Friday, July 22, 2011

Homelessness and the Gang of Six

Budget talks.  Legislators.  It's all so exhausting and frustrating.

Standing on immovable and uncompromising partisan platforms, the Democratic Governor and Republican Legislature postured, pointed fingers, traveled the State and created countless sound-bites over Minnesota's budget deficit.  Unable to bend, our leaders closed the State of Minnesota for a record 3 weeks!  For the foreseeable future, analysts will be trying to add up how much it cost taxpayers for this childish display of "my way or the highway".  Maybe a better analogy would be the game of chicken where, in our case, everybody lost.

Our elected officials repeatedly stood in front of cameras saying "I was elected because I promised ______(fill in appropriate party rhetoric)" adding that the constituents agree with "ME".  I'm quite certain that when we cast our ballots, we didn't say "put your head in the sand, forget about any efforts to compromise and bring the other party to its knees even if you have to cost the state $50M+ and close the government".  Of course, maybe I'm wrong.

In any case, the Federal landscape looks very similar right now - and it's scary!  Are all of these people willing to cost taxpayers hundreds of millions of dollars to prove a point?  I wouldn't have thought it possible, except that the State of Minnesota was CLOSED FOR THREE WEEKS!  Apparently, the strategy of brinkmanship is much more important than the sound governing principals of putting the best interest of the nation before all else.

So, what does this rant have to do with homelessness?  Well, it seems that every governing entity from small municipalities to the national capital is facing serious financial decisions. We're spending more than we're taking in and that leads down one road - we don't want to go there! 

Changes are coming. 
They're going to hurt. 
The alternative is worse. 

As a solution eventually sees agreement, there are real possibilities that some tax reform will occur in order to raise revenues.  Although some will not call this a tax increase, let's be real.  Anything that raises revenue for the government is and can only be, just that!  One area being considered for reform is labeled 'Tax Expenditures'.  This consists of line items that reduce what a taxpayer owes the Treasury - deductions.  Which deductions are being considered?

Well, the easy answer has to be all of them.  And, some are near and dear to our hearts.  The mortgage interest deduction is one.  Health care premiums are another.  Capital gains, pension plans and charitable giving are all on the table as well. 

That last one is the point of this article.  What happens when the rules change?  What happens when this deduction is significantly reduced or eliminated all together?  I want to believe that people give because its the right thing to do.  I want to believe that the deduction is simply an incentive which says "We, the people of the United States, believe that giving is moral and ethical. We know in our hearts that caring for each other is our responsibility and our right".  But then I read things.

On July 5, the Partnership on Philanthropic Planning published an article stating that the annual revenue received by charitable organizations could drop by 7 Billion dollars each year if a proposed cap on charitable deductions is enacted.  Significant. 

In one form or another, it should be relatively clear that we will all feel the effects of the coming legislation.  Change is inevitable.  So what do we do?  We adjust how we live.  Maybe we buy smaller homes.  Maybe we pay our loans off quicker.  Maybe we give to charitable organizations concerned more with how our money will affect the lives of others and less about how it will affect our tax bill.

This is the reason Responsible Referrals exists.  Believing that revenues available for nonprofits helping our nation's homeless kids will likely be shrinking at a time when the need is expanding, we offer our form of solution.  It's our way of adjusting.  If you like what we're doing, tell everybody you know.  Time is running short to solve our nations spiraling debt, but time is running out for those who desperately need our help.

2 comments:

  1. This was an extremely well written piece, I enjoyed every word. Responsible Referrals is in the right place at the right time. You inspire me, and offer hope that there are good people out there trying to make a difference. That very thing is what makes America great!

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  2. When we give, we need to ask ourselves why we're giving. Are we giving simply to get (recognition, tax deduction) or are we giving to help? Are we truly trying to make the world a better place? If so, we'll give when and where our heart leads -- whether or not we receive the accolades or the financial incentives. And what will we receive in return? Something that money can't buy: the satisfaction and fulfillment that come from knowing that we have helped to make a difference. In my book, that's far more valuable than an income tax deduction!

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