Recently read that the wealthiest Americans — those in the top 20% of income earners — give an average of 1.3% of their income to charity. By contrast, those in the lowest 20% of income earners give 3.2% of their income to charity.
How does that make any sense? Well it doesn’t, actually, but there are two theories attempting to explain it. And I’ll add a third minor theory.
The first theory is that the rich are just greedy and don’t want to give up their money. Paul Piff, a psychologist at UC Berkeley, told New York magazine, “…the rich are way more likely to prioritize their own self-interests above the interests of other people.” He continued by saying they are “…more likely to exhibit characteristics that we would stereotypically associate with, say, assholes.”
Okay, so that sounds harsh. Another grenade to set off class wars. I’m not buying it. Though it might be true for some, my experience with the wealthy isn’t consistent with this perspective.
The second theory is that the wealthy are out of touch with the needs of our society. As I say in Junkyard Wisdom, they can often live behind walls that separate themselves from the poor. Piff’s work apparently lends credence to this idea. When both lower and upper income people were exposed to sympathy producing videos about poverty, the upper income earners became much more generous.
In other words, being aware of need makes a difference. Breaking down the walls between rich and poor elicits generosity. Relationship drives generosity decisions. This makes a lot of sense to me.
To the above two theories I’ll add another thought.
For most who are wealthy, money is a tool. It’s used to make more money. Giving the tool (money) away is limiting their ability to create wealth. Creating wealth means creating jobs, investing in infrastructure, building companies that create great products, research and development, etc etc.
This isn’t a perfect analogy, but think of it this way. Would you ask a chef to give away her pans? Would you ask a carpenter to give away his level? Would you ask a musician to give away her instrument? Of course not, because then they’d be limited in their ability to exercise their giftedness. In the same way, asking a wealth creator to give away money is to ask for the tools they need to exercise their giftedness.
Of course it’s not a perfect analogy. A chef might have extra pans, a carpenter might have more than one level, and a wealthy person has extra dollars. But you can see how this could be a factor.
And before you go nuts, I’m not trying to make an excuse for why the rich don’t give a higher percentage of their income. But I do think in some select instances there are people who see cash not as a source of income but as a tool to exercise their ability as a wealth creator, and parting with that tool is extremely difficult.
Note: this article in The Atlantic was a great resource for this post.