When shares of Wall Street powerhouse Bear Stearns lost over 90 percent of their value in one weekend, stock markets around the world shuddered.
So did some charities. About 1,000 of Bear Stearns' highly compensated senior managers have been required to give 4 percent of their substantial incomes to charity as a condition of employment. This unique policy has been in place since the 1970s, and in 2006 alone, Bear Stearns employees gave almost $50 million to mostly secular charities.
But what about Christian ministries? Will market jitters hurt them as well?
Daryl Heald is president of Generous Giving and senior program officer at the Maclellan Foundation, one of the nation's largest Christian philanthropic foundations. Heald says major ministry leaders are "very upbeat. . . . Last year was a very good year for Christian charity. For ministries with large and diverse donor bases, things are not bad."
Heald added, "Christians with a giving mentality and heart" sometimes actually revel in the down cycles of the economy: "The Bible says we should store up riches in heaven because treasure in heaven is secure."
K.P. Yohannan, founder and president of Gospel for Asia, said that GFA donations increased during the recession that followed the high-tech bust and 9/11. He speculated that contributors to Christian ministries are "serious about sacrifice and following the Lord." But he noted that the dollar's declining value has been a factor for ministries with overseas operations: "A year ago, one U.S. dollar would buy 49 Indian rupees. Today, it will buy only 38 rupees. It takes more U.S. dollars to do the same thing we did a year ago."
Mark Hanlon of Compassion International said his organization "has not seen a decline in giving" largely because "the majority of our sponsors in the U.S. support one Compassion child." However, he said the dip might be ahead: "If we do see a drop in donations from [major donors], it usually lags the overall U.S. economic situation."
Philanthropy expert Arthur Brooks said the experience of these ministry leaders is typical: "We'll probably see some impact . . . it will lag the general trends in the economy. But it surprises some people to learn that charitable giving, while not recession-proof, is remarkably recession resistant. Most people are not like Barack Obama. If they're givers, they're givers in good times and bad."
Tough times are not all bad, Heald says: "Sometimes it takes a major correction to cause people to realign their priorities. We've seen people who lose wealth in major down cycles become more generous. They realize what's important and start doing more of their investing in activities that have an eternal gain."
The charities that depended on Bear Stearns' "4 percenters" might be at risk: Bear spokesman Russell Sherman noted that new owner J.P. Morgan will decide whether the Bear tradition continues. But God doesn't change, noted Gospel for Asia's Yohannan: "We're learning to trust God more and more, and that's not a bad thing."
Philanthropy experts consulted by WORLD had the following advice for Christians in tough financial times:
- Pray first. Generosity is the result of a full heart, not a full bank account. Let the Holy Spirit, not financial conditions, be your guide.
- Honor your commitments. Pledges to your church and commitments to ministries should be honored if at all possible-even if personal circumstances change.
- If honoring your commitments becomes impossible, communicate with the ministry, especially if it is a small ministry. The communication helps them plan, and helps them pray for you.
- Ask God to show you the difference between saving and hoarding. Scripture calls the saver "wise" and "prudent." Scripture calls the man who hoards a "fool."
- Remember that all ages seem uncertain at the time. The only true security is trust in God, not in a large bank account.
-Sources: Generous Giving, Crown Financial Concepts