The Joy of Giving: A Case for Voluntary Wealth Redistribution
- Cort Hoffman
- Mar 8
- 4 min read
With many redistribution program policies circulating, it’s worth exploring how we currently redistribute wealth on a voluntary basis. I’ll also argue that freely giving wealth is far more satisfying for both the giver and the receiver.
Redistribution involves the transfer of wealth from one group to another. Socialism essentially centers on redistribution, whether the transfer comes from wealthy individuals or institutions. Advocates often argue that it is unjust for a small portion of society to own most of the wealth. They claim that systematically taking wealth from the top 1% could significantly reduce poverty. In practice, all government programs involve an element of redistribution, as higher-income earners pay a disproportionately large share of taxes while receiving similar benefits to others.
Income Inequality and Wealth Accumulation
One of the largest sources of income inequality stems from age. As we age, we tend to earn more. Additionally, the two primary pathways to achieving millionaire status are through homeownership and a 401(k). Both require decades to build value. Investments often start as modest amounts but, thanks to the power of compound interest, grow into something extraordinary. While home values generally keep pace with inflation, paying off a mortgage creates a valuable asset over time.
Individuals who have invested prudently throughout their careers often find themselves with more money than they can reasonably spend. When such individuals give their excess wealth to those starting out or in need, it creates immense social value. Here are a few ways Americans voluntarily transfer wealth:
Weddings, Graduations, and Baby Showers
These life events provide excellent opportunities for older, wealthier individuals to support younger, less financially stable individuals and families. A key benefit is that recipients can specify exactly what they need or want. For newlyweds, gifts can range into the thousands, easing the financial burdens of starting a life together. High school graduates often receive cash gifts from relatives and friends, helping those who have little financial means. Baby showers, too, are vital, as raising children is expensive, and many young parents struggle to cover costs.
Churches
Churches are primarily funded through voluntary contributions from attendees. The amount given varies, as Christian scripture emphasizes giving with a cheerful heart rather than prescribing a fixed percentage (though Jewish tithing traditionally suggests 10%). Church funds typically cover pastoral salaries, building expenses, missionary work, and aid for congregants in need. This voluntary model ensures that all parties benefit givers, recipients, and the broader church community.
Charities
Another avenue for wealth redistribution is charitable organizations. Americans are remarkably generous, giving a collective $557.16 billion in 2023 alone, according to Giving USA [1]. This demonstrates a strong supply of voluntary charitable giving, suggesting that government redistribution may not always be the best solution.
Wills
Ultimately, wealth is entirely redistributed upon death. Wills provide a mechanism for individuals to distribute their assets however they choose. While many people leave their wealth to family members, it’s also common to allocate portions to religious or charitable organizations. Interestingly, few people choose to leave their wealth to the government, highlighting a general preference for personal discretion in wealth redistribution.
On the Giver
One of the key issues with state enforced redistribution is its ethical implications. Government taxation is compulsory, with penalties for noncompliance ranging from fines to imprisonment. This coercion robs individuals of the virtue and satisfaction that come from giving freely to those in need. Voluntary giving allows givers to be selective in their support, ensuring their contributions align with their values. It fosters a sense of purpose and a direct understanding that they are making a meaningful difference in someone’s life. In an ideal scenario, the outcome of redistribution wealth moving from one individual to another is the same. However, the key difference lies in how it happens: one involves willing generosity, while the other is enforced by the state.
On the Recipient
Receiving government aid can have unintended consequences for the individual. For example, consider the push for college loan forgiveness. Advocates argue that the government should transfer wealth from those who didn’t attend college to those who did. This raises ethical concerns, as college graduates tend to earn more over their lifetimes, making it unjust to take from lower earners to benefit higher earners.
Furthermore, recipients of government redistribution often feel entitled rather than grateful. They may demand more aid and react with outrage if benefits are reduced. This sense of entitlement undermines the personal growth and gratitude that typically come from voluntary acts of generosity.
A Better Way
As Dennis Prager famously said, “The bigger the state, the smaller the individual.” There is virtue in giving and immense societal benefit in doing so voluntarily. The question isn’t whether we should give, but how we should give. When the government becomes involved, inefficiency abounds, givers are stripped of the joy of giving, and recipients lose the gratitude that comes with receiving.
Admittedly, voluntary giving doesn’t address those who choose never to give. However, a culture that emphasizes free, voluntary redistribution is far superior to one reliant on coercion. Ultimately, all wealth will eventually be redistributed, as the saying goes: “You can’t take it with you.”
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