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An absurd ban

For all that I am sometimes bemused about the views of the assorted rock stars, media wannabes and other folk gathered around Sir Bob Geldof’s “Make Poverty History” campaign, I was a bit taken aback at this story. A UK regulatory body has banned the group from making any television or radio advertising on the grounds that it is a political group.

It would surely take the wisdom of Solomon to figure out the fine boundaries defining what is and what is not a “political” organisation. So many charities nowadays seem to stray into territory that one might construe as political. Many think tanks, which describe themselves as education or research institutes for the purpose of getting charitable tax status, are often highly political, if not in the simple party sense.

In my view, if a charity is deemed unfit to broadcast its views on the telly, it should be banned, full stop. For example, a radical Islamist or neo-Nazi group claiming to be a charity which is banned from spreading its message should also be banned as such (although some libertarians might argue that even such groups should be tolerated unless their members advocate violent acts with a reasonable chance of carrying them out).

The state has no business trying to define the boundaries of what is and what is not a charity. Ultimately, of course, the way to cut through the problem might be to end the tax breaks that charitable status brings and cut taxes across the board so that the designation of “charitable status” no longer is something decided by the Great and the Good but left up to we mortals to decide for ourselves.

16 comments to An absurd ban

  • Patrick

    whoa there! That charities are not allowed to be political is, as you point out, a feature of the law of trusts. Its reasons however remain surely just as valid as ever.

    What can anyone on this blog of all places have to say against the idea that people should be encouraged to give to charity – and what better way than permitting them to sequester part of their wealth (with the added advantage that they can solicit contributions from other like minded givers) and distribute it to those good causes that they wish, without incurring any tax on it?

    Would not this be the most egregious of double taxation, since (and this was even more the case in the 1600s when this reallly started) this is money spent to relieve the state? Rather than say that the state has no business determining what is a charity, you should applaud the two principles this law recognises, namely the desirability of private rather than state charitable spending and the desirability of some limit to this.

    Of course, your point would be valid if you were talking about a minimal state of the ‘protective society’ sort; but I assume you are talking about Britain.

    The restriction on television broadcasting comes from the addition of the negative requirement of not political: not only must charities be x, y, z, zz, zyx, or etc; they must not be political. This is because essentially the government doesn’t want to give tax breaks to people advocating its’ otherthrow, unsurprisingly! Also perhaps because ‘political’ activities are recognised as of little benefit to society 🙂

    Also, although the acceptable causes are very broadly interpreted these days, I’m not aware of any provision that a neo-nazi group could sneak through, unless they looked after a bridge or orphans or something, and even then they would lose their status for political activities.

    A ‘radical islamic’ group is a tougher case, since religious groups are inherently ‘charitable’ – but Hamas, say, would not qualify, nor any organisation that directly advocated political action or change.

  • Julian Morrison

    Two ways of dealing with charity.

    Way 1: flat tax everyone, no special breaks for charities. If you want the charity to pay no tax (and I do), do it by making everyone pay no tax.

    Way 2: all private state-replacing provision is tax exempt, specifically it replaces the taxes that would have been taken for the equivalent state function. Pay for rent-a-cops, don’t pay for police. Pay for charity, don’t pay for welfare. The intent being to wean everyone off the state and then shut it down.

    I’m not sure which of those is best.

  • The problem is, I think, the way the current system of taxation is set up. We have the issue of giving organizations the status of tax-exempted because we tax the income of organizations.

    If we were to have a fix anual tax (fixed as in fixed sum, not fixed percentage) on individual/citizen income you’d get a State budget of x pounds per citizen multiplied by the y number of citizens, and no taxes levied on businesses or organization.

    If we are to separate State from the economy then the State ought to deal with its citizens directly, and not with the organizations they set up.

  • “Make Poverty History” sounds very pinko to me, and on several counts for that matter:

    – The idea that the state and/or some kind of “enlightened” avant-guard(e) can change or “accelerate” the course of History is typical of early 19th century socialism e.g. the Marquis de Saint-Simon (young Karl’s French idol) spoke of “making feudalism history”

    – The idea that human ills and/or social “maladies” can be cured by some kind of “political doctor” is also typical 19th century totalitarian socialism: crooks such as N.G. Chernichevski spoke of an ideal city based on the “twin virtuous of hierarchical authority and moral transparency” [sic] were “all humankind’s social maladies would be dealt with once and for all”- this is probably where pathetic Paradise Island socialists such as Geldof and Blair took their “progressive” inspiration…

  • Verity

    Blair never took his inspiration from a philosopher because he has never read a book in his life. Your “Paradise Island” analogy doesn’t apply because Blair has no inspiration and no philosphy other than what people (absent Alastair – right- snigger) the dreaded Cherie. Blair has no inner compass. He is totally empty, which is why he is so convenient.

  • Julian Morrison

    John Thomas: it would actually be fairly trivial to make poverty history, and it’s stuff governments could do, largely because it’s their mess to clean up. They have distorted the market, given “loans” to be repaid by expropriation, and tolerated misrule. If they stopped, the problem will quickly fix itself.

  • Am I thick because I’m American? Why, exactly, is it that political organizations are banned from radio and TV advertising?

  • Julian, no one will ever make poverty history because “poverty” as politically defined by activists is relative, not absolute.

    It’s the bottom N% of the bell curve. There will always be a bottom N% of the bell curve.

    “Poverty” in the US now is defined as a yearly income below about $20,000 (IIRC) which is in fact not far below the median income in most of Europe and well above the median income for most of the world. Fact is, the “poor” in America would be considered extremely wealthy in most of the world.

    Those who politically want to “make poverty history” want to do it by redistribution so that no one is either richer or poorer than anyone else. Does that sound familiar?

  • guy herbert

    Don’t worry folks! The Blair administration is in the course of transforming charity law. The old-fashioned restrictive rules about religion, education and the relief of poverty that have been in place (supplemented by a bit of common law) since 1603 are about to be swept away by proper moderninsation. Charities may soon have political aims and activities–just as long as they are the right regulator-approved ones!–and education, for example, is not going to be charitable unless the regulator agrees it is for the right people–so no more unfair advantages for private education that might not even be sticking to the national curriculum.

  • John Thomas

    I meant “Paradise Island”… in the Bahamas


  • The “Make Poverty History” campaign is highly political and they go out their way to meddle in politics. The ban on political adverts in the UK is the daft bit not the ban specifically on “MPH”

    Ending tax breaks for all charties, including religious institutions, in both the UK or the US is a very good idea.

  • Robert Alderson

    Of course there is no good reason for banning political advertisments. I’m not even sure what the stated reason is. Probably somehow related to the fact that political parties get free time slots on network TV in Britain during election campagins and that this is a “fairer” method than allowing parties to buy advertising space.

    I would favour an end to the special tax treatment of charities. The definition of what constitues a charity is so difficult that it just opens the door to having a big bureaucracy to rule on the matter. Better to just tax everybody on the same basis.

  • Patrick

    Actually, nothing of the sort – the rules on charities are determined by judges, and although obviously there is quite a bit of money in it for lawyers, not nearly as much as you would think since on the whole it is (to a lawyer) usually straightforward.

    I cannot understand why you would not favour tax breaks for charities – do you support state-dependence? Why not encourage people to give their own money to good causes by letting them have it? I agree that taxes generally should be lowered a lot, and I think that probably all welfare could be delivered by private charity and much more effectively at that.

    But I cannot see why anyone would want to take what seems like such a massive step backwards.

  • Robert Alderson

    I didn’t write accurately enough. I believe that there is a general ban on political advertising on TV and radio but not in print. Organisations like the TUC can run press ads in favour of e.g. an increased minimum wage but cannot run TV ads for the same cause. There are additional restrictions on advertising by charitable organisations which, I guess, are imposed by the Charity Commission.

    As for why I favour ending the tax exempt status of charities. Well, I should explain that this is not something I feel is urgent. I can see that in the current high tax environment it would severely reduce charitable giving and that charitable giving is a good thing. The reason is that I do not want to have the state making value judgements about where citizens spend their money.

    Just think about some quirks of the current system: if you spend your money to go and see a rock concert that part of your income is taxable, on the other hand you might contribute tax free money to a charity which subsidises classical music and then be able to watch a concert for free. If you visit the Eden Project in Cornwall it is a charity and they will ask you to Gift Aid your admission fee, but if you went to another tourist attraction it may be a tax paying business. I know when you think charity you are probably thinking about truly worthy causes like feeding the poor or housing the homeless but there is such a wide spectrum of potentially “charitable” activity that it is best for the government to get out of it.

    As for the cost of tax exempting charities (excluding the lost tax revenue) there is the cost of the whole UK Gift Aid system. This is a hugely complex system whereby millions of tiny donations get processed through Gordon Brown’s bloated treasury – it must be costing hundreds of millions.

    I don’t want state dependence but I definitely don’t want a bigger more intrusive state deciding on what is a “worthy” charity.

  • Johnathan

    Patrick, you miss the point. Tax breaks for charities are effectively subsidies. As a result, politicians want to regulate who gets the tax-advantaged status. He who pays the Piper plays the tune and so forth.

    This is the crux of the matter. Charities, from the moment they benefit from a tweak to the tax rules, are bound to come under regulatory scrutiny. Sooner or later that scrutiny becomes a problem. That is why I favour scrapping all existing allowances and cutting taxes across the board, so that how we spend or invest our money is taken on the economic merits, not because of some political or social objective. Rgds

  • Patrick

    I don’t (surprise!) think I have missed the point; at least no more than you have mine 😉

    I can accept that the inherent subsidy distorts spending – but not that it is as much of a problem as you make out. Here I have a confession to make: I’m not British (well, I am!) but Australian. Gift Aid certainly sounds abominable, but here, the system works pretty well. Sure, there are some causes that for purely arbitrary reasons aren’t charitable, but this is only a problem because other purely arbitrary causes are and not because the those that aren’t are actually desirable. The real limit is that charities cannot be actively political, which I think is a reasonable enough trade-off.

    Your last line strikes me as somewhat odd – possibly a majority of individial discretionary spending is not made on its economic merits! That it no way means it is less ‘right’ or worthwhile – the time you spend on this blog, which I thoroughly appreciate, is an example. But my real problem with your idea is that I think that, inasmuch as this ‘subsidy’ is directly spent by earners of money, it is without a doubt money better directed than that spent by state.

    In short, the charitable exemption is distorting, but less distorting than would be it’s absence. So until they cut the taxes and the welfare state, I’d much rather hang on to it.