The Surprising Truth About American Generosity

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The Surprising Truth About American Generosity

When Alexis de Tocqueville came to America in 1835, he was surprised by how willing people were to donate their time and money to causes they considered worthy.  "The Americans," he wrote, "make associations to give entertainments, to found seminaries, to build inns, to construct churches, to diffuse books, to send missionaries to the antipodes; in this manner they found hospitals, prisons, and schools."

In the past two centuries, that spirit of generosity has only become more ingrained in the American culture.  According to The American magazine,1 in 2006, Americans gave $295 billion to charity, up 4.2 percent from the previous year. Charitable donations have consistently risen faster than the GDP since World War II.  Per capita GDP in the U.S. has gone up by about 150 percent during the last half century.  At the same time, charitable donations have risen by almost 200 percent. 

It is estimated that some 70 to 80 percent of Americans donate each year, and the average household contributes more than $1,000 a year, with about a third of it going to places of worship, while two-thirds is given to secular causes, such as schools. 

Though some critics love to complain that Americans consume too much and share too little, the numbers undermine this line of reasoning.  Per capita, the people in the United States are perhaps the most generous in the world, as measured by what they give.  In 1995, we gave three-and-a-half times more than the French, seven times more than the Germans, and fourteen times more than the Italians. Americans donate more of their time as well — 15 percent more than the Dutch, 21 percent more than the Swiss, and 32 percent more than the Germans.  Those figures are adjusted for education, income, age, sex, and marital status.  In other words, the American level of giving cannot be explained by saying that Americans simply have more money and time to give.

Neither can it be explained by tax laws that favor charitable donations.  In fact, the U.S. paid out, in effect, $37.2 billion in 2002 as a result of people deducting donations from their tax returns.  But, upon closer analysis, we find that tax policy has little to do with the high level of donations in the U.S.  Only a third of Americans itemize deductions on their tax returns.  As reported in Who Really Cares?2 a 2006 scholarly study by Arthur C. Brooks, professor of business and government policy at Syracuse University, research consistently shows that almost no one is motivated to give only because of the tax consequences...

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