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The Squandered Stimulus
Jul 20, 2009; Washington Post | This is a stunning and devastating op-ed by Robert Samuelson in the Washington Post. His argument is what many of us have said, but without his cogency: The $787 billion stimulus package passed early this year was not a stimulus program, but “mostly a political exercise, designed to claim credit for any recovery, shower benefits on favored constituencies and signal support for fashionable causes.” Rather than a program to maximize economic impact, the stimulus plan “became an orgy of politically appealing spending increases and tax breaks.” Samuelson argues that it might be simply too late for President Obama to rescue the first stimulus deal, and a second stimulus, needed because of the inadequacy of the first, would have to “be financed by culling some of the old” stimulus. Samuelson fundamentally suggests that some of the ARRA provisions that nonprofits are most interested in are among those with limited stimulative effect. It poses the question to nonprofits that we have raised in several other articles:  Are nonprofits (and foundations) willing to forego resources that benefit themselves as institutions for actions, incentives, investments, and programs that benefit society and, as a consequence, reduce the demand for the services and safety nets that nonprofits provide?.  —Rick Cohen

Marion Barry’s Not the Only One With Nonprofit Trouble
Jul 20, 2009; City Paper| Maybe someone ought to tell Washington DC council members and perhaps to many other state and municipal politicians around the country the story of Pennsylvania State Senator Vince Fumo heading to jail in part for funneling money to and through a nonprofit largely linked to and staffed by his political aides. In DC, former mayor and Ward 8 council member Marion Barry has been pegged in the press, though no legal action yet, for funneling $1 million in earmarked grants to nonprofits controlled by his own staff. Some of the grants were made before the groups even legally existed, some of the groups have apparently fraudulent signatures on their incorporating papers from people who say they didn’t know they were signatories, the paperwork for all of the groups is virtually identical, etc.  DC’s alternative paper, the City Paper, has provided a good article with documentation of the unusual paperwork for these nonprofits. But don’t pick on Barry. The alternative paper also has caught Ward 5 councilman Harry Thomas Jr. with his own controlled nonprofit, but in this case, one that accepted a $55,000 “donation” from a developer whose 237-home proposed development at the Brookland Seminary was opposed by the Zoning Commission and the Advisory Neighborhood Commission-but got Thomas’s vigorous support. Where is the outrage from the nonprofit sector about Barry or Thomas or Fumo or any of the politicians creating Potemkin nonprofits for their allies, staff, and themselves?  Deafening silence? Of course, because many nonprofits accept the transgressions of these pols so that they can get their slices of their discretionary earmark grants. See “Nonprofits Revisit Budgets as Earmark Cuts Loom,” Washington Post, July 21, 2009, for a story about DC’s legitimate nonprofits fretting about shortfalls in the DC municipal budget compelling reductions in their heretofore automatic earmarks from the Council. The earmarking system of DC is corrupted, but like many situations, groups will turn a blind eye to the corrupted percentage in order to make sure they get to use the uncorrupted portion for good purposes.  When you’re part of a system of corruption, partaking in the benefits because you’re doing good things with the funds even though others are not, there’s no way to make sure that your good nonprofit doesn’t end up splattered with the taint. The big national nonprofit leadership organizations love to say that they want to drive the bad apples out of the system.  It can’t be done unless nonprofits stand up and identify the bad apples in their midst. More coverage can be found in Marion Barry: Boss for Life and Barry Involved in Suspect Nonprofit Dealings D.C. Council sent $450,000 to nonexistent organizations. —Rick Cohen

Rural dwellers ‘face 280 year wait’ for affordable home
Jul 21, 2009; Planning Resource
| In case NPQ readers think that we’ve been too hard on the failures of U.S. policy and philanthropy to provide support to rural areas, we note this brief article from the UK about the length of time rural families in Great Britain would have to wait for affordable homes. The average waiting time in rural areas based on current production levels is 90 years, but in East Riding of Yorkshire, the wait would be 280 years. Those numbers are all predicated on no new income-qualified families being added to the waiting lists.  —Rick Cohen

As Immigrants Move In, Americans Move Up
Jul 21, 2009; Free Trade Bulletin
| It is striking how some of the most “progressive” positions on immigration reform have come from the ultra-conservative, libertarian Cato Institute. It must gall Democrats who like to characterize all conservatives as anti-immigration (when several Democrats are already on record as ready to oppose an Obama Administration immigration reform package, no matter what it contains) and anti-immigrant Republicans who must be nonplussed by Cato’s tough-minded, data-based research.  In this piece, the Cato researcher basically takes on the arguments of anti-immigrant Democrats such as some who have participated in an “anti-amnesty” Congressional caucus in response to their constituents (among the five Democrats in the predominantly Republican Immigration Reform Caucus are Jason Altmire of Pennsylvania, footballer Heath Shuler of North Carolina, though more than these five are likely to oppose immigration reform). The basic points in the Cato piece are as follows:  1. A “contribution of immigration has been that it has changed the character of the American underclass for the better. Years of low-skilled immigration have created an underclass that is not only smaller than it was 15 years ago, but also more functional. Members of today’s more immigrant and Hispanic underclass are more likely to work and less likely to live in poverty or commit crimes than members of the more native-born underclass of past decades.” 2. “The arrival of low-skilled, foreign-born workers in the labor force increases the incentives for younger native-born Americans to stay in school and for older workers to upgrade their skills. Because they compete directly with the lowest-skilled Americans, low-skilled immigrants do exert mild downward pressure on the wages of the lowest-paid American workers. But the addition of low-skilled immigrants also expands the size of the overall economy, creating openings in higher-paid occupations such as managers, skilled craftsmen, and accountants. The result is a greater financial reward for finishing high school and for acquiring additional job skills.” 3. “Legal immigrants can be screened for criminal records, reducing the odds that they will engage in criminal behavior once in the United States. Illegal immigrants have the incentive to avoid committing crimes to minimize their chances of being caught and deported. Legal or illegal, immigrants come to America to realize the opportunities of working in a more free-market, open, and prosperous economy; committing a crime puts that opportunity in jeopardy. Strong empirical evidence points to the fact that immigrants are less likely to commit crimes than native-born Americans.” And 4. “Illegal immigrants who break U.S. immigration laws to enter the United States appear much more likely than native-born Americans to respect our domestic criminal code once they are inside the country. Once here, low-skilled immigrants, as a rule, get down to the business of earning money, sending home remittances, and staying out of trouble. The wider benefit to our society is that, in comparison to 15 years ago, a member of today’s underclass, standing on a street corner, is more likely to be waiting for a job than a drug deal.”  Good, fact-based stuff about a “special population” that, like immigrants of eras past, is making America better.  —Rick Cohen

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