Despite the immense health and economic challenges the world faced in 2020, and a significant portion of the country being involved in some level of protesting about systemic racism, inequality as well as police reform, the latest annual report from the Giving USA Foundation finds that Americans did not cease supporting their communities and fellow citizens.
According to the report, Americans donated a record $471 billion to charity in 2020, a 3.8 percent increase from 2019. These increases were particularly noticeable for organizations that offer social services, support people in need, and work to protect civil rights. These totals were released this week by Giving USA, which has tracked total charitable giving in the U.S. for over 60 years and is a collaborative effort of Giving USA Foundation and Indiana University Lilly School of Philanthropy.
Giving by individuals in 2020 totaled a record $324.1 billion, up 2.2 percent (1 percent, adjusted for inflation), even as its share of total giving remained below 70 percent for the third consecutive year. Giving by foundations jumped 17 percent (15.6 percent), to an estimated $88.55 billion, while bequests increased 10.3 percent (9 percent), to $41.91 billion. By contrast, cash and in-kind corporate giving fell 6.1 percent (-7.3 percent), to $16.88 billion.
Seven of the nine charitable sectors saw growth in 2020. Public-society benefit (15.7%) and environment/animals (11.6%) led the way with double-digit growth. Not far behind were human services (9.7%), international affairs (9.1%) and education (9%). There was positive two-year growth for all nine subsectors. This was critical to sustaining many organizations during turbulent times.
"In some ways, 2020 is a story of uneven impact and uneven recovery. Many wealthier households were more insulated from the effects of COVID-19 and the ensuing economic shock, and they may have had greater capacity to give charitably than households and communities that were disproportionately affected and struggled financially," said Amir Pasic, the Eugene R. Tempel Dean of the Lilly Family School of Philanthropy. "Similarly, growth in the S&P 500 in recent years and the market recovery in 2020 positioned foundations to respond to the year's challenges, with the result that giving by foundations reached its largest-ever share of total giving, at 19 percent. Still, for many people and communities, the need remained great throughout the year and beyond."
Confronted by adversity, we have seen time and again that the world unites and helps those most impacted. Charitable giving is now seen as a component of unity and togetherness. Our history shows that whether in the wake of 9/11 and the Great Recession, during an economic downturn or a global health pandemic, or in response to natural disasters or racial and social justice movements, Americans demonstrate their philanthropy.
"Giving USA 2021: The Annual Report on Philanthropy for the Year 2020." Giving USA Foundation and Indiana University Lilly Family School of Philanthropy report 06/15/2021.
"Giving USA 2021: In a year of unprecedented events and challenges, charitable giving reached a record $471.44 billion in 2020." Giving USA and Indiana University Lilly Family School of Philanthropy press release 06/15/2021.
In the United States, philanthropy is as American as baseball, apple pie and rock-n-roll music. One popular definition of ‘philanthropy’ is “the desire to promote the welfare of others, expressed especially by the generous donation of money to good causes”. Another popular definition of ‘philanthropy’ is “the desire to promote the welfare of others, expressed especially by the generous donation of money to good causes”.
Philanthropy dates to Greek society. The Greek philosopher Plato died in 347 B.C. leaving funds in his will to help maintain the academy he had founded during his lifetime. He instructed his nephew to use the income from the family farm to maintain the academy so that students would continue to be taught and faculty would continue to be employed. Around 150 years later, Pliny the Younger contributed one-third of the funds for a Roman school for young boys. He instructed the fathers of the students to come up with the rest. The intention was to keep young Romans educated in the city rather than abroad.
In 1638, John Harvard laid the foundations for Harvard University after bequeathing half of his estate to start the school. In an oral will recited to his wife, the childless Harvard who had inherited considerable sums from his father, mother, and brother, donated half of his estate to start what is now Harvard University with the remainder to his wife. Equally as import, he gave his scholar's library comprising some 329 titles (totaling 400 volumes, some titles being multivolume works) to the school. At the time, this bequest was roughly equal to the Massachusetts Bay Colony's annual tax receipts.
Andrew Carnegie (November 25, 1835 – August 11, 1919) is one of America's most famous philanthropists, noted for the large scale of his charitable contributions, which included the building of more than 2,500 libraries worldwide. His philanthropy is estimated to amount to over $350,000,000 during his life and at his death. He gave millions to colleges (usually the smaller ones), to churches for organs, to the Carnegie Foundation for the Advancement of Teaching, the Carnegie Institute of Pittsburgh, the Carnegie Institution of Washington, and the Endowment for International Peace.
Since the late 19th century philanthropy has been a major source of income for religion, medicine and health care, the fine arts and performing arts, as well as educational institutions. Those of you wishing to get a sweeping overview of the history of the nonprofit sector and philanthropy in the United States will be well rewarded by reading Philanthropy in America: A History by Oliver Zunz (Princeton University Press, c2012). It “tell[s] the story of the convergence of big-money philanthropy and mass giving that … sustained civil society initiatives over the 20th century in the [U.S.]." The book is part of Princeton’s “Politics and Society in Twentieth-Century America” series and focuses on the legal and public policy aspects of the topic.
In his book, Zunz explains that after Congress ratified the 16th Amendment (the levying of income tax) in 1913, the Treasury Department created a single category in the tax code for exempting gifts to charity, the exemption in turn nurtured and ultimately entrenched philanthropy in the U.S. It also allowed groups with divergent interests to work together and foster a powerful and well-supported nonprofit sector.
He points out that while the philanthropic sector operates on a much smaller scale than government, the resources available to charities and foundation are large and influential enough that the continual “debate about the proper relationship of government to philanthropy has become a distinctive feature of American society.” Throughout the book, he illustrates the constant dance between politics and civil society and discusses how Americans of all classes invested an enormous amount of energy in philanthropy while in the process enlarging American democracy.
Oftentimes, philanthropy is often undertaken by those seeking tax breaks, in addition to feeling good and helping others. Forbes partnered with SHOOK Research of Boca Raton, Florida, and tracked which givers doled out the most funds in 2018. Accounting only for funds that reached beneficiaries—and excluded commitments that have yet to be paid out, most of the top philanthropists are also among the richest Americans in the country. The 5 top givers (and their areas in interest for their giving) in their study were:
In total, America's 50 most generous philanthropists gave out $14.1 billion in 2018, up from $12.6 billion in 2017 and $12.2 billion in 2016. Collectively, the group's lifetime giving—a tally of funds distributed by their foundations plus direct gifts—exceeds $173 billion.
More recent philanthropy was expressed by Jeff Bezos who pledged $10 billion in February of 2021 to fight climate change and dispersed $791 million in his first grants from that pledge. That was split between 16 groups including the Environmental Defense Fund and the World Wildlife Fund. Nike cofounder Phil Knight donated $900 million to his own Knight Foundation and $300 million to the University of Oregon for a total of $1.2 billion. Construction magnate Fred Kummer also donated $300 million to an educational institution, Missouri University of Science and Technology.
Americans are fortunate that philanthropists continue to use their wealth and fame to change the world, in addition to supporting issues as diverse interests. Modern day philanthropists have cited famous American philanthropists such as Carnegie and Harvard as influences in their giving. The spirit of generosity continues to be a shining light of hope and aspiration for Americans.
Earlier this year, it was estimated that tens of thousands of nonprofits could close their doors permanently due to COVID-19 shutdowns. However, Americans are some of the most generous individuals on the planet!
More than $2.47 billion was raised on #GivingTuesday, a 25% increase from the $1.97 billion both online and offline in 2019, according to preliminary estimates from the GivingTuesday Data Commons. This good news came as a relief to the nonprofit leaders who had voiced concerns that donors who had given more than usual throughout 2020 due to the COVID-19 pandemic and economic distress might avoid this yearly show of support for charities. For example, an earlier event, #GivingTuesdayNow, raised more than $503 million in May for pandemic relief.
#GivingTuesday happens on the Tuesday after Thanksgiving, which fell on Dec. 1 in 2020. However, the event is becoming a week of giving and not just one day. An estimated 34.8 million people participated this year, which would be a 29% increase compared to 2019.
The fundraising totals were in addition to the more than $503 million in online donations contributed in the U.S. on #GivingTuesdayNow which occurred on May 5th, in response to the coronavirus pandemic (COVID-19). Facebook attributed $135 million in donations over the two weeks leading up to #GivingTuesday. Other platforms reporting donations included DonorPerfect, $55 million; Classy, $37.9 million; Neon One, $16.3 million, and GiveCampus, $12.5 million.
“This groundswell of giving reaffirms that generosity is universal and powerful, and that it acts as an antidote to fear, division, and isolation,” Asha Curran, co-founder and CEO of GivingTuesday, said via a statement announcing the results. “Throughout this year, we have seen people driving extraordinary efforts rooted in a pursuit of equity, community, and shared humanity — driving giving and action across all races, faiths and political views. We know that when we act collectively — what we can, with what we have, from where we are — we can make massive change happen. Now, let us resolve to carry this energy forward to reimagine a world where generosity is at the heart of all we do,” she said.
#GivingTuesday was created in 2012 as a day that encouraged people to do good and has become a “global generosity movement with a distributed network of entrepreneurial leaders” who have launched more than 240 community campaigns across the U.S. and national movements in more than 70 countries.
GivingTuesday, often stylized as #GivingTuesday for the purposes of hashtag activism, is the Tuesday after Thanksgiving in the United States. It is touted as a "global generosity movement unleashing the power of people and organizations to transform their communities and the world". The organization of the same name is an independent 501c3 nonprofit that supports the global movement. #GivingTuesday began as a simple idea in 2012 a day that encourages people to do good. As an organization, GivingTuesday promotes the concept of radical generosity— “generosity not as a benevolence that the haves show to the have-nots but rather an expression of mutuality, solidarity, and reciprocity.” To that end, they execute several year-round activities to support the generosity sector around the world.