A study in charitable giving

Northwestern Financial Review, Jul 1-Jul 14, 2007 by Bengtson, Tom

In this magazine, it is common to find articles about bankers who make significant contributions to local charities. Bankers, in general, seem to be community-minded and often make donations of time and treasure. So I was intrigued when Arthur Brooks, a professor at Syracuse University, came to town recently to discuss his research on charitable giving. He has written a controversial book about his findings: "Who Really Cares; America's Charity Divide."

He looks at who gives and aligns that data with political affiliation. His conclusion: conservatives give more money to charity than liberals. It is an interesting conclusion given the stereotype that conservatives are cold-hearted individualists while liberals are compassionate collectivists. I would have thought that the most obvious difference between those who give to charity and those who do not, is income. I assumed that low-income people give infrequently and high-income people give often. Turns out income has very little to do with it. Ideology is a much better predictor of whether a person gives to charity. It turns out a low-income conservative is more likely to donate to charity than a high-income liberal.

Brooks said there is a segment of the liberal population that believes charity is bad. Their thinking is that the more people give to charity, the more they are letting the government off the hook for the things it should be doing.

Brooks posed this statement: "The government should do more to assure income equality in this country." He said that the more people agreed with this statement, the less likely they were to give to charity.

By speaking and writing this book, Brooks really wants to get a public policy discussion going about the role of charity in a society. Personally, I think it is very important and I suspect most bankers would agree with me. Brooks thinks, for example, that the tax benefits of charitable giving should be made available to people who don't itemize. This is a valid social trade-off, Brooks said, because people who regularly donate are more engaged in their communities, arc more informed, and tend to take leadership roles in neighborhood activities. This kind of social engagement, he said, is what strengthens societies, so charitable giving should be encouraged, he argues.

Does being conservative make a person more charitable? Brooks says no. He said it is really a matter of religious conviction. People who are involved in their church tend to be the most charitable, and those people are more likely to be conservative. The biggest givers, he said, typically, had the example of parents who gave regularly, attended a house of worship, and got into the habit of giving at an early age.

By Tom Bengtson, Publisher