3 Reasons America's Wealthy Don't Give More to Charity

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Warren BuffettBy Robert Frank

The American wealthy are hands down the most philanthropic in the world. Americans dominate global giving lists and surveys consistently show that the U.S. rich are far more likely to make philanthropy a priority.

But some say they could give more. One recent study found that a large share of people making $200,000 or more give only 2.8 percent of their income to charity. Other studies show that multimillionaires donate only about one percent of their wealth to charity (though billionaires tend to give a higher percentage).


Warren Buffett and Bill Gates launched their Giving Pledge in large part to persuade the super-rich and the non-super-rich alike to give more to charity. As Buffett told me in 2011, "The hope is that our larger population ends up giving a larger proportion of their income to fund philanthropy."

So why don't the rich give more?


Charity's Biggest 2012 Spenders

CNBC's Robert Frank reports who were the nation's most generous donors last year.

A new study of multimillionaires offers some answers. The study, by SEI Private Wealth Management, found that 82 percent of wealthy families believe that having more money means you have a greater obligation to be philanthropic.

But the respondents (worth $10 million or more) listed three main reasons for not giving more. First, nearly half said they needed more confidence "that the level of their wealth would continue to support their lifestyle and their family." Second, they said they would give more if the markets improved.

Finally, a third of those polled said they needed to "find something they could be more passionate about."

The first two reasons aren't all that surprising. If they had more money, the wealthy would give more of it away.

But the third reason is worth noting. While more money helps, it's also important to be motivated by a cause. And if you care enough about a particular problem, you'll be more inclined to sacrifice some of life's comforts to solve it.

Money, in other words, isn't the only driver of philanthropy. It's about the heart as much as the wallet.

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David Zapen

The Lifestyles of the Rich and Famous are rarely based on greater talent or hard work, but the low top marginal income taxes of the 80's and 2000's. Too many Americans are trapped in the median household wealth of 1969; the minimum wage is worse than in 1968. Even if we had the 50% top marginal income tax of President Ronald Wilson Reagan, the wealthy would have incentive to invest in American labor and infrastructure, or to give to charity. Instead, they can effectively hop on Jack Welch's globe-trotting barge seeking cheap labor and quick profits from the BRICS (Brazil, Russia, India, China, South Africa) countries. A national sales tax is a red herring because billionaires have every incentive to stash money in the Caymen Islands, Ireland, and even Apple's stateless entity to legally evade taxes, whether the 40% top marginal income tax or 20% top capital gains tax. Wealth disparity is at its worst since the 1920's, and we are still trying to avoid another Great Depression. The high income taxes of President Eisenhower and Truman, above three-million-dollars in today's wages, created a maximum wage that diverted money back from Wall Street to Main Street. A $10/hour minimum wage would be a first step.

June 22 2013 at 9:34 AM Report abuse rate up rate down Reply
rini1946

this is some of the reason for number 3 Last year,a charity called make a wish it reported raising $3.1 million cash and spent about 60% of that -- $1.8 million -- granting wishes.The same year, Kids Wish raised $18.6 million, its tax filing shows. It spent just $240,000 granting wishes -- 1% of the cash raised.
•Eight veterans charities, including some of the nation's largest, gave less than a third of the money raised to the causes they champion, far below the recommended standard, the American Institute of Philanthropy says in a report.
•One group
• [American Veterans Relief Foundation] passed along 1 cent for every dollar raised, the report says.
•Another
•[Help Hospitalized Veterans/Coalition to Salute America's Heroes] paid its founder and his wife a combined $540,000 in compensation and benefits last year, a Washington Post analysis of tax filings showed.
Read more: http://www.military-money-matters.com/charity-expose.html#ixzz2WoCT3nxZ
Follow us: @MilMoneyMatters on Twitter | Military.Money.Matters on Facebook

June 20 2013 at 9:13 PM Report abuse rate up rate down Reply
Liberty Underpants

Screw it, obviously they don't care. I'm done. Y'all can have it, I can't be around you people anymore.

June 06 2013 at 7:36 PM Report abuse rate up rate down Reply
Liberty Underpants

They needmore confidence "that the level of their wealth would continue to support their lifestyle and their family....."

Are you ******* kidding me?? Do these greedy, heartless ******** not understand that little kids are starving to death by the thousands every single day? What in the **** makes these twats thing that their right to live in a palace and be driven around in limousines takes precedence over someone else's right to simply live??? Do they have any idea how many children

June 06 2013 at 7:35 PM Report abuse +1 rate up rate down Reply
1 reply to Liberty Underpants's comment
mick.oharley

Not sure if my initial cmments made it through but how about its their money. They can do with it as they wish. If I had it i would keep it. I earned it. They earned it. I would those I wish to, family, friends, no one. You can go make a billion and give it away if you wish. Its yours.

September 27 2013 at 1:55 PM Report abuse rate up rate down Reply
ebneila

That third reason is just a thinly veiled excuse for greed. The only draw back to being rich is; you never have enough. Conservatives talk about doing away with entitlements in favor of turning the needy over to charities. However, there are an estimated 23 million people at or below the poverty level and even more with no health insurance. No charity (s) could possibly pay for that many, nor should it. A wealthy friend once told me; it is easier to give to the poor when it is not required. It seems "dependence" is the biggest wedge between the poor and wealthy

June 01 2013 at 4:59 AM Report abuse +1 rate up rate down Reply
1 reply to ebneila's comment
norf4@hotmail.com

Funny how it's always a LIBERAL that attacks people (conservatives) who give GENEROUSLY to charity while claiming it's not enough, when most liberals (i.e. Al Gore, Barack Obama, Hilary and Bill Clinton, the late Ted Kennedy and most of the Kennedy clan, Joe Biden, Diane Feinstein, Charlie Rangel and COUNTLESS pop and movie stars like Barbra Streisand, Jon Bon Jovi, Ben Afleck, Bruce Springsteen, Madona etc,) give on average FAR less that one percent of their income to worthy (private)-causes. I'll never forget Bill Clinton and Al Gore's 1990 tax returns, or Joe Biden's 2006 tax returns which revealed NONE of these self-rightous pols ever gave more than a mere couple of "franklins" to charity on an annual basis until they chose to seek the Presidency. Talk about hypocrites!)

In comparison, weathly conservatives like Mitt Romney, the Bush Family, John McCain, the late President and Nancy Reagan, John Clancy, Rush Limbaugh, Sean Hannity, Neal Boortz, Ann Coulter, Bill O'Reily, the late Charlton Heston and Jack Warner, Gary Sinese, et al) choose to make little or no mention of their MILLIONS of dollars of philanthropy while publicly stating 34% of anyone's income is more than any government should take from individuals REGARDLESS of what that person earns. Hell, even Bill Maher had an epiphany about the greed of government in the last 90 days; stating he was ready to move out of California, and that: "Liberals, you could lose me on this!" THAT SHOULD TELL YOU SOMETHING!

As has always been the case; private organizations have ALWAYS been far more effective at providing services to the poor. On average, 73 cents of every dollar donated to charity goes DIRECTLY to those in-need (AKA Shands Hospitals, Catholic and Jewish charities, The Cancer Society, The Heart Fund, The YMCA (yes, the "Y" is a VERY effective charity whose efforts in the poor community you rarely hear about), The Anne Frank Foundation, Ronald McDonald Charities, etc, etc, etc.) in comparison to the ineffectiveness of federal programs which on average deliver less than 25 cents to the poor out of every tax dollar squeezed from productive members of our society. Imagine how much more good would come out of such private organizations if they didn't have to compete with an unfairly-positioned, greedy federal government which always thinks IT knows better than we the people how-best to spend OUR (not the goverment's) money.

June 03 2013 at 12:52 AM Report abuse -1 rate up rate down Reply
IN MY OPINION ONLY

I don't trust charties cuz charties have their own CEO and board members that sucks millions for themselves first then a little bit for their cause. I'd fire the CEO and executives of charties before donating millions.

May 29 2013 at 11:46 PM Report abuse +2 rate up rate down Reply
2 replies to IN MY OPINION ONLY's comment
ebneila

Then who would make sure your money was being used properly

June 01 2013 at 5:01 AM Report abuse +1 rate up rate down Reply
norf4@hotmail.com

Yeah, but a BLOATED federal governement which fails at every turn when it comes to social programs you don't even question.

Talk about uninformed.

June 03 2013 at 1:00 AM Report abuse -1 rate up rate down Reply
hamcallk5co

You are apparently not aware that invested money is taxed at a lower rate. That encourages investing and, after all, it is money saved after already being taxed. What kind of dope wrote this thing??

May 14 2013 at 9:28 PM Report abuse +1 rate up rate down Reply
wwward

I might suggest that they don't know the true rules of prosperity. Generous giving leads to blessings they will never know. They rob God by not paying tithing, they rob themselves as they cannot know the happiness that comes from helping your brothers and sisters get through this life. And you get the Lord's blessings when you do this. He withholds them when you don't. Of course living a good life is most important and keeping the commandments, but we are only on the earth of a brief while. Generosity is a form of eternal insurance. No good deed goes unrewarded.

May 10 2013 at 7:41 PM Report abuse rate up rate down Reply
idcsr1

Their lifestyle!?!?! Weak "cop-out".
What they give is only to look good; bragging rights.
Guys like Buffet and Gates strongly favor any and all population reductions, that's where their donations and efforts really go. Buffet doesn't hide his support for UN Agenda 21.

March 13 2013 at 3:54 AM Report abuse +1 rate up rate down Reply
homeloansbyed

They have lost their soul and never heard of tithing and seeding since they don't go to church. They also pay less in taxes, or ZERO like General Electric. They make themselves the center of the universe. They have no God. They create Philanthropy Organizations to boost their image around the world, but it does little to help the masses. It does not have to be about the poor. It can be about the good who go without. It can be about the old, the forgotten. It can be about the abandoned, the orphaned, the ill, and the sick and wounded. You don't even have to leave your own town or the USA.

March 12 2013 at 9:19 PM Report abuse +2 rate up rate down Reply