This article by was originally published on the Latest from Alliance blog on 27 March 2013. The original article can be found here. For more information about Alliance magazine, please visit www.alliancemagazine.org.
Philanthropy’s standing with the policymakers in Washington, DC, has reached an all-time low. A prime reason foundations have earned that status is that they have lost sight of their primary obligation to support the poor.
Philanthropy, for instance, regards the charitable tax deduction as the sine qua non of its work. And yet President Obama, in spite of his service on several foundation boards in the years before he ran for president, has repeatedly attempted to reduce that deduction.
Likewise, during the recent presidential election, the Republican candidate Mitt Romney proposed a general cap on tax deductions that would no doubt have fallen particularly hard on charitable giving.
Adding insult to injury, during the recent negotiations over the fiscal cliff, policymakers treated the charitable deduction as a mere pawn in the political chess game, as if it were just another pesky loophole for the wealthy that should be closed so the federal government could collect more tax revenue.
This is a far cry, indeed, from the almost hallowed status the deduction enjoyed until recent times.
Only after wealthy and powerful foundations had spent substantial sums on wealthy and powerful K Street lobbyists was Congress reminded that in fact philanthropy isn’t at all about the wealthy, it’s about the poor.
After all, the argument went, the poor and their non-profit representatives would suffer most directly from a diminished deduction. How could Congress have forgotten this? I would suggest it’s because philanthropy itself has forgotten this.
William A Schambra is the director of Hudson Institute’s Bradley Center for Philanthropy and Civic Renewal. This article was first published in the Chronicle of Philanthropy.