Wednesday, February 25, 2009

Millionaires Who Give Money To Help: A Rare Breed?

Since last year, I have seen so much gluttony on Wall Street (bankers taking astronomical bonuses even as they cry out for taxpayers' money...) that I have almost given up on humanity.

Have our moral standards declined so much that we have no qualms about earning money at others' expenses? To be frank, I will love to see more heartwarming tales of caring and sharing from these rich people.

Millionaires Who Give Money To HelpActually, there are many millionaires who give money to help people in need, like this modest guy who gave money away to strangers and left little for his family members. At Christmas time, you may find secret Santa Claus lurking around dark corners and handing out $100 bills to strangers.

Such charitable acts deserve accolades but too bad, the media do not give sufficient coverage, either because the millionaires do not wish to seek publicity or because readers are more interested in useless gossip.

In any case, I am worried that in the aftermath of this financial crisis, millionaires who give money to help could become a rare breed, if this Wall Street Journal article: "Help, We’re Running Out of Rich People," is anything to go by.

I know a lot of millionaires have their wealth destroyed as the economic recession borders on the 1920s Great Depression. Even if you have not invested in the stock market or real-estate, hardworking and fiscally responsible folks are still affected as many businesses are struggling to survive the lack of credit and demand.

With shrinking assets, President Obama is set to exacebate the woes of the rich (by his definition, people with joint income exceeding $100,000 are RICH). This group will be taxed heavily (increase to 39.6% from 35%) as Obama seeks to reduce the deficit.

Obama will also raises taxes on the investment gains of private-equity and hedge-fund chiefs and the rate for capital gains and dividends.

I think the number of rich millionaires in America are not declining, what is happening is the significant reduction of taxable income.

However, money given to charity should not be compromised. At times like these, money for the less fortunate becomes even more critical. It is up to the millionaires when and how much to give though.


frugalCPA said...

It seems like the economy relies more on the middle class than on the rich, and Wall Street is a poor (rich) sample of the US population. As long as things don't get too much worse, I think we'll still have plenty of people willing to give through their churches, to their friends and family members in need, and to their charities of choice.

But that may just be my unwillingness to accept a frighteningly constricted future.