Fears Lead Too Many Donors to Skimp on Charitable Giving

To the Editor:

Your cover story “Pinched From All Sides” (August 8) gives anecdotes of hard times for charities brought on by falling endowments, state budgets, and reduced income from donors. This is indeed a tough time for many nonprofits. However, we should not lose sight of the reality that our country has a tremendous capacity to be philanthropic and to raise funds even with the unsettled economy and neurotic stock market.

Our underlying ability to give is far greater than any amount that we have given to date. The people of the United States remain the possessor of one-third of the world’s wealth. Merrill Lynch and Cap Gemini Ernst & Young report that the number of millionaires in the United States continued to grow in 2001, despite the volatile markets. There are 2.22 million high-net-worth individuals in North America, with nearly all of them, 2.1 million, living in the United States. (High-net-worth individuals have assets of at least $1-million, excluding real estate.) Their wealth grew nearly 2 percent in 2001 to total $7.6-trillion.

More broadly, we are well-off by almost any standard. The U.S. per-capita income stands at $35,000, while the per-capita income of three billion people on the planet equals less than $2 per day. Relatively speaking today we are loaded with dough, and the ups and downs of the market do not change the fact that we have money to give generously.

Then why don’t we? The problem is fear. In spite of the relative extravagance of our wealth, we worry that it will not be enough, so we hold on tighter to what we have. We see ourselves facing lives of scarcity when in fact we could give much away and still have plenty to live on by any worldly standard. We also worry that our support will not make a difference in addressing large and complex social problems. These forces blind us to the extraordinary material wealth that we as Americans possess, and the results that we can achieve when our support is generous and well directed.

Successful fund raising is always candid about the realities of an institution’s finances. But in this environment institutions must, more than ever, appeal to donors’ core values, taking them beyond the uncertainties of the moment toward what is really most important in life. It requires a case for support driven by transformative leaders who, as James MacGregor Burns has written, engage people “in such a way that leaders and followers raise one another to higher levels of motivation and morality.”

Our experience is that when it is clear to people that they can make a difference, they will be generous, even in times of economic uncertainty. Donors need to hear new stories that capture afresh the needs of specific groups of people and the plans and strategies to meet their needs. They need to hear about how contributions create for people opportunity, enlightenment, and the capacities to realize their potential. These are the stories that will liberate donors from the irrational fears of a false scarcity to the joy of discovering an extraordinary capacity to give from an abundance of wealth that today remains unprecedented in the history of the world.

Bill Walch
President
Development Community Associates
Boston