The Grand Illusion
Almost invariably, the majority of mail that we receive is from charitable organizations, the preponderance of it from so-called charities to which we do not contribute nor most likely never will. There are some, I admit, that once received a contribution in a moment of weakness on our part, but never will again. The unanswered telephone solicitations are even more disturbing, because we have never contributed to anyone or anything based on a telephone solicitation.
It appears, in fact, that everyone and everything has its own charitable organization. While this perception is in fact erroneous, it still feels that way to me, perhaps because there are over a million and a half charitable organizations in the United States alone. And after the scattered revelations of the past few years about the compensation of those running charitable organizations and the fact that, in all too many cases, far too much of donated funds to legally permitted 501(c) (3) organizations goes to anything but the purposes for which they were ostensibly founded. From what I can tell, there are foundations for almost every form of ill-treated or endangered species, particularly mammals, land-based and aquatic, and large avians, not to mention scores of foundations dealing with social ills, justice, discrimination, civil rights, conservation and environmental improvement – the list is truly endless.
The problem, of course, is that a great many of them address very real problems. Far fewer do so efficiently and cost-effectively. Some address problems that don’t seem to be problems to me, such as the “need” to “return” federal lands to either the people or the states [not that either ever held those lands], and some spotlight problems that cannot be solved by greater application of resources.
If people wish to give money to these causes, so be it, but should all these donations be considered tax-deductible? For that matter, should donations to religious organizations be tax-deductible? Such deductions add to the federal deficit and, in essence, require higher taxes on everyone.
Now, I know that many conservatives feel that government attempts to do too much in social programs and believe that private charity is more suited to dealing with many of these problems, but isn’t providing tax deductions for charitable and religious organizations effectively the same as a government subsidy? And all too often, the cost of subsidies is far greater than anyone knows because it’s essentially hidden. The more than one and a half million U.S. charities spend 1.5 trillion dollars every year, an amount equivalent to the 40% of the federal budget. Given the billions poured into charities, if charity were that effective, shouldn’t we be seeing better results?
So, the government is entitled to a share of everything we do, including gifts we make out of the kindness of our hearts?
It would make more sense to cut US expenditures on the military and “intelligence”, neither of which have been remotely necessary or productive since WW II. The fact that our highly intrusive “intelligence services” couldn’t even prevent their own secretary of state from using an unsecured email server illustrates their “competence”.
I don’t like taxes any more than anyone else, but when charitable gifts reduce your taxes, that’s a tax break, not a tax on gifts. And, according to tax law, and the Constitution, as amended, government is entitled to a share of everything we make, unless, of course, we reduce what’s taxable through various schemes. The questions are: what is deductible; what should be deductible; and why?
Charity is deductible.
Charity is that which is given and affords no immediate return to the giver.
By that definition it is not up to anyone to decide what is or is not worthy. All that should need to be proven is that the gift does not benefit the giver (or his/her direct relatives) directly.
Mr. Modesitt, I heartily agree with you. A tax break on an amount to a specific charity is in essence a tax on the rest of us to support that charity. We should repeal this deduction.
Government programs also are subject to much inefficiency and fraud; and supporting them isn’t even voluntary.
There are at least three major organizations that rate charities “on how they spend their money, protect donor privacy, govern themselves, and more”. The following articles lists them:
http://www.consumerreports.org/cro/2012/12/make-sure-your-donation-counts/index.htm
Why not _expect_ to shop for a charity as smartly as one would shop for a smartphone or other gadget? If government protected you from mistakes, or a lack of responsible shopping, the very protection would make you less free. It’s one thing to punish false advertising (as either fraud or breach of implied contract), and quite another to make your decisions for you, spend your money for you, and ultimately enslave you as a mere tool of the state.
I find it hypocritical to donate one’s money for what an individual interprets as an act for a greater good and then turn around and seek a tax break/attention for generosity. When I choose to donate to any organization I do not fill out any of federal forms for the tax breaks. Nor the boxes for donations of public tax dollars for political campaigns. Why would anyone wish to put themselves under further scrutiny and garner attention for a supposed selfless act? Sounds like a form of Naming to me.
The US should change to the British ‘Gift Aid’ system. For approved charities you pay a bit extra on your subscription or ticket, and the taxman pays over the amount of tax that you’ve already paid him on the money.
Too ad to John’s entry, Gift Aid is a scheme where the charity can claim back tax on any contribution made providing the donor has paid enough tax in the year to cover all their donations.
There is no tax benefit to the giver at all.
I understand that US donors get tax relief on their giving. Any change from that system would likely see donations massively drop, or so a US economist told me.
If it’s any consolation, I just filed my U.S. Federal Income Tax and found that, due to having paid insufficient mortgage interest due to downsizing, I no longer could itemize my deductions (or at least it would have cost me more to do so) the upshot of which is that NONE of my 2015 charitable contributions were tax-deductible. Does this mean that we will forgo charitable contributions going forward? Not a bit; the point of giving is to support causes we believe worthy and whose administration is minimally kleptomaniac. The tax deductions were just a nice plus while they lasted.
>isn’t providing tax deductions for charitable and religious organizations effectively the same as a government subsidy? And all too often, the cost of subsidies is far greater than anyone knows because it’s essentially hidden.
It looks like everyone skipped this point and went right to discussing the benefits and disadvantages of charitable contributions in our current tax structure.
(I happen to agree with your assessment, but I’m not an economist; I wouldn’t mind having an educated opinion on this point.)
An outline of the “anti-budget” (shadow budget?) in which governmental subsidies are identified and numerated would be interesting. An academic analysis/study of the impacts would be spectacular.
Side note: This does remind me of a seemingly favorite device of yours, which is when your character reviews reports/budgets/documentation and sees what’s missing or isn’t there.