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General News    H2'ed 10/13/14

Our Empathetic Rich: The Rarest of Birds

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A landmark new study has laid bare the dirty little secret of modern American philanthropy: America's wealthy don't particularly care all that much about the rest of us.

Billionaire CEO Nicholas Woodman, news reports trumpeted earlier this month, has set aside $450 million worth of his GoPro software stock to set up a brand-new charitable foundation
"We wake up every morning grateful for the opportunities life has given us," Woodman and his wife Jill noted in a joint statement. "We hope to return the favor as best we can."

Stories about charitable billionaires have long been a media staple. The defenders of our economic order love them -- and regularly trot them out to justify America's ever more top-heavy concentration of income and wealth.

Our charities depend, the argument goes, on the generosity of the rich. The richer the rich, the better off our charitable enterprises will be.

But this defense of inequality, analysts have understood for quite some time, holds precious little water. Low- and middle-income people, the research shows, give a greater share of their incomes to charity than people of decidedly more ample means.

The Chronicle of Philanthropy, the nation's top monitor of everything charitable, last week dramatically added to this research.

Between 2006 and 2012, a new Chronicle analysis of IRS tax return data reveals, Americans who make over $200,000 a year decreased the share of their income they devote to charity by 4.6 percent.

Over those same years, a time of recession and limited recovery, these same affluent Americans saw their own incomes increase. For the nation's top 5 percent of income earners, that increase averaged 9.9 percent.

By contrast, those Americans making less than $100,000 actually increased their giving between 2006 and 2012. The most generous Americans of all? Those making less than $25,000. Amid the hard times of recent years, low-income Americans devoted 16.6 percent more of their meager incomes to charity.

Overall, those making under $100,000 increased their giving by 4.5 percent.

In the half-dozen years this new study covers, the Chronicle of Philanthropyconcludes, "poor and middle class Americans dug deeper into their wallets to give to charity, even though they were earning less."

America's affluent do still remain, in absolute terms, the nation's largest givers to charity. In 2012, the Chronicle analysis shows, those earning under $100,000 handed charities $57.3 billion. Americans making over $200,000 gave away $77.5 billion.

But that $77.5 billion pales against at how much more the rich could -- rather painlessly -- be giving. Between 2006 and 2012, the combined wealth of the Forbes400 alone increased by $1.04 trillion.

What the rich do give to charity often does people truly in need no good at all. Wealthy people do the bulk of their giving to colleges and cultural institutions, notesChronicle of Philanthropy editor Stacy Palmer. Food banks and other social service charities "depend more on lower income Americans."

Low- and middle-income people, adds Palmer, "know people who lost their jobs or are homeless." They've been sacrificing "to help their neighbors."

America's increasing economic segregation, meanwhile, has left America's rich less and less exposed to "neighbors" struggling to get by. That's opening up, saysVox policy analyst Danielle Kurtzleben, an "empathy gap."

"After all," she explains, "if I can't see you, I'm less likely to help you."

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Sam Pizzigati is an  Associate Fellow, Institute for Policy Studies

Editor,  Too Much ,  an online weekly on excess and inequality

Author, The Rich Don't Always (more...)
 

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