I am pleased to be writing at a time when U.S. economic output has been expanding for several years, a clear sign that the economy is continuing to recover from the recession that dampened growth in 2008 and 2009. This economic climate should support an increase in charitable giving not just from the Butler Famility Foundation but from all levels of philanthropic activity in our country.
Level of Giving Tied to Broader Economic Conditions
During economic downturns between 1960 and 2004, giving as a percentage of gross domestic product fell during recessions or in the year that followed and then increased again as the economy expanded. Contributions to charities during and after the global financial crisis of 2008 and 2009 followed this same pattern. The most recent edition of Giving USA: The Annual Report on Philanthropy, an annual survey of charitable giving in the United States, shows that donations fell by 10% from 2007 to 2009 but have returned to pre 2007 levels after 2011 Levels of giving have been on the rise, again in 2014, and are expected to continue on an upward trajectory as the economy continues to grow in the years ahead.
Economic growth has a positive impact on households, companies and foundations. Just as individuals with more economic security can afford to contribute more to charity, corporations with greater profits and savings are able to donate more to the nonprofit sector. Similarly, when economic conditions are favorable, foundations have more assets and as a result, a greater ability to give.
Example Set by Bill Gates and Warren Buffet Resonates Strongly
Since 2010, Microsoft co-founder Executive Bill Gates and investor
Warren Buffet’s Giving Pledge has encouraged many of the world’s wealthiest people to commit to contributing a substantial share of their net worth to charitable causes. This initiative has helped to broadcast the idea that those who are successful have an obligation to play a role in protecting our environment and creating a better future for our children and the generations of people who will come after them. The number of people signing the pledge has increased every year and includes many prominent Silicon Valley technology company CEO’s.
Many of those who signed The Giving Pledge have expressed a desire for their philanthropic gifts to have a measurable impact on the world, and increasingly donors to higher education want their funds to be used to address society’s most challenging problems. For example, Nike Chairman Phil Knight’s $500 million matching gift for the Oregon Health & Science University has made possible a cancer research institute program dedicated to the “early detection of lethal cancers.” A recent gift from hedge fund manager John Paulson will enable Harvard University to expand offerings at its new engineering school and to foster connections between engineering and other disciplines. Albeit much more modest,through the Gary C. Butler Family Foundation, we were able to establish a faculty chair at the School of Industrial & Systems Engineering at The Georgia Institute of Technology that will allow my alma mater to continue to play a leadership role in the field of engineering by attracting highly talented students and senior faculty to the ISYE program.”
I am proud of the contributions from the Butler Family Foundation to my alma mater as well as my children’s alma maters and to organizations that help secure a bright future for children and their families, and to groups that protect animals and wetlands. I look forward to joining with others to increase the flow of donations to these and other worthy causes in the years ahead.