Posts Tagged ‘Private Charity’

Spending Cuts and Monsters

Posted on February 14, 2013 at 1.00 pm

Q. Let’s face it: the notion that anyone can be successful in this country is absolutely false. There are millions of Americans who are on food stamps/ other entitlements, and are barely staying afloat. If you want to cut these entitlements, what do you say to these people? I know that their entitlements are being taken from someone else, but that person does not need them as much. The fact that they ‘earned’ their own money doesn’t prove that they don’t deserve to be poor, but the poor people do. – musicalvegan, from tumblr.

Q. I don’t want poor people to be poor, and cutting programs, like food stamps, for the poorest of the poor is nowhere near the top of my list of priority spending cuts.

The way I see it, the government spends a lot of other people’s money which I think it has no business spending on a lot of projects which I don’t think should exist/exist in their current state. And, yes, I want to significantly reduce that spending.

But in the grand scheme of all the spending to be cut, not all spending is equal, and not all spending should be cut with equal speed. That would be impractical, unwise, and — where poverty is concerned — inhumane.

As I’ve quoted in response to similar questions in the past, I like what Ron Paul has said on this question:

While our goal is to reduce the size of the state as quickly as possible, we should always make sure our immediate proposals minimize social disruption and human suffering. Thus, we should not seek to abolish the social safety net overnight because that would harm those who have grown dependent on government-provided welfare. Instead, we would want to give individuals who have come to rely on the state time to prepare for the day when responsibility for providing aide is returned to those organizations best able to administer compassionate and effective help —churches and private charities.

Now, this need for a transition period does not apply to all types of welfare. For example, I would have no problem defunding corporate welfare programs, such as the Export-Import Bank or the TARP bank bailouts, right away. I find it difficult to muster much sympathy for the CEO’s of Lockheed Martin and Goldman Sachs.

When it comes to corporate welfare, I’m all for overnight cuts. Ditto foreign military aid and war spending. Ditto…well, ditto a lot of things.

But when it comes to social programs and entitlements, I’d say that some cuts can be made very quickly, while others must go more slowly and on a clear and strict schedule.

For example, older people who are wealthy on their own do not need to get a cut of my salary in the form of Social Security payments. Those checks can stop immediately. But elderly people who have very little money and rely on a program which they paid into their whole lives on the basis of a promise that it would take care of them? I have no desire to snatch away their income.

In short, there’s a difference between wanting serious spending cuts as quickly as possible and being a monster. I don’t want a bloated government, true — but I also don’t want to throw the neediest people in our country onto the street overnight when there are plenty of other cuts we can make first.

A Couple Quick Questions, Ed. 9

Posted on May 20, 2011 at 1.38 pm

Q. Do you agree that the army is a socialist organisation? — Nick, from the internet.

A. Google’s got socialism defined as a “political and economic theory of social organization that advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.”  So if you consider it an industry of sorts, then I suppose “socialist” might be an accurate adjective for the military.

That said, I’ve written at length before about why I consider myself a minarchist libertarian, rather than an anarcho-communist — a differentiation which I think is key to the answer of your question.  You can read my thoughts on the subject in my FAQ; particularly check out the links in the philosophy section.

Q. It kind of seems to me that the libertarian position on charity and government spending completely overlooks the phenomena of greed. If we cut government welfare and safety nets and also cut taxes to compensate, would individuals really donate more? Are their ways to show that this has happened from tax cuts in the past? I just feel like the elevation of “charity” over “safety nets” involves making the assumption that people are just bursting to give charitably if they had extra income. — tideofthought, from tumblr.

A. One of the reasons I’ve delayed answering your question for so inexcusably long is the difficulty I’ve had finding good numbers to answer your question.  I’m still not satisfied with what I have found — so I may update or repost your question in the future — but for now this will have to suffice.

First, I found it noteworthy that donations to charity are, after only taxes paid and mortgage interest, the biggest deduction on taxes Americans make.

Second, let’s take a look at some charts:

In the top graph, we see the income tax rate (the blue line is the relevant one) going down from the mid-1960s to the mid-2000s.  In the second graph, we see the country’s total charitable giving increasing over the same period of time (this time we’re ignoring the blue line, which is the Dow Jones Industrial Average).  The giving is measured in billions, and even adjusted for inflation (using this calculator), the giving in 1967 had more than doubled by 2007.

So from this cursory glance at the data, tax breaks do, in fact, increase charitable giving.  However, we all know correlation doesn’t equal causation, and this information — while certainly extremely interesting — isn’t alone enough to make the case that we don’t need government involved in charity.  To add to the evidence, I’d refer you to Marvin Olasky’s The Tragedy of American Compassion, which is probably the main book on the subject of the history of private charity in America.  As Ron Paul has summarized,

[As Olasky has] amply documented, before they were crowded out by federal programs, private charities did an exemplary job at providing necessary assistance to those in need. These charities not only met the material needs of those in poverty but helped break many of the bad habits, such as alcoholism, taught them “marketable” skills or otherwise engaged them in productive activity, and helped them move up the economic ladder.

Olasky writes from a Christian perspective, which is perhaps appropriate given the role of the church in private charity throughout history.  If you’re interested in the topic — regardless of your views on Christianity — I’d recommend you check out his book.  Also take a look at some the questions I’ve answered on related subjects in the past on my FAQ page under the “Charity and Social Welfare” header.

Q. What is your thoughts on the Uniform Commercial code?  If you are unfamiliar with it, check this. — Shawn, from the internet.

A. The link you provided went to a forum post which was…confusing, or put it mildly.  Alas, such is sometimes the nature of threads on the Daily Paul (or any forum, really).  I did find, however, this explanation of the practice, which was a little more succinct:

Sign your name with any of the following words: “without prejudice,” “All rights reserved without: prejudice, recourse or notice,” or “UCC 1-308.” The purpose? On most occasions, you are considered to have waived your rights unless you specifically reserve them. These words/phrases legally signify that you, in no way, waive any rights not specified on the document you signed.

The actual text of the code is:

(a) A party that with explicit reservation of rights performs or promises performance or assents to performance in a manner demanded or offered by the other party does not thereby prejudice the rights reserved. Such words as “without prejudice,” “under protest,” or the like are sufficient.(b) Subsection (a) does not apply to an accord and satisfaction.

It sounds like a potentially valuable legal protection, though I’m not sure in what circumstances I’d personally need to use it — at least, what circumstances I in my present lifestyle might encounter.  If you have experience with it, though, I’d love to hear more in the comments!

Economy as Idealism

Posted on September 27, 2010 at 10.01 pm

Q. Sometimes, when I have conversations with socialists (we call them “New Democrats” in Canada), I have no idea how to counter arguments like: But what do we do about the poor and marginalized? Cutting government spending only ensures that the poor and marginalized in society become more poor and marginalized. Then the elites can grab power and exploit the poor and marginalized. We need a balance, we need more government programs.

This has been an ongoing problem that I’ve found being on the Libertarian side of things in a very socialist country. I may just shake your magic 8-ball again for advice at some point. — coeus, from tumblr.

A. The “we must save the poor and marginalized one” is certainly a sympathetic one, I must admit.  However, it’s also based on a completely false premise:  that government helps the poor and marginalized.

In fact, I completed my honors thesis on this very subject of public vs. private charity, and I can tell you that the academic literature on the subject of private charity and comparable public programs is generally in agreement:  Private organizations are more efficient and/or effective in their work.

Why?  Well, for a number of reasons which I’ll only briefly mention here:

  • Private charities act in a marketplace of sorts, competing for donations.  If one fails to perform, it will lose support.  Government programs, on the other hand, get more money if they fail, an incredibly perverse incentive.
  • Private charities lack the political associations that government agencies inherently have.  This is especially important in international aid, where private charities can go places a government agency can’t touch.
  • Private charities statistically spend far less on administrative costs than comparable government agencies do.  This allows them to devote more resources to actually helping those in need.
  • Finally, private charities have more freedom to innovate and choose flexible solutions to the problems they deal with.  Government agencies may not have the same option because of their obligation to higher-ups, the legislature, and taxpayers.

(more…)