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News from the President 1.20.17
Inauguration Day is an historic day for our country and 2017 may be an historic year for philanthropy. There are many predictions that charitable giving will rise higher than last year, and many predictions that it will fall. For example, if the new President’s proposed tax cuts lowering taxes for the wealthy are implemented the incentive to make large gifts could be reduced. On the up side, should it pass there’s likely to be a huge uptick in giving prior to the law taking effect.
There are other factors pointing to increased giving in 2017. Individual and household giving is set to increase by 3.8% due to average growth in personal income for the former and above average income growth for the latter. Increased giving from foundations is expected to go up to 6.4% in part due to increases in the S&P 500 compared to previous years, and average projected growth in the GDP compared to previous years. Corporate giving is expected to increase to 4.7% in part due to more companies offering employees opportunities to give back.
A prediction made by Inside Philanthropy’s David Callahan offers another case. It’s likely that new cuts will be made to non-defense domestic discretionary spending in the Federal budget, already at a low that would shrink to its lowest level in years under Republican control of the White House and Congress. In this case, the loss of public resources will then deepen, and a larger role for private funders will emerge. It’s a trend that’s already in progress in areas like education, public parks and science research. As a result, foundations and major donors will fund more and will also wield more influence.
It may be that many progressive nonprofits will receive large gifts from foundations and donors in anticipation of new federal cuts. After Meryl Streep urged those at the Golden Globes and others to support the Committee to Protect Journalists, they received $250,000 within days.
It’s also possible that the tax break for the wealthy providing them with more income will give them more spare cash to give away. While we may not know how 2017 will play out, we do know that we are a giving nation.