CSNbbs - Charitable giving

<a href='http://www.washingtonpost.com/wp-dyn/articles/A50753-2003Apr28.html' target='_blank'>Washington Post Article</a>

Ok, I just don't know where to vent my disgust at the lack of rational thought behind these analyses. Is it the journalists or the 'think tanks' that put out such nonsense? Thus my quote from Lewis about modern education.

Anyway,

The 'U' shaped curve for charitable giving...an empircally verifiable observable. But the hypotheses and conclusions as to why this exists...pathetic. (Except that giving doesn't track w/ income. That made sense.)

How about these ideas?

- Middle income folks expect to save for college for their kids. Remember the tuition thread? (this rant is meant to be college related) Students from low income families are more likely go get financial aid. Wealthy families can afford the tuition outright. Middle incomes? Stuck, w/ tuitions outpacing inflation, and an expectation that a kid needs a college education to maintain their position. Thus they save aggressively, and forego outside charities.

- Graduated tax scale. Geesh, talk about an invitation for DG to sound off 03-razz

...with a graduated scale, middle income folks pay more in taxes for the higher dollars earned. This flattens out for personal income tax and social security for the high incomes.

-Skewed statistics from singles. Many singles still rent rather than own homes. Thus they are far less likely to itemize w/o a mortgage deduction. I'd bet this shifts the statistics significantly, if not dramatically.

In general I do think people could give more. Give up CaTV and movies for a start. Bike to work (and give up the gym membership). Fast once a week (or at least give up soda). But it's these misleading stories that really piss me off.

No more or less pathetic than those offered in the article. What would be interesting is to see the correlation between income and membership in evangelical/charismatic congregations where tithing is stressed heavily.

As for the tax point, remember that those too poor to pay income taxes bear the total out-of-pocket cost for each dollar donated. Bottom-bracket payers are out-of-pocket 85 cents after taxes for each dollar donated. (I'm doing federal-only for simplicity.) Middle income payers bear 72 cents of the cost of each donated dollar. Top-bracket taxpayers bear only 60.4 cents of the cost of each dollar donated (and get to avoid paying capital gains on in-kind donations of appreciated assets). I'm not seeing how that helps explain the "U."

DevilGrad Wrote:No more or less pathetic than those offered in the article.

Bite me. :)
They've overlooked the obvious while going for trivialities that play a minor role in the whole analysis.

Quote:As for the tax point, remember that those too poor to pay income taxes bear the total out-of-pocket cost for each dollar donated.  Bottom-bracket payers are out-of-pocket 85 cents after taxes for each dollar donated.  (I'm doing federal-only for simplicity.)  Middle income payers bear 72 cents of the cost of each donated dollar.  Top-bracket taxpayers bear only 60.4 cents of the cost of each dollar donated (and get to avoid paying capital gains on in-kind donations of appreciated assets).  I'm not seeing how that helps explain the "U."

Those at the bottom are less likely to itemize, and thus be included in this study.
But yes, those w/ lower incomes get less of a tax break than middle incomes, but they start w/ a lower tax burden. (That's where the 'U' come in.)

Bite yourself. The data suggest that 75% of giving is to religious organizations. You can't analyze the data without thinking about religious affiliation and, consequently, race. Just because you're a rocket scientist and uncomfortable with "soft" factors doesn't mean they don't exist. 03-wink

I thought the article said it studied only returns with $50K or more of household income, so those at the bottom are excluded regardless of whether they itemize. (As a practical matter, folks under $50K are unlikely to have a big enough mortgage-interest deduction to beat the standard deduction, which usually is the basic tradeoff on which way to file.)

I'm still betting that if you could fit a good regression model on this puppy, religious affiliation would either your top or second-most explanatory variable. (I'd use a binary variable for whether the person belongs to a religious sect that believes that the Bible/Koran/Torah is literally true.) But, then again, I'm a lapsed data analyst.

DevilGrad Wrote:Bite yourself. The data suggest that 75% of giving is to religious organizations. You can't analyze the data without thinking about religious affiliation and, consequently, race. Just because you're a rocket scientist and uncomfortable with "soft" factors doesn't mean they don't exist.

I don't have a problem w/ that, I think it's an interesting question.

I'm just saying the original conclusions are focused on the small stuff, ignoring major, obvious issues. Ergo the commentary was pathetic.