By Bob Ferris
I got into a Facebook debate yesterday. I am sure that this is not a big surprise to those who know
|Porcupine quills have barbs that allow forward movement but |
seriously impair backward movement. This is great in a quill
but not so good in person or population.
The debate was related to the current situation with Hillary Clinton and the Clinton Foundation. Reuters did a piece that looked at the financial reporting of the Clinton Foundation and called their accounting into question because of some Canadian contributions that were not mentioned in the proper boxes. This is all part of the maelstrom associated with the release of Peter Schweizer's book “Clinton Cash” which at this point seems to be more about guilt by association than any hard evidence. The author’s assertions need to be addressed, but we are not dealing with conclusions here but rather questions.
My particular debate revolved not around the Reuters coverage or the Fox News piece, but about an article in the Examiner with a headline that went like this:Clinton Foundation only gives 15 percent of donations to charities, IRS concern. This piece was posted by a Libertarian friend of mine and I decided to take a peek at the article. Although the Reuters’ piece seemed to be the catalyst for this essay it really ended up being a bubbling stew of accusations and innuendos many of them preying on the fears and resentments of the Tea Party crowd or those of similar ilk.
“Disturbing details of the finances of the Clintons Foundation were reported upon by Rush Limbaugh, the controversial talk radio show host, on Thursday. He asserts that much of the 85 percent of the millions of dollars that do not end up in the hands of charities have undefined destinations. In fact, 60 percent of the money donated to the Clintons is categorized as “other.” Knowing this, consider that that the Clinton Foundation’s IRS filings show that it raised more than $500 million between 2009 and 2012. The Federalist publication has published that only 15 percent – or only $75 million – was spent on charity. In excess of $25 million was spent on travel expenses and approximately $110 million went toward employee salaries and benefits, according to Free Republic.” Scott Paulson, Examiner, April 23, 2015
|The kangaroo in an animal that can only hop forward.|
In my mind the most logical place to start answering this question is to look at the George W. Bush Foundation (see FY 2013 990s here) and compare that entity with the Clinton Foundation (see FY 2013 990s here). This makes sense as both of these organizations operate presidential libraries and both entities raised about $500 million from 2008 to 2012 so they are similar in size.
At the offset I will say that Mr. Limbaugh’s claims about percentages going to charities and emphasizing the “other” category are both disingenuous. The Clinton Foundation is an IRS 501(c) 3 charity so the true measure that needs to be considered here is how much money is going to administrative costs and how much to programs (i.e., the charitable purpose of the foundation). When you look at the 990s for these two foundations you find that the Clinton Foundation spent a little more on administration at 19% in FY-2013 than the Bush Foundation at 17%, but not a significant amount. And this difference makes sense as the Clinton Foundation raised $148 million in 2013 while the Bush organization raised only $36 million in that year. It costs money to raise money.
As to the argument about the foul sounding “other” category found on page 9 of the IRS form 990s, the Clinton Foundation placed 77% of their revenue in this category in FY 2013 which interestingly is exactly the same percentage that the Bush Foundation placed in this category for that same year. So there is really nothing to see here particularly when you look at the other classifications in the section of the form. Moreover, if the Clinton Foundation makes the changes discussed in the Reuters piece this percentage will go down.
Mr. Limbaugh’s use of the word “other” is evocative even though it is not meaningful. It brings to mind something alien and not right which strikes a chord in those fearful of change or the unknown. But it is simply like P.T. Barnum’s use of the word “egress” to drive people to exit: It is meant to fool the unaware.
Salaries are mentioned too. Here the most important salaries to examine are those of the leadership. The Clinton Foundation had 9 senior employees who made $2.6 million in FY 2013 and the Bush Foundation had 9 senior employees who made $2.2 million in that same year. Yes the Clinton Foundation paid marginally more to their top employees. That said those employees managed a larger budget and raised considerably more money than their counter-parts at the Bush Foundation. My sense is that Mr. Limbaugh would not publicly make the argument that paying people who have more responsibilities more or paying employees who perform at a higher level more is out of line.
And travel costs too were raised as a red flag issue. Yes indeed the travel costs for the Clinton Foundation are more than the Bush Foundation. But should it really be a huge surprise that an organization operating internationally should rightfully have higher travel cost than one that mainly operates domestically? This red flag seem more like a red herring when considered fully.
This brings us back to the porcupine quill, because when I provided this information and documentation to my “learned” opponent his response was to cling doggedly to the information provided mainly in the above paragraph from Mr. Paulson’s opus. He was steadfast in his headline-driven stance that the Clinton Foundation “wasted” 85% of its donations in the absolute absence of any supporting information and piles of information that contradicted his belief.
I cannot say whether or not Hillary Clinton has done anything seriously wrong in her dealings vis a vis this foundation, but I can say definitively that our country is harmed by this growing inability of some of its citizenry to adjust strongly held beliefs in the presence of contradictory facts. Moreover, this tendency to devalue the idea of learning and to embrace those who have repeatedly and openly mislead them and betrayed their interests is exceedingly troubling. I and others (see here) chalk much of this up to the our purposeful dismantling of our education system which I would equate to an overt act of social and democratic suicide.
Our country was founded by learned people and made great by our ability to out think and be more innovative than our often more powerful opponents. This cannot be our continued future if the “common sense” that we all share—either personally or through our elected officials—is a combination of ignorance, fear, intolerance and inflexibility. The current Kansas school crisis (1,2,3) should be a cautionary tale in all of this and we need to take it to heart before similar forces choke the very life out of the educational systems that once made us exceptional and less like the thoughtless quills found on a prickly rodent. Hopefully, corrective action will be taken by all at the next election.