THE ECONOMY, THE WORLD SITUATION, AND MY STEWARDSHIP

You will find below an encouraging article about charitable and religious giving in tough economic times from The Center on Philanthropy at Indiana University. Thank you for all your faithful stewardship to your church, the causes you care about, and Sebring Camp Meeting!


How Do Crisis and the Economy Affect Giving?

When the economy slows down, churches and other charitable organizations that depend on donations grow concerned. How will the crisis and the economy affect giving? It is a question that is frequently asked, most recently in the wake of the September 11 attacks on America. The question was taken up in 2002 by the AAFRC Trust for Philanthropy and The Center On Philanthropy at Indiana University. Together they examined historical precedents that might affect giving. They examined what happened to the economy and giving in the years surrounding 13 major events of terrorism, war (or war-like) acts, and political or economic crisis. They are: the World War II Fall of France, Pearl Harbor, the Korean War, the Cuban Missile Crisis, the U.S. Bombing of Cambodia, the Gulf War, the bombings of the World Trade Center (1993) and Oklahoma City, the Assassination of President Kennedy, the Resignation of President Nixon, the Arab Oil Embargo, the Hunt Silver Crisis, and the 1987 Financial Panic ("Black Monday").

What they found is that the total amount of giving in the U.S. has increased every year but one (1987) for the past 40 years, including through wars, recessions and other crises. While the rate of growth has varied from year to year, each year Americans have given more than the previous year. This is an encouraging finding for churches and other charitable organizations, especially in the midst of a capital campaign or project that requires large financial resources.

2008 is characterized by wars in Iraq and Afghanistan, a political election for President, and an economic downturn. The study provides very positive analysis for what may be expected. In regards to the effect of war on giving, growth in giving rose faster in the years after acts of war than it did in the years prior to acts of war. The one exception is Pearl Harbor, when giving in 1942 rose at the rate very close to the rate of growth for 1940.

The study examined the Black Monday of 1987, the Arab Oil Embargo, and the Hunt Silver Crises. In the year following each of these economic crises, the rate of growth in giving exceeded that of the year of the event.

A press released issued by the study included the following remarks, "Our findings from this evaluation and other studies show that both the stock market and giving are resilient," said Eugene R. Tempel, executive director of the Center on Philanthropy. "While this is a unique situation, in the past Americans have shown a remarkable capacity to recover from adversity, both economically and spiritually, as measured by the stock market and giving."

For more information, view the entire report with supporting data on the Center for Philanthropy at Indiana University website: Update – What Do Crises Mean for Giving?
Data Sources: Stock Market Change: Dow Jones Industrial Average,
Daily Values Gross Domestic Product Change: Bureau of Economic Analysis in a file released March 2001
Total Giving: Giving USA annual editions and historical records from Statistics of Income, Internal Revenue Service