I recently heard about a Responsum* from the Reform Rabbis' Responsa Committee, concerning the current financial crisis. One of the aspects addressed was the relationship between good governmental fiscal policy and tzedakah (charity, more or less).
*"Responsum" is the singular of Responsa, which are answers which Rabbis give to questions they receive, traditionally by mail. It is a long-standing way that thinkers and sages can answer the questions of Jews from other places, and can address detailed issues ("am I allowed to eat this?") or more general inquiries ("do I have to believe this?" "What is the proper way to pray?").
Part of the question was whether there was a proper fiscal policy for Jews to support. That is, given our values and laws, is it proper for a Jew to be a "Supply Sider," or a "Tax and Spender," or anything else, and are we obligated to support a government/candidate with that policy? Interestingly (and, to me, thankfully) the answer was, "no." Judaism absolutely demands that we take care of the poor, and the argument, "I worked hard for my money, I shouldn't have to give it away to those less fortunate/hardworking/worthy than I am" carries absolutely no weight for us. But, there are those who argue that, in the long run, Supply Side economics will give the most benefit to the most people. It is, big-picture, more just and more caring than other econimic policies. Judaism, and Rabbis in particular, are in no position to judge that assertion - it's purely economic, not religious. Therefore, the Responsa Committee refused to endorse any one fiscal policy. Given that most people on the Committee are probably very liberal, and most would probably gouge out their own eyes before supporting a Supply Side policy, it was a nice moment of honesty and restraint, I thought. (And, in case it's not obvious, I'm one of those bleeding-heart liberal, Supply Side hating types, so this isn't just me being partisan!)
But, things really got interesting when the Responsum addressed a different issue. If we support a fiscal policy which gives aid to the poor through tax cuts, does that, in any way, affect our requirement to give tzedakah? In other words, if I work hard to ensure that the poor pay less in taxes, then I've increased their available money. One could argue that I am now not obligated (or obligated to a lesser degree) to give of my own money. Similarly, a government which cuts taxes on the poor could feel less obligated to give direct aid to those same poor - the tax cut is aid.**
** Of course, I also understand that the government isn't, and shouldn't be guided by Jewish values. But, this was a theoretical discussion of what we should expect of a just government.
The answer was, in short, "no." Giving tax cuts in no way changes our obligation to give tzedakah. And, why was that? Because, giving tzedakah is an active obligation. In other words, we, as Jews, are obligated to give, not just to help. Helping in other ways might be laudable, but it doesn't change our base obligation, which is to give from our own wallets.
It's helpful to know that tzedakah is very often referred to as a tax (which is how it's different from charity - it's an obligation, not a free-will offering). And, like taxes, giving in other areas doesn't change our tax burden. If I donate to the local school, that doesn't change the amount of tax I have to pay to the government, even though some of that money will then go to that same school! No matter what else I do, I am still obligated to give tzedakah, actively.
But, that still leaves the question of, "why?" Why do we have to give tzedakah. I'm sure that there are many reasons, but let me suggest just a few. First off, and maybe most importantly, there is still need. Even if you arrange for lots of support/tax breaks/whatever, there are still poor people who desperately need help. We have to give to them, because they need us to give. Simple.
But, there is something else. There is something about the actual act of giving which is powerful. Something about the act of taking what seemed to be mine, and handing it over to you. It's more personal. It gets me engaged. It's like the difference between sending a doctor to look after my child who is sick, and being there to stroke his head when he feels awful. The first might be more effecacious, but the second is so much more important, in a different way.
Primarily, tzedakah is about helping the needy, and however we help them, that's a good thing. But we can't forget that we are a part of tzedakah, too. Our obligation to give is really our obligation. We can't let someone else do it for us. It is, in the end, our mitzvah. And, that's what keeps it sacred.