Charity

In recent years I've been confused by a couple things I've read.

On the one hand, I read that Americans lead the world in charitable giving, setting a record in 2006 by giving $300 billion.

On the other hand, I read that America is near the bottom of the industrialized nations in terms of foreign aid as a fraction of its GNP.  That is, it's total giving is big but not so much as a fraction of its economy.  The $20 billion number quoted in the Wikipedia article is a lot smaller than the $300 billion mentioned above.  From this I assumed that the US is a great giver but mostly gives to itself.

An editorial in the LA Times by Robert Reich (Is Harvard a charity? Most donations go to institutions that serve the rich; they shouldn't be fully tax-deductible) reveals another side of this issue.

This year's charitable donations are expected to total more than $200 billion, a record. But a big portion of this impressive sum -- especially from the wealthy, who have the most to donate -- is going to culture palaces: to the operas, art museums, symphonies and theaters where the wealthy spend much of their leisure time. It's also being donated to the universities they attended and expect their children to attend, perhaps with the added inducement of knowing that these schools often practice a kind of affirmative action for "legacies." 

It turns out that only an estimated 10% of all charitable deductions are directed at the poor.