Let's Be Honest About What the Fiscal Cliff Means For Nonprofits | Mike King, GOOD

Honesty in communication: What a concept! And what an essential goal it is for all our writing and speaking to clients, members, customers, employees, donors, family members, friends, politicians, and the news media.

Half-truths, misleading statements, missing facts, and blatant lies too often infect the statements we read and hear from people in power--at every level. How can people form reasonable opinions and make rational decisions when they're not given, don't get, or ignore complete, reliable information?

So I appreciate this article by Mike King, national president and CEO of Volunteers of America.

I am a proud progressive/liberal Democrat who believes that wealthy people and corporations in the United States don't pay their fair share in taxes. I support efforts to increase tax rates for wealthy individuals and to close tax loopholes that give inequitable, unnecessary advantages to the rich and powerful.

That said, I agree with King's argument in this article about eliminating or reducing tax deductions for contributions to nonprofit agencies and organizations. (BTW, I'm sure some people don't think this article tells the complete story. It's a point of view, though, that I don't hear or read about in our national discussion, and the result is a misled public and, probably, some misled politicians.)

King begins:

Let's be honest about the "fiscal cliff" and the faulty logic that claims that charitable tax deduction is a benefit for the wealthy that won't be missed. Political leaders touting this bromide are justifying proposals to redirect these dollars away from important work happening in communities nationwide.

He continues (emphasis added):

Limiting or doing away with the charitable deduction at a time when people are still reeling from the recession and budget cutbacks simply makes no sense. It won't help the federal government avoid the fiscal cliff. It will simply shift it to the nonprofit sector and communities that depend on it. ...

Data suggests that for every dollar deducted through this incentive, communities receives $3 of benefit. No other tax provision generates the kind of positive impact. But, if donors have less incentive to give, donations decline. The result is the loss of billions of dollars to support worthy causes, the jobs they provide, and the millions they serve. ...

And the public doesn't support cutting tax deductions for charitable contributions. King writes:

A new public opinion poll commissioned by the United Way found that most Americans (79 percent) believe reducing or eliminating the charitable tax deduction would have a negative impact on charities and the people they serve. Of those who indicate they would reduce charitable giving, the majority (62 percent) indicate they would have to reduce their contributions by a significant amount—by 25 percent or more. Two out of every three Americans (67 percent) are opposed to reducing the charitable tax deduction.

King adds clarity to this issue by getting away from the eye-rolling, eye-drooping rhetoric and language of politicians and economists. He puts the issue into real-life terms:

The diverse nonprofit sector supports efforts to, for example, develop technology and medications to improve our health—like insulin, the polio vaccine, the MRI, electron microscope and pacemaker, provide educational opportunities and access to health services and ensure housing and shelter for the most vulnerable. Other nonprofits enhance the arts and cultural activities, conserve wetlands and protect the environment, protect civil and voting rights, and preserve historic treasures.

Concrete examples like those (with even more detail) must be included in all communications on other issues to help people understand and act on what they read and hear. 

King concludes:

Now is not the time for Congress to dismantle a tradition that supports America's nonprofits and the people and causes they serve. No doubt our nation faces a fiscal crisis that must be addressed, but Congress should stop seeing the charitable deduction as an easy mark and acknowledge the fiscal cliff they will create for America's most vulnerable at a time they can least afford it. Giving strengthens our communities. Urge your members of Congress to preserve the charitable deduction.

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King's articles is featured today, Dec. 3, in my daily online paper, Garbl's Good Cause Communications--available at the Nonprofit Communications tab above and by free email subscription.