It’s three weeks into the federal government shutdown and debt-ceiling gridlock in Washington, D.C., and all that is clear is that communities are starting to really feel the pain.
The solutions and policy implications are unclear, and public confidence in Congress is at an all-time low.
Tim Delaney, president and CEO of the National Council of Nonprofits, cites the hardships being imposed on the people served by the nation’s nonprofits. The national Council on Foundations highlights the resilience grantmakers provide for communities left to grapple with the shutdown, though in doing so, is put in the position of reinforcing the notion philanthropy has the capacity to pick up the slack when public dollars are tight.
Grantmaking Assets at Risk
Foundations, along with all kinds of investors who are slowly recovering from losses incurred in 2008, are noting the risk of plunging the world into recession, a concern expressed most prominently by Christine Lagarde, head of the International Monetary Fund. The lack of confidence is real, and there’s nothing appealing about the prospect of having investments and grantmaking resources evaporate.
And then there is the social damage. As observed by David Brooks and Mark Shields on PBS Newshour, “But the real cost . . . is the erosion and hemorrhaging of confidence in government and in our ability to act collectively. “ It exacerbates the historic decline of confidence in social institutions noted by Gallup polling and should raise concerns for everyone engaged in building community capacity and resilience.
Input on Tax Reform
We do not have a political crystal ball here at the Minnesota Council on Foundations. But we know that the question of some kind of “global deal” to address federal budgeting, spending and tax reform is back on the table. This may be part of a solution to address the immediate impasse or, more likely, a deal to be made later this fall or shortly after the beginning of the year.
Regardless, here at MCF, we will dust off our letters from last fall to members of the Minnesota Congressional delegation to remind them about the risks of altering the charitable giving tax deduction and the need to simplify the private foundation excise tax as part of any tax reforms.
A useful step . . . provided there is anyone on the job to read the letter.
– Bob Tracy, MCF director of government relations and public policy