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Talking About Ten Percent: How Americans and Europeans Give Differently

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Stephanie South

During my time in our nation’s capital with the Trans-Atlantic Junior Fellows, we had a conversation with Andrew Schulz.

Schulz, vice president of legal and government relations at the Council on Foundations, has a young son. Each month when his son receives his allowance, he has been taught by Schulz to divide this money into three different pots—one for savings, one for spending, and one for giving away to others. Despite his youth, Schulz's son has already begun his philanthropic endeavors and participation in America’s "culture of giving."

I have a similar story about the influence of my upbringing, but for me the desire to give to others did not come from my parents. Today, I give ten percent of my monthly income to charity because of my familiarity with the religious practice referred to most often as tithing. I do not give to religious institutions, but the reason the first checks I write out of my paycheck each month are to nonprofits is a direct result of my Christian education.

The Europeans were taken aback by this announcement during one of our meetings in Washington, D.C. Making the decision to give custody of my money to someone else when it is not required was unfathomable to them. In Europe, they explained, young professionals are not philanthropists; they are citizens. Instead of giving to charity, they rely on the government to provide solutions to the issues our nonprofit sector was created to care for in the United States. In fact, according to a blog entry on Mint.com entitled, “Charity: Who Cares?”, it would take the charitable donations of three Frenchmen, seven Germans, or fourteen Italians to equal what one American gives in a year. Collectively, Americans contribute $300 billion to charities annually. With regard to volunteerism, Americans are also 15 percent more likely to volunteer than the Dutch, 21 percent more likely than the Swiss, and 32 percent more likely than the Germans.

Further discussion about the dichotomy between Europe and the United States in regard to charitable giving and the third sector continued throughout the various meetings we had with nonprofit entities like Independent Sector, the Association of Small Foundations, and the Council on Foundations. By the end of our two weeks in Washington, D.C., it had become clear to the Trans-Atlantic Junior Fellows that Europe does lack a viable nonprofit sector and, therefore, a culture of giving. I wrestled with the question of why and finally concluded that this is not because Americans are more altruistic by nature. It is simply because the infrastructure encourages this behavior. A foundation of both religious principles and limited government and economic incentives for giving have always been there for us.

The United States was conceived to be the antithesis of European, especially British, rule. That meant limited government. Considering this framework, it follows that the people did not and would not wish to have all of their needs met by the state. In the absence of public sector assistance, organizations that became our modern-day nonprofits were born.

Although I would like to believe Americans are highly selfless, the value of tax incentives—an infrastructural facet Europe also lacks—cannot go unmentioned as an additional motivator. However, it is important to note that, according to Charity Navigator, only one third of all taxpayers itemize their tax returns. Even out of those individuals earning $120,000+, only 40 percent itemize in order to maximize their tax deductible donations. How this will affect future giving is being debated right now.

Regardless of the systems and motivations for Americans to give, during my time spent in Washington, D.C., I more fully recognized and appreciated the importance of the sector in which I am currently employed. In 2010, despite the economic conditions, Americans gave more than $290 billion to the causes closest to their hearts, according to a Giving USA report. Those who make less than $20,000 actually give twice as much (as a percentage) of their income to charity as those who make $100,000 (see the Mint.com blog). While there are a plethora of ways for governments and their people to address the needs of citizens, the American system is worthy of acknowledgement. It took my time with those coming from a different background to truly understand why.