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Devil's advocate: Don't donate to charity

Hey, not everyone can be a nice guy.

By Karen Datko Sep 30, 2009 4:47AM

This devil's advocate post comes from Jim Wang at partner blog Bargaineering.

This devil's advocate post will cover something that's bound to elicit a lot of discussion: Here are four reasons why you shouldn't donate money to charity.

That's right. You read that correctly. I have four reasons why donating your hard-earned money to a charity is a bad idea, and chances are there is at least one reason here that you haven't even considered. If there was ever a devil's advocate post to end all devil's advocate posts (don't worry, it's not the last one), this would probably be it.

Americans are among the most charitable people in the world, donating $314 billion in 2007, according to the Philanthropy Journal. And despite a brutal economy, that dropped only 2% (or 5.7% after adjusting for inflation) to $307 billion in 2008.

In the face of that, I present to you four reasons why you shouldn't donate money to charity.

You already donate. Whether you know it or not, you already donate to a lot of charities. When you pay your taxes, you're subsidizing the operations of every single nonprofit organization in the United States because they don't have to pay taxes. When organizations receive subsidies or "investments" from the government in the form of grants, you're more directly donating to philanthropic organizations. In the case of charities that help needy people (homeless shelters, soup kitchens, etc.), you are already supporting those people because your taxes go to the welfare and food stamp programs. It may be more efficient to donate directly to a local homeless shelter or local food bank, but you already donate to them and the people they help through your taxes.

Teach a man to fish. The old maxim of teaching a man to fish has and always will be true: "Give a man a fish, he eats for a day. Teach a man to fish and he eats for a lifetime." Homeless shelters and soup kitchens are wonderful if they are simply helping people get back on their feet, but far too many residents end up staying much longer than they would if the assistance weren't so easy to come by. Withholding support from an organization trying to do good isn't necessarily the best approach to affect this type of change, but it is an approach.

Administrative overhead. All philanthropic organizations have administrative overhead costs. Many philanthropic organizations also have fundraising costs. When you donate your money, a part of it goes to those administrative and fundraising costs. You can check Charity Navigator to see the administrative overhead of almost any charity. For instance, the American Cancer Society spends 9.3% of its revenue on administrative expenses and another 20.2% on raising money. Thirty cents out of every dollar you donate won't go toward anything cancer-related.

Money is too easy. It's very easy to donate money to an organization. It's much harder to donate your time by volunteering. When you volunteer, you have a much greater impact because you'll probably volunteer locally. Local organizations don't get nearly as many monetary donations as the national organizations because they don't spend as much on publicity. Also, charities like Habitat for Humanity may get a larger benefit from volunteers than they do from monetary donations. Finally, donating your time is a truly philanthropic act because you don't get a tax deduction for your time. (The only exception to this is, if you can otherwise make a boatload of cash during the time you would spend volunteering, then you probably should earn the money and donate that.)

I really struggled with this devil's advocate post, probably more so than any other post, as my fellow tweeters can attest to. In my tweeting about it, most of the responses that came back had to do with arguments against donating to a particular charity, rather than arguments against donating to charities at all.

Ultimately, though, I think the argument against donating to charities is pretty thin and comes down to personal preference. I don't think you're a bad person if you don't donate (you may not have the means, etc.), just as I don't think you're automatically a saint for donating.

It's a personal choice that we all must make on our own.

Related reading at Bargaineering:

Published June 17, 2009


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