Tuesday, March 3, 2009

Pulse on Obama

Much is being written about the big-name moderates, Brooks and Buckley, reversing their previous support of Obama just a month or so into his presidency. The conservative media is already seeing the hope of change in 2010, and even the mainstream media is binging to wonder about Obama's support from moderates. To be honest, I really don't don't know what makes these guys, or most people, moderate. Best I can tell, moderate means willing to try a little of everything to see what works. This sounds appealing, but a little poison can cause a lot of problems.

I'll stick to the policy, and leave the politics to others. I am more interested by the reaction to Obama's plan to reduce the tax benefits to charitable deductions. According to the Robert Frank of the Wall Street Journal, Government is the new charity, albeit coerced:

In the past decade, more and more government functions have been privatized, leaving the private sector and rich individuals to solve broader social ills. Whether this worked well or not is hard to measure.

But as the rich got richer, and Bill Gates and Warren Buffett paved the way for more giving, wealthy philanthropists took on more of what used to be government functions, from health care and education to medical research.

Democrats want to tilt the balance back to government. As Robert Reich told the Chronicle of Philanthropy: “Is the good that will be done through health-care reform greater than the good that would have been done with the charitable projects of the wealthy people [who might decrease their gifts]?” he asked, implying that the answer is yes.


Hmm, I would bet on no, myself, but time will tell, I suppose. Regardless, I stand along Mr. Frank as holding the outdated notion that philanthropy is (and should be) voluntary.

The Washington Times story on the same subject raises a few more questions in my mind:

Mr. Obama is counting on that provision to raise $179.8 billion over 10 years.

...

Roberton Williams, senior fellow at the Tax Policy Center, said it's impossible to calculate the exact effects of all the tax changes, but said the overall result is clear - less philanthropic giving.

"This will lead people to give less to charities if they behave the way they've behaved in the past," he said. "We've already seen a drop in giving as a result of the economic collapse. On top of that, this will just reduce the amount of giving."

Asked about that, Office of Management and Budget Director Peter Orszag said Mr. Obama took care of that by giving charities government money to make up part of the difference.

Rep. Paul D. Ryan, Wisconsin Republican, describes "the good, the bad and the ugly" of President Obama's 2010 budget plan Thursday on Capitol Hill. (Astrid Riecken/The Washington Times)

"Contained in the recovery act, there's $100 million to support nonprofits and charities as we get through this period of economic difficulty," he said.


The government raises $180 billion from the measure, but sets aside $100 million to make up for the difference. Oh, of course, it gets to decide which organizations win in the giveaway. Hmm...

Having posted all the quotes above, I am actually not a fan of tax incentives. If I were President, I may be tempted to get rid of both the charity and mortgage interest deductions. There are a lot of junk charities out there, just as there are a lot of junk mortgages. What would worry me, however, is removing tax incentives while simultaneously raising taxes, and in a down economy no less. Enter The Chronicle of Philanthropy:

Michael W. Peregrine, a lawyer in Chicago who advises nonprofit groups, says charities are now facing a “triple play” that could cut into their donations — the bad economy, the proposed charitable-deduction limits, and proposals by President Obama to end tax cuts for wealthy people that were introduced by President Bush.


People can not give their money to charity, regardless of the tax benefits, if they owe it to government.

10 comments:

Anonymous said...

Again, great work Justus. But I would argue that no economist can derive a theory or provide an analysis of why people make charitable contributions. Similarly, no government program, regardless of how benevolent its intent, can replace or render obsolete the compulsion faithful and benevolent people feel to support their churches or their favorite charities.

When you get to the nut of true human benevolence, tax schemes, government budgets, economic tides, and federal agencies become little more than an irrelevant side show.

Accordingly, I am unpersuaded by any economist that would argue that charity decreases when taxes increase and economic crisis exacts its toll. What the bean counters fail to understand is that the true power of charitable giving comes not from the amount of money collected but rather from the spirit of benevolence that compels the giver to give. I don't blame the economists for their error, I just point out that their analytical tools can't account for such phenomenon.

For the record, I don't like paying taxes anymore than the next person, and every year I try to reduce my contribution to the government coffers as much as the law will allow. But government decisions regarding tax breaks for charitable giving have no impact on the spirit of benevolence.

Justus Hommes said...

It's not clear cut, I agree.

But if it weren't for the tax benefit, the Howard Hughes Medical Foundation, and hundreds of other trusts and foundations would not exist. I am not saying that is a good or bad thing. I am just saying that these policies decisions are hardly irrelevant.

Sure, many people would continue to give as much as they could, regardless of economy, taxes, and incentives, and analysis can't answer why, but certainly how. A complicated mathematical model is not needed to tell us that the less money someone controls, the fewer decisions they can make with that money, and the smaller the dollar amounts involved.

Anonymous said...

I would submit that economic analysis can't even answer the question of how. It can only answer the question of how much money. No matter how much money is given, there will always be unmet financial needs. Even in times of plenty, no charitable organization ever says "we're good, we don't really need your financial support anymore."

No, my argument is that money isn't the bottom line when it comes to human compassion. Money doesn't cure cancer. Money doesn't feed the hungry or clothe children just as money doesn't build bridges or fight fires. People do all these things. Now some people assist these things by lending financial support, but people working with a spirit of benevolence make a far bigger difference than any financial contribution ever will. And lets at least acknowledge that financial resources can sometimes encourage waste and complacency (one of those unexpected consequences mentioned in the TED speech referenced in another posting). Even if you eliminate money or wealth all together, people of faith and benevolence will still find a way. Why? Because God works through his people without regard for the bear or the bull; God works without regard for the IRS and the tax code.

For me, this whole discussion returns to Jesus' ministry - if you look at his ministry as a political movement, it was a movement of the powerless, the penniless, and the worthless: among his followers were the sick, untouchable, women, children, whores, tax collectors, convicts, those utterly without resources. This movement sprung up out of a dominant system every bit as concerned with wealth, righteousness (or the appearance thereof), political power, and military might as ours is today. Yet and still the Church stands and believers around the globe do God's work long after the failure of the Roman, Persian, and Austro-Hungarian empires with all their wealth and power. The people of God (and even those benevolent souls who profess no religion) will continue to follow the Spirit (or their sense of human compassion) without regard for the ebb and flow of the business cycle or revisions to the tax code. Those same people will always be far more powerful and have far more influence than the dollar or any institution ever will be.

So perhaps this explains why I stop listening whenever an economist attempts to forge a link between charitable giving and a particular policy argument, whether for or against taxes, whether for or against expanding government programs. The economists with all their their financial models and all their data and all their considered reasoning simply do not and cannot understand what they're talking about.

Justus Hommes said...

Wow, OK. I think we are talking past each other, but I'll try to respond.

Sure, people are the doers that make thing happen, and are absolutely the primary part of the equation, but they do it in large part with money. I personally couldn't cure cancer if I was a billionaire, but the world's best scientist can't cure cancer without a little scratch. And how much money that scientist had at his disposal most certainly could make a difference.

As for Jesus' ministry, it wasn't a political movement. Maybe you can correct my thought here, but I don't see that way at all. But to play devil's advocate, in addition to the untouchables you mention, there were a lot of people giving of their financial resources (Luke 8:1-3). Those tax collectors did OK in their past lives. And Judas was treasurer, a role not needed if they were all penniless.

Since you went Bible, allow me -

Galatians 5:1-5 - For freedom Christ has set us free; stand fast therefore, and do not submit again to a yoke of slavery.

Rome was far enough away, the dominant ruling power that Christ and the early church really dealt with was the Jewish establishment. And this verse, as does all of Galatians, declares that the Messiah has set us free so that we may enjoy the benefits of freedom, and that we are not to submit to the slavery of any authority except Christ and other believers. To paraphrase Paul's handling of the circumcision issue, if we concede the tip, we must concede everything. He exhorts his followers to reject any heavy-handed establishment of law in favor of a self-supporting community of believers.

Anonymous said...

I only went to the bible because it informs my view of charity. I thought about that when I posted - (RR, are you sure you want to bring out the heavy artillery?). And then I ignored my thought and barreled right on through.

Sure Rome was far enough away, but lets not underestimate the power of the Prefect over Palestine during Jesus' time. And at the time of the epistles, the early church's single biggest outside oppressor was Rome. In fact, much of the epistles and Revelation are direct or indirect (read - encrypted) indictments against the Roman Empire's domination system. That's just one reason why they are relevant to our discussion about the ever-expanding federal government as you so rightly point out.

And so we come full circle. You are probably right - we are probably talking past each other. Your issue is with taxes and federally mandated "charitable" spending, while my issue is with economists and their attempts to analyze or predict the effect of any fiscal or tax policy on charitable acts.

Sorry if I was overbearing, but again this is what maternity leave looks like.

Let me know when I cross over into troll land...

Justus Hommes said...

I love the comments, keep them coming. The trollier, the better.

Anonymous said...

I've often been accused of having troll-like features what with my sloped forehead and hairy palms.

So its hard to jump in the middle of this and figure out where to respond. And the "talking past each other" phrase probably describes all of this best.

I'm not sure that the arguments the economists are making are religious, or at least shouldn't be. I would also suggest(without any stats or even anecdotal evidence - although I could fabricate some) that a majority of charitable giving has nothing to do with faith. To those of us whose giving is motivated primarily or entirely by our faith the laws are irrelevant. To those who give because of the benefits it brings their wallet, then the laws are very important. Interesting to note all of the athletes that start funds and charitable organizations, which could prove either point depending on perspective.

I would agree with Dr.RosenRosen that God will accomplish his purpose with or without the government, charitable organization, or current economies, and in spite of most of us. Sacrifice does more good than wealth.

I would disagree that Jesus' ministry was a political movement (although I'm not sure you were saying it was). Did his ministry have political impact? Yes. Between the Sanhedrin and the Romans the Jewish people were very aware of politics. I would say, as a possible counter to Justus' comment about the distance of Rome, that the Jewish leadership was far more spiritually oppressive than the Roman. As long as you "rendered to Caesar", Caesar would let you do what you wished.

Jesus reached out to the untouchables, but he reached out to forgive their sins, not to remove their political oppression. If he were concerned with politics He would not have changed the life of Nicodemus, the Centurion at the cross, or called tax collectors (respected by no party) like Matthew and Zaccheus. I do not doubt that we all agree that Jesus came to save our souls; I just wanted to express that although His coming had political impact that was a result of the changed lives in His believers not a result of any political intention. He tells us to submit to authority and to pray for authority.

I would also disagree and possibly pull out of context for the sake of blogging Justus' coment that "we are not to submit to the slavery of any authority except Christ". Christ is certainly the utmost, the King of Kings, and it is His mind that we should share and example that we should follow. However, he tells us to submit to authority and to pray for it, but I am not aware of any instance He tells us to overthrow it. If we obey the authority (and all authority is given by the power of God), then God will deal with them when they are wrong. When Peter was in jail, did God tell the disciples to break him out? No, He delivered him by one of the angels. When Paul and Silas were in jail and the earthquake came, did they take that as a sign from God to run? No, they made all the prisoners stay and as a result the jailer and his house believed. When God anointed David as the next King of Israel and twice delivered the murderous King Saul into his hand, did David act? No, God promotes in His time, and delivers in His way. Often the unfairness of authority is put in our path to see if we will seek man's solution or God's. "Consider it pure joy, my brothers, whenever you face trials of many kinds because you know that the testing of your faith develops perseverance... so that you may be mature and complete, lacking nothing." James 1:2-4

Justus Hommes said...

Mr. Anon,

In addition to the examples you gave, I would consider Daniel refusing to eat the king's meat, or worship the king's idol. Should he have submitted to authority and wait for God to deal with it in his way and time? God can do anything he wants, but throughout the Bible and throughout history, we see that he chooses to work through people. Daniel was willing to take a stand for his faith, and I hope, though can not be certain, that I would have the strength to do the same.

This is certainly up for debate, but I qualify the biblical passages concerning human authority and government laws. I am glad Bonhoeffer did not submit to Hitler, as I don't think Hitler's authority was given by God. Bonhoeffer could have sat back and waited for God to act, but instead he was executed for his active resistance. I see him as a hero.

Anonymous said...

Well put. If we look at Daniel, we see that the direct authority over him agreed to allow him to drink water and eat vegetables. However, he did not stop his prayers and his three friends did not bow to the idol. You are correct, when the laws of man call us to directly blaspheme or disobey our God we are to submit to God's law first. However, I don't think you can apply this unilaterally to extreme unfairness or poor government (not that you were - its just my point). I think that many Christians will use their "righteous indignation" to pursue political means far outside of what the scriptures call.

Would it be fair to say that when we have resistance to man's law in the Bible it is done by individuals who do so without making a scene (or make it about themselves) or forcibly attack/overthrow the government. They are not concerned with the law or its consequences. They are just concerned with following the law of God and trust him to work His will.

This does not mean we cannot question the government or express our displeasure. I just think it means that God sometimes intends for us to grow through unfairness we often want to avoid, and some justify themselves where God does not.

Anonymous said...

Wow, this turned into an awesome thread. Mr. Anon, welcome to the troll patrol. Jump in midstream any time you like. And your name is right on - some of us, in know each other outside of the blogosphere, so this may or may not be a truly anonymous board.

And Justus brings up a point I've been wrestling with recently. I am a big fan of Bonhoeffer's, but one thing I can't get my mind around was B's decision to join a plot to assassinate Hitler. Certainly Hitler had to be stopped - I fully agree in principle, understand the logic, and am thankful that he was ultimately unsuccessful. But for a Christian, particularly one who was so radical in his interpretation of Christ's ministry, I'm not sure I understand how he arrived at the point where he would be willing to simultaneously act as judge, jury, and executioner. Maybe I need to read some of his letters from prison, or maybe y'all can help me with that.