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United States is a nation of Santas and Scrooges

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  • Americans continue to debate whether government or charity is most effective
  • Some argue government does a better job because of ability to get at root causes
  • Others say charities are more efficient because they depend on volunteers
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By John Blake
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(CNN) -- Which statement is true?

Americans are some the most generous people on the planet. Or: Americans are some of the stingiest.

Both are correct.

Salvation Army

The Salvation Army helps nearly 33 million people in the U.S. each year.

America is a country of Santas and Scrooges -- it just depends on how you look at the numbers. Americans, it turns out, are as divided by their attitudes toward giving as they are by politics.

Some numbers hint at the divisions. Americans, for example, gave $8.4 billion to Hurricane Katrina and tsunami victims in 2005, according to The Center on Philanthropy at Indiana University. Americans give more to private philanthropy than any other country, a Johns Hopkins University study concluded.

But during the same year as Katrina, the U.S. government gave 0.22 percent of its Gross National Income to foreign aid, ranking near the bottom -- 20th out of 22 -- of all Western nations, according to the Organization for Economic Development and Co-operation, an international agency that measures international economic data. Norway and Sweden were the top two.

The truth is that Americans are generous when it comes to private aid, domestic or overseas. But the U.S. government is comparatively stingy when helping the poor, here and abroad.

The disparity is nothing new. It's a reflection of a political debate over the role of government in America that dates to the 18th century, scholars say. Americans have long clashed over what's the most effective way to help the poor -- through government or charity. Timeline: America's history of giving »

"America is firmly rooted in the idea of the rugged individual -- you do it on your own and you don't turn to the government for help," says Mark Robert Rank, author of "One Nation, Underprivileged: Why American Poverty Affects Us All."

This debate divides philanthropic leaders as well. Several philanthropic and poverty experts were recently asked about the role of charity versus government in helping the poor. They couldn't agree either.

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Some say the most effective way to help the poor is through charity, or private sources. Their argument: Charities are cheaper and more efficient because they depend on volunteers and personal contact.

"Americans know they're not stingy people," says Carol Adelman, a director at the Hudson Institute, a private research center that champions charitable giving.

"They've always preferred working though private institutions," she says. "Private aid doesn't try to do it all for people. It also works more at the local level because it works more people-to-people."

Charities also transform the giver, not just the recipient, says Arthur Brooks, author of "Who Really Cares," a book that says that conservatives care more for the poor than liberals because they give more money to charity.

Brooks says studies show that people who volunteer and donate to charity are happier than people who simply write a check -- though that, too, has its benefits.

"You don't become a better person when you pay taxes but you do when you give," Brooks says. "When we're responsible for voluntarily taking care of private needs in this country, we are in control. We are empowered."

Yet others say that government does a better job of helping the poor because it has the economic and public policy clout to attack poverty's root causes.

Lester Salamon, director of the Center for Civil Society Studies at Johns Hopkins University, says people often think that American's generous charitable donations compensate for any deficiency in government aid.

Charities just can't do as much for the poor because they don't have the economic muscle of the U.S. government, he says.

"There's such an enormous difference between the two that it's ludicrous to argue that one makes up for the other," Salamon says.

Besides, much of the money that goes to charity doesn't go directly to poor. It goes to administrative costs or other philanthropic endeavors that have little to do with feeding, clothing and housing the poor, he says.

"Most of the [charitable] money goes to places that aren't typically focused on the poor," Salamon says. "Only about 12 percent of our giving goes to the poor."

Rank, author of "One Nation, Underprivileged," says charities also aren't equipped to address the "structural failings" that cause poverty: the lack of affordable health care, the disappearance of manufacturing jobs and underfunded school districts.

Americans may love to give to the poor, but they don't do a good job of lifting people out of poverty, Rank said. He said America has the highest rate of poverty in the industrialized world, though it is the wealthiest nation.

The country's economic system is rigged against poor people no matter how hard some work, Rank says.

"We're playing a large-scale version of musical chairs," he says. "We have 10 people playing and only eight chairs available. We can say individual things like you need to be quicker, you need to listen to the music better, but we've set this up so that some people are going to lose out, regardless."


There's a place for donating to food pantries during the holiday season, Rank says, but people shouldn't stop there.

"We can't lose sight," Rank says, "of why people are turning to those food pantries in the first place." E-mail to a friend E-mail to a friend

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