As the economy continues to falter, the number of charities formed in the U.S. has risen dramatically, a phenomenon that some in Washington want to stop.
The problem, according to these bureaucrats, is that charitable contributions are partially or wholly tax-deductible. And that means that the government isn’t soaking people for all the money it could possibly be getting.
The New York Times reported Saturday that people donated $300 billion to charities last year, which “cost” the government $50 billion in tax revenue.
“Especially during these tough economic times, it’s troubling to hear we are increasing the number of these organizations at such a rapid pace,” said Representative Xavier Becerra, a California Democrat who is one of the few members of Congress to pay attention to the nonprofit sector.
“It’s not free,” Mr. Becerra said, “and so we need to do something to make sure taxpayers are getting a big enough benefit in return.” — New York Times
Worse, it means that people are starting to depend on themselves, their friends, families and neighbors, rather than the government. And more than the money, that is the highest concern to any government official.
Charities can expose the lie that government is necessary to help people, which is why Becerra is so worried. But in recent years the Internal Revenue Service has streamlined its approval process for charities registering for 501(c)(3) tax-exempt status, after complaints that the process took too long.
A Stanford University study published last week found that the IRS approves over 99 percent of the applications it receives, leading to the creation of 40,000 or 50,000 (depending on whose numbers you believe) new charities just last year.
Most are local in nature.
Dean Zerbe, former tax counsel for the Senate Finance Committee, thinks that people should join existing charities rather than start new ones. But some who have started new charities for specific issues say that their projects would get lost in the bureaucratic shuffle at a large charitable organization.
The real problem, of course, is that for more than 80 years, Americans have been taught to rely on government for help, rather than to rely on themselves and those in their immediate communities. You can see the destruction that this has wrought in any city.
The solution, of course, is not to crack down on charities, but to encourage more of them. Government programs meant to help, such as Social Security and Medicare, are failing rapidly, since government welfare programs are never sustainable.
Ultimately, when people need help, it must not be the government that they get it from. The best help comes from people who want to help. Join or start a mutual aid society today.