A look at charitable giving

Arthur Brooks, a professor at Syracuse University, was in Minneapolis last week to deliver a luncheon presentation on his recently published book, “Who Really Cares; America’s Charity Divide.” I had read the relatively short book earlier and was delighted to get a chance to hear the author explain his research into charitable giving trends.

I can’t think about charitable giving for very long without coming up with a lot of questions of my own. Who should I give to? How much should I give? Is it better to give more to fewer charities or less to more charities? Should I give to hopeless causes, like Sam Brownback’s presidential campaign? Should I give to umbrella organizations like the United Way or the Archbishop’s Annual Appeal, even if some of the recipient organizations under those appeals offend me? Do I need to tithe? If so, do I figure my giving total according to my gross income or my after-tax income?

Brooks doesn’t go after any of these questions. He looks at who gives and aligns that data with political affiliation. His conclusion: conservatives give more money to charity than liberals. It is an interesting conclusion given the stereotype that conservatives are cold-hearted individualists while liberals are bleeding heart do-gooders.

I would have thought that the most obvious difference between those who give to charity and those who do not, is income. I assumed that low income people give infrequently and high income people give often. Turns out income has very little to do with it. Ideology is a much better predictor of whether a person gives to charity. It turns out a low income conservative is more likely to donate to charity than a high income liberal.

Brooks said there is a segment of the liberal population that believes charity is bad; people in this group don’t give anything at all. Their thinking is that the more people give to charity, the more they are letting the government off the hook for the things it should be doing. These folks want to see broad taxation, with the money used to raise the standard of living for everyone in the country to a comfortable level. This is a prevailing idea Europe.

Brooks posed this statement: “The government should do more to assure income equality in this country.” He said that the more people agreed with this statement, the less likely they were to give to charity. The more people disagreed with this statement, the more likely they were to give to charity. As I thought about it, I realized that his findings are consisted with my own experience.

I have been in discussions with liberals about a particular social problem. We will all agree that it is a problem. These kinds of discussions generally lead me to think that I need to pull out my checkbook and donate some money to help out. Or I end up thinking I need to organize a group of neighbors and undertake a solution to the problem. My liberal friends, on the other hand, always think the government needs to do something. They usually conclude (before trying) that the challenge is too great for ordinary people to tackle on their own.

A few years ago in my neighborhood, a lot of people displayed a yard sign that says “Happy to pay for a better Minnesota.” It is a sign in support of tax increases. A debate over the appropriate level of taxation is always healthy, but I do think it is worth clarifying that taxation and charitable giving are completely different. People give to charity on a voluntary basis. People pay their taxes under the threat of incarceration. If homeless people need shelter, is it better for that shelter to be provided by tax dollars or by charitable dollars? That’s an interesting debate.

By speaking and writing this book, Brooks really wants to get a public policy discussion going about the role of charity in a society. He thinks, for example, that the tax benefits of charitably giving should be made available to people who don’t itemize. This is a valid social trade-off, Brooks said, because people who regularly donate are more engaged in their communities, are more informed, and tend to take leadership roles in neighborhood activities. This kind of social engagement, he said, is what strengthens societies, so charitable giving should be encouraged, he argues.

Does being conservative make a person more charitable? Brooks says no. He said it is really a matter of religious conviction. People who are involved in their church tend to be the most charitable, and those people are more likely to be conservative. The biggest givers, he said, typically, had the example of parents who gave regulatory, attended a house of worship, and got into the habit of giving at an early age.

Presidential predictions

The 2008 presidential election is about a year and a half away; will John McCain still be in the hunt a year from now? James Carville, a genius when it comes to campaigns, doesn’t think so. I was at a business meeting last month in Hawaii where Carville and his wife, Mary Matalin, shared political observations and Carville predicted McCain would drop out of the race before the Iowa Caucuses.

“When I look at him, he just looks like a guy who doesn’t have his heart in it. And it is a long haul,” Carville told us. “He strikes me as someone who is playing a role he is not comfortable in. He is 72, which is not too old, but he does not look as young as he did in 2000. It’s a long way to go, and I don’t see him making the cut.”

Carville said he expects either Newt Gingrich or Al Gore to get into the race. He said it is possible both of them will enter the race. He also said he suspects there will be a third party candidate who will get more than 5 percent of the vote.

Then he made a prediction that seems like a long shot to me: Jeb Bush will be the Republican nominee. “Why? Because the Republicans love order, and they are not going to get any of it. There is going to be disorder the likes of which you have never seen,” Carville said. “The only name I can think of that if he got in the race that would kind of quell everybody down would be Bush. I don’t think the Republican nominee is in the field” right now, he said.

He went out on a limb even further and predicted Mike Huckabee would be the Republican nominee for vice president.

Among the Democrats, he said it is all about “Obama and Mama.” Carville observed that “Mama needs more spice and Obama needs more seasoning.” He said “any good Cajun knows there is a difference between spice and seasoning.”

Carville said if Hillary Clinton can deliver her message with a little more passion, she will get the nomination; but if her message remains flat and Barack Obama improves his campaigning, Carville said the nominee will be Obama.

He predicted the vice presidential nominee for the Democrats will be Catherine Sebelius, the governor of Kansas.

Matalin explained that each party is looking for the candidate who can win the most swing states. “The question is, ‘which Red guy can pick up more Blue states, and which Blue guy can pick up more Red states?’,” she summarized. “Right now, Rudy Giuliani moves more Blue states than Hilary moves Red states. He puts more states in play.”

Although many observers think the election is in the bag for the Democrats, Matalin urged caution. “You cannot listen to conventional wisdom today,” she said. “Conventional wisdom today cannot predict the tomorrow.”

She said the notion that the Democrats will win in 2008 is based on a “very specious premise, which is the outcome of the 2006 elections. You would only predict the Democrats will win in 2008 if you thought they won in 2006,” she said. “They did not win. The Republicans lost. There is a difference.”

Another snow day

They say March is the snowiest month of the year in Minnesota, and that is proving to be true in 2007. We had more than a foot of snow on March 1. Our kids were off from school Thursday and Friday as everyone shoveled out. Just about every school in the area was closed Friday, even the inner city schools, most of which hadn’t taken a day off because of whether since Gov. Arne Carlson closed all the schools in the state one very cold day in 1994.

It took me a long time to shovel the sidewalks and driveway on Friday, although I lucked out when a good neighbor offered to use his 12-cylinder snow blower to clear off my driveway. Moving snow is a big deal. I am told that earlier in the week, on the first wave of the snow storm, United Hospitals in St. Paul treated five people who suffered heart attacks while shoveling.

I get mixed impressions whenever I first look out the window in the morning after a night’s heavy snow. The snow covers many of the things I am used to seeking, like some bushes in the back yard and a bench near the garage. It is a little bit disorienting. Years ago, there was a picture in the newspaper of a guy standing in the middle of a bunch of new fallen snow. The caption under the photo had the guy exclaiming: “I can’t find my garage!” Well, it wasn’t that bad yesterday, but we certainly got a lot of snow.

Years ago, I used to start my car and let it run while I finished up my shoveling. It takes a good 10 minutes for my car to warm up to the point where a human being can sit in it on these cold days. But do you know that that is illegal now in Minneapolis? Yes, our beloved city has passed an ordinance making it illegal to idle your car if you are not in it. So now, if your car is stolen while it was idling, the first thing a Minneapolis police officer is going to do when you report the crime is give you a ticket. In an email the city sent out to residents, the police warn that if your car is stolen while you are in violation of city ordinance you may not be able to collect your insurance.

A few years ago, my office was within walking distance of our house – about a mile. At that time, I came up with an idea that I still think has merit. You know how those early morning TV news programs show a map of the highway system with blinking lights that indicate traffic levels? Well, wouldn't it be great if there was something similar on the internet for sidewalks? Rather than indicating traffic levels, the web site could provide real-time information about which sidewalks were shoveled. The same way those TV-road maps help a commuter determine the best way to work, the sidewalk map could help walkers choose their best route. The shoveled walks could be represented by a thick green line and the un-shoveled sidewalks could be represented by a red light. Perhaps there could be another color to indicate shoveled walks that remain icy.

I could look at the map, and if I saw that four houses on 45th Street had not yet shoveled, I would walk down Beard Avenue another block before turning along 46th Street. The neighbors could all pitch in to make such a system work. After I finish shoveling my own walk in the morning, I could put a call into the person maintaining the web site, or I could just send them an email. It might even be fun to bring up the web site and watch as the sidewalk in front of my house officially changes from red to green.

Furthermore, if we noticed a shoveled sidewalk still represented by a red line on the web site, we could call that in to set the record straight. I suspect people calling in to report the condition of other peoples’ sidewalks would be key to the service’s success. The people in my neighborhood are already pretty good at keeping an eye on their neighbors’ property. Last summer, there were some neighborhood volunteers who actually went around counting all the trees in everyone’s yard. It would be much easier to keep track of whether someone has shoveled the sidewalk in front of their house than to keep track of whether someone has planted a new conifer in their back yard.

Spring starts in two and a half weeks, although I am not sure that means much. In high school, I played on the tennis team and I can remember matches in April being snowed out. Either way, I love the fullness of the four seasons which we get in this part of the country. Every season comes with its own stories.

A real snow day

We had a foot of snow last night. In some places it drifted and the snow is two feet or more deep. It is the first real snow we have had this winter. Of course, the weather professionals had been predicting a snow storm, so everyone was ready. I am sure that if you took an inventory of everyone’s pantry this weekend, you would find them typically stocked with soups and noodles and a varity of ready-to-heat meals.

In our house, we don’t pay too much attention to the weatherman. When I was in college I took an introduction to meteorology course. The professor told us that if every day you simply predicted that the weather tomorrow will be the same as it is today, you would be right 60 percent of the time. The professor further told us that with all of our technology and scientific knowledge, weather forecasting is correct about 80 percent of the time. In other words, all that Doppler radar and other stuff only improves our weather forecasting by about 20 percent.

Nonetheless, as people talked about the on-coming storm all week, there was a sense of surprise about it all. We have had a relatively mild winter so far and I think most of us really expected to get through the season without any substantial snow shoveling. Perhaps most of us have secretly embraced the near-term benefits of global warming. But, of course, we shouldn’t be surprised about a snow storm. This is the last week of February in Minnesota. If it doesn’t snow here, then it probably isn’t going to snow anywhere. The state high school tournaments are getting underway. That’s a sure signal that the real snowy season in Minnesota has begun. The records apparently indicated that March, in fact, is the snowiest month of the year.

I drove to church this morning and the street out in front of my house was a mess. I don’t really expect it to be plowed until Tuesday or Wednesday. I think it is amazing that it takes three days to plow all the city’s streets. It’s not like snow plowing should be a rare occurrence around here. It snows every winter. I am told the big Canadian cities get their streets plowed in a day.

As I was driving around this morning, you could feel the testosterone in the air. There were men in parkas everywhere maneuvering snow blowers over the sidewalks and driveways. Any Minnesota man takes great pride in his snow blower. The bigger the better. A man really feels like something when he can shoot a steady stream of frozen snow 15 feet in the air. I especially like the snow blowers with headlights. I once saw a snow blower that had a protective plastic casing for the operator to stand in; this machine had three headlights and chains on the wheels!

You always know when a man is feeling good about his snow blower because he gladly plows more sidewalk that his own. He keeps walking right down the sidewalk, clearing a path in front of two or three neighbor’s houses on each side of his own. The price of gas, which seems so outrageous when filling your car’s gas tank, doesn’t seem so important when it comes to keeping the snow blower operating.

People help each other out in the aftermath of a snowstorm. A car gets stuck in a drift of snow and its common for a whole crew of guys to get behind the trunk of that car and help the driver get back on his or her way. Maybe these are situations where we truly are left to our own devices. You can’t call the police or an ambulance when you get stuck in the snow. You have to rely on your neighbor. And around here anyway, the neighbors almost always seem to be there.

Then there’s me. I don’t have a working snow blower. I own an electric snow blower but the small plastic key required to make it work has been lost. I know I can write the manufacturer and get another one, but with the snow being so mild this winter I haven’t gotten around to it. So I am left to dig my way out of this snowfall with a shovel. I have one of those ergonomically designed shovels with a bend in the handle. It is supposed to be easier on the back.

I laugh as I look around me and see all my neighbors plowing with their noisy, gasoline-powered snow blowers. In a neighborhood that has a reputation as home to more environmentalists per square mile than any neighborhood east of Oregon, I am the last person who would call himself an environmentalist. And yet I’m the guy using the shovel.

Real learning requires you to weigh experience against media reports

I am a big fan of learning by doing. I do not have a business degree but I feel like I do since I have twenty-plus years of small business experience. For me, it has been very effective to learn by doing; I get a lot more out of making my own mistakes than I do by reading about someone else’s mistakes.

But not everything can be learned directly by doing; most of the time, we have to accept the authority of an expert. One of my fears about our culture is that too many people look to television and newspapers for expertise. This is a mistake. Media has its place, but it is not as an authoritative teacher.

Media is big business; major newspaper publishers and network news professionals have to weigh numerous competing commercial interests whenever they make a decision about what to publish or broadcast. Most news stories are meant to appeal to our emotions, not our intellect. News programs and newspapers are first and foremost sales vehicles, and sales is primarily an emotional game. Any sales professional knows you sell on benefits (emotional appeal), not features (intellectual appeal).

The important thing to remember about anything we learn from television or newspapers is that it is only a start; it is not the final word. And oftentimes, it is only a start of baby steps. Knowledge comes about through intellectual pursuit, which requires commitment and takes time. It is more akin to getting in shape through diet and exercise than it is to fueling up with a self-service stop at the gas station.

People are the source of news so the best way to learn is to actually visit with people. Actually talking to someone is better than reading something from someone who talked to someone.

Real knowledge, of course, is knowing what’s in someone’s heart, not what’s in the newspaper. I know a lot of people who are up on the news but don’t have a clue about who their neighbor is. Too many people are happy to read the newspaper or plop down in front of the television set, but lack the initiative to engage their neighbor. I think that is really too bad – for both the learner and the neighbor.

Realistically, most of us are forced to rely on secondary sources for much information. The value of that secondary information, however, is proportional to our first-hand information. If I spend my entire day in my house, never interacting with anyone, then the news I get on TV and in the newspaper or over the radio is far less meaningful because I have no self-determined context for the information. All I have is someone else’s context, and the context of that editor or reporter or producer may not in any way reflect my own life and circumstances. However, if I am out in the world most of the day, interacting with people, observing first-hand how people behave on the bus and in the department store and in the restaurant or in church, then I have some context for absorbing stories I get from broadcast and print media.

Economists, for example, frequently make pronouncements about the condition of the country. They cite employment figures and inflation and production levels and many other factors; newspapers regularly publish these analysis. But how often do we read this stuff and scratch our heads because it just doesn’t seem to fit our own experience? They talk about full employment, but the guy in Michigan is puzzled because he hasn’t worked in a year. Or they talk about high rates of inflation and the guy trying to sell his house wonders why he can’t get any more for it than what he paid a decade ago.

Economists often use statistics gathered from across the nation. They get numbers from everywhere so that they, in fact, represent nowhere. Aggregates and averages make for easy reporting but they do not necessarily represent what is happening in your home town. So if all you did was read the Wall Street Journal and you failed to pay attention to local market conditions -- like the price of milk at the corner store, the length of time a neighbor has been out of work, and whether anyone on the block is remodeling their kitchen -- you might have a totally inaccurate idea of what’s going on.

For many years I did not have a television set so I hardly ever saw television news. When I would mentioned this to someone, they would ask: “How do you know what’s going on?” I would answer: “I live my life.”

To this day, I continue to think that is the best way to learn. Live your life. Intellectual strength is more about interacting with others than it is about absorbing facts. It is easy to learn what is in the newspaper but it takes a little more effort to learn what is in someone’s heart, even your own.

Gov. Pawlenty on education

I had the opportunity to listen to Minnesota Gov. Tim Pawlenty on Wednesday address a business group in St. Paul. Throughout his governorship, Pawlenty has expressed concern about the state’s education system. Pawlenty notes that many kids are not being properly prepared to succeed in the emerging globally marketplace. Here is was he said on Feb. 7 about education:

Just one generation ago, if you missed the educational rung or skill rung, there was still a large safety net. There was the large safety net of manual labor jobs that offered higher pay and better benefits than many of them are offering today. A lot of those jobs are gone now. They have migrated to different places.

It is more important than ever that we have as many children as possible with an education or skill that is relevant to the economy of the future, and yet we have an education system that we designed in the 1940s. We have an iPod world now. We don’t have a one-size-fits-all world. With the exception of some special needs and gifted kids, our schools work kind of like an assembly line. And that is not the world we live in anymore.

When you hear the education debate, almost all the discussion is about how much money is going in. That is one important measure. I will concede they need to get some more money in; they are getting more money in. We are proposing about an 8 percent increase for the schools in this next budget cycle for K-12; it’s well into double digits for higher education.

But in addition to how much money is going in, we are focusing on trying to get some reforms that also measure the results we are getting. Does the money align to the result? Is the money aligned to the things that are actually changing student performance? This, believe it or not, is a novel concept in government. I know it is not in business. In business you say: What is my business? Who are my customers? What measurements do we have to determine whether we are getting the results that we want? And, is the money aligned to those results?

We are just starting that, 20 years late in government. With carrots, not sticks, we are saying: Join us in a different kind of system where we pay you not just for how many years you have been around, but on whether you are getting training that is actually relevant to what you are doing in the class room. Are you willing to mentor a younger teacher who is new? Are you willing to put some time into that? If you are, we will give you some extra pay. And can you move the needle with your class, not compared to some fancy school district, but from your school district? Can you move the needle on student performance, and if you can, we’ll give you some more money for that. That’s the kind of thinking we need in our schools. And we are constructively, gently, moving that way, and it’s big cultural change.

In high school, we have some really gifted and talented kids who are doing great even by international standards. We have some children who need special accommodation.

But we have a lot of “in-betweener” students who are coasting. The academic progress of these in-betweeners has flat-lined. It is flat as a pancake. We are spending a ton of money on two or three years of high school for an experience that, for too many of our kids, is adding next to no academic progress. So we have got to get more of our kids into more rigorous programs, something that is more interesting, something they are passionate about. More AP classes, more IB classes, more post-secondary enrollment classes, more technical college, while they are in school.

We need to re-orient the high school experience. Not physically, but virtually to something very different from what it is now. Bill Gates says the American high school is obsolete… that we are preparing kids for the economy and citizenship of 40 years ago. He said preparing kids for the economy of today and tomorrow in today’s high school is like using a 50-year-old mainframe. So there is dramatic change that needs to come. There’s huge institutional and cultural resistance, but we are trying to do it constructively, but it is a very, very important reform.

Reflections on the passing of two big political figures

Last month, two big-name political figures died -- Gerald Ford and Jeane Kirkpatrick. I met Steve Ford, Gerald Ford’s son, in October of 2004, and I had a chance to meet Kirkpatrick in 1990.

Ford was in Minneapolis to speak to a business group. I remember speaking to Steve about the fact that his father was adopted, something that was interesting to me as the father of adopted children. Gerald Ford was born in 1913 as Leslie King, Jr., son of a man who physically abused his mother. In the middle of the night, Dorothy Gardner King snuck away from their Omaha home with their only son to escape back to her parents in Illinois. A divorce was filed and the shame of the situation was so great that she had to move out of the area and begin her life anew. She moved to Grand Rapids, Mich., where she met a man named Gerald Ford. He married her and adopted the son, renaming him after himself.

Steve said that the older Gerald Ford “invested in my father’s life.” He praised the senior Ford, saying: “This man was not a blood relative, but he is a man who chose to invest in my father’s life, giving him the character and integrity so that he would be able to handle the presidency in a very unique time in American history. He never lived long enough to see Dad become president. It is love, not blood, which makes a difference in a kid’s life.”

In addition to being the 38th president of the United States, and a long-time Congressman, Gerald Ford was an All-American football player for the University of Michigan in 1934. Even as a college student, Gerald Ford showed great character. Steve Ford explained that the team went undefeated during the 1932 and 1933 seasons. In 1934, Michigan was scheduled to play Georgia Tech University, which was an all-white school at the time. Georgia Tech told the University of Michigan that it would refuse to play against the Wolverines because the team had one black player. The player was Willis Ward, who happened to be Gerald Ford’s roommate. Ford, a senior that year, was so upset by the racism of the Georgia Tech team that Ford said he would not play the 1934 season if Ward sat out the Georgia Tech game. Ward, however, agreed on his own, to sit out the Georgia Tech game and urged Ford to stay on the team. Ford returned to the team, although the Wolverines lost every game that season except the one against Georgia Tech.

Gerald Ford, may he rest in peace.

Kirkpatrick was the first woman to represent the United States before the United Nations. She was a member of President Reagan’s Cabinet and the National Security Council in the 1980s.

I was the communications director for the Minnesota Bankers Association in 1990 and was involved in planning the association’s annual convention in June of that year. Jim Hearon was MBA president in 1989-90 and advocated inviting Kirkpatrick to speak at the convention, which was conducted in Bloomington. So we invited her, and she accepted.

Hearon, who was president of National City Bank in downtown Minneapolis, was intrigued by Kirkpatrick’s philosophical evolution. Early in her career, she was a liberal Democrat, but over time she evolved into a tough-minded conservative. Seated together at a convention luncheon, I remember Hearon asking Kirkpatrick if she would consider a run for president.

During her convention speech, Kirkpatrick spoke about Mikhail Gorbachev and the United States’ relationship with Russia. The comments were particularly timely, as Gorbachev and his charismatic wife Raisa, had visited Minneapolis the day before.

Jeane Kirkpatrick, may she rest in peace.

Memo to lawmakers: Focus on the big stuff

Christmas is the day after tomorrow and I know the state’s Democrats who recently took control of the Minnesota legislature are feeling in a holiday mood. One of the very first initiatives they identified for the session which will open next month is gift cards. They want to outlaw those pesky fees and expiration dates that accompany some of the cards. I say they are wasting their time; they really should focus on much more important issues.

True enough, gift cards are big business. In 2006, U.S. consumers will purchase $72.8 billion in gift cards. In my view, that is an argument to leave the gift card industry alone; lots of cards are being sold and used with the laws just as they are. It doesn’t seem any change is needed. But some legislators say they want to help us consumers.

However, this is not something we need any help with. Let’s face it, we give gift cards when we really don’t care what we are giving. It’s a default product we can always give to that someone we don’t know very well and really don’t expect to get to know any better. Certainly if we cared, we’d take the time to get them something unique. That’s the reality from the giver’s side of it.

Now consider the recipient’s side of it. It’s a gift. We may not have been expecting anything in the first place. We are lucky to get anything at all. What does it say about the value I place on the gift card I received if I let it sit in a drawer for a year without using it? Clearly I don’t value it all that much, and so if the merchant starts deducting fees from the card after of year, I don’t really care. Either way, I am ahead.

But lawmakers have a solution so they need to identify a problem. And the Democrats in Minnesota are not alone. Twenty-five states already have beefed up laws related to gift cards in recent years. In Connecticut, Montana and Rhode Island, it is actually illegal to offer a gift card with a fee or an expiration date.

Legislators abuse their authority when they exercise it to interfere with pricing negotiations between buyers and sellers. In most cases where the stakes are small, the market weeds out the bad players as consumers naturally migrate to the best offers. I can see where a case can be made for lawmakers to get involved in major purchases, such as a home or car, or situations where consumers are in a particularly vulnerable situation, like when they are paying for a funeral. But lawmakers don’t need to get involved in the purchase of a $50 gift card.

Bans on fees and/or expiration dates will ultimately reduce the availability of gift cards. Oh sure, the big guys like Wal-Mart and Target will continue to offer gift cards – as they do now – without fees or expiration dates. But the specialty stores and family-owned one-of-a-kind shops are less likely to offer them. At a smaller shop, the time value of money actually means something. If these merchants are not afforded the opportunity to recoup their costs for keeping a gift account open for years, then they may just decide not to offer them at all.

There’s not a legislator in Minnesota who was elected to “do something about gift cards.” Our elected officials should focus on the big things – doing something about the rising cost of health care, improving our transportation networks and bringing our schools into the 21st century. These are the issues to which lawmakers should be directing all their energies. Once the session opens next month, I hope they don’t waste any energy on something as trivial as gift cards.