With Charity, Who Needs Taxes?

November 28th, 2012

The idea that contributions to the public good, for provision of public goods, should be voluntary is certainly appealing. But I was curious about the numbers. Like most things libertarian, this notion is utopian and unrealistic.

Total charitable contributions by individuals, corporations, and foundations was an estimated $298.42 billion in 2011, up 4 percent in current dollars and 0.9 percent in inflation-adjusted dollars from a revised total of $286.91 billion in 2010, according to a report from the Giving USA Foundation and the Center on Philanthropy at Indiana University.

That’s 2% of GDP. Government spending over the years has been circa 30% of GDP. If taxes were eliminated, would charitable giving increase fifteen-fold?

Would it be donated to the sexy things like road maintenance and bank regulation?

American giving.

  1. Pedro Alvarez
    November 28th, 2012 at 19:33 | #1

    There are many Jill Kelley cancer foundation types. These charities exist because of tax deducations. If there were no taxes, we will be left with few genuine charities like Gates foundation. Even these genuine charities don’t focus so much on the American public.

  2. December 18th, 2012 at 15:36 | #2

    Most of what the government does isn’t charity. Now, to be fair, the government spends way more on welfare than there is charity. Libertarians can argue that there are crowding out effects, but I don’t think they are enough to fully replace government, even if private charities are more efficient than governmental programs.

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