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The Business of Giving: Keeping Faith in Tough Times

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Give money if you can; give time if you can't.

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Like everyone else on the planet, I'm consumed by what the markets are doing day by day, if not hour by hour. I'm personally concerned about the impact of the financial situation on my family and friends, my organization, and the man on the street.

The psychology of fear and uncertainty that's driving shares down is now affecting the general public, causing concern the likes of which we haven't seen in many decades.

So I'm looking at trends and taking sustenance from them, even though I'm being told this is a trend-breaking market.

In 2003, Chip Grizzard, columnist for OnPhilanthropy, said there's only been one year in the past 30 in which charitable giving in constant dollars has decreased from the previous year. That was in 1987, when the major giving season followed the market crash.

However, giving might have remained steady, if not for a second event: In 1986, Congress passed a reduction in individual tax rates that took effect in 1987, and many people moved part of their 1987 giving into 1986, when the deduction would have a greater impact.

The trend in giving has increased in the past 5 years as well, making 1987 the only year of the past 35 in which charitable giving was down. This is a trend I can believe in, even as things seem gloomier by the day.

Another trend I'm going to believe in to keep society moving forward over the coming months, regardless of market fluctuations, is the trend in individual giving. Donations by individuals account for 75% of all giving, totaling an estimated $229 billion in 2007.


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In addition to the sheer volume of donations generated by individuals, there is a very stable trend in the percentage of disposable income individuals give away each year, compared to corporate giving as a percentage of pretax profits.
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No positions in stocks mentioned.

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