From the “clowns to the left of me, jokers to the right” file.
Last week, Artsjournal.com linked to a Backstage story about a Republican proposal in the House of Representatives to get rid of funding for the NEA, NEH and PBS. Looking at donation rates from 2001, they concluded that “The funding could easily be funded by private donations.”
The proposal was part of the Republican Study Committee’s “Operation Offset” report which looks for ways cut the federal budget to pay for the damage caused by Hurricane Katrina.
Now there are many arguements one may make against this certainly. But what inspired my entry today was the recollection of an entry on the Artful Manager a month ago about the delay in the Senate’s vote to repeal the estate tax.
The Artful Manager quotes an article by the American Arts Alliance that noted:
A 2004 Congressional Budget Office study reported that eliminating the estate tax would result in an estimated 22% decline in charitable bequests. A report issued by the Brookings Institution indicates that a repeal of the estate tax would result in a total loss of about $10 billion in charitable giving each year.
The amount the Republican Study Committee says the private sector contributed to non-profit arts in 2001–$11.5 billion. So that leaves 1.5 billion for everyone to fight over, eh?
Well actually, that is comparing apples and oranges. The 10 billion probably includes bequests to hospitals, churches, United Way, Red Cross along with arts organizations. The RSC’s $11.5 billion probably includes direct giving in fundraising campaigns as well as bequests.
The point is though, the House members are projecting private giving can make up for the loss of the NEA at the same time the Senate is considering a move which will remove the incentive for a segment of private giving. Even if the arts only get $2 billion of the annual bequests, that is still huge and there are some who will lose big.
If both efforts succeed, it will be a devestating blow from two directions for some organizations.
The vote to repeal was delayed according to Senate Finance Chair Charles Grassley, “It would appear “unseemly” for Congress to push through a repeal of the estate tax while also coping with the hurricane disaster in the Gulf” (nod to Artful Manager for the link)
What to do? Well again I must bow in deference to His Artfulness who links to the following discussion on the Western States Arts Federation website which examines it all better than I can.