David Cay Johnston, a reporter for the New York Times, has been reporting on income taxes and related issues for decades. Here is his latest. This article points out why we cannot rely on “trickle down” charity to take care of the needs of the most vulnerable of us.
The tax nuts, those who want to abolish all taxes, claim that the needs of the less fortunate will be taken care of by the private charity sector. That has never been the case, and it is not the case now, even in these days of spendthrift giveways to the ultra rich on the part of a government gone insane. Charitable giving has actually dropped as a percentage of income among the rich since the tax cuts took effect.
The proliferation of non-profit organizations is the privatization of what should be government functions. I am not complaining, mind you, that we have non-profit organizations, but rather, that the government uses them to shirk its ministerial duties.
I strongly recommend a sober and well-researched book by Johnston: Perfectly Legal.
December 19, 2005
Study Shows the Superrich Are Not the Most Generous
By DAVID CAY JOHNSTON
Working-age Americans who make $50,000 to $100,000 a year are two to six times more generous in the share of their investment assets that they give to charity than those Americans who make more than $10 million, a pioneering study of federal tax data shows.
The least generous of all working-age Americans in 2003, the latest year for which Internal Revenue Service data is available, were among the young and prosperous – the 285 taxpayers age 35 and under who made more than $10 million – and the 18,600 taxpayers making $500,000 to $1 million. The top group had on average $101 million of investment assets while the other group had on average $2.4 million of investment assets.
On average these two groups made charitable gifts equal to 0.4 percent of their assets, while people the same age who made $50,000 to $100,000 gave gifts equal to more than 2.5 percent of their investment assets, six times that of their far wealthier peers.