With the attempt to limit the deductibility of contributions to charities by high-earners, the Obama Administration opened a multi-front attack against the American tradition of “neighbor helping neighbor” and financially successful people turning large portions of their wealth over to charities that improve the American culture in august manners. The governmental power grab competes with the attempts to control the financial sector for its significance and may exceed it in the long-term effect upon our culture.
One first has to marvel at how liberals can twist logic to rationalize a tax increase. It happens regularly from the local government level up to the national level. Does anyone really believe that the cameras at intersections are for driver safety? The politicians preach about how lives are being saved while what they are really doing is extorting more monies for their various projects.
In the same manner, the Obama team worked hard to define their argument to limit the benefit deduction. They outlined three main points. The first is that high-income people should not get greater tax benefit than people taxed at the lower rate of 28%. They then argue the tax-benefit would be the same that was provided during the Reagan era when the top rate for everyone was 28%. These are marvelous twists of semantics that would delight any Orwellian scholar. These assertions beg the question of a lower top rate or a flat tax. The last point they make is just totally bogus and must have derived from some obscure study by a misguided PhD. The President stating with a straight face that tax benefits have little influence upon charitable decisions displays either his naiveté or his disingenuousness.
Republicans fell for a similar argument during the Bush 41 Administration. The Democrats argued for the income tax rate at 31% stating that the phasing out of deductions created a bubble and that certain people were getting an advantage. This new rate would bring everyone to a true 28%; thus equalizing taxes. The Republicans foolishly bought that argument – merely a precursor for the next argument. Not long after, the second step of raising the rate to 31% was argued for because now the top earners were paying a 28% on their top income, and it would only be fair to raise the top rate to 31% for all income. This same convoluted logic will be used as the first step toward eliminating the charitable contribution for everyone.
One might conclude, upon reading the left-leaning press, that a tax-benefited gift to charity is a nefarious scheme. This press and its followers revolt against the fact that religious organizations benefit from these gifts. An assertion is made that the tax benefit constitutes stealing money from the government even though the money is used for deeds that actually help people.
American volunteerism has been assaulted by the establishment of AmeriCorps and the recent passage of the Serve America Act of 2009. No longer will Americans work to improve their community through the United Appeal, Red Cross or hundreds of other noble organizations. Now young and old Americans are being paid to “volunteer” for projects that charities did more efficiently. With the ever growing involvement of government in charities the omnipotent control will follow.
During the aftermath of Hurricane Katrina, a prime example of the difference between how the government and a non-profit operates was obvious. A convoy of Red Cross trucks sat waiting to help the citizens at the Superdome, while Michael Brown, the then-FEMA director, sought authorization from the government of Louisiana. He could not contact his counterpart at the state level since that person was in prison on corruption charges, and no one filled that position for making emergency management decisions. He contacted then-Governor Blanco, who dithered while the people suffered, and finally decided against sending in the Red Cross. Left to its own devices, the Red Cross, experts on crisis management, would have immediately aided the people and avoided one of the blackest marks in American history.
We have seen people time and again tackle problems through charitable operations that government would allow to languish in political debate while elected officials worry about their next election. Does anyone really believe that we would have made the heroic efforts Jerry Lewis has achieved to eradicate muscular dystrophy if left up to the government? Or if Nancy Brinker’s sister had not contracted breast cancer, does anyone believe the Susan G. Komen Foundation would have been equaled by the government in the saving of women’s lives.
Stories like this abound in America because our past political leaders realized government could not do all. Encouragement of Americans to conquer problems from education deficiency to drug-abuse to cures for disease could be accomplished through the vital efforts of average people who created a passion to help.
Paying people to do good while limiting people’s tax benefit to do good leads us down the wrong path. Instead of expanding governmental control and limiting charities, President Obama should set an example by working with charities to solve problems the government will never solve. His onslaught against independent entities helping fellow Americans needs to stop. This centralizing of money and control in the federal government will lead our country down the bleakest road imaginable. It will destroy the essence of America that was defined ages ago by de Tocqueville, thus reducing us to merely an ordinary rather than extraordinary country.