Posted on March 5, 2012 by Jason Lewis
One’s Break is Another’s Tax Burden: Here’s a rogue’s gallery of local outfits that happily take what the system gives.
Barack Obama, in his newfound role as patriarch-in-chief, has been lecturing the American family on the evils of selfishness. Pedestrian pursuits of individual happiness must forever be subordinated to the idea of “shared responsibility,” a favorite presidential buzzword.
Of course, for anyone with even a cursory knowledge of Democrat-speak, this is code for raising taxes and closing corporate loopholes.
In fact, rarely does the president miss an opportunity to talk about all those nasty oil company “tax breaks” he’s trying to repeal (even though, according to the Tax Foundation, the industry has actually paid $388 billion in income taxes to the federal and state governments over the last three decades). Liberals call these routine deductions “tax expenditures” as though they were the same as spending.
Nevertheless, as long as we’re talking about paying our fair share, it’s time we take a look at perhaps one of the greatest loopholes of them all: the tax-exempt organization. You see, tax-exempt entities raise massive amounts of capital, and what others might refer to as “profits,” they call expenses.
Consider the self-described “social purpose capitalism” of Minnesota Public Radio, which has resulted in a massive radio empire competing with its taxable broadcast brethren.
Oh, yes, I’m well aware of all the work these wonderful groups perform for the downtrodden, so spare me the outrage over questioning the status of so-called “nonprofits.” But someone has to create wealth before it can be redistributed.
Dare I say, the most beneficial social organization in society remains the profitable business. Indeed, the evil entrepreneur, far from begging for donations, is the one providing the goods and services for which people are actually willing to pay.
On the other hand, imagine a 501(c)3 tax-exempt outfit whose mission is to ensure that “resources accrue to all local citizens” within the “creation of ecologically sound and economically equitable communities.” Uh? Well, try the Institute for Local Self-Reliance.
Or how about a collection of smart growth groupies at Transit for Livable Communities, dedicated to increasing government funding for “bus and rail transit, bicycling, walking and transit-oriented development.”
And don’t forget to take that “charitable” tax deduction for contributing to the gang at Growth & Justice, a merry band of collectivists who think Minnesota state government isn’t big enough.
Of course, for sheer audacity you can’t ignore ClearWay Minnesota, granted tax favored status under section 509(a)3 of the IRS code for living off the largesse of the state’s tobacco lawsuit. Private shareholders may not benefit, but the six-figure salary management team isn’t fairing too poorly.
But, hey, how do you put a price on lobbying for smoking bans and funding vital programs that “build capacity in the African/African American, Asian American and Pacific Islander, Chicano Latino, Gay, Lesbian, Bisexual and Transgendered and American Indian Communities to develop and implement effective tobacco prevention and control programs and policies”?
The irony here is that far from relieving the government’s (taxpayer’s) social burden, most of these “public charities” seek to expand it.
Regardless, my favorite “tax expenditure” is a fledgling little project known as MinnPost. Here you’ll find a group of scribes still smarting over a market devaluation of their services. Hence, MinnPost’s creed is that high-quality journalism “can no longer depend only on the private sector.” Maybe that’s why they’re propped up by grants from yet another tax-exempt entity, the mega-McKnight Foundation.
In fact, these private foundations alone, says Virginia business attorney Ross C. Reeves, control $650 billion in wealth and, depending on the year, have investment income of around $60 billion — none of which is subject to income taxes.
This has proved to be a convenient tool for the Warren Buffets of the world to claim an immediate write-off, reduce their estate tax, and promote such charitable causes as reproductive rights, saving the planet, and world peace. All the while clamoring for higher taxes on someone else.
What a country.
Published in the Star Tribune, March 4, 2012
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