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Charitable Giving Falters as Economy Fumbles
July 25, 2008 07:00 AM
by
findingDulcinea Staff
Nonprofit and charitable organizations are bracing themselves for a difficult year as economic woes affect American donors.
30-Second Summary
Americans' charitable giving is starting to fall due to the poor economy, according to several news reports.
"The real test of Americans' commitment to the less fortunate may well be 2008, as family budgets are squeezed by rising food and energy costs and other economic pressures," writes the Fredericksburg Free Lance Star.
Nonprofit executives are slightly less optimistic about present and future fundraising than they were even half a year ago, according to the Philanthropic Giving Index conducted by the Center on Philanthropy at Indiana University.
"The percentage of fundraisers reporting a negative impact of the economy on giving has grown significantly," said Patrick M. Rooney, director of research at the Center. "Just over 83 percent of fundraisers reflect that view now, as opposed to 48 percent six months ago. For some corporations and donors with lower or fixed incomes, philanthropy may be seen as a kind of luxury good."
In 2007, Americans' financial donations to charity topped a record $300 billion at $306.39 billion despite mounting worries over the economy, according to the Giving USA Foundation.
But after adjusting for inflation, donations rose only 1 percent from the previous year's figure of $295 billion, according to a June Wall Street Journal report.
Earlier in the summer, reports showed America was suffering from philanthropic fatigue as the world coped with a bevy of natural disasters, including Cyclone Nargis in Myanmar and the earthquake that devastated China's Sichuan province.
"The real test of Americans' commitment to the less fortunate may well be 2008, as family budgets are squeezed by rising food and energy costs and other economic pressures," writes the Fredericksburg Free Lance Star.
Nonprofit executives are slightly less optimistic about present and future fundraising than they were even half a year ago, according to the Philanthropic Giving Index conducted by the Center on Philanthropy at Indiana University.
"The percentage of fundraisers reporting a negative impact of the economy on giving has grown significantly," said Patrick M. Rooney, director of research at the Center. "Just over 83 percent of fundraisers reflect that view now, as opposed to 48 percent six months ago. For some corporations and donors with lower or fixed incomes, philanthropy may be seen as a kind of luxury good."
In 2007, Americans' financial donations to charity topped a record $300 billion at $306.39 billion despite mounting worries over the economy, according to the Giving USA Foundation.
But after adjusting for inflation, donations rose only 1 percent from the previous year's figure of $295 billion, according to a June Wall Street Journal report.
Earlier in the summer, reports showed America was suffering from philanthropic fatigue as the world coped with a bevy of natural disasters, including Cyclone Nargis in Myanmar and the earthquake that devastated China's Sichuan province.
Headline Link: Economic slump puts damper on charitable giving
The Philanthropic Giving Index, which is conducted by the Center on Philanthropy at Indiana University in Indianapolis, includes three indexes on a scale from 0 to 100 based on a semiannual national survey of nonprofit fundraising professionals. The latest survey indicated that all three of the main indexes had suffered declines from previous levels.
Source: The NonProfit Times
Opinion & Analysis: 'A Time to Give'
Fredericksburg, Va. newspaper The Free Lance Star suggests focusing your charitable giving on necessities such as food, shelter and clothing, or donating your time during difficult financial times. "Americans live in the wealthiest nation in the world, but millions are still homeless and hungry. The number only increases when the economy slows. That's a challenge for the rest of us to dig deeper to help one another."
Source: The Free Lance Star
Background: 'Americans' Charitable Giving Hits a Record'
"There's a lot of economic and political uncertainty right now and people don't like uncertainty," said Patrick Rooney, director of research at Indiana University's Center on Philanthropy. "Uncertainty is the enemy of investment. In some ways, uncertainty also hurts philanthropy."
Source: The Wall Street Journal
Related Topics: Philanthropic fatigue; celebrity charities
Many Americans are donating less money to disaster relief for Myanmar and China than they have for past events, possibly due to "disaster fatigue." Cyclone Nargis pounded Myanmar on May 2 and 3, left at least 78,000 dead and 56,000 missing. Just over a week later, a powerful earthquake devastated Sichuan province in China, killing over 40,000 and injuring more than 247,000.
Source: findingDulcinea
The American Red Cross reported that it was running low on disaster relief funds earlier in the summer, due to shrinking donations, scandals and Midwestern floods that have stretched its financial resources too thin. Since April 2008, the organization has handled more than 30 disaster operations, and currently has thousands of workers helping flood victims in the U.S. Midwest.
Source: findingDulcinea
Are celebrity charities about good will or good PR? Critics criticized Sting's rainforest charity earlier this year, saying that too little of the money raised goes to the forests he claims to save. According to the New York Post, Sting's 2006 Carnegie Hall charity concert raised over $2 million to save the world's rainforests, but less than half of that—$887,374—actually funded "tree-saving programs."
Source: findingDulcinea
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