Tithing That Works

Tithing That Works
By Jay D. Homnick on 2.18.11 @ 6:06AM




Before commenting on this highly sensitive subject, please let me share a story I heard from one of the parties involved. Here in Miami there is a particular church which is geared towards Chinese immigrants. Some were Christians in China afraid to practice in public, and they are grateful for the opportunity to do so in the United States. Others were inspired to join after arriving in these shores. I get the feeling -- although no one wants to say so openly -- that some of them go just to socialize.

Howbeit, the policy of the community is for members to tithe their incomes to charity. Originally everyone complied. Some years ago, a group of entry-level workers, waiters and dishwashers, just off the boat, living on minimal income, made a quiet rebellion. Instead of giving the tithe, they gave one dollar from each paycheck. When they start making some real money, they promised, they would pay their full share.

About a decade later, a fascinating phenomenon prevailed. Of the people who had been working those same entry level jobs at the time of the rebellion, the same bus boys and delivery boys and bellhops, there were now two distinct clusters. The ones who tithed despite their limited means all advanced to lucrative careers and a high standard of living. The dollar dolers were all still passing the same buck, stuck doing the laundry and delivering Chinese food, scraping by on low incomes which refused to budge.

This should give you some idea of my passion for donating money to worthy causes. I give less than 10 percent to charity right now because 35 percent of my disposable income is still going to Jewish schools for my children's education. Otherwise, I try to be meticulous in meeting that threshold, moving the tithe into a separate charity account so it doesn't accidentally stick to my pocket.

Earlier this week, Warren Buffett was awarded the Medal of Freedom at the White House. The rationale for the honor was his work in convincing the richest people to leave 50 percent or more of their holdings to charity, a campaign called The Giving Pledge. In theory this sounds like a lovely idea, and in practice it sometimes comes close to that level. But more often the flaws in this notion overwhelm its virtues and the money is squandered -- at best wasted, at worst utilized for evil purpose.

Sounds shocking and perhaps counterintuitive, but it is absolutely true.

The main problem is that it is better for society at large for money to be in the hands of billionaires than for it to be in the hands of charities. Billionaires know how to make more money with their money, how to create projects to benefit mankind with their money and how to create employment opportunities with their money.

To take $40 billion from Warren Buffett and to give one billion kids in Africa $40 each will bring an awful lot of short-term joy to those little guys but it builds nothing lasting, nothing to generate fuel for the engine of progress. That is even if every dollar makes it to the intended recipients. By the same token, if you go to Toys-r-Us and buy $40 billion worth of toys to distribute, you will trigger an explosion of new jobs and new financial opportunities in several countries. You could theoretically have people benefiting a hundred years from now as a result of that toy purchase, while the $40-a-kid campaign will melt the power of the $40 billion into nothingness within days.

To the extent that billionaires will deplete the most powerful locus of human progress, namely their own minds and talents, to confer an illusory and ephemeral benefit upon the least capable people, it is against the best interests of mankind. That sounds harsh but it is true.

The Talmud teaches that shortly after the destruction of the Second Temple, the leading rabbis of the age pronounced a rule that even one who is dropping money liberally in charitable directions should limit his contributions to 20 percent of total assets. In the context of that time period in Israel, with the country in ruins, it is fascinating that their biggest concern was to cap contributions to the needy.

Clearly they saw that soft-hearted Jews who could not bear to see the terrible plight of their brethren were ready to clean themselves out so every beggar could have a loaf of bread. To do that would have set back the recovery from the devastation by many years. The long-term chance of bouncing back depends heavily on financially capable people having capital at their disposal.

There are a number of other problems today with dumping large sums of money into foundations. They are generally managed by trendy leftists who think killing babies through Planned Parenthood is more valuable than giving scholarships to young people to better themselves. All in all, I would rather see a man give 20 percent with close supervision to achieve maximum effect.

This subject is very close to my heart and I have to make a supreme effort to stop myself from ranting on for a few more pages. I personally ran a wonderful program, in memory of my late mother, which provided funds to tutor children from poor families who were lagging in particular subjects. The school designated the beneficiaries. Money was never given to the parents; it went from the funds to the tutors. We preset the tutoring fee at about 75% of market, so the tutors were contributing a little themselves.

The program was wildly effective but we ran out of funds, and so many of these so-called educational foundations put up so many barriers that we would have needed a full-time employee just to apply for the grants. I saw clearly how smart money could help real people, but most of the wealthy philanthropists were too distracted to guide their money with the perspicacity they show in other arenas.

In short, the type of thinking demonstrated in this campaign is on a par with the thinking that money should be funneled from corporate profits into government redistribution.