9/8/12 - Bulk of Charitable Giving Not Earmarked for the Poor
The New York Times
September 8, 2012
By GINIA BELLAFANTE
Trust president Lorie Slutsky is quoted in this piece.
One weekend several years ago, as I was arriving at my neighborhood farmers’ market, a college student approached me with a clipboard and an impassioned, if easily forgettable pitch for Greenpeace. If I signed the papers he had in his hand, a $20 charge would appear on my credit card statement each month and a small but vital fraction of the world’s marine life could be saved. Confronted by an actual person and standing in the vicinity of cheese whose per-pound price was equal to the monthly cost of potentially saving a monk seal, I was too embarrassed to say, “Thanks, but I’ll pass,” only then to move on to the artisanal cheddars of Pennsylvania.
Need confronts us all the time, especially in New York, where density and dependence on mass transit place those on various sides of the economic divide into more routine contact than might occur in Houston or Denver or Seattle. Need, of course, has been escalating in recent years, and liberals fear that it would soar far more aggressively under a Republican leadership likely to make significant cuts to federal programs that benefit the poor. Could charitable inclination, further aroused by new tax breaks, really assume the burdens relinquished by government? Though it may be the case, as some would contend, that decentralized giving is the most efficient means of reaching the poor, the argument rests on the assumption that human beings give efficiently.
It is not entirely clear that they do. Americans give generously but they give polymorphously. Charitable contribution is motivated by compassion, affinity, history, fealty, social contest and, not infrequently, shame. The bulk of charitable donations in this country are made by individuals, and the passions of individuals do not typically align with the broader exigencies of a particular social moment. Nationally, 32 percent of the $298 billion given away last year went to religious institutions, 13 percent to cultural organizations and 12 percent to social services, according to a report issued annually by the American Association of Fundraising Counsel. But if giving were conducted with the greatest consideration paid to the most urgent needs of the society, then Yale, a private institution with a $19.2 billion endowment, would arguably never receive another 50 cents.
New Yorkers give lavishly. According to the Chronicle of Philanthropy, the metropolitan area ranks highest among cities in terms of dollar sum (though not in percentage of income) given to charity. The Upper East Side’s 10021 ZIP code was responsible for $459 million in charitable donations in 2008, making it the country’s most magnanimous in terms of money allocated.
And yet if we look at the Chronicle’s ranking of individual donations of $1 million or more made in New York State so far this year, we see very little money going to causes aimed at enriching the lives of the less fortunate. Of the top five donations, totaling $190 million, one was made to Columbia University’s business school, another to the Metropolitan Museum of Art. Third on the list is Joshua P. Rechnitz’s $40 million contribution to the Brooklyn Bridge Park Corporation, made specifically for the purpose of building an indoor cycling track. That figure represents about 25 times the amount raised by New Yorkers for Children, an organization focusing on young people in foster care and run by a former commissioner for the Administration of Children’s Services, Nicholas Scoppetta, at its annual gala.
Looking at the top 49 gifts on the Chronicle’s list, not one went to support social services explicitly.
Even when improving the lives of the suffering is at the forefront of charitable interest, giving in a way that maximizes the usefulness of what you give is not something ordinary civilians are reflexively equipped to do. It may be that $240 given annually to Greenpeace does wonderful, impactive work or it may be that the money would be of more vital use to an organization like the Food Bank for New York City — to pick one of a hundred examples — which has been forced to deliver 11 million fewer meals this year because of cuts in federal spending. The more charitable obligation we assume, the more we are put in the uncomfortable position of playing God.
And then there are the questions of metrics, numbers, statistics. “If you spend 50 percent on fund-raising, you’re considered a bad charity,” Lorie A. Slutsky, chief executive of the New York Community Trust, a nearly-100-year-old organization that administers charitable giving for the wealthy, told me. But that measure of analysis is itself fluid, she explained, because new charities may not see yield on expensive direct-mail solicitation for years. Barring the reading of 990 tax forms, it is often difficult to determine what constitutes a successful charitable enterprise.
I asked Ms. Slutsky, who has taken donors to impoverished parts of the city in the hope of widening their charitable scope beyond the institutions favored on the Upper East Side, what she thought of the idea that charity could repair potentially bigger holes in the social safety net. “I always say to people, name one of the richest people you can think of,” she told me. “Let’s say Mike Bloomberg. Even if he gave away every penny he had — $22 billion — that would be a drop in the bucket. That’s basically New York City’s public school budget for one year.”