As the end of the year draws near, we are in what is often called “the season of giving.” For the last few years, our willingness to give, particularly to charitable causes, has grown.
The Giving USA Foundation reported that charitable donations in the U.S. total more than $373 billion, up an inflation-adjusted 4.1 percent between 2014 and 2015. More giving at a time of slow economic growth is a testament to how much we care for those around us. Over the same year, disposable personal income rose only 3 percent, according to the U.S. Bureau of Economic Analysis.
Despite more donations, nonprofit organizations across the country may be living beyond their means. According to the Federal Reserve, nonprofits have more than $487 billion in debt, up over 4 percent since 2014.
While giving may be up, nonprofits must still need more capital to meet the needs they serve. Some organizations simply ask you to give to pay off their debt.
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One not-for-profit organization owes more than $14 trillion: the United States government.
As of November 2016, the principal amount of federal debt held by the public was $14,443,700,000,000. This number does not include the $5,504,365,000,000 in debt held by the Social Security Trust Fund and other “Intergovernmental Debt Holdings.”
Like nonprofits, the U.S. government is faced with a relatively slow economy, and it therefore has trouble paying off its debt. Slow economic growth lowers tax revenues, making debt payments all that much harder.
In the spirit of the season, you can help by making a contribution to reduce the federal debt. According to a U.S. Treasury website, you can use PayPal or “make your check payable to the Bureau of the Public Debt” and send it to the attention of “Dept G” at the Bureau of the Public Debt in Parkersburg, W.V. They ask that in the memo section of your check you note that it is a gift to reduce debt held by the public.
Treasury reports that for the most recent fiscal year, $2,718,154.76 was given under this program. Unlike charitable giving however, this amount is down 53 percent from 2014, when $5,103,452.84 was gifted.
In this season of giving, consider foregoing some wrapped gifts under the tree and send your money to a worthy cause of your choosing.
Peter Crabb is professor of finance and economics at Northwest Nazarene University in Nampa. email@example.com. This column is part of a special section on nonprofits in the Dec. 21, 2016-Jan. 17, 2017, edition of the Idaho Statesman’s Business Insider magazine. Click here for the e-edition (subscription required).