We’ve seen that U.S. foundations spend a very small portion of their investment assets each year. As it turns out, that amount is actually less than net-of-inflation appreciation and new contributions, so the philanthropic sector is constantly growing. Both state and federal law, if anything, tend to discourage larger payout amounts. And most contributions to foundations are heavily tax subsidized. Should current law be doing more to encourage faster use of philanthropic funds? Although I think there are strong arguments on both sides, my present inclination is to answer “yes.”
Let’s start today with arguments in favor of charitable savings — that is, arguments against faster-payout rules.