Should I Give Handouts to Panhandlers?

Q: My friend says I'm a sucker to give money to panhandlers, but I feel guilty when I just walk on by. How do you view this dilemma?

Do you feel guilty about not giving to a particular panhandler or not doing what you feel you should do for the poor in general? There's a difference. Some generous, compassionate people don't give money on principle to someone begging on a street corner because they don't know anything about the person's actual neediness, character and intentions for using the handout. They also feel that giving to panhandlers rewards an activity that degrades the urban environment and results in more people looking for handouts on the street. Some cities, concerned about panhandlers who solicit in a menacing way, have banned begging altogether.

You can assuage your guilt by supporting local social-service agencies that help many poor people and screen for need. Or you could see about buying a supply of $2 gift vouchers from a local fast-food restaurant or deli, and give them to panhandlers instead of cash.

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Q: Whenever I go to a charity party with lavish decor, food, printed programs and entertainment, I think of how much more the event could have raised for its beneficiary by keeping things simple. Your thoughts, please.

I'm with you, and sometimes I would rather send a donation and skip the fancy party. The success of a benefit should be judged by its net proceeds, in both dollars and percentage of total revenues. The bottom line can be boosted by keeping amenities simple or by convincing vendors to donate a lot of the goods and services for the party. The simple-is-better ethic seems to be catching on. But there are still many benefit organizers and committees whose egos seem to demand "the best party ever," or who believe that a high-price ticket (with a large donation built in) requires sumptuous perks to attract the big donors.

Have a money-and-ethics question you'd like me to answer in this column? Write to me at ethics@kiplinger.com.

Knight came to Kiplinger in 1983, after 13 years in daily newspaper journalism, the last six as Washington bureau chief of the Ottaway Newspapers division of Dow Jones. A frequent speaker before business audiences, he has appeared on NPR, CNN, Fox and CNBC, among other networks. Knight contributes to the weekly Kiplinger Letter.