Tasteless Jokes and Disgusting Overhead in the Charity Game

By Bruce Clark

When kids come to my door selling snack food in the name of charity, I have to hold back on my Marxist rants against the sinister corporations taking advantage of child enslavement.

Enlisting children to sell chocolate, nuts or the disgusting cookies that girl guides are forced to flog every year by jacking up the price is a brilliant marketing scheme. It’s difficult to turn down children funding their own worthwhile endeavours.

Most do-gooders aren’t deterred from supporting a worthy cause even though the cookies taste like they were made by a drunken, maiden aunt or that a box of five dollar chocolate- covered almonds retails for a buck and a half at the local 7-11.

Rather than purchase something I don’t need, I’ll give the kid a couple of bucks and tell him I’d rather donate directly to his Boy Scout troop, his hockey team or his crack habit and, at the same time, cut out the middle man.

I always give something because I believe it’s the decent thing to do, it may teach the kid something about critical thinking and, most importantly, I don’t want to give the evil little imp a reason to set fire to my garage. (I have a house in Elmwood.)

Volunteering your time is a form of charity that has the highest personal cost. To most people, donating a few hours to the local soup kitchen or making the commitment to coach a kids’ football team is just too much work.

Even though scientists believe that giving is innately human and claim they’ve discovered the gene for altruism (the joke goes: it must be genetic, otherwise you wouldn’t pass it on to others) nurture has it all over nature when it comes to learning the value of helping others.

My parents set an example to me with their tireless volunteer work in the community. When I knew everything at the age of twelve, I would unwillingly accompany my father to nursing homes and hospitals where we would, among other things, wheel elderly men and women to their Sunday morning church service.  My father, always dressed in a suit and tie and me in my “good cords” spent many hours helping total strangers.

When I bellyached about what then seemed like unrewarding work and asked my dad why I had to suffer the nauseating odor of hospital food mixed with the acrid scent of urine while my friends slept in or played ball hockey, he simply said, “Because — it’s what you do.”

Hockey, soccer, baseball, lacrosse and other sports saw my father driving kids all over the city several times a week using his own car and fuel while other uninvolved parents never once kicked in a buck or two for gas. My parents donated thousands of hours of their own time because they cared about their families and the community. They couldn’t afford to “earn” a tax break and they understood that community returns on donated time are much higher than donated cash.

Maybe it’s because people have less time and more money, or maybe it’s the natural course of things when large amounts of money are involved, but charity work has become a booming “not for profit” business. CEOs of non-profits regularly earn salaries in the quarter-million dollar range.

There are 85,659 registered charities in Canada, one for every 430 people in the country.   The vast majority of the estimated $182 billion donated are used to prop up bureaucratic systems that rival the most inefficient of governments.

When I was asked to become a sponsor for a charity hockey game for the Winnipeg Jets Foundation, I checked out their website which stated their goal:

…to strengthen and broaden the base of the Winnipeg Jets’ involvement in the community. It succeeds in this area by providing funds to local, registered charitable organizations strictly in the Province of Manitoba who provide programs and/or initiatives for children/youth with a focus on healthy living.

It sounds like the Jets want to give back to the people of Winnipeg and the province of Manitoba who supported them in bringing back an NHL franchise.

Since I’m a cynic, I always check with the Canadian Revenue Agency’s website here before I donate to any charity to ensure I’m not buying a box of overpriced junk food.

In their T3010 return, the Jets Foundation reported revenues of  $768,000, but only donated $176,000.  According to the formula used to rate charities by Moneysense magazine, the Jets foundation, like some of the Jets, scores very poorly.

Even if their method of raising money via a 50/50 draw at home games is taken into account, the foundation still only gifts about 37% of the money they raise. The Jets owners who so graciously “want to provide programs for children and youth…” lease space to the foundation (which only has two employees) to the tune of $26,640 a year.

There are virtually no government oversights when it comes to charity finances. Creating a foundation is a convenient way for businessmen to pop a few bucks in their pockets in the name of charity without being handed a misconduct.

Because government regulation is so lax, anyone can purchase a building, create a foundation, pay themselves a salary of half a million a year and rent the building back to themselves and — AND — not have to hand out a single dime to charity. As long as the money is kept in a “long term investment” that charity can legally continue to exist.

Charity scams have been engineered by lawyers (big surprise) where a $1,000 donation earns a $5,000 tax credit. About 175,000 Canadians “donated” to these fly-by-night outfits to the tune of $9 billion. Next to no money went to the needy but it did line the pockets of the greedy operators behind the scam.

Even charities that have good intentions can be almost as inefficient as the full-blown scams. One of the problems with organizations like the Jets Foundation is the “trickle down effect.” Since they are in the business of raising money and gifting that money to other organizations, they are subject to the third party charity’s overhead.

The Jets Foundation gave $30,000 to The Special Olympics of Manitoba (S.O.M).  (Reader: He’s not going to attack the Special Olympics is he?)  I will use Toronto comic Paul Wildbaum’s Special Olympic joke not to entertain but as an example of how well-respected the Special Olympics is in relation to the reaction to Paul’s joke:

“They should have boxing in the Special Olympics. They might just knock some sense into each other.”

The tastelessness of this joke also reflects the sensitivity of the subject. The more taboo it is to crack wise about something, the more taboo it is to criticize.

In order for the Jets Foundation to donate $30,000 to the S.O.M. they had to raise close to $100,000. Since the S.O.M. has a fairly hefty overhead, by the time that $30,000 pays for office, salaries and other costs, according to the Moneysense method, only about $15,000 is considered to be spent on “programs.”

So, if you donated $100 to the Jets Foundation, only about $15 was eventually used on S.O.M. programming.  Lesson: Want to donate to the Special Olympics?  Do it directly.

Although, if you look at the S.O.M.’s financial report, you may want to volunteer your time instead of volunteering your dollars.

The S.O.M. reported about $2.1 million in revenues in 2010. $258,000 came from government grants and $1.7m came from fundraising, while the rest came from other sources.

Salaries for S.O.M. employees amounted to about $1 million. These include accountants, finance directors and individuals who organize the events that are run by the 800 volunteers who coach, officiate or administer the events.  (They reported rent of $24,000 for a staff of fifteen compared to the Jets Foundation’s $26,640 for a staff of two).

More than half a million was spent on fundraising and the rest on marketing, coaching clinics and education. Only $103,363 was spent on the national games and another $59,991 on the provincials.

It’s difficult to cast aspersions on something as noble as the Special Olympics but it’s hard not to raise an eyebrow considering the S.O.M.’s CEO earns almost as much as they spend on their own national games.

People want the best bang for their donated buck. Knowing that more of your money is going to help the needy rather than enrich the administration helps to decide who is going to receive your donation. (The next time you toss some change in their red kettle, remember that The Salvation Army owns about $4 billion worth of real estate in the US.)

To attract donations, the United Way of Winnipeg makes the absurd claim that “every dollar of your donation goes back to the community.”

When I asked United Way officials about the specious claim of giving every dime back to the community they said they stand behind it because they get a $3 million grant from the provincial government. The logic being, your tax dollars fund the United Way so they can give away your money without costing you any money.

The United Way of Winnipeg reported about $30 million in revenues in 2010, including the $3 million from the taxpayer. They gifted about $15 million and spent about $2.5 million on programs.

With $4.5 million in salaries and another $3 million in office expenditures, Bernie Madoff couldn’t convince me that every dollar goes to the community unless you consider the CEO’s salary of close to $200,000 as part of the community.

The United Way of Winnipeg does some good work. It has the power to raise money for organizations that don’t have the capacity to do it for themselves. They will give to charities that aren’t “sexy” who have trouble finding donors.  Other charities would not exist without them, but it’s categorically false to advertise that every dollar goes back to the community.

The nonsensical assertion of 100% efficiency speaks to the competitiveness for the charity dollar. That extreme competition is often cited by charity spokespeople to address complaints about the high salaries of those running charities (the CEO of the Heart and Stroke Foundation of Ontario makes $350,000 and three employees of the Canadian Breast Cancer Foundation make $250,000).

Charity has become big business. What was once the domain of selfless individuals at the corner church or the community centre with an authentic desire to help has been hijacked by profiteers who earn enormous salaries off the avails of the volunteer.

I won’t give to those charities and I won’t volunteer for them either. I will continue to give cash to the kid selling cookies and I’ll even toss a twoney to the squeegee kid. Even if he does wash my windshield with filthy water, at least I know where my money’s going.