America Suffers No 'Crisis in Philanthropy'

No, America is not in a crisis of philanthropy. But new laws on giving wouldn't help if we were.

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By Peter Roff, Thomas Jefferson Street blog

The cap and trade national energy tax bill is not the only solution to a manufactured problem drawing attention in the nation's capital. The Washington Examiner ' s generally excellent David Freddoso explains Friday that efforts are under way to make policymakers believe America is suffering from a "crisis in philanthropy."

Freddoso writes that the National Council for Responsible Philanthropy and its directors "have been both subtly and overtly threatening new federal regulations that would force foundations to give half their money to a narrow set of causes, and with few strings attached."

America's foundations give only 33.2 percent of their grant money to nonprofits serving those "most in need," a factoid the group has come up with that is being used to pressure Congress to act. But, Freddoso says, that figure measures the contributions made in the interests of serving "most vulnerable populations," as the liberal NCRP defines them. This includes the poor, racial minorities and girls and AIDS patients but not, he points out, people with cancer, drug addicts, or boys.

"Even accepting all of NCRP's assertions about who needs the money most, they mislead when they claim that 'approximately $1 out of every $3 granted ... was intended to benefit communities with the least wealth, opportunity or power,' " he writes.

Combined with the Obama administration's effort to cap the deductibility of charitable contributions for high-income individuals and families, the NCRP's effort could be seen as an effort to give the federal government a controlling voice in America's private philanthropic institutions. And, if successful, to destroy deTocquevillian America.

What makes it all worse is that, as Freddoso says in the Examiner, the numbers the NCRP cites are just wrong. According to Georgetown University economist Phillip Swagel, who looked at the issue in a study for the Philanthropic Collaborative, "more than 68 percent of the grant money he surveyed went to underserved populations." To put it another way, more than half, instead of one out of every three dollars, as the NCRP claims.

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