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The Recession Will End … When Charitable Giving Bounces Back


Americans are buying more holiday gifts this season than last, but that same spirit of generosity has yet to reach most charities. (via Chronicle of Philanthropy)

If a tight job market, pinched portfolio and limited credit have taught us anything this year, it’s that when it comes to spending, it’s time to prioritize. We’re partially surprised that spending on gifts has trumped giving to charities, but it might be worth separating the two data points: Holiday spending reflected a small but growing uptick in Americans’ income, coupled with cutting back that happened all year. Who wouldn’t splurge a little at the holidays?

But when people cut back on giving to philanthropy, that’s something else altogether.

“Humans want to feel a sense of connection and a sense of purpose to life. Giving (time, money, energy) is a central way that we strive to find meaning,” writes Sean Stannard-Stockton, a principal and director of Tactical Philanthropy at Ensemble Capital Management. He also acknowledges that, “No doubt some giving is motivated by selfishness.”

Indeed. A study released earlier this year reported that a driving force behind giving was “image motivation” — not an internal desire to give, but an internal desire to be seen as a giving person. This remains whether one is packing a healthy bank account or considering food stamps.

Red Cross found that 90 percent of Americans had planned to make charitable donations over the holidays with 39 percent also noting that they were willing to have money that would have been spent on gifts donated to charities instead. A full 80 percent said they would gladly donate to charity vs. buy a gift if given the choice. So why the disparity between these intentions and the actions?

Perhaps we should turn to Aristotle, who said that generosity is “a mean between the excess of wastefulness and the deficiency of stinginess.”

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