On several occasions, Sojourners chief Jim Wallis has insisted that the private sector could only provide for 6% of charity and poverty alleviation in the U.S. He uses this frightening number to defend an unlimited federal Welfare State as the chief focus of Christian compassion.
Wallis assumes that government is competent in handling poverty and merits even greater funding. But Christians should examine his claims. A look at the habits, statistics, and finances of government welfare programs paint a grim picture. The limits of governmental welfare contrast strongly with the comparative effectiveness of private charities.
Where did Wallis get his 6% figure? Chuck Warnok calculated this number in Ethics Daily. Wallis divides up the recipients of food stamps and their potential cost to the current number of U.S. church attenders. Warnock writes, “For churches to take over the feeding of America’s poor, each church in America would have to feed 90 people each. That means that the average church would take on as many poor people as it currently has in attendance.” Of course, food stamps are only one of dozens of federal anti-poverty programs. Warnock and Wallis assume that private charities would be no more cost effective than the federal bureaucracy and that the government calculation of poverty is accurate.
First, the government loosely defines poverty, which is accepted at face-value by many. A recent study by the Heritage Foundation discovered that most poor households own air conditioning, means of transportation, a television, and have more housing space than the average European. Few impoverished households actually face physical deprivation.
Second, government welfare programs are already quite expansive. The projected cost of food stamps in 2011 is $68,294,000,000, nearly twice that of 2007. As current research indicates, the federal government wields about 26 food and nutrition programs operated by six different agencies. The food stamp program, now known as the more palatable SNAP, has continued to grow over the past few years. It is the nature of bureaucracies to become bloated. Efficiency by not spending all available funds (or more) means that a program faces the threat of a future cut.
Also, welfare programs requiring more accountability from recipients are often abandoned in favor of more easily accessed programs. TANF numbers dropped in favor of more food stamps; many have favored this shift. As one SNAP user told the New York Times, “It used to be easier to go on cash assistance…You didn’t have to go to work, you didn’t have to report every day to an office and sign in and sign out. Now, if you don’t go to those group job meetings in the mornings, they shut down your whole welfare case.” As usage of the looser SNAP program expands, it will demand more funding. And TANF likely will lose its share of the budgetary pie. To compete, federal programs have to be less effective or recruit more dependents.
Third, the government poorly stewards its resources. Private charities must be frugal in order to balance limited budgets, while government has no such incentive. The SNAP program’s 2009 financial records show administrative costs are soaring. The federal certification costs alone amount to $1,766,442,037; the issuance cost is $160,892,732; fraud control cost maxes out at $128,518,146. Automatic data processing services offered two more fund-sponges: the development cost $66,165,315 while the actual operation cost $208,774,455. The SNAP records also reported a 7.56% increase in fraud. Also note that these figures merely represent the federal level; the funds are transmitted through the states, adding another layer of bureaucracy.
Fourth, government welfare crowds out private poverty assistance. People have to be taxed in order to pay into these programs, leaving less for private charity. Government welfare diminishes freedom for donors, private programs, and recipients.
Of course, the genuinely needy must not be ignored. Christ called His church to the love of its neighbors. Christians in the past focused on their own direct charity, not the bureaucratic Welfare State. Wallis and his allies neglect this history and deride private charity as less capable than government.
Contrary to Wallis’ assumptions, private charities are generally more efficient than the government in helping the needy. Charity Navigator estimated as of 2004 that 70% of the thousands of charities they rate used at least three quarters of their budgets on programs and services rather than administration. For example, in 2009, ActionAid International USA used over 80% of its budget on anti-poverty programs. One major reason for this high effectiveness is the accountability factor. Private giving entails a high level of accountability because donors are free to direct their money. This accountability motivates private charities towards prudence.
Are Americans willing to give to private charity? The 2011 Annual Report on Philanthropy by GivingUSA reports that charitable giving rose by 2.1% (all figures adjusted for inflation) in 2010. Over the long term, U.S. charitable giving has dramatically increased. Total annual donations by Americans have increased from just over $100 billion in 1970, to $290 billion in 2010. This growth trend is likely to continue, and if the “crowd out” effect of increased government services were eliminated, this number would be higher.
Religious statists like Wallis equate the Welfare State with Christian compassion. But common sense and statics indicate that government programs are often least effective in combatting poverty, sometimes even perpetuating it. Shouldn’t Christians and others of good will seek maximum effectiveness in helping the needy rather than just further increasing Big Government?
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