The wealthy drive much of the world’s philanthropic giving — about one-third of all donations to charitable causes come from the top one percent of earners, according to Philanthropy Roundtable.
So, let’s stop treating them like the enemy.
Donations from the rich build hospitals, feed the hungry and shelter the homeless. While politicians demagogue the rising cost of education and student debt, the rich are actually doing something about it by endowing college scholarship funds to make education more affordable.
Making the rich “pay their fair share” is a trendy talking point for anti-capitalists. It’s a talking point that conveniently ignores how the uber-wealthy pay far more than their so-called fair share when it comes to philanthropy.
This stark truth came to light in 2010, when the wealthiest in the world stepped up to the plate to publicly declare their philanthropic intentions. Warren Buffett and Bill Gates created the Giving Pledge campaign to inspire fellow billionaires to donate a majority of their wealth to philanthropy.
This wasn’t about earmarking an additional portion of annual income for charitable causes. This was about giving away entire fortunes built through a lifetime of hard work, creative thinking and capital investment.
Buffett put his money where his mouth was, and as of 2020 had given away more than $37 billion to philanthropy. This is in addition to other Giving Pledge members, like DFS co-founder Chuck Feeney ($9 billion), and hedge fund billionaires Ray and Barbara Dalio ($5 billion.)
Buffett has also pledged to give away more than 99% of his net worth. I think we can agree that 99% is far and above his fair share.
Today, more than 230 individuals, including billionaires Elon Musk and Larry Ellison, have signed the Giving Pledge. This has resulted in an estimated $600 billion pledged to all kinds of causes.
And that’s another reason why capitalism is the best economic system in the world.
Because capitalism doesn’t just work for the wealthy. It’s a tool that anyone can use to generate wealth and economic security. And in the process, it cultivates a culture of generosity — by giving more people the opportunity for philanthropy, regardless of their background.
Americans give seven times as much as Europeans, and in 2020 gave over $471 billion — 5.1% more than the previous year
More individuals across the socioeconomic spectrum have a personal stake in a capitalist society and incentive to support the well-being of that society by giving, becoming the billionaires of our communities without having a billion dollars.
The local soup kitchen, homeless shelter, or pregnancy resource center doesn’t need $100 million from Warren Buffet — they need 100 $1,000 donations from everyday people who care about the world as much as they do. Those donations may come in the form of money, direct volunteering, or organizing fellow community members to become involved.
And that’s the greater point: you don’t need to have lots of money to help a fellow human being.
Even though not everyone can write a check or launch a foundation, over 77 million Americans gave of their time, talents, and energy to charity in 2020 — one of the toughest years in memory for many Americans who lost their jobs, got sick, and lost loved ones. Giving isn’t only about the money, it’s about using our gifts and blessings.
When recent tornadoes devastated communities in Kentucky, the Cajun Navy’s relief and recovery options were on the ground just hours later, and two days before President Biden’s visit. They didn’t wait for the government to give platitudes and other people’s tax money; they acted on their own volition, with neighborly care.
So, politicians and media pundits should stop attacking the rich, and besmirching the economic system that has created wealth for tens of millions of people, not just billionaires. Because capitalism has given all of us, from the uber-wealthy on down, the ability to contribute to making the world a better place.
Charles Mizrahi is author of Wall Street Profits for Main Street Investors and host of The Charles Mizrahi Show. Read His Reports — Here.
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