Charitable Donations Rise
Individuals, businesses, foundations donate $260 billion
By Michael Jay Friedman
Washington File Staff Writer
Americans in 2005 increased their charitable donations by over 6 percent, to more than $260 billion, according to a study released June 19 by the Giving USA Foundation.
Americans traditionally devote part of their time, labor and financial resources to charitable works. These voluntary efforts have shaped the model of philanthropy that prevails in the United States, and rendered difficult direct comparison of U.S. charitable efforts with those of other nations.
In 2005, total private charitable donations comprised 2.1% of the 2005 United States gross domestic product (GDP).
Individuals contributed about $199 billion, or 76.5 percent of total giving. Americans thus donated 2.2 percent of their average disposable (after-tax) income
Corporate contributions rose 22.5 percent from the previous year, to an estimated $13.77 billion, a figure representing 5.3 percent of total donations.
Other major categories include foundation grants ($30 billion, 11.5 percent of the total) and charitable bequests ($17.44 billion, 6.7 percent).
Giving USA Chairman Richard Jolly attributed much of the increase to Americans’ collective response to the Asian tsunami, Pakistani earthquake and Hurricanes Katrina and Rita. "The American public stepped forward and provided additional support," he said.
While Americans contribute to a wide variety of charitable organizations, groups working to improve education, help animals, protect the environment and assist people overseas experienced double-digit growth.
Another trend was the increase in on-line giving. The Chronicle of Philanthropy reported recently that donations made through the internet increased by nearly 150 percent from the previous year. 167 charitable groups reported receiving $911.9 million via this method.
Technology firms are among the leaders in philanthropy. Yahoo!, a leading internet services company, has partnered with the ONE Campaign, an organization combating poverty and AIDS in the developing world.
Intel Corporation recently donated $2 million to the University of California to support an initiative to improve science and math education in that state.
Larry Page and Sergey Brin, the founders of Google, another major search engine and web services company, have created the Google Foundation. Its sponsored projects include an entrepreneurial development program in the west African nation of Ghana, research into effective means of improving the water supply in rural Kenya, and market-based efforts to develop affordable goods and services for the world's 4 billion people living on less than $4 per day.
Bill Gates, co-founder of the Microsoft Corporation and the world's wealthiest man, recently announced his intent to give up day-to-day supervision of Microsoft to devote his efforts to the Bill & Melinda Gates Foundation, the nation’s largest charitable fund, with $29.1 billion in assets. Gates has expressed an intention eventually to donate up to 90 percent of his wealth.
The Giving USA report was prepared by the Center on Philanthropy at Indiana University, which has studied philanthropic giving since 1965.
For additional information on philanthropy and charitable giving in America, see the "Giving: U.S. Philanthropy" electronic journal. See also Volunteerism.
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