07/07/2006: "Philanthropy Is Invaluable to America"
Recent announcements concerning Warren Buffett’s unprecedented monetary gift and Bill Gates’ decision to devote more time to his charitable foundation have put philanthropy back on the front pages—right where it should be.
The measures taken by these individuals are clearly praiseworthy examples for all of us in this fast-paced society where we spend so much time focusing on receiving. Their contributions place them in a category alongside ultra-wealthy entrepreneurs of the past such as Carnegie, Vanderbilt, and Rockefeller, each of whom distributed freely of their financial gain to provide opportunities for a better life to millions of people around the world.
While large gifts to charity certainly get our attention, it is not just the rich who make donations to worthy causes. In fact, philanthropy is a way of life in the US. Its popularity is widespread, and in general, the gifts are not heavily influenced by the resulting tax deductions. Giving to those in need is as American as apple pie and baseball, and the results usually affect the givers as well as the recipients in many positive ways.
Providing monetary support to alleviate suffering was in vogue in the US even before it became a nation. The first fund-raising drive is thought to have been conducted by Harvard University in 1643. Over the years, as pioneers developed cities from ocean to ocean, volunteers asked for funds to help others, and Americans graciously opened their pocketbooks.
In 1889, an essay entitled “The Gospel of Wealth,” written by Andrew Carnegie, probably created the modern concept of philanthropy. He suggested that the rich, instead of leaving the monies they had accumulated to their families through their estates, should use the funds to create a public trust during their lifetimes. Bill Gates and Warren Buffett have clearly followed this advice and have even expanded the possibilities beyond any level that Carnegie probably could have ever envisioned.
The story of America is replete with well-known examples of philanthropy. They span the gamut from our nation’s founders and early leaders to those whose gifts make news headlines today. However, for every person who makes a very sizeable donation to a nonprofit institution or program, there are hundreds or even thousands more who give with no public acknowledgement.
Today, upwards of 80% of US citizens make at least one gift to a charitable endeavor or nonprofit group annually. Those who contribute, whether a lot or a little, do so because they want to make a difference.
Who can forget the rush of monies collected to help victims of 9/11, or the tsunamis that wreaked havoc in regions surrounding the Indian Ocean, or the massive hurricanes that struck the Gulf Coast? Even though the total amount given to aid families who suffered in those catastrophes was very substantial, it is only a small percentage of the aggregate amount of donations normally given each year to the more than one million nonprofit organizations across the country.
According to the Giving USA Foundation, charitable giving in 2005 amounted to some $260.28 billion, a 6.1% hike over 2004. About 76.5% of the total giving was from individuals. Foundation grants, which represented about 11.5% of all charitable gifts in 2005, climbed 5.6% last year. The steadiness of the stock market played a significant role in this increase. Corporate donations, which accounted for some 5.3% of aggregate contributions to charities, expanded by an unprecedented 22.5%.
Religious organizations are usually the greatest beneficiaries of America’s donations, receiving almost a third. About $1 out of every $14 goes for education purposes. Almost half of these monies come from individuals, with the remainder from corporations, foundations, endowments, and other entities.
Not all areas of the nation practice the same philanthropy philosophy; they vary in substance and causes. A recent study of organizations that raise funds in the largest metropolitan areas of the US indicated that the Houston area was among the highest rated in raising money and managing costs to do so.
Contributing to help others is the lifeblood of our nation. Donations fund research programs, endow scholarships, support cultural organizations and activities, provide vital resources, and much more.
Without the support of so many generous-minded people—both the wealthy like Gates and Buffett and average Americans—our nation and its economy would be a great deal poorer—not only in economic terms, but in spirit as well.