ABSTRACT: Some people advocate for reducing government spending on social welfare programs by arguing that private charity should and could address social needs. However, when people’s needs are essential and time sensitive, charity is insufficient and undependable. For example, charities won’t be able to fill the $5 billion hole left by the recent cuts to the $78 billion federal Food Stamps program. This amount is equal to the total amount of annual contributions to all food banks in the country.
Charity or philanthropy can also serve as a smoke screen for activities that do far more harm than the benefits of the charitable giving. An example is the recent $20 million gift by the billionaire corporate executive, David Koch, to provide child care for 126 children at MIT. He spent easily ten times this amount on political activism in the last federal elections, supporting politicians who have been leaders in cutting the federal budget. Such cuts have meant that 57,000 poor children have been denied Head Start child care services, and, in addition, in Massachusetts alone, there are over 30,000 low income children on the waiting list for largely federally-funded child care subsidies. As Joan Vennochi wrote in her column in the Boston Globe about Koch’s gift, “The generosity of individuals is a blessing, but it’s no substitute for national policy.”
There are many examples of philanthropy, similar to this Koch case, where the givers, both individuals and corporations, have much greater negative impacts on society than the positive effects of their charity. In the case of McDonald’s, history indicates that from the start the goal of its philanthropy has been positive public relations for the corporation, not helping those in need. Its aggressive marketing of unhealthy food to children does far more harm than the good its very modest philanthropy does.
FULL POST: Some people advocate for reducing government spending on social welfare programs by arguing that private charity should and could address social needs. While charity or philanthropy plays an important role in our communities and country, when people’s needs are essential and time sensitive, charity is not dependable enough to be relied on. Charity can meet some people’s needs some of the time but it doesn’t – and can’t – meet all people’s needs, even their critical needs, all the time. The public sector must serve as the resource of last resort and ensure that critical needs are met in a timely fashion.
Charity is insufficient and lacks the consistency necessary to meet critical needs on a regular and timely basis. For example, access to sufficient and nutritious food is essential to well-being for adults and especially for children. However, charities won’t be able to fill the $5 billion hole left by the November 1 cuts to the $78 billion federal Food Stamps program. This reduction in food assistance from the federal government is equal to the total amount of annual contributions to all food banks in the country, according to a study by the Washington-based anti-hunger advocate Bread for the World. [1] Therefore, charitable donations for food would need to double instantaneously to fill this gap. Furthermore, Congress is likely to cut federal funding for food assistance even further in the next budget. (See my post Starving America on 11/11/13 for more detail at https://lippittpolicyandpolitics.org/2013/11/11/starving-america/.)
Clearly, there is no way that private charity can make up for the recent lost funding let alone for future cuts. Therefore, these cuts mean that nutrition will suffer and hunger will increase. For some young children, this may well have long lasting effects on their developing brains.
Charity or philanthropy can also serve as a smoke screen for activities that do far more harm than the benefits of the charitable giving. An example is the recent $20 million gift by the billionaire corporate executive, David Koch, to provide child care for 126 children at MIT. [2] Child care is essential for working parents and quality early education and care is critical for young children due to the foundational brain development that occurs in the first five years of life.
Koch is a generous philanthropist, but he is better known for his political activism. He spent easily ten times this $20 million on his political activism in the last federal elections. The politicians he supports have been leaders in cutting the federal budget. The cuts in March, 2013, known as the sequester, meant that 57,000 poor children nationwide have been denied Head Start child care services. In addition, in Massachusetts alone, there are over 30,000 low income children on the waiting list for child care subsidies, which are largely federally funded. This number has grown significantly due to cuts in federal funding. So, while Koch’s philanthropy got him a very positive story on the front page of the Boston Globe, its impact is far, far outweighed by the negative effects on national child care policies of his political activism.
There are two lessons to be learned from this example. First, charity is not and will not be sufficient to ensure affordable, quality early care and education for every child of working parents. Substantially increased spending by state and federal governments is needed to meet this critically important need. As Joan Vennochi wrote in her column in the Boston Globe about Koch’s gift, “The generosity of individuals is a blessing, but it’s no substitute for national policy.” [3]
The second lesson to be learned from this example is that it is often important to look at the context of charity and the overall impact of the giver. There are many examples of philanthropy, similar to this Koch case, where the givers, both individuals and corporations (or other organizations), have much greater negative impacts on society than the positive effects of their charity. Walmart and McDonald’s are two classic examples from the corporate world. In some cases, the charitable activities are a relatively blatant attempt at public relations; an effort to get favorable stories in the media and divert attention from the negative effects of other activities. (See my post Lack of Good Jobs is Our Most Urgent Problem on 10/29/13 for more information on how low pay and part-time jobs at Walmart, McDonald’s, and other large corporations are costing taxpayers billions of dollars in public assistance for their employees. https://lippittpolicyandpolitics.org/2013/10/29/lack-of-good-jobs-is-our-most-urgent-problem/)
In the case of McDonald’s, history indicates that from the start the goal of its philanthropy has been positive public relations for the corporation, not helping those in need. Its philanthropy is less that 0.5% of its profits and it spends 25 times as much on advertising. Its aggressive marketing of unhealthy food to children does far more harm than the good its very modest philanthropy does. It also spends far more lobbying for favorable public policies than it spends on philanthropy. [4]
This is the first of a couple of posts on charity or philanthropy (terms I use interchangeably). There are a number of other issues about charity that I plan to discuss, including:
- Decisions about charitable or philanthropic spending are made by private individuals or organizations. They may not reflect public priorities and often lack public input and accountability.
- Charity can exacerbate inequality. Richer communities generally have greater capacity to raise money than poorer communities, so communities where the need is the greatest, both rural and urban, often have less capacity for charitable activity.
- Philanthropic activity can affect public policies and programs. It may undermine the democratic decision-making process and community involvement.
[1] Wallbank, D., & Bjerga, A., “Wal-Mart to widows will feel U.S. Food Stamp cuts,” Bloomberg
[2] Johnson, C.Y., 10/4/13, “Scientists at MIT get prized gift of day care,” The Boston Globe, front page
[3] Vennochi, J., 10/10/13, The two David Kochs,” The Boston Globe
[4] Simon, M., 10/29/13, “Clowning around with charity,” Corporate Accountability International and Small Planet Fund (http://www.eatdrinkpolitics.com/2013/10/29/clowning-around-with-charity-how-mcdonalds-exploits-philanthropy-and-targets-children/)
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