Streetwise Professor

March 1, 2009

Mandatory Charity

Filed under: Economics,Politics — The Professor @ 5:39 pm

In another example of the cascade of oxymorons emanating from the US government, Michael Giberson (spelled it right that time, Mike!) at Knowledge Problem reports the following from the WaPo:

Asked about that, Office of Management and Budget Director Peter Orszag said Mr. Obama took care of [the decline in charitable giving likely to result from reduced tax deductions] by giving charities government money to make up part of the difference.

“Contained in the recovery act, there’s $100 million to support nonprofits and charities as we get through this period of economic difficulty,” he said.

Michael points out that $100 million is probably a drop in the bucket compared to the likely decline in charitable contributions that will result from Obama’s tax policy.  But that’s not what pops my cork.  

What gets me is that Orszag’s justification is another example of the administration’s desire to preempt an ever-widening range of individual decisions, from health care to the car I can drive to you name it.  Further evidence of its intent to shift the locus of decision making in all aspects of our live to our betters in the government.  

Quite frankly, my dear, I don’t give a damn whether the dollar amount flowing to charities in aggregate rises because of the government’s beneficence.  I do care about its arrogating the decision regarding the charities I support–or don’t.  I want to be free to choose the charities I support.

In other words, it’s not just the dollars.  It’s who gets to decide where the dollars go.  Mr. Orszag’s cavalier dismissal of that distinction (with him, it’s all about the money) reveals a great deal about the dominant mindset in Washington today.

What’s more, this shift in the power of decision will contribute to the rise of what the Adam Smith Institute calls fake charities: charities that are in effect front organizations for government.  Charities are important for many reasons, not the least of which is that they are an alternative to the government.  They are a pillar of civil society that is at least somewhat independent of the state.  Increasing dependence of charities on the government undermines civil society and cedes control over an ever widening swath of our lives to the state.  Moreover, it means that the survival of charities will depend on their ability to lobby and influence legislators and bureaucrats, rather than on their ability to convince people that they are doing something worthwhile–by doing something worthwhile.  The market for charitable giving is far from perfect, due to free riding and all that, but over-reliance on government support undermines that market, rather than strengthens it.  

In the present scheme of things, this is not a big deal on its own.  It is important more for what it says about the country’s current journey.  Hayek gave us a famously succinct description of the destination.

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1 Comment »

  1. Re: “important more for what it says about the country’s current journey.”

    Right on!

    And to give credit where due, I was just riffing on a post by Scott Gustafson at the Arizona Economics blog.

    Comment by Michael Giberson — March 1, 2009 @ 11:11 pm

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