In Australia, when clothing is thrown into the charity bins, they will automatically do a cull for you. The good stuff gets resold, the 'beyond resale' stash gets divided into type of material and resold to manufacturers by the sackful. At least I felt I was putting money towards a good cause when buying our rags for the sign shop I used to co-own.

You could probably just ring up the charities and find out which one does this if you're seeking instant banishment rather than holding on for making rag rugs (which I also love).