New Report: Populist Proposals Targeting Philanthropy Will Hurt Those in Need

Philanthropy Roundtable published a new primer today that explores increasing calls for government to target certain U.S. charities and those who support them. In the primer, “When Philanthropy Comes Under Attack: What the Resurgence of Populism Means for Charitable Organizations,” the author and Roundtable Senior Director of Policy and Government Affairs Elizabeth McGuigan says while populism may have some benefits as a check against the power of institutions and government, it goes awry when it seeks to stifle or restrict charitable organizations.

“Criticisms of philanthropy are not without merit. However, in their proposed solutions, populists on the right are turning away from the underpinnings of conservatism: freedom, liberty and limited government traditions,” writes McGuigan. “Their resulting policy proposals include expanding the size and reach of government regulation of the charitable sector.”

The primer cites the example of author and Senator-elect J.D. Vance of Ohio, who has said that “We should eliminate all special privileges that exist for our nonprofit and foundation class.” During his Senate campaign, Vance went on Fox News last year and suggested seizing the private funds of organizations with which he disagrees.

“Why don’t we seize the assets of the Ford Foundation, tax their assets, and give it to the people who’ve had their lives destroyed by the radical open borders agenda?” Vance asked. He went on to name other communities and causes these funds should support. He has also proposed imposing an annual 20% payout requirement for philanthropies with endowments over $100 million.

The Roundtable has not been shy to mention where our mission and values diverge from some charitable organizations like the Ford Foundation, and we agree with Vance’s point about how some philanthropic funding can advance ideas that conservatives believe are harmful to society. For example, we take serious issue with the Ford Foundation’s efforts to advance identity politics over the years.

However, when it comes to charitable giving, the Roundtable takes a principled stance on philanthropic freedom and advocates that all donors should have the right and freedom to give to the charities of their choice as long as permissible under the law.

More importantly, McGuigan cautions conservatives by describing government regulation as a slippery slope. She notes, “Imposing new restrictions on foundations and donors will not just hurt large liberal organizations but will inevitably hurt smaller foundations and conservative causes and will lead to fewer dollars for the communities they serve.”

According to McGuigan, the current populist push against philanthropy has deep historical roots, dating back to the early 20th century when John D. Rockefeller faced backlash as he attempted to charter his foundation. The campaign continued throughout that century as populist lawmakers sought to limit the freedom of philanthropies.

In McGuigan’s primer, she debunks five key arguments of today’s populist-fueled campaign against philanthropic freedom:

  1. Foundations are too “woke.”
  2. Foundations are not committed to real needs.
  3. Foundations are too political.
  4. Foundations receive tax benefits but engage in activities that too often cross the political line.
  5. Foundations are indistinguishable from big government.

Anti-philanthropic ideas are foreign to the conservative movement, which advocates for how the private sector and private individuals contribute to civil society and can help address social challenges. Populist proposals to use the power of government to silence those within philanthropy who do not share conservative values is not a fundamental part of conservatism, but rather it is a symptom of social discontent.

“Just as planned economies fail, allowing the government to pick winners and losers in philanthropy and restrain foundations simply because of their size or effectiveness will lead to less philanthropy and less support for the most vulnerable in our society,” writes McGuigan. “Punishing givers will chill charitable activities altogether and weaken civil society, precisely at a time when we need the charitable sector as a check on a powerful centralized government.”

Read the full primer here.

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