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Less to give

Charity | The economic recession has meant sharply lower donations to ministries

Issue: "Pro-baby," Jan. 30, 2010

Rick Warren's "urgent" post-Christmas plea to Saddleback Church members for $900,000 in donations to cover a budget shortfall shocked observers around the country. Not surprisingly, critics of Warren and his ministry were quick to speculate on nefarious reasons for the surprising and pressing need for such a large sum of money at one of the nation's most successful churches (see below). The real reason for the shortfall, however, appears to be shared among Christian ministries across the nation, if not the world-the lengthy and deep economic downturn.

Ministries are still completing the final tally of gifts received at the end of 2009, but Calvin Edwards, who leads a philanthropic advisory firm based in Atlanta, Ga., believes donations for many ministries could fall by 10 percent to 15 percent for the year. For many, like Saddleback Church, this is a heavy burden to bear, especially given the concurrent increase in demand for charitable services. Many ministries have already reduced staffing levels and many worry this trend may continue into 2010.

The decline in giving in 2009 could well be the worst since the Great Depression. A study in Giving USA Spotlight indicated during all recessions between 1967 and 2007, donations to all nonprofits fell only by 1 percent on average. Even in the worst recession during this period, in 1974, giving fell by only 2.7 percent. Chuck Bentley, CEO of Crown Financial Ministries in Gainesville, Ga., says the 2009 financial shortfall is "not all bad." With financial resources constrained, ministry leaders are eliminating ineffective programs rather than limping along with them.

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Edwards, however, is "cautiously optimistic" about increased charitable giving in 2010: Improving economic trends should translate into a recovery in giving, "but caution is warranted because small businesses are one of the engines behind major gifts. With government taxation and regulatory policies keeping small businesses insecure about their future, there may be a greater reluctance to fund charitable efforts."

Research on the relationship between stock prices and giving trends also offers hope for ministries and those they serve in 2010. One study (by Deb, Wilhelm, Rooney, and Brown of Hunter College, Indiana University, and Purdue University) associated a 100-point yearly advance in the Standard & Poor's 500 Index with at least a $1.7 billion increase in charitable tax deductions. Since hitting its lows in early March 2009, the Standard and Poor's 500 Index has risen by 475 points.

The response to Warren's call to cover Saddleback's $900,000 deficit may also be telling. Calling his congregation's generosity "amazing," Warren reported donations of $2.4 million in the days after his appeal. "We're starting the new decade with a surplus," said Warren: "It came from thousands of ordinary people. This was not one big fat cat." That is encouraging not only to Warren but to all ministries looking for light at the end of the 2008-2009 tunnel.

Posting nonsense

Rick Warren's plea for funds produced contributions but also false and misleading attacks by critics of Warren, some of whom hate his opposition to same-sex marriage. Here are three of the anti-Warren blog postings and the facts concerning their charges:

"Yaa im sure he will use all 2.4mil on the church.........none on himself to buy a new Mercedes or a new house."

-George, Sterling, VA on Topix.com/forum/who/rick-warren

Warren receives no income from Saddleback Church.

"If I was in Rick Warren's flock, I'd ask for an audit."

-Joe Sudbay on the Americablog Gay

There is no indication that the financial shortfall was related to anything other than a sudden decline in Christmas donations.

"Rick Warren demands $900,000 from his parish­ioners to continue his obscenely lavish lifestyle."

-ComradeRutherford on rawstory.com

There is no evidence that Warren leads an "obscenely lavish lifestyle," although his successful book sales would give him the means to do so. Warren has said that he gives away 90 percent of his income.

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