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February 2009

Existential Choice

Url A generation ago, Sartre asked if being preceded essence or the other way around. In today's vernacular, does our identity determine our actions, or do our actions determine our identity? What passes for financial, estate, or philanthropic planning can be understood in part as the elicitation of existential choice.  A financial plan is a moral portrait.  Should Being and Nothingness, then, be an assigned text towards a challenge exam in philanthropy? That is Diogenes, hoping to guess the right answer.

The Charitable Deduction Cap in Perspective

Commentatorreact to Obama's plan to reduce itemized deductions, including the charitable deduction, for high income tax payers.  Indiana Center on Philanthropy estimates that giving could drop $3.9 billion. My understanding, though, is that the capping or reducing of deductions for the wealthy  is not a new battleground. Under earlier law there had been a reduction of itemized deductions for high income earners. That reduction in turn was being phased out. Now, back something like it comes. I seriously doubt that most donors are motivated by these tax machinations at the margins. Professionals get deeply into them. Fundraisers and journalists may express concerns, but what donors want to talk about in my experience, candidly, is the donor and the donor's family, and the life the donor wants to lead, and the values he or she wants to stand for, and the impact he or she wants to have, during these very difficult times. 

Put it this way, in a financial or estate plan, the bulk of a wealth person's money may be misaligned with his or her ideals. The tax driven planning process gets so caught up in details, taking tax as its focus, it fails to confront the big issues: What kind of person do you want to be, in what kind of world?

95% of clients who do not finish an estate plan say it is because the plan was out of whack with their goals. That is not a fine point. To get more money moving to better purpose, open a conversation about the donor's life history, the crossroads they confront, the life determing choices they face, the person they want to be, the example they want to set.   Then, convene the bean counters to find the most tax effective and tax efficient way to acheive those ends in view, but do not let the the conversation sidetrack the purpose conversation. How much donors gives depends in part on how well counseled they are.  As advisors is our responsibility to help clients and donors keep things in persptive and aligned with their aspirations and ideals.

The Things We Do For Love

What makes your short list of things we do for love? Here is mine:

  • art

  • play

  • marriage, children, family

  • conversation with friends

  • blogging, twitter, social media

  • patriotism

  • volunteering

  • co-creation, confabulation

  • pursuit of wisdom (philo-sophia)

  • taking care of pets, or a garden

  • craftwork

  • playing annoying tricks on people to make them think (or maybe that comes under art above, or under pursuit of wisdom).

  • worship

  • giving, sharing, reciprocating

If all of the above we would do for love, we can do them without money.  The core of giving, then, is not financial and will survive a stock market crash, a depression, or a world war.  The things we do for love are what will sustain us in times of material abundance and in times of destitution.

Cynthia Gibson's Synoptic Vision of the Field

In recent posts, Cynthia Gibson has provided a balanced view of many of the warring forces in play in the field.

Stimulus Stimulates Some Tension

 The stimulus vote surfaced some tensions in the nonprofit sector that may be important to (finally) acknowledge and address.

Social Entrepreneurism:  Am I the Only One Getting Confused?

 Even those who support social entrepreneurism are getting confused about what that means, whether ithe term is being overused, and/or whether it is being viewed as the "right" way for nonprofits to operate. 

The Stupidity of Crowds?

Two recent public voting initaitives illustrate the pitfalls of relying solely on "real people"--rather than a combination of these folks and experts--to make important decisions.

Taxonomy Please

 Those of us non-MBAs (and even some of us MBAs) desperately need some basic instruction in nonprofit enterprise, financing, capitalization, and other concepts that (continue to) befuddle (and frustrate) many who might otherwise be interested in these concepts and approaches (including funders). 

Trusted Advisors in Sheep's Clothing

Those who would suceed in becoming the trusted advisors to the wealthy would do well to study the best practices of confidence artists, ponzi scheme promoters, and priests gone to the dark side.  To instill blind trust:

  • Work within a closed face to face network .
  • Work with the best people and convey an atmosphere of exclusivity.
  • Preferably work within a covenanted congregation, in which people call one another "brother"  and "sister."
  • Take a prominent role preaching virtue.
  • Return some of your stolen wealth in conspicuous philanthropy.
  • Live well, since that is a sign of God's election.

Trusted advisors are sometimes miscreants, to be sure. As we promote "trusted advisors" working with nonprofits for inspired legacies it is good to remember that some percentage of such are frauds.  For the common good, we should do our best to give one another the reputation we deserve. As Pindar put it, speaking of the role of the poet, the giver of good and bad fame, "Praise what deserve praise/And sew blame for wrong-doers." As community foundations and nonprofits work with advisors, please do exactly that. 

Lobby to Increase your Fair Share of Taxes Here

Given the wealth disparities in our society, and the needs, particularly of the bailout, let alone social programs, would you support your paying more in taxes? Would you, assuming your come from money, support a more progressive tax system? Speak up for higher taxes for you and your family here. If you are willing to get a petition signed by other members of your class, assuming you are wealthy, that would also be appreciated. If the wealthy rise up to insist on higher taxes on themselves, the world will be a better place, bailed out bankers will get their bonuses, and it will all somehow come out even. Maybe philanthropy then would be redundant.

Praise the Young and Keep them in the Dark

"I’ll be honest, the notion of being scolded by a Boomer hits home for me ," writes upsidedownbananas, in a thoughtful post on mentoring in the nonprofit sector.  I would just like to remind my Boomer peers that we were much harder on our elders than are the young on us.  As to mentoring, the young, though, check your retirement fund balance before you help them compete for your cubicle.  To help me and my agemates rationalize what must be done, I am adapting a famous essay on Life Boat Ethics.  It will be subtitled, The Case Against Helping the Young. I hope over time that I can get funding for it from folks even older tham I am.