I have often argued that charities are a major part of our economy and ought to be more directly recognized in efforts to stimulate the economy.  In a piece in the Chronicle of Philanthropy in 2009, David Ross of the Pennsylvania Association of Nonprofit Organizations and I urged a temporary increase in charitable contribution deductions for those who actually increased their giving for general operating expenses.  The reasons were simple.  Charities will spend new funds very quickly, on goods and services that generally benefit the public in some significant way, and predominantly here in the U.S.  It is hard to imagine a more direct stimulus to our economy.

In December, when Congress extended the current tax rates, it also extended the IRA rollover (which many charities are using to make a new appeal to their donors), and created a new one-year reduction in payroll taxes that directly increases the take-home pay of all employees.  For many of those who get the benefit, the windfall will not be necessary to pay accumulated bills or maintain their standard of living. 

Charities should use this opportunity to ask their donors to share the benefit.  They can assure the donors that the money will be spent promptly, on public goods or services the donors care about, here at home, with money the donors won’t really miss because they didn’t have it last year.  It could be both productive and patriotic.