Month: March 2009

Once upon a time we needed to await the Christmas season and Dr. Seuss for a refresher on the timeless truths of philanthropy. But, courtesy of the Obama administration, we will soon learn that every April 15th is Christmas Day.

At his press conference this week, President Obama vigorously defended his proposed new tax on charitable giving, which various non-profits estimate could cost private charities up to $3.8 billion.  The new monies will cushion the cost of the expanded Obama health care plan.1

And as is the Administration’s habit, all of this is defended in the rhetoric of fairness.

That the rich do not pay their fair share is axiomatic among Obama and his supporters. Yet, this is simply another example of a false choice that the Obama administration presents to the American public in pursuit of its goals.

Fact: The top 1% of earners pay almost 40% of federal income taxes.  That is 13% more today than they did in 1983.2

Fact: The bottom 50% pay 3% of federal taxes, and their tax burden dropped between 19%-52% for the least able to pay since the early years of the Reagan Administration.3

But the Left never let the facts get in the way of a good story.

On charitable giving, the maxim on populist equality is masquerading as doctrinaire and arrogant presumption. Indeed, why should someone who makes $250k have a bigger tax break for charitable giving that someone who earns 50k?

Clearly, instead of recognizing that rising incomes also mean rising philanthropy, the Obama administration sees progressive incentives for private giving as nothing more than another insidious tax break for the wealthy.  Under those circumstances, why let an individual make a choice that the government can make for you?

So, if enacted, personal altruism is going to take a hit.

Disease research, soup kitchens, animal shelters, community institutions, educational endowments, among others, are going to hurt.

On the bright side, the most generous people on earth can substitute their need to give back to their community with a simple “drive and waive” past the Department of Health and Human Services (HHS).

But on the drive home, consider that the hits to charity accompany a program where the Obama administration wants to tax your health care benefits. No matter than candidate Obama called taxing health care benefits “the biggest middle class tax increase in history.”Now in power, there’s $246 billion on the table in potentially fresh revenue to fund Obama-care.4

Middle class voters might rightfully be wondering how promises on the trail become less actionable in Washington.

But taxing the health care benefits of private citizens pales in comparison to a “dead on arrival” Obama plan to make soldiers pay out of private insurance for wounds sustained in combat.5

There is simply no greater moral obligation for America than to honor the service, courage and sacrifice of our wounded soldiers with all the care they require. It is the very least that we as a nation can do. Yet, under the discussed Obama plan, those same vets would be paying additional costs on that private insurance, ironically as part of freshly taxed compensation benefits.

Reprehensible is an understatement. That it may have even been a proposal is an insult to war fighters and veterans.

Keep all of this in mind.

In a sense, the joke is on us.

Obama came to office promising social justice for the average worker with a “fair-share” tax on the rich and a tax cut for the middle class.

But as we get into the sausage-making of Obama-style societal transformation, it looks as if no one is going to get away untouched.

A new health care system will come with greater taxable benefits and less choice. The vaunted Cap n’ Trade system is a tax on carbon producers and users that will hit everyone from Exxon-Mobil to you at the pump, with a sector wide impact on cost and economic growth.

On balance, it is unlikely that Obama’s much touted Happy Meal tax cut – which the Democratic Congress will end anyway as part of its laughable effort at “deficit reduction” amid misplaced priorities – will offset the costs we will all be paying in other areas of the economy to make the Obama transformation plan a reality.

Sadly, even these efforts to find revenue sources to feed government’s new insatiable appetite will not put a dent in debt Obama will run up to make these new program expansions a reality. So while we pay more to get less today, we’re still leaving our children the burden of paying the balance for the future.

It’s enough to keep a Grinch’s heart two times small.

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