The Compassion Gap & Generosity of the Poor

[grey_beard]

Of course they are not charity, but they can be used for many of the same purposes. In places with higher taxes, there is often a broader range of services available to more people (i.e. children, elderly, disabled, poor), services otherwise paid for through charity. The 19th and early 20th century mentality was to leave these services to charitable organizations supported through voluntary donations. We see how well that worked. Yes, there were wealthy donors who set up free clinics, children's homes, soup kitchens, etc. but coverage was very uneven and did not come close to meeting needs in most places.

Funding such services through taxes provides a higher and more consistent level of funding; spreads the funding burden across a larger pool of people; and makes a given service available more consistently across the population. So, in this respect if raising taxes on the wealthy causes them to donate less to charity, it may still be the better bargain. Sooner or later, we all pay anyway; better sooner, and less.

Two issues with that.
1) Overhead
2) Scope creep and empire building.
"If you're not part of the solution, there's good money to be made in prolonging the problem."

Oh, and the problem of "hangers-on" -- people who really aren't in need of the service, but find their way through the bureaucracy or engage in fraud, because hey, free money.

You run into the "lawyer's uncertainty principle" -- if you define things closely enough to cut out most fraud, a lot of intended recipients fall afoul of the red tape; if you define things loosely enough
to allow even the unsophisticated among the needy to find their way in, you get a lot of fraud, waste, abuse, & hangers-on...

Not so much with private charity; particularly those which upheld and encouraged the self-respect of the recipients by requiring them to donate time & services in return for charitable donations.

 

[xisnotx]

the poor are more generous because a favor is worth more than a dollar.

not because they're better people.

 

[Coriolis]

Two issues with that.
1) Overhead
2) Scope creep and empire building.
"If you're not part of the solution, there's good money to be made in prolonging the problem."

Oh, and the problem of "hangers-on" -- people who really aren't in need of the service, but find their way through the bureaucracy or engage in fraud, because hey, free money.

You run into the "lawyer's uncertainty principle" -- if you define things closely enough to cut out most fraud, a lot of intended recipients fall afoul of the red tape; if you define things loosely enough
to allow even the unsophisticated among the needy to find their way in, you get a lot of fraud, waste, abuse, & hangers-on...

Not so much with private charity; particularly those which upheld and encouraged the self-respect of the recipients by requiring them to donate time & services in return for charitable donations.

These are problems of implementation, which charities are not immune to. Plenty of charities have excessive administrative costs and questionable results. Yes, the savvy donor can usually figure this out and give elsewhere, but meanwhile the charity is still collecting money from the more gullible, and has relatively little accountability. Government programs sometimes require benefit recipients to pay back or contribute. The whole premise behind WPA, for instance was that the poor wanted a job, not a handout. We don't revert to a practice known not to work because it's replacement needs some improvement. To paraphrase the well-known quote about democracy, tax-based methods are the worst way to address society's needs except for all the others.

 

[grey_beard]

These are problems of implementation, which charities are not immune to. Plenty of charities have excessive administrative costs and questionable results, and government programs sometimes require benefit recipients to pay back or contribute. Yes, the savvy donor can usually figure this out and give elsewhere, but meanwhile the charity is still collecting money from the more gullible, and has relatively little accountability. We don't revert to a practice known not to work because it's replacement needs some improvement. To paraphrase the well-known quote about democracy, it's the worst way to address society's needs except for all the others.

I happen to disagree; but I'm simply too tired to spell it out in detail.
"Cliff's Notes *to* the Cliff's Notes" version is that if a private charity is overrun with hangers-on, they can simply move or refuse service on an individual basis; government MUST have fixed uniform standards.
Private charities (of the kind we are discussing here) do not accumulate staffs and lobbyists and expense accounts -- at least, legitimate ones don't ; and of course there are charities which exist primarily as fundraising organizations, and some of the best-known charities seem to pay their officers *WAY* too much money -- e.g. one city-level President of the United Way was pulling in $400k / year.
But private charities are limited by the need to raise money voluntarily, it is not "friendly Congressman adds $$$ in the omnibus spending bill" and as such have a form of accountability which is more direct than the government.

Bowing out for now as I sense we have differences at the *axiomatic* level ; not wishing to pick a quarrel.

 

[Tellenbach]

These are problems of implementation, which charities are not immune to.

Before a single dollar is allocated to a government agency, roughly 20% has already been spent in the tax collection process. That's the percentage of tax income needed to collect federal taxes. Overall, it takes the government roughly 75 cents to distribute 25 cents in government benefits.

"For example, about 75% of the tax dollars that are targeted to welfare programs actually go to the middle-class administrators rather than the needy. In contrast, private programs give about 75% of donated dollars to the poor. Thus, the poor get more when charitable giving is private."

How effective is government welfare compared to private charity?

To paraphrase the well-known quote about democracy, tax-based methods are the worst way to address society's needs except for all the others.

Simply not true. For example, look what happens when the government plays venture capitalist with Solyndra, AboundSolar, Fisker, A123, etc.

 

[SD45T-2]

"If you're not part of the solution, there's good money to be made in prolonging the problem."

Is that Norm Augustine?

 

[21%]

I'll add my very unhelpful 2-cents:

Only cut-throat business people make it to the top twenty percent. I think the economic structure now favors certain 'unethical' practices so the most successful tend to be those with the least moral attachments.

 

[grey_beard]

Is that Norm Augustine?

I don't know for sure; I thought I read it in P.J.O'Rourke or on one of those "Murphy's Law" sites.