While the "Robber Barons" were associated with unfair play in the business world, they were great donors to charity. They gave out a significant amount of their wealth. The reason behind their generosity can be attributed to self-interest, as described in Adam Smith's theory of moral sentiments. The approach is based on social and personal passions for approval and happiness. The concept behind this is that self-interest leads to positive behavior and this applies to both social and economic markets (Moran & Stone, 2016). The rich donated to empathize with the poor which, was an act of humanity. As Smith says the free market only works when driven by self-seeking which in turn leads to moral sentiment. That is why no matter how bad the Robber Barons were to both their competitors and workers; they had to return their wealth to people through giving. For instance, Andrew Carnegie turned more than 80% of his wealth to philanthropic deeds.
Whether the Rise in Federal Spending Affected the Growth of Non-Profit
The increase in the expenditure by the federal government in the mid-20th to cater to social and economic welfare did not hinder the growth of Non-Profit Organizations (NGOs). This is because the operations that these institutions engaged in could not be left alone to the government. Instead, the government promoted the growth of NGOs to work together towards improving the livelihoods of many citizens of the United States (Pennerstorfer & Neumayr, 2017). If the government interferes with the operations in the NGOs through unfavorable policies and regulations, the purpose of the Non-profits will remain relevant and fail in the long run. During this time the government gave funds in the form of grants to the Non-profits which eventually boosted the growth, and many of such organizations were registered. In conclusion, the institutions did not only benefit from the government recognition but also in grants hence their growth was promoted and not blocked in this era.
Why the University of Pittsburgh and Its Donors Exempted Tax
Public subsidies towards the promotion of higher education are justifiable by the benefits that are gained by society through education. The University of Pittsburgh enrolls many students who study different courses. When they are done, they can use the knowledge to improve the welfare of their community (Holcombe, 2018). Education is a development pillar which means that the educational institutions and people who donate towards it should be exempted from taxation. The federal government recognizes that universities and colleges are essential in fostering the civic and productive capacities of the citizens. After all, they are state facilities the same tax ought to be used in the development of the learning facilities and schools.
Holcombe, R. G. (2018). Writing Off Ideas: Taxation, Philanthropy, and America's Non-profit Foundations. Routledge.
Moran, M., & Stone, D. (2016). The new philanthropy: Private power in international development policy?. In The Palgrave handbook of international development (pp. 297-313). Palgrave Macmillan, London.
Pennerstorfer, A., & Neumayr, M. (2017). Examining the association of welfare state expenditure, non-profit regimes, and charitable giving. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 28(2), 532-555. https://link.springer.com/article/10.1007/s11266-016-9739-7
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