Friday, November 4, 2011

The latest newsletter is available below or with full articles online.

Washington Roundup

 Here is an update from Capitol Hill:

Super Committee
On Tuesday, November 1st, the Joint Select Committee on Deficit Reduction (aka the “Super Committee”) held a hearing entitled “Overview of Previous Debt Proposals.”  Witnesses included Former Senator Alan Simpson (R-WY) and Former White House Chief of Staff Erskine Bowles, co-chairs of the President’s National Commission on Fiscal Responsibility and Reform ; and Former Senator Pete Domenici (R-NM) and Former White House Budget Director Dr. Alice Rivlin, co-chairs of the Bipartisan Policy Center’s Debt Reduction Task Force.

As expected, the hearing focused primarily on the specifics of the panelists’ two different deficit reduction proposals, with most questions revolving around health care savings.  There were cases, however, where Members asked about tax incentives in the context of tax reform, specifically how much individual rates could be lowered if all expenditures were eliminated.  Former Senator Simpson remarked that the plan his Commission produced last December would “give the American people what they wanted, which is lowering the rate and broadening the base.”   As you may recall, the Commission proposed removing all tax expenditures to bring the marginal rates down as low as possible, and then adding in “valuable” expenditures as Congress saw fit.  The Commission believed the charitable deduction was worthy of being kept in the code, and proposed a 12% non-refundable tax credit for all taxpayers, available above a 2% of Adjusted Gross Income (AGI) floor. 

Domenici and Rivlin, however, focused on the bigger picture of what might happen if the Committee did not reach a deal.  During their testimony, they said “should the committee fail to reach agreement on major reforms that will encourage growth and stabilize our fiscal situation, you will have missed an historic opportunity to set the country on the right track, and the consequences both to the economy and to public confidence could be dire.”

The most surprising moment of Tuesday’s hearing came during final remarks... (CONTINUE READING)
 

Spending Packages
In addition to the Super Committee debate, both the House and the Senate are trying to pass FY2012 appropriations packages before the end of the year.  Most recently, the Senate approved a $182 billion spending package that provides funding for agriculture, criminal justice, transportation and housing agencies through the 2012 fiscal year.  The differences between the Senate version of the bill and the one the House passed a few weeks ago will now need to be ironed out. House Appropriations Committee Chairman Hal Rogers (R-KY) has said that he wants a quick turnaround on the bill, bringing a final version to the floor the week of November 14th. 

Next up is an infrastructure bill that provides $50 billion in funding to update the country’s roads, bridges and highways, and continues the effort to pass the President’s jobs bill one piece at a time.  The bill is paid for in part with a 0.7% surtax on incomes over $1 million, which Senate Democrats have included in previous jobs-bill efforts and Republicans have repeatedly shot down. As expected, the measure did not pass on Thursday, as Democrats failed to reach the 60-vote threshold that would advance the bill to final debate.

Finally, Congress must still pass a continuing resolution (CR) to keep the government running past November 18th.  Most recently, members of the conservative Republican Study Committee have threatened to oppose a package that would fund the government through the end of the year, saying that it runs afoul of the deficit reduction deal reached earlier this summer.  House Leadership maintains that there will not be a problem passing such a package, as a CR might be included in the final version of the aforementioned $182 billion package.

Consider This

ACR @ the 2011 Philanthropy Roundtable Annual Meeting

This week, Consider This is preempted by a recap of the Alliance for Charitable Reform’s presence at the 2011 Philanthropy Roundtable annual meeting.

Themed Can-Do Philanthropy: Solving America’s Greatest Challenges, this year’s annual meeting explored how private independent giving can—and does—solve America’s greatest challenges. In his opening address, Roundtable president Adam Meyerson reminded the audience that despite the achievements of philanthropy there are serious dangers facing charitable giving including economic stagnation, over-regulation of the charitable sector, and an assault on the charitable deduction by the current Administration. These persistent threats make necessary the vigilance and efforts of ACR, the Roundtable’s public policy arm, to preserve the charitable deduction and protect the freedom of donors and foundations... (Continue reading)

Making Headlines

Here are a few recent news items you may find interesting:

Federal

Charitable Deduction: The Center on Philanthropy at Indiana University has released a new report Impact of The Obama Administration’s Proposed Tax Policy Changes on Itemized Charitable Giving. It finds that the impact of the president's proposal to limit the value of the charitable deductions for the wealthy would cost charities less than $1-billion, but if combined with the end of the Bush-era tax cuts for upper-income earners that could balloon to more than $2-billion.

Voices from across sectors and the country continue to speak out against proposals to limit the charitable deduction: USA Today, Seacoast Online (Rep. Frank Guinta, R-NH), and Oregon Catalyst . Some support for the president’s proposal exists in the sector which has sparked debate.

Related news – For an explanation for how the tax proposals of Republican presidential candidates treat the charitable deduction: How Will the Perry and Cain Flat-Tax Schemes Impact Charitable Giving, Nonprofit Quarterly

This Caught Our Eye…

Politicization of Philanthropy: In the Wall Street Journal Howard Husock discusses the Obama Administration's efforts to highlight particular organizations and causes for private funding through programs such as the Social Innovation Fund.  He uses Solyndra as an illustration.

Social Innovation Fund: An in-depth interview with Paul Carttar, Director of the Social Innovation Fund--an initiative of the Corporation for National and Community Service (CNCS)--about the program’s goals and impact since its creation in 2009.

Squeezing Nonprofits: Elizabeth Boris, director of the Urban Institute's Center on Nonprofits and Philanthropy, and Tim Delaney, president and CEO of the National Council of Nonprofits, are interviewed by Governing magazine about aggressive tactics states and municipalities are pursuing to extract new revenue from nonprofits.

Giving Priorities: As part of its special Giving section, the New York Times explores giving priorities and values of donors and examines how some foundations have responded to the hardship caused by the current economy.

Philanthropy Thinking Big vs. Small: William Schambra challenges the current philosophy that philanthropy is most effective when it "thinks big" by focusing on values, strategies, measures, and theories of change, and  suggests thinking "small" may yield better outcomes.

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