Invest in Charities, Not Political Campaigns

The 2004 presidential campaign promises to be the costliest in American history. Political experts predict that John Kerry and George W. Bush will spend a total of $500-million on the presidential campaign alone. Add in all of the other campaigns, from school board to U.S. Senate, and we’re talking about tens of billions of dollars of donor support. Most of that money is wasted.

Tens of millions of Americans will support political candidates this year with their hard-earned dollars. Some will do so in an effort to make our country better, some will do it because they see it as a wise investment in the nation’s future, some will do it out of civic duty, and some will do it to serve their own self-interests. However, in almost every case, these people would have been far better off supporting one of America’s more than 900,000 charities, and nonprofit leaders have an obligation to point this out to those considering donating to political campaigns.

Charity leaders need to spread the message that people donating to political campaigns are making neither a smart nor a particularly responsible decision. Most donors would be better off supporting a high-performing nonprofit organization. The time to spread the word is today, before all the available discretionary money disappears forever in a torrent of noisy and relatively pointless campaign commercials. Here are some of the key points that nonprofit leaders should make to donors:

Charities are more efficient than candidates. A charity that spends 25 percent of its budget on administrative costs, fund raising, and communications is considered about average in the nonprofit world. The rest is used toward achieving its goals. Candidates, however, spend every last dime given to them on overhead, fund raising, and communications. This is the nature of political campaigns. There’s rarely anything left at the end.

Charities are more accountable. State attorneys general, watchdogs like the one I head, donors, and, to a lesser extent unfortunately, the Internal Revenue Service are here to scrutinize the financial practices of every large nonprofit organization in the country to make sure its funds are spent wisely and appropriately.

The warp speed of political campaigns precludes any serious scrutiny of how the public’s dollars are being allocated. All we really know is how much they raised, and how much they have left. Where it actually went is anyone’s guess.

Charities are more effective. Nonprofit groups increasingly have stepped in to provide programs our government once sought to deliver. Because of charities, our wetlands are being preserved, many of our homeless have shelter, hungry children are being fed, diseases are being cured, and more animals are safe. Without a doubt, our country is a better place because of charities. Can we really say the same thing about our elected officials?

Donors already pay for the candidates through their taxes. From the presidential race down to local city council races, most elections are financed with large chunks of government matching funds. Like it or not, taxpayers are already supporting these elections. We’ve paid once. Have we paid for a charity yet in the same manner? Not likely. Charity support is being cut nationwide from local, state, and federal budgets. But even with the worst of financial crises, as after-school programs and food for the poor are being cut, matching funds for elections are safe. Why? Because those that benefit from the programs, the elected officials, are the ones who vote on those budgets.

Charities won’t flip-flop on their donors. Most people are motivated by one issue, whether it is the environment, or schools, or reproductive rights, and they select and support candidates who believe as they do on that issue. But how does anyone know that candidates, when elected, will care as much about the issue as they claim to today? How can people know their candidates won’t take the corporate money and decide the issue is a little more “complex” than they originally thought?

Quite simply, people can’t. But what are the chances that an advocacy charity will make the same flip-flop? Absolutely none. The charity has a proven track record of supporting that issue and makes its living from that continued support.

Advocacy groups are not beholden to special interests; they are the special interest. If donors truly care about the issue, and not the candidate, the only one they can truly trust to work on their behalf is the charity that shares their value system.

Charities are in it for the long haul. Once the election cycle ends, the losers will go home, and the winners will celebrate the spoils. Many of the campaigns’ issues will go back on the shelf until the next cycle begins. But for the charities — the advocates, the change agents, and the service deliverers — the day after the election will just be another day, a day to do their jobs and try to make the world a better place. Donors shouldn’t spend their money to simply bet on a horse in this campaign cycle.

Campaign deductions aren’t tax-deductible. Federal law recognizes a basic principle of economics in its support of charities. Charities provide a public good, and it is therefore in the interest of our entire society to support them.

Accordingly, all donations from people who itemize on their taxes can be deducted. Donations to candidates, however, at any level, are not tax-deductible. Supporting a candidate is no different than buying a six-pack of beer, except one can more readily predict the results from consuming the beer.

The elections of 2004 are important, and the candidates have important differences on vital issues. But the candidates are going to run for election whether Americans support them financially or not. In 2004, charities need to persuade their donors to vote with their ballot, not their checkbook, and save their hard-earned dollars for the people who can do the most with the money — America’s charities.

Trent Stamp is executive director of Charity Navigator, a nonprofit organization in Mahwah, N.J., that evaluates the effectiveness and financial health of charitable groups.