response to Jenny Price and Justin Gabbard's post Against Philanthropy
Against "Against Philanthropy"
Commented on September 25, 2007 by - hcc
2 votes
Business & Money
response to Jenny Price and Justin Gabbard's post Against Philanthropy
Commented on September 25, 2007 by - hcc
I found several issues with this article. I would have let just one slide, but there are just too many to let it go.
> Corporations donate a tiny percentage of their profits / receive sizeable tax writeoffs.
You have to pick one here: big or small? A corporations donation to charity will equal the size of their writeoff for doing so. 1% of profits is a small number, $90M and is an equally small number when compared to overall profit. But that same $90M is A LOT of money for a charity. One side can't be referred to as big at the same time the other side of the equation is referred to as small; numbers don't work that way.
Also, why assume a tiny percentage of profit? Verizon matches charitable contributions up to $100k annually. Entry-level salary at Verizon is about $35k. If each employee tithes 10%, that's 3500*242k = $847M; now DOUBLE that because it's all matched.
Now after being the person at my company who goes around bugging people to donate to the annual charitable contribution campaign, I'll be the first to say that employees do not donate anywhere near 10% of their income. But they could. I find it neglectful of the author to not even so much as mention an individual's responsibility in improving the world, but instead demanding that those with more money change their ways.
> But what if Gates and Buffett simply applied their sentiments as philanthropists to their work as CEOs in the first place?
Here's how it would have turned out: neither of them would be in a position to makes as big of an impact as they are now. The capitalist world favors those who specialize in what they do best. Buffet is very good at investing. Over his lifetime, he has been able to use this skill to amass an incredible sum of money in a relatively short amount of time. He did this by being very shrewd and rejecting living a life of luxury. His intent was never to horde cash for himself or his family, but to amass and disburse to those who need it.
> In the meantime, the United States is losing $40 billion annually on tax write-offs for philanthropy.
One could also argue that the charities themselves are costing the United States billions due to their non-profit status. That would be an equally ridiculous claim.
Corporations are taxed on their profits. Now if corporations were to prioritize employee salaries, welfare, and benefits, those added costs would count as labor cost for the corporations. This would lead to smaller corporate profits (since increased labor cost would be subtracted from revenue) and the United States would STILL be "losing" billions in tax dollars. And where would new money toward employee benefits and welfare be going? Into a 401k that invests in ExxonMobil and other large multinationals that the author seems to hate so? Going to pay the outrageous health care fees that the oh-so-ethical health care industry rakes in? Given the choice between that, Uncle Sam, or charities, I'll go with the charities to make the best use of my money.
> On our own shores, meanwhile, charitable donations to domestic organizations that grapple with poverty and racism have declined to an all-time low.
Might this have something to do with poverty in the US nearing historic lows?
Also, why the hatred toward non-domestic charities? I send the majority of my charitable donations overseas to places like Senegal, Cambodia, and Peru. I would consider more giving overseas to be a GOOD thing, in hopes that maybe Americans are earning a better world view.