Archive for June 24th, 2011

June 24, 2011

Giving USA 2011: Good News or More Bad News?

Giving USA 2011 reports that charitable giving in the United States increased by 2.1 percent in 2010 compared to 2009, when adjusting for inflation. So, is this good news or bad news?

Edith H. Falk, Chair of the Giving USA Foundation; Thomas W. Mesaros, CFRE, Chair of the Giving Institute; and Patrick M. Rooney, PhD, Executive Director of The Center on Philanthropy at Indiana University all clearly think the increase in philanthropy is good news. In the Foreword to the Executive Summary of Giving USA 2011, they wrote:

We believe the numbers underscore the fact that giving remains a core American value. Over the past decade, philanthropy has held its own in spite of two recessions, terrorism, wars, and a series of devastating natural and man-made disasters. Adjusted for inflation, total giving exceeded $280 billion a year every year for the past decade and surpassed $290 billion in six of the last seven years. This tells us that despite personal and economic hardship, Americans remain steadfastly committed to each other and their communities. Philanthropy is at the heart of who we are as a society, and it is undeterred, if occasionally deferred, by hardship.

However, others see only more bad news in the report. For example, Ruth McCambridge and Rick Cohen at The Nonprofit Quarterly, were almost hysterical in their pessimism:

What the Giving USA numbers suggest is not only a crisis of declining charitable giving reaching human services or social safety net groups, but a class divide where the groups that do well in charitable solicitations are those with connections, with the social class interrelationships that give them automatic access. Meanwhile, charitable giving for human services is very much the province of the less moneyed donors, the payroll deduction donors, the people who volunteer at the shelter or food pantry or clinic because they know the tangible importance of those institutions to their communities.

I suggest that the good folks at Giving USA are the ones who have it right. While the report does not present great news, it does certainly present good news. Charitable giving is up. Furthermore, despite the ravages of the Great Recession, giving has remained at 2 percent of Gross Domestic Product. Since data has been collected, philanthropy as a percentage of GDP has hovered between 1.7 percent and 2.3 percent.

I also want to point out another piece of good news in the Giving USA report. Of all philanthropic revenue streams, bequest giving saw the largest turn around. Bequest giving increased 16.9 percent in 2010 despite the continued depression of the housing market. While bequest giving took a huge hit of 38.5 percent in 2009, Giving USA attributes that to unusually large bequests that were recorded in 2008. Bequest revenue accounted for 8 percent of philanthropy in 2010.

While it is true that giving has not yet recovered to a pre-recession level, giving was up in 2010 following a two-year decline. The modest up-tick in charitable giving in 2010 is consistent with other immediate post-recession periods.

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