must be controlled and regulated by the government. Tax policy is only one means to do that.

What do you think? Should the government monitor charities more closely and tax the wealthy contributors more heavily? Comments are open.

 
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