Philanthropy Feature 4: Transfer of Wealth
In 2000, Americans gave more than $152 billion to churches... schools... arts groups... Public Radio... and scores of other non-profit organizations. It was a record year - one which has some in the public sector pretty optimistic about the future. Terry Hanson is with the Cleveland Foundation.
Terry Hanson: We had a great year - more than doubled the new gifts from 99 in 2000 and it was not a good year for the economy - the market was up and down and all around. Nasdaq crashed badly. - and yet we had probably our second best year in the history of the foundation.
Thanks, in large part, to donors made wealthy by the new economy. Still - Hanson admits, many of these donors could have been even more generous. The San Francisco-based philanthropic research organization New Tithing Group estimates that tax filers could have comfortably doubled their giving last year. Other research finds that if boomers were giving at the same proportions as their parents there'd be a whole lot more money going round - and that's why folks who study philanthropy - and those who work for nonprofits - are anxiously, perhaps nervously, anticipating what's being called the biggest transfer of wealth in history. Over the next two decades - trillions of dollars, perhaps hundreds of trillions - moving from baby boomers parents to boomers. Just where that money will end up - in people's pockets or serving the public good - depends on who you ask according to John Yankey of the Mandel Center for Nonprofit Organizations at Case Western Reserve University.
John Yankey: There are critics who indicate it is a more self-centered group of people who will be in control of the money. They do not harbor the same kind of socially-oriented motivation that their ancestors did and as a consequence they will want to use it for their own self-interest.
Jeff Davis: I'm surprised that non-profits are so concerned.
Financial planner Jeff Davis is himself a boomer.
Jeff Davis: Because my vision of it is that many of my clients are interested in giving. They've already probably spent a lot of that money on themselves and there's this full circle coming around where traditional family values are more important.
Again, the Cleveland Foundation's Terry Hanson.
Terry Hanson: People are looking for some kind of connection to this world. They're looking for some kind of significance and why they're here and why do I have all this wealthy and what am I supposed to do and how many homes do I need? How many trip to Europe do I need to go on before they start saying, okay - now what? If money bought you happiness - then why is there the Betty Ford clinic?
Of course, a good amount of the money that finds its way to boomers will eventually flow to boomers kids - generations X, Y, and so on... and that worries philanthropist Doris Bardon - herself an octogenarian.
Doris Bardon: Today's young people are being raised to be receivers, not givers, in every sense of the word. So philanthropy would be the furthest thing from their minds or hearts. Just as being participatory citizens means nothing - they wouldn't know what you are saying if you used those words.
Paul Schervish: Without much evidence we are always saying 'i'm okay. You're not. You're not giving enough at the right time to the right causes in the right way.
Boston College sociologist Paul Schervish is the leading researcher on the transfer of wealth. It's his financial predictions that have sparked such generational sparring, but he dismisses the debate, saying each generation has always thought it was more proactive and generous than those that came before and those set to follow. He adds, the recent tragedies may in fact spur younger generations to be even more generous than even the most optimistic might have predicted.
Paul Schervish: There is an indication from several surveys that have been done in the wake of the events that there are people who have given for the first time and that these, in many cases, tend to be younger people who have not yet become givers because they are generally unchurched and they don't have children yet, but nevertheless have become acquainted with both seeing themselves as able to assist people in need and have experienced the great gratifying rewards of doing so.
And, research shows, giving to charity even once greatly increases the chances a person will give again. I'm Tanya Ott for WCPN.