Beltway Confidential

Obama’s war on civil society continues

By Conn Carroll
Published April 13, 2011 4:00am ET
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One of the major goals of the progressive movement is to replace all voluntary coordination between free individuals with the coercive power of the state. President Obama forwarded that goal in his fiscal speech today:

The fourth step in our approach is to reduce spending in the tax code. … while I agree with the goals of many of these deductions, like homeownership or charitable giving, we cannot ignore the fact that they provide millionaires an average tax break of $75,000 while doing nothing for the typical middle-class family that doesn’t itemize.

Obama’s anti-charity tax hike will discourage individuals from freely giving to their favorite causes and organizations. Progressives want as little private charity as possible. Only the state should be allowed to direct how citizens assist one another. The Heritage Foundation’s Ryan Messmore details the relationship between our civil society and the state:

As government claims responsibility for more tasks, it absorbs the allegiance that citizens once placed in other relationships and forms of association. When the federal government assumes more responsibility for fulfilling the moral obligations among citizens, it tends to undermine the perceived significance and authority of local institutions and communities.
This encourages citizens, instead of looking to their families, churches, or local communities for guidance and assistance, to depend on the government for education, welfare, and various other services. As individuals begin to look more consistently to the government for support, the institutions that are able to generate virtues like trust and responsibility begin to lose their sway in the community. Excessive bureaucratic centralization thus sets in motion a dangerous cycle of dependence and social decay.

Last month Messmore examined the the impact of Obama’s anti-voluntary giving proposal:

Obama made a similar attempt to reduce charitable deductions in his FY 2010 budget. During that debate, scholars at the Center on Philanthropy at Indiana University estimated that Obama’s proposed changes would have reduced total itemized giving by wealthy households by almost $4 billion. While this is only a small percentage of total annual charitable donations, it is more than the combined annual operating budgets of the American Cancer Society, World Vision, St. Jude Children’s Research Hospital, Habitat for Humanity, and the American Heart Association.
More recently, a survey of health care development professionals found that 61 percent of fund-raisers expected such a reduction of the charitable giving deduction to reduce donations by 10 percent to 19 percent. This would likely lead nonprofit hospitals and health care providers to cancel or delay purchase of medical equipment, hospital renovations, and hospital expansions.
Few donors give based solely on the charitable deduction, but experts suggest that the tax deduction can influence the manner and the timing of giving and the number and size of the gifts. This is especially true with large gifts from high-income Americans. The proposed reduction of charitable deductions would most affect organizations that depend on donations from donors in the top tax brackets. Universities and medical centers could be hit particularly hard. These institutions and other nonprofits employ many people, so reduced donations would likely reduce employment either by slowing the creation of new jobs or by eliminating existing jobs because of the lack of funds.

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Conn Carroll