“Charity? Why yes, I send my usual check to Harvard, of course…have to make sure young Ethan gets accepted despite his vehicular manslaughter conviction…”
Robert Reich, Bill Clinton’s former Secretary of Labor, is out with an opinion piece declaring that giving to his favored charitable causes—charities directly assisting the poor– is real charity, while giving to other non-profits, in the arts, humanities and education, is just a self-serving, classist tax game.
“…A large portion of the charitable deductions now claimed by America’s wealthy are for donations to culture palaces – operas, art museums, symphonies, and theaters – where they spend their leisure time hobnobbing with other wealthy benefactors,” he writes. “I’m all in favor of supporting fancy museums and elite schools, but face it: These aren’t really charities as most people understand the term. They’re often investments in the life-styles the wealthy already enjoy and want their children to have as well. Increasingly, being rich in America means not having to come across anyone who’s not.”
Reich is an intelligent man, and I have a difficult time, reading this nonsense, believing that he is doing anything but gratuitous class-bashing here. Does he really believe that poor people don’t need and appreciate the arts, don’t go to see theater productions, never listen to music and wouldn’t be caught dead in a museum? Does he really believe everyone in an opera audience looks like the Monopoly Man, and goes there, not to listen to beautiful music, but to “hobnob” with old prep school buddies? Reich’s essay is an ugly example of class bias, and little more. How does he explain generous philanthropists who are childless? What’s their “angle”? Heaven knows,the wealthy never do anything out of compassion or generosity! Reich is engaging in biases on all sides: the poor are mundane, intellectually bereft philistines, and the wealthy are insular snobs.His complaint also makes no sense. Without private philanthropy, arts organizations simply cease to exist, or the government, also known as taxpayers, must pick up the bill. In the alternative, free museums would have to begin charging significant entrance fees, and the only citizens who could avail themselves of culture would be the rich. Does Reich really believe that the absence of access to culture won’t handicap the life options of those from lower socio-economic groups? Culture is essential to civilization, and his formula for charity will create more stratification, not less. If wealthy graduates don’t give to Harvard, then Harvard cannot, as it does now, provide full tuition support to qualified but indigent students. If wealthy patrons don’t help theaters keep ticket prices from hitting three figures, only the wealthy will experience and absorb the wisdom of Shakespeare, O’Neill, Sophocles, Miller and Shaw. Apparently, Reich doesn’t think that will matter. Three thousand years of human experience says he’s wrong.
Reich also attacks the charitable gifts deduction, making this specious and dishonest argument:
“In economic terms, a tax deduction is exactly the same as government spending. Which means the government will, in effect, hand out $40 billion this year for “charity” that’s going largely to wealthy people who use much of it to enhance their lifestyles. To put this in perspective, $40 billion is more than the federal government will spend this year on Temporary Assistance for Needy Families (what’s left of welfare), school lunches for poor kids, and Head Start, put together.”
Except, Professor, and I know that you know this, the money contributed to keeping a museum open or a university operating is far more than the amount lost to the government through the deduction for that gift, and if the loss of the deduction resulted in no more donations at all, the government would have to pick up the whole expense, or live with the consequences, which might be no scholarships for poor students, no art museums and no symphony orchestras. In other words, the charitable deduction motivates larger amounts in donations that the government would have to pay for otherwise.
Studies indicate that donations to all charities would dry up considerably if the charitable deduction were eliminated, and both “real” charities (those that support the interest Reich cares about) and “fake” charities (the arts, humanities, elite universities, museums—you know, all those places where tycoons and their trophy wives eat caviar and “hobnob.’—talk about polo matches, autumn in Monaco, that sort of thing….) would be seriously wounded. That’s OK, though, because what Reich really wants is for the government to dictate and control what you give to charity, by taking more from you in taxes and sending the money to the causes government bureaucrats, like Reich, have decreed are really important.
On a more basic level, however, Reich’s argument is just an obnoxious instance of someone imposing his narrow values on others. Robert Reich believes that the only charities that matter involve giving money directly to housing and services for the poor, and that all charity directed elsewhere isn’t respectable, genuine or generous, but is really a sham. He’s trying to make good and generous people feel ashamed of their generosity, so he can bully them into supporting his causes. Giving one’s own money to a cause, resource or institution that benefits others, no matter who they are, is virtuous and admirable, regardless of what Robert Reich thinks. He can give his money to the charities he likes with my blessing, and as far as what charities I give my money to, I don’t give a damn what he thinks. As his essay proves, he doesn’t understand that man or woman, rich or poor, cannot live on bread alone.
______________________________
Pointer: Fark
Source: Salon
Ethics Alarms 
I’m usually a big supporter of Reich, but he’s dead wrong on this one.
I hope to have time to write a more comprehensive rebuttal of my own in a couple of days, but I have about 400 pages of play analysis and theatre history papers to grade by Wednesday noon.
More later, I hope.
I’ll be looking for it. This is in your wheelhouse.
i just looked up charity navigator’s list of most highly paid ceo’s. I don’t know.
You don’t know what?
I do know…now that I am recovering from a narcoleptic nap.
I support the idea of charity, but when more than half the money is spent on fundraising or admin costs, it no longer seems to be a real charity and I feel like I’m feeding some puppy with a huge leach attached to it.
http://www.charitynavigator.org/index.cfm?bay=topten.detail&listid=8#.Uq5khVWzKpg
A highly-paid CEO is value neutral. Is he/she worth it or not? How large of a charitable effort is he/she running? How efficient is it?
If you do even a moderate amount of reading about charities, you quickly learn that it’s counterproductive to criticize charities for overhead/administration costs. The most effective and helpful charities often NEED to have high overhead costs, without which they could not do the impressive, large-scale good they do.
And sometimes charities with the lowest overhead are the most useless (which is why they don’t need any skilled professionals working for them full time.)
It depends in the charity. Looking at the overhead numbers and CEO pay is misleading, and if everyone did it the world would probably be much worse off.
value neutral? That sounds like a cop out. Why should something that largely depends on the good will of the public pay their top execs over 200k? They do this while the pennies dribble down to he people that it is aimed at. That the reasons for giving are not abundantly clear, in the first place, is a flag imo. Therefore it is necessary to have 200 dollar plate dinners and other gimmicks to get the pump primed etc, so the well heeled can hobnob , tells me they are not charities in the normal sense.
Because if people want to give to it and think their givings are being disbursed in a manner consistent with how they want to give and it isn’t to further a crime, then who are you to stop them?
I am not trying to stop people from giving. They can give to the kkk if they want and I can’t stop them. I find something unsavory (personally) about top execs making a huge amount of money for a charity where there is a large overhead.
So, Ick Factor?
No, “value-neutral” means that the fact that a non-profit pays its CEO a lot of money ALONE tells you nothing. It COULD mean that the charity is just “dripping pennies” down to the people it is supposed to help. Or it could mean that the people are being helped 7 times more than they would be if the charity were run by whatever kind of CEO could be had for less money.
That’s not a “cop-out”, that’s just common logic. What would it be a “cop out” for, anyway? I’m not defending any one organization, and I assure you I despise plenty of organizations that have highly-paid CEOs. I’m just pointing out that just listing charities with highly-paid CEOs and calling them out is lazy and counter-productive. You’d be bashing some of the most cost-efficient, effective charities, and letting some lousy, unworthy charities off the hook.
Well said.
Agreed. You make a good point. I can understand that each case is different. My personal experience had been getting calls from the “firemen’s muster league” and a few others and then finding that all the calls originated from the same place and that the target recipients actually received a few pennies on the dollar. So basically, my donation was paying for a “call center” for charities. Two years ago, my father was on the board for a non profit sustainable ag program being run into the ground by a ceo and hired fundraiser who had managed to raise about a quarter of what they were paid. He had to clean house.
Isaac,
For my own edification-do me the favor of providing an example, if you can. Perhaps name a charity w/ high overhead that works well, and the opposite. If it’s not too much trouble.
gracias
Not only is the money lost* in federal revenue less than the gifts, it is more efficient, as the government always takes its cut.
*Motherfucker, I will skullfuck the next pile of shit that makes the claim that anything that reduces the money the federal government gets “costs” the government, or that the money is “lost”.
The government has no fucking claim to my money. It is my money, not the government’s, and it is only through threat of force that the government takes what it wants.
Tax cuts don’t cost the government anything.
If the government provided a service I was willing to pay for (at a price I was willing to pay), that would be one thing – it would be competing and earning.
But no – the government decides what I will get, and sets the cost to me regardless of my wishes. The government only consumes, it never produces.
And I’m hardly shocked that a leftist toad like Rhobert Rhieshhhhh would make a statement that suggests otherwise.
If you can’t claim the donation as a deduction, then you have pay taxes on that income. So yes, it is “your money,” but we all have to pay taxes on our money. And, should the institution be deemed a charity anyway if only the elite can afford to go there?
I love the arts — all of them (well, except maybe for anything involving interpretive dance, blech). A music scholarship helped pay for a large part of my undergrad degree which, in turn, permitted me to borrow less money for law school. My husband and I attend cultural events as much as our budget and family responsibilities permit, but it is true that — for the most part — only the upwardly mobile can afford to go to many of these events.
DC is unique in that we have the Smithsonian museums (funded by our taxes) which are free to visitors. We also have a large number of smaller community theaters which won’t break the bank. But, take the Kennedy Center. While it does put on a number of free events, the majority of their productions cost a fortune. I’d wager that there are not a lot of poor people who have seen Book of Mormon, where tickets sold out immediately in DC and were $100-$250 a ticket. (Not counting the $20+ parking and hopefully you can make it through the show without needing a beverage, because the intermission drink prices there are staggering.)
Does the Kennedy Center (or the Shakespeare Theater or other fine theaters in DC) give a tremendous amount to the community? Of course they do — great culture always has positive ripple effects throughout society. But IF the vast majority of their programs are only accessible by the wealthy, should those institutions be able to operate completely tax free? And should all of my donations be tax free? Reich’s comments are not new — this has been a topic of conversation for a long time.
I am conflicted so will not offer an opinion. However, I do know several wealthy arts lovers on both sides of this issue.
Do you realize that there is no universal law that says that all I our income has to be taxed?
Nearly half of Americans don’t pay income taxes (negating your first point) because they don’t earn enough. Is all of that “lost” money “the same as government spending?”
I’m pretty good at avoiding using “liberal” as an insult, but if liberals actually think this way, I might have no other choice. What kind of magical thinking is this from Reich? We tax SOME income now, and so all of the income we don’t tax is lost government income? Who is actually this dumb?
No wonder some liberals don’t think that we have a government spending problem. When you consider that they COULD take 40 cents out every dollar earned by every living soul, but they DON’T- it’s a wonder they can even scrape up enough to have salaries. These poor public servants are severely under-funded! Think of all the money that they are just LETTING people keep, untaxed!
I thought “Santa Baby” was a tongue-in-cheek song. But maybe I am just not thinking progressively enough. Eartha Kitt did leave a LOT of unkissed fellas on the table.
Of course not all income is taxed. I also presume that those paying little to no income tax are neither major contributors to the Kennedy Center nor the subject of Reich’s opinion piece. And if we want to tax every single dollar earned – I don’t have a problem with that. But I’m willing to bet that reliance on government programs (like food stamps) would increase dramatically. We will end up propping up the poor regardless of what we do with tax code.
It’s changing the topic slightly (because you were mainly looking at Income Tax), but that shouldn’t happen with the Negative Payroll Tax approach of Professor Kim Swales of the University of Strathclyde and his colleagues (in the UK – see http://www.faxfn.org/feedback/03_jobs/jobs_tax.htm#23feb98a), and of Nobel winner Professor Edmund S. Phelps, McVickar Professor of Political Economy at Columbia University (in the USA – see http://www.columbia.edu/~esp2/taxcomm.pdf, or his book Rewarding Work). With that, the poor get promoted out of poverty, and there is no need to continue propping them up if you then make a transition to self-sustaining ways to keep them out of poverty, e.g. Distributism. If it all works, of course, but so far I have never seen any critic address that rather than, say, the political realities of ever getting to try it.
Here is a link to some of my own material in the area: http://www.spectacle.org/0112/lawrence.html.
“I love the arts — all of them (well, except maybe for anything involving interpretive dance, blech)”
Hahahaha! Interpretive dance is one of my tricks (used as a last resort) I use to get students’ attention when they’re involved in private conversations instead of listening to me, their substitute teacher. It never fails to stop them in their tracks.
Well, it certainly stops me in my tracks! You’re a smart teacher.
Is it virtuous and admirable to give one’s own money to ODESSA style systems, which were certainly causes, resources or institutions that benefit others, no matter who they are?
Since helping wanted criminals escape justice is illegal, no such organization could gain 501c3 status. Do you have a better hypothetical charity that helps people but isn’t commendable?
That’s like rebutting a claim that capital punishment kills people by saying that it follows due process.
The U.S. legal status is irrelevant to the information I sought, unless and until the author modifies his original, general position that way (but it wouldn’t help much if he did, as it wouldn’t provide an independent and general principle so much as a list of ad hoc exceptions). I asked if certain real (not hypothetical) organisations would qualify under his test, hoping that he would refine his test in some way that kept it general but made it fit our intuitions better. Your rebuttal is no help at all in that respect; that test would hardly be available anywhere but in the U.S.A., and I would venture to suggest that the organisations I offered as a test case operated elsewhere.
While I would not consider such an organization as worthy my charitable monies, I’m sure that some would consider it perfectly acceptable – laudable, even.
They could not claim such donations on their taxes since (as was said above) such groups could never qualify for 501c(3) status, but nothing would likely actively stop their efforts to send the money.
Charity is in the eye of the giver. Even in my atheism I consider a good number of semi-religiois charities as worthy, but I also think that groups like Justice Through Music are fucking shams (I name that one for a reason, please feel free to ask why) and consider the idea of giving them money to be worse than a waste.
What is Justice through Music? I haven’t heard of it. Is it extra effective when combined with equine therapy and twilight yoga?
Having frequented a comic shop that was next door to a Yoga studio, I have only this to say: Combine yoga-stink with horse musk and you do not have an atmosphere condusive to therapy. Unless it’s one of those puke-out-the-evil detox things. Those cute flexible chicks got some stank on em.
JTM (and a couple of other “charities”) were started by Brett Kimberlin, convicted domestic terrorist and suspected murderer. These charities – in my opinion – are used to effectively hide assets.
You see, Brett lost a million-dollar wrongful-death suit (this is not, by the way, the death he is suspected of being involved with), and simply refused to pay. He now makes himself largely immune from further suits by having no income or property of his own – his cars are all owned by his charities, he lives with his mother and “pays rent” to her for “office space” (her basement) for his charities (I suspect that this money is then used by Brett himself, but I can’t prove it). He basically uses these charities to fund his life and his pro se lawfare campaign against anyone who would criticize him or his allies.
The blog Hogewash has some info, Popehat has written about him, as has Patterico.
Brett Kimberlin is, in my opinion, a pedophilic sociopath who has learned how to effectively game the system.
I can find links to better and more complete write-ups, if you would like. I suggest Popehat as a great starting point.
Good lord. At least money launderers try to hide what they are doing.
Did some reading on this today — it gave me the chills.
This blog post is in response to an article that directly addresses tax-deductible charities. It matters, because that is generally what is meant by “charitable organization” in this country.
There were 850 museum visits in 2008 alone (about 6 times as many as went to a sporting event.)
So the 150 million fans who spent $50 a pop on Browns tickets are mostly Johnny Six-Pack blue-collar plebs, but the 850 museum visits were all Grey-Poupon-eating 1%ers?
That doesn’t make sense. Oh, wait, I’ve got it. Robert Reich is full of it.
The recent crusade against tax-deductions as a general concept has been picking up steam on the Left ever since the IRS scandal. “Sure, some right-leaning organizations got shafted, but tax-deductibility is a sham anyway. Those Tea-Partiers just wanted a free ride.”
Limiting or eliminating charitable tax-deductions makes sense for the political Left. Charities embarrass government programs when they outperform them using less money. Taking away some of that money and throwing it on the tax-pile helps negate this, making it easier I make the “just hand everything over to the State” case.
Statist-leftists charities might suffer, but the Left also dominates the State-funded programs themselves (see NPR), and charity for the Right is mostly a private endeavor. The net benefit would be theirs, and State-run programs would fall better in line with ideologies they support.
Tossing out tax-deductions would also squeeze those religious charities that aren’t suitably progressive, by decreasing their donors’ ability to give.
If the government would engage in real social policy – instead of flushing hundreds of billions (or more) of tax payer money down the proverbial toilet – there’d be no real need for charities. On the one hand there’s an excessive headcount in government bureaucracy that seems to be allowed to go on an ungoverned spending trip for nonsense each year, and on the other, there are companies and business men/women who have seats in congress who pass tax laws that increase the ever growing gap between the rich and the poor.
And then wealthy folks give to charities.
(Any generalisations were on purpose.)
PS: If any commenters now suggest that everyone could make something of themselves, rags-to-riches-style, that nobody has have to work in a supermarket at the counter or mop floors in the hospital etc. – and become lawyers, doctors or bankers to make bigger bugs – then I ask you: How would that work? How would businesses across the country stay in business without the blue collars. If everyone in the U.S. became lawyers, doctors and bankers and no one worked in the service industry anymore which includes anything from someone putting new pipes under your sink to someone who picks apples which you can then buy at the supermarket, it’s as trivial as someone preparing your double hazelnut latte in a coffee shop or doing the welding on the autobody of your Lexus. I don’t know, the list really is endless. Heck, someone casting the pipes in a factory that are then installed under your sink.
Would there be enough spending power to pay for 250 million lawyers, doctors and bankers?
We can always go into great detail discussing the awesome *and almost 100% fair* equilibriums gained in the Free Market.
If everyone truly suddenly decided to become a doctor or lawyer or whatever else you wish to list as high paying jobs, then you know what happens to that market? It floods. Suddenly those jobs are not worth much and won’t get compensated.
Suddenly, the market for janitors, having dried up, becomes extremely valuable.
Why doesn’t this happen? Because in the Free Market (which involves personal and private decisions that involve dedication of time and effort, create other non-monetary incentives. Why doesn’t everyone become those high paying jobs? Because they require a ton more effort and dedication. That disincentivizes most pursuits right there. We can all say “we want to be lawyers” or “we want to be doctors”. But for the vast majority who don’t become doctors and lawyers, they didn’t actually want it. Because they didn’t want the hidden non-monetary costs that go along with it.
The equilibrium that is struck, which is almost 100% fair is because for the most part we elevate ourselves to a point where we are comfortable with the compensation we are receiving in relation to the effort we are contributing.
So, no, businesses wouldn’t stay in business without blue collars. But the market will always incentivize that work for those willing to do it.
You only see unfairness in our system because we’ve long since stopped being mostly free market. Our system has so many artificial cost/price controls and regulations leading to unnecessary overheard mark-ups (and inevitable inflation) yet we still call it “Free Market”; so we can disparage the free market because of this.
“If any commenters now suggest that everyone could make something of themselves, rags-to-riches-style, that nobody has have to work in a supermarket at the counter or mop floors in the hospital etc”
Everyone can. That’s the point. Our system never says everyone WILL, just that no political force will combine to stop you from trying.
Never said that one couldn’t but that we need the workforce in the service industry.
I think you misunderstood. I didn’t mean that if one wanted to become a doctor instead of a janitor, that there would be insurmountable obstacles in his or her way to make it in said profession.
I said that society and economy is only able to function with many people working in the service industry.
And that if a person is handy with tools and wants to work as a plumber then he/she should be paid enough to feed his/her family and have insurance to boot and not have to rely on charity to buy his kid a nice looking prosthesis or whatever after the kid got into an accident.
Oh… your comment was an opening to argue more about Medical Insurance being a right?
It isn’t.
May be it’s hard for me to fathom because I live in a country where everyone has the right to medical insurance – whether they can afford it or not.
But in answer to your question: No, I was arguing that after an honest day’s work said work should put enough in your pocket to buy insurance.
It isn’t a right. I think you meant to say “….because I live in a country where everyone has access to a service paid for through taxation…”
No, I meant to say “right”. And since a few years ago, it is also a citizen’s duty to have medical insurance.
No, it’s actually not! That was when the mandate was a penalty, but the law survived the Supreme Court on the grounds that it is a TAX. That means that accepting the tax is just as legitimate as complying with the law—no penalty, no obligation. It’s a choice.
Sorry, should have added in “my country”. My earlier comment a little above this opened with “May be it’s hard for me to fathom because I live in a country where everyone has the right to medical insurance” in a reply to texagg04. As I was using the reply funktion to his/her comment to answer, I didn’t specify my statement more because I regarded it as a continuation of that conversation.
Ah.
Rights are NOT DERIVED from mandate of the government. Rights are SELF-EVIDENT and NATURAL.
Medical Services and Solutions are *products* generated by a market of scientists and doctors and other professionals, that would NOT EXIST otherwise. They are not rights.
They are products. Products which must be paid for. They are not rights.
If it has to be paid for, then the money comes from somewhere. If the government is ‘paying’ for it, then the money was compelled from the citizens. Rights CANNOT BE DERIVED from confiscation of someone else’s property.
Services and entitlements and any other number of CHANGEABLE policies may very well be derived from confiscation of someone else’s property. But they aren’t rights.
By that reasing the only rights that immediately seem natural and self-evident are the right to life and physical integrity, and the right to sacrifice one’s life. All other rights are the formulated product of the combined conscience and reasoning of the society one lives in and are ceded to you by that group as all rights apart from the first three have a direct impact on the rights of everyone around you and must therefore be agreed upon…
And those that logically follow to protect those basics.
It’s pretty cool, it rounds out to certain inalienable rights, among these are life, liberty and the pursuit of happiness. Of course some would write the list as life, liberty and property… And they wouldn’t be wrong.
No they aren’t ‘ceded’ by the group. Groups don’t have rights, which are individual in nature.
“No, I was arguing that after an honest day’s work said work should put enough in your pocket to buy insurance.”
That’s spiffy and all, but if an ‘honest days work’ doesn’t contribute to the greater community a value the community perceives, by what perverse logic then do you suppose the individual is entitled to what he thinks he deserves?
How does an “honest day’s work” not contribute a value to the greater community which said community perceives as such? “Perverse” logic…?
I can spend all day digging a garden in my back yard. That’s an honest day’s work. It however contributes nothing to that the greater community is willing to compensate me for.
If an individual pursues work that does not generate a value perceived by the community that equals what the individual feels he ought to be compensated… that sucks, individual… you overvalue yourself… adjust your expectations, because compelling the community to adjust it’s expectations is unfair.
And what kind of profession would you be performing by digging up your own back yard? I would call that recreational.
Now being a construction labourer and digging a trench alongside the road to reach faulty telefone cables or some such – would not only seem like an honest day’s work to me but also like sweaty dirty back-breaking work that should be compensated to a degree that said individual can provide all that is necessary for him/herself and his/her children.
Who’s discussing professions? You said “work”. And who are you to decide what work is and what work isn’t? A tenant farmer attempting to raise food for ONLY his family digs a garden for much more than recreation. However, he isn’t providing much to the rest of the community of value.
The market, no matter how you want to discuss it, consists of people doing actions they believe fulfill the needs (that is to say, provide value) to the greater community. The Community, as an aggregate of preferences and individual value propositions, come to a general average of what they consider the value of any one service to be. That is to say: the Community or Market decides the value provided by that individual, independent of what the individual thinks is the value provided.
A system designed based on what the individual needs, requires an arbitrary set of definitions of what constitutes need. If that individual does not provide services that the market values to meet those arbitrarily defined needs, then the deficit has to be made up from somewhere. I know your system is based considerably on redistribution of wealth. But to effect such, the State has to arbitrarily decide how much of your Property really isn’t yours but actually someone else’s.
Plumbers make great money in the US. More than a lot of desk jobs. They probably enjoy a much higher standard of living thannthe average, say, Norwegian.
You are right of course, but the argument though is rendered moot because Ulrike’s point is moot.
If the market currently generates demand for $10,000 worth of plumbing work, and on average, those professing to be plumbers have developed a market value of $200. In this hypothetical, the market can support 50 plumbers.
Now Ulrike’s argument may be: $200 isn’t enough for a plumber (in Ulrike’s mind), they should be paid $250! Well that’s all great sounding, but saying that doesn’t change the market reality that is driving a need for only $10,000 worth of plumbing work.
Should we have Ulrike’s way and mandate this ‘minimum wage’ of $250 — now the market can only support 40 plumbers. Sucks to be those 10 that the market no longer supports (who may very well have been comfortable with the $200)
Of course Ulrike may reply: well, what if the plumber’s don’t like that the market equilibrium has determined that they are separately valued at $200?
Yeah what if? I know some would say, well, those discontent can raise their prices and see what the market tells them about their market value. Some would say, the discontent should find other jobs more in line with their notion of compensation/effort ratio.
It doesn’t *look* fair. But I guarantee the ‘solutions’ that proclaim to make it ‘fair’ end up leaving greater unfairness and inequality.
Norway is one of the richst countries in the world. The avarage plumber there earns around $5,600 a month (numbers from 2011). In the U.S. it’s $3,900 (also 2011).
Charity is, as Ablative stated, in the eye of the giver. However, to discuss it in terms of tax deductions, the government must define what it considers to be charity. As Reich discusses it, it seems he is of the oldest attitude of charity — that it must be some sort of direct material benefit to those who cannot help themselves, such as food for the hungry, shelter for the homeless. That certainly is charity, but it only defines charity based on a very narrow definition of the receiving end.
I think the broader definition that we seem to be using is fair, and does allow giving to the Arts or other facilities that may not directly and exclusively aid the poor, but do add overall benefit to the community. This “civic giving” may not target the hungry or the homeless all the time with food or shelter, but it is still giving to the community for a good objective. That seems enough to me to consider the giving “charitable”.
Reich’s notion also about the relation of money not taken by the government is “lost” is imbecilic. Ablative appropriate and summarily discussed that already.
Here is a discussion that goes into depth on a comparison between government “paid for” “charities” and private charities:
It’s a long read, but the summary is that private charities are about 2.3 times more efficient than government welfare, that $ .70 of every dollar of private charity reaches the intended recipients materially while only $ .30 of every dollar of taxes intended for welfare reach intended recipients materially.
THE COSTS OF PUBLIC INCOME REDISTRIBUTION AND PRIVATE CHARITY
I could have guessed it. I have personally known people whose careers as drug-dealers were made possible by EBT cash, foodstamps, and unemployment checks. (Tip to enterpreneurs out there- pimps and dealers don’t pay taxes! And qualify for every kind of aid!)
Don’t know if there are too many pushers around living off the Salvation Army’s dime.
Apologies for placing this reply incorrectly before.
Comparing charitable and state provision of relief or welfare for efficiency of distribution of funds is not ‘like for like’ valid as the state welfare must be inclusive of all who are entitled. Paying welfare to the poorest recipients means dealing with the most illegal, violent, obstructive, fraudulent, angry, iliterate, insane and insanitary part of the population – which costs a lot more effort and time. Also central administration costs being minimised by incentiive for charities also means cjarities being incentivised to interpret accounts to that end. The article on public income distribution does not deal with those factors and i am skeptical of its findings for that reason.
Except, when a study compares “the efficiency of disbursement of money taken in”, the objections you have listed are not items that undermine the legitimacy of the comparison. They become items that describe the source of the inefficiency – and valid points to raise question of “why the hell do we use a public option then?”
Why exactly would we subsidize illegal or fraudulent or violent elements in society? Why?
If you wish to disburse money efficiently – to take it to the extreme – you could give it to the people with a fixed address, a bank account, and a degree in accountancy. But if your charity is for the homeless and destitute that policy won’t get you far in terms of your objectives as a body. The disbursement is ineffective though efficient and not a legitimate comparator.
Have you met the poor, needy and excluded recently? They are not happy. From the few i meet (mostly in NHS waiting rooms its true) I’d go along with Dickens in a Christmas Carol. I’m misquoting ‘….one is Want and the other Ignorance. Beware of them both..’. That is, both philanthropy and a sense of self preservation are incentives to care for the neediest, who all other things being equal, are going to be illegal in status, disposed to fraud and incetivised to violence. I don’t say that it ought to be so only that it is so.
Behaviour is expected to follow incentives, in markets or in poverty. Not so? Or should the poor be more moral than markets?
In the realm of charity, the behavior one wishes to disincentivize is reliance on others for your needs. If money disbursed is given to anyone who fits the immediate definition of ‘needy’ (which currently tends to mean someone under a certain wealth bracket), then you actually don’t incentivize better behavior or a desire for enterprise; you merely incentivize neediness.
However, like the charities which are selective and give a help out to those who do display a requisite drive to achieve or display a legitimate condition that keeps them ‘down’, giving aid to those actually trying incentivizes the good qualities you want.
The historic record of public assistance supports this; consider the amount of welfare nations dump down the drain for the so-called ‘needy’ compared to the fact that it hasn’t IMPROVED the situation one iota.
Structurally you have a point. I don’t give cash to the homeless in the street for that very reason. However keeping a needy person alive for long enough that you can get to them is kind of necessary.
Improvement of the whole situation is one goal, a lower objective is mitigation or amelioration. A first stop objective is communication and acceptance. And if you do help a ‘hard case’ directly or indirectly you may just be stopping a chain of familial abuse going back generations. I hope most charities would not put the ‘trouble makers’ to the back of the queue. But it does seem to be an instinctive reaction.
“However keeping a needy person alive for long enough that you can get to them is kind of necessary.”
What do you mean by this? ‘get to them’?
” I hope most charities would not put the ‘trouble makers’ to the back of the queue. But it does seem to be an instinctive reaction.”
I’m willing to bet most charities give benefit of the doubt with first time requesters of aid. However, they have no justifiable obligation to continue to render aid to individuals who continue to rely on assistance while not simultaneously making a real effort to improve their own situation, either behaviorally/legally or economically.
That the public options do not discriminate in that regard is why the public options only incentivize further dependency. The dark side of this is the politicians know this and use it quite rottenly for vote purchasing.
Pingback: The Age of Envy | pundit from another planet
The article linked in the pingback above (Pundit from another Planet) is a great read.
There are occasions where the two aspects of charity (arts for art’s sake) and philanthropy come into collision with public service provision as a third factor.
In my country, UK, the government delivered benefit (NHS, social services, housing programs and others) not infrequently are boosted by charities. Hospitals for example can retain sizeable art collections as the property of their charity partners. This is displayed, for ‘the benefit of patients and relatives’ by the same great and good benefactors who make educational, medical research and ‘discretionary’ service provision grants – for patients support groups and the like. I don’t know about Reich’s world of benefactors, but I do know how patients and relatives feel when presented with large and obviously expensive pieces of modern sculpture in hospitals, public parks and open spaces. Expletives deleted they are usually strongly ‘Against’ and assume that the money provided has come from the tax payer – so Against and Furious.
If that gives a clear picture to what Mr Reich is saying then maybe charitable donors should consider if there is a big difference between the beneficiaries of charity being philistine or ungrateful on one hand and not wanting to be treated like dirt by a self appointed cultural elite who decide how you are to be ‘elevated’ on the other.
Is cultural charity unethical? It depends … on what I’m not sure. Style perhaps, humility probably, respect looks likely, others…
(As for supposed efficiency of charities spending please recall that some charities cherry pick the ‘deserving poor’ as recipients. Dealing with the undeserving – the most illegal, violent, obstructive, fraudulent, angry, iliterate, insane and insanitary part of the population – understandably costs more effort per benefit deliivered. The Pareto rule and more applies in cases I’ve observed as a general impression.)
My initial response to this story is that the guy who earns the money is the same guy who gets to decide where to donate the money.
Bingo. And yet some people think that proposition is “unfair.” Right-wing, even.
Of course that’s true — but “earned” money suggests taxable money. No one is suggesting that you can’t donate it once you pay your taxes. I just gave money today to an arts charity that does not yet have tax-free status. If it doesn’t acquire it, I will have to pay taxes on that donation – and a previous one earlier this year – in April 2014. Even if it does achieve tax free status, that doesn’t mean that not paying taxes is a good thing. As I mentioned above, I am conflicted on this topic. In any event, I decided to donate that money irrespective of that fact – because that arts group is important to me.
For what it’s worth, I give to very few charities these days. Doctors Without Borders is One. Best Friends is another. And Smile Train. That’s pretty much it. Medical for those caught in the crossfire of war. Helping to feed and care for abandonded and abused animals of all kinds. And helping pay for surgery for kids with cleft palates.
Finally, I bake bread every weekend and give it to the homeless people I see on the street. (I think I was inspired by Pope Francis.)
Awwww, Robert Reich doesn’t trust SOMEbody.
Whom might that be, today?
I get on this blog occasionally to catch up. And now, having read all this crap, have only one question: WILL SOMEONE ELSE LEAVE A REPLY???. WE HAVE THE SMART ONES AND THE MORONS ARGUING BACK AND FORTH, AND FRANKLY, IT’S NOT WORTH MY TIME.
“Buh-bye” (as the flight attendants say) for now!
“Maybe there’s only one revolution, since the beginning, the good guys against the bad guys. Question is, who are the good guys?”
—-Bill Dolworth (Burt Lancaster), in “The Professionals”
Who are the smart ones and who are the morons, since the morons think they are the smart ones? And who are the additional commenters you are seeking? What is the middle ground between smart and dumb? Why is their contribution essential, or even valuable?
I thought we were all a little dumb.
Jack,
On second reading, I think she meant everyone felt like adding their two cents and it was overkill and a waste of her time. I don’t think it was a request for more readers.
I hope this is a fluke. I like reading her comments. But she has a couple other equally exasperated comments on the recent posts.