Reprinted from To The Point Analyses
For one thing, it suggests that there are a wide array of community-related projects that are underfunded or simply not funded at all by public monies. These include various forms of medical research; local arts, including orchestras, theaters, and museums; parks and wildlife causes; animal shelters and rescue services; various sorts of poor-relief organizations such as the Salvation Army and Good Will; civil and human rights groups; women's shelters; and volunteer fire companies. The list seems endless.
In the U.S. this process of charitable solicitation has become a big business. There is an article in the 14 July 2016 New York Review of Books entitled "The Undermining of American Charity." According to the article, the "second most popular charity" in the U.S., in terms of donated dollars, is Fidelity Charitable, a branch of Fidelity Investments that acts as a "middleman" between "individual client accounts" and the charities they wish to support. Fidelity holds the money and, of course, "manages" it for profit until the clients instruct the firm how to distribute the funds.
Fidelity can also help the donor save on taxes by timing out donations. The charges and fees for all this make these "donor advised funds" money makers for "big finance." The authors of the NYRB essay don't like this turn of events. They feel that too much of the charitable funds are being "hoarded" by such institutions as Fidelity in order to maximize profits. Charities end up with less.Part II -- An Underdependence on Government Of course, someone was bound to turn charity into big business in an economy and culture that prioritizes the making of profit. However, that apparent inevitability aside, what lesson can be learned from the large and growing role played by charitable solicitations in the United States? An answer can be found in the proposition that, to the extent that a society is dependent on charity to satisfy community needs, the proper role of government is not being realized.
This conclusion is based on a commonsense social democratic point of view -- one that assumes that the collective (working through government) has a responsibility to support activities that reflect important community interests. This is, ultimately, one of the purposes of government. Most of the charities soliciting funds through the U.S. Mail would fit into this category of activities.Part III -- A Perverse Philosophy It is significant that, in the U.S., reluctance to use government to own up to this responsibility is rationalized in the name of "freedom" from economic restraint and taxes. That is, the perverse American philosophy of radical individualism preaches that government should not be responsible for community needs beyond supporting the justice system, national defense and the enforcement of contracts. Everything else is the individual's responsibility. Such a scheme, at least in theory, gives the citizen the "right" to "get rich" as well as the "right" to endure a lifetime of poverty.