Yesterday, the White House revealed how President Obama’s latest costly proposals to revive a sagging economy will be paid for. The answer included a plan first floated by the administration in the spring of 2009 when other expensive items such as Obamacare and the first stimulus were under consideration: limiting itemized deductions for charitable contributions. Though the president claimed at the time this was nothing more than one more tax on the rich, it signaled something more far-reaching than the standard class warfare tactics of the Democrats. It heralded a new war on philanthropy.
The devastating impact on philanthropic endeavors such a change in tax policy would have is not an accident. It is, as our former colleague David Billet explained in his July 2009 COMMENTARY article, every bit as important today as it was two years ago; an attempt to limit the role of private charitable initiatives and to expand the role of government. This is not, as Billet wrote, a question of “fairness” as the administration claims, but reflects a “liberal suspicion of charity that has gained tractions in recent years, and that withhold even two cheers from American philanthropy as it is now practiced.”
The liberal mindset that seeks to harm philanthropy sees the hodgepodge free market world of private philanthropy as too anarchic to suit the needs of the country. A world in which individual initiatives not checked by central planning operates is one in which government does not call the tune on every issue.
Back in 2009, then Budget Director Peter Orszag claimed the catastrophic impact cutbacks forced by these measures would have on a variety of causes helping the poor as well as the arts would be offset by the benefits to society that would accrue from the extra cash government could spend. To be more specific, Orszag said the creation of a national health care law would more than compensate the country for any negative fallout from the decimation of private charities.
That statement makes this issue more easily understood even by those with little interest in philanthropy or sympathy for those who donate large sums to charities. The cutting of charitable donations doesn’t so much hurt the rich as it does those persons and causes that benefit from their generosity. But even more than that, Obama’s war on philanthropy is an assault on the notion Washington need not run every aspect of our lives. By limiting the flow of funds to charities, Obama would be giving the government not only more money but also more power.
The war on philanthropy is yet another attempt to strengthen the role of government and to weaken the private sector. Congress will seek to find elements of Obama’s proposals to pass so as to undermine the White House’s efforts to place the blame for our sinking economy on anyone but the president. But whatever it does, it must reject the White House’s new war on philanthropy.