I'm not saying that there's a perfect (inverse) correlation between the size of government and the level of charitable giving in a society. Just for starters, governments do many other things—some legitimate, many not, in my opinion—besides running welfare programs. And it's not hard to think of many other factors that would affect generosity besides the total tax burden.
But government welfare undoubtedly does crowd out voluntary charity to some substantial extent. And this has many unfortunate consequences, including bureaucratic inefficiency; abuse of the system by those who don't really need it; an entitlement mentality among beneficiaries; and a lack of that charitable glow among "givers" who have no choice in the matter and no real contact with the people they help.
Most supporters of government welfare programs are surely aware of these serious shortcomings; they just fear that absent funding through taxation, many poor people would go without the basic necessities. But what if being less heavily taxed made us far richer and led us to donate far more of our higher incomes to the needy, both at home and abroad? What if this money were more carefully spent to fund better-targeted programs? And what if it would be healthier, psychologically, for both givers and recipients of aid to be involved in transactions that are voluntary and transparent? What if our fear is keeping us from realizing just how generous we can be?