Thursday, December 1, 2011
Philanthropy and government intervention are often viewed as substitutes. The “crowding out” argument in the economic literature suggests that the larger welfare states grow, the smaller private donations become. Hence the idea that philanthropy and the nonprofit sector could replace welfare programs if provided with the appropriate incentives. Since the 2010 general election, the UK government has encouraged such views through the “Big Society” allegory, and sponsored local and community-based programs in order to unleash entrepreneurial spirit in social matters. Yet this policy has been widely criticized as utopian, uncertain, unequal, insincere or even authoritarian. The British example illustrates a universal debate of particular relevance today: What should a government do – if anything – to foster “private initiatives for public good”? How is it possible to boost philanthropy and social investment despite the financial and debt crisis?
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