Dire views: US Labor Secretary wants to cut tax breaks for opera and museums

Robert Reich has made this extraordinary proposal on his Facebook page:

Tis the season to be charitable, or at least make a charitable contribution that can be deducted from 2014 taxable income. But if you’re very rich, charity seems to begin at home. No more than 30% of the charitable deductions of America’s wealthy go to the poor. Most go to institutions the rich favor – art museums and opera houses they attend, “think tanks” and political groups whose policies they agree with, and elite universities they graduated from. Yet because such contributions are deducted from their taxable incomes, the government in effect provides these institutions with 35 to 40 cents of every dollar “contributed.”

Wouldn’t it make more sense to limit the full charitable deduction to institutions that focus on the poor, and allow only half the deduction to other nonprofits?

If Reich gets his way, museums and opera houses will have to shut across the USA while soup kitchens won’t receive an additional cent. More than 1,300 people have shared his comments on FB and debate is raging. 

met tickets

Sample responses:

– Bob, that’s a swing and a miss. Museums, symphonies, even elite colleges, are not just for the 1%ers. They can’t afford substantial cuts through reduced deductible contributions. Go after capital gains and offshoring corp assets first.

– I run an opera company in the San Fernando Valley of Los Angeles, called Center Stage Opera. We depend on donations to stay afloat, and our ticket prices start at only $25 (with discounts for students and seniors). We provide more community service to disadvantaged kids, seniors, and adults than anything else we do. We bring educational programs into schools, from elementary through college; we bring recitals and concerts into retirement homes; we provide entertainment programs for abused women’s shelters and homeless shelters; we collect clothing, canned goods, and toys for various charitable organizations at our main stage performances…. the list goes on and on. We also set aside a good number of tickets to our main stage productions for low income children and their parents (at our last production of La Traviata we had 60 disadvantaged kids in our audience, none of whom paid a single penny). We never turn anyone away from any performance because of an inability to pay.

– The whole institution of being a non-profit needs to be looked into. Some of the CEO’s of these non-profits receive unrealistically large salaries.

– You haven’t thought this one through very well, Mr. Reich. Funding the arts often transforms depressed areas into places with increased employment opportunities for a wide variety of people. Look at Mass MOCA, for example. Look at neighborhoods and small towns revitalized by non-profit theaters.

 

 

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  • This is exactly the kind of cuckoo argument the French left, pink and green (always the champion of subconscious judeo-christian guilt…) is using to shoot subsidized institutions of “high culture” – like the parisian “conservatoires d’arrondissement” (to make them more “popular” they’ve just doubled the inscription fee, from 500 to 1000 euros a year : Caruso’s papa couldn’t afford it), or even world famous orchestras (like Les Arts Florissants and Les Musiciens du Louvre-soon-to-be-formerly-Grenoble). Operas are for the rich. Orchestras are for the rich. Conservatories are for the rich. Museums are for the rich. And then they’re surprised and wonder “what’s happened” and where has this generation of blind and deaf ignoramuses come from.

  • The headline is misleading. Robert Reich is a FORMER US Labor Secretary, in that position for four years during the Bill Clinton administration – nearly 20 years ago. That was a long time ago in American politics. He is now a college professor, so at this point he has no more power to “get his way” than the rest of us.

    • While it’s true that he is the former Labor Secretary, we should be careful not to minimize his influence – in particular, recently. His “wing” of the Democratic Party, for all intents and purposes led by Senator Elizabeth Warren, is ascendant within the party. Moreover, he remains connected to the Clinton machine.

      Ideas like this are never good to read, but especially from someone with such connections.

      • Before getting too hysterical about this, I think we need to be reminded of the hundreds of people who express their opinions in the media day in and day out that no one ever follows up on. One also has to consider the argument about this matter that come up annually Congress and NEVER goes anywhere, even when the argument was at its nastiest.

        And, finally, finding more than a few Democrats who agree on anything is a rare experience. Reich has no constituency, he can say and suggest anything he wants and will suffer no blow back. Sen. Warren has a statewide and highly educated constituency. Boston, a city that has more colleges than one can imagine, is the center of all arts activities in New England and I can’t imagine her every suggesting such a thing that would put her state (and a politically powerful city) at such a cultural and financial disadvantage.

        I think it’s just time to take a breath and not worry about it until there is a real reason to do so.

        • I don’t believe there is a word in my comment that could be described as “hysterical.”

          I merely suggest that we should not summarily dismiss Mr. Reich’s comments since he does, in fact, have ears listening to him in Washington.

          Certainly, getting anything passed through Congress is difficult to impossible, but let us not fall into the trap of believing that *only* Democrats have little understanding of the benefits of opera. Anti-classical music comments of many kinds have been made by members of both parties.

          I agree with you that Senator Warren herself would likely never support Mr. Reich’s proposal, but that does not mean that others who have adopted her (somewhat against her will) would not.

          Thank you for your response! This is an important topic, even if it does not result in any action in Washington. Public opinion can be shifted over time, so standing back and letting these comments stand with no response is unwise, I believe.

          • My apologies, hysterical was an overstatement, but it wasn’t meant to be directed to you. The thing is that people tend to get worked up when someone floats an idiotic idea and no one waits to see how it plays out. I think you’ll agree with me that most comments by media pundits disappear into thin air. And, the Republican Congress has shown, if nothing else, that anytime a Democrat utters an opinion – even if it was formerly their own idea – they treat it as if it were to lead to the end of the world.

            But in the end, politicians tend to go for something only if they see it as being in their own interest and I’m not sure that they would see this as doing much for them personally. I may be wrong, though. After all, the money going to arts organizations through tax deductions is little more than a few drops in the Congress’ bucket.

            As to which politicians care about the arts less, I don’t know. In general, I don’t think they know much about them at all. The only important things to many of them is power and money in no particular order – and that is hardly new. All the rest is just a means toward one of those two ends.
            – See more at: https://slippedisc.com/2014/12/dire-views-us-labor-secretary-wants-to-cut-tax-breaks-for-opera-and-museums/#comment-52761ax

          • @Dan P – Terrific comment and I generally agree with all of it.

            I hate to see these sorts of comments like Reich made filling the atmosphere. They create a basic “understanding” that really isn’t… and spreading ignorance is never useful. It’s the old… “repeat a lie enough and it becomes the truth” issue.

  • Yes, Norman–Dan P is correct in that Bob Reich is long gone from his place of influence within the U.S. government. That being said, there remain powerful forces within our Congress (now–unfortunately–both houses) that would love nothing more to defund the National Endowments for the Arts and Humanities, as well as gut many of the social nets that our society depends upon to simply maintain a roof over one’s head and food in one’s belly. As a conductor, teacher, and erstwhile music scholar, I fear for the cultural future of my nation.

  • This idea did not originate with Reich, it has long been popular amongst the statist crowd. The left hates money which they themselves do not control and this evil little scheme would go far towards further erosion of personal freedom and responsibilities while ensuring that government wields ever more power and influence. It is a perfectly malignant idea.

    • I agree with Mr. Hughes above. The desire to reduce or eliminate public funding (whether direct or indirect) for public arts institutions and the foundations that support them can be traced back at least until the 1980s. But JJC is surely incorrect to attribute this mainly to the Left. The argument against funding has been made regularly, year after year almost entirely by the Right, who have fought it in Congress since the Reagen era. Complaints have been that we should not be funding the NEA and NEH because they support art that is sacrilegious, anti-religious, sexually explicit, or anti-government and paid for by people who don’t approve. We in NYC have not forgotten the time that Republican Mayor Giuliani tried to defund the Brooklyn Museum of Art (a major institution, famous for its collection) because of an exhibit of works he thought sacrilegious. This went on for quite some time before he finally gave up.

      The position that we should be taking the money from the arts to put into social welfare programs goes back to the 1970s when it was only taken by the very far left (not the centrist liberals). That’s when I first encountered those arguments. Their argument was purely political and made be folks who hardly would have even recognized Mozart’s name.

      Of course, one can argue against both Left and Right that the visitors and tourists these institutions attract also generate TONS of money into the economy. Attracting for people far and wide, they not only pay for the ticket (which is taxed), but they pay for parking and bridge tolls, lunch/dinner and hotels (which are also taxed), and other activities (like shopping) they might enjoy while in the neighborhood. These not only provide income for the service providers and their employees, but also generate LOTS of tax revenue for the city and state. It also provides a reason to come and visit any city with significant arts activities.

      So far, it’s been a stalemate. I think the best thing that one can hopeful in today’s political climate is that it remains one.

      For these reasons, such positions against public funding have been argued against by other members of the same parties and has always ended in a stalemate once the short sighted, anti-arts crowd has had its traditional say in the matter.

      • The idea that Reich promotes is not targeted at the paltry sums of public arts funding, but rather at the private sources which are the lifeblood of these organizations. It removes the incentive for individuals to donate to arts institutions with the result that they will be almost entirely dependent upon the government for their existence. This, to use a polite term, is coercive and it quite obviously is intended to make the cultural establishment subservient to the government. And as far as ‘todays political climate’ is concerned, Dan, I can well believe that anything, except common sense, is possible.

        • Disallowing tax deductions for donations is not as easy as it sounds because the tax code 501c(3) that allows for deductions for charitable donations not only covers arts organizations but also religious, educational, scientific, literary, public safety testing, amateur sports as well as some other things. Arts organizations are incorporated under the rubric of educational institutions. That would be very messy to tamper with. I’m not saying it’s impossible, but it might not be worth the effort. But, I don’t see any evidence that 501(c)3 is coercive and “obviously intended to make the cultural establishment subservient to the government.” What is the evidence? In what way is, say, any opera company, symphony orchestra, or ballet subservient to the federal government? And what form would that subservience take?

  • I was extremely disappointed with Mr. Reich when I read this. He is normally a man who values research and some level of logical argument. Unlike many who are on one side or another, he normally supports even outlandish ideas with some sort of figures.

    But, in this case, the numbers completely disprove his beliefs. Music and the arts matter and make an extremely positive contribution to both the life of a community and the success of students in schools.

    In t his case, reverse classism seems to have reared its head here, and that is very unfortunate.

  • Typical left-speak. Give to what I am interested in and think is important and screw everyone else. Never mind that schools in the U.S. accelerated their decline when the arts were shown the door.

  • My apologies, hysterical was an overstatement, but it wasn’t meant to be directed to you. The thing is that people tend to get worked up when someone floats an idiotic idea and no one waits to see how it plays out. I think you’ll agree with me that most comments by media pundits disappear into thin air. And, the Republican Congress has shown, if nothing else, that anytime a Democrat utters an opinion – even if it was formerly their own idea – they treat it as if it were to lead to the end of the world.

    But in the end, politicians tend to go for something only if they see it as being in their own interest and I’m not sure that they would see this as doing much for them personally. I may be wrong, though. After all, the money going to arts organizations through tax deductions is little more than a few drops in the Congress’ bucket.

    As to which politicians care about the arts less, I don’t know. In general, I don’t think they know much about them at all. The only important things to many of them is power and money in no particular order – and that is hardly new. All the rest is just a means toward one of those two ends.

  • For all intents and purposes, the United States does not have government-supported arts (military ensembles excepted).

    We substitute charitable tax deductions. These incentivize people — especially rich ones — to donate to various worthy institutions and programs. The government thus indirectly subsidizes such programs through the hit it takes in taxes.

    This is not as good as it should be, but is better than nothing.

    An elimination or reduction of these deductions would do great mischief to our music programs and institutions, and other worthy causes.

    Robert Reich’s proposal is the wrong answer to the wrong question.

  • Mr. Reich does not have a fully developed soul… It may be there, somewhere, but he is not in contact with it. He and his followers have created a dependency culture that is spiritually bankrupt. God have mercy on them, most especially on those they “help”.

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