Tuesday, July 6, 2010

Satan hides in the details.

As Prime Minister Netanyahu and President Obama prepare to meet in the White House today, a hue and cry is calling out from several liberal quarters, including The New York Times, about the tax-exempt money that is pouring from the United States to support expansion in the West Bank. I have a comment, and it is "oh, oh!"

It is true that tax-exempt American dollars have been finding their way into Israel and the territories for decades. Some wind up in Jewish hands, and some in Palestinian hands. Most serve humanitarian purposes, but some may be used to buy arms.

Whatever the mix, it might be very tempting for the Obama administration to cut off some if not all of this money. It would serve as a gesture, so the hue and cry goes, to put U.S. money where the U.S. mouth is with regard to settlements in the West Bank. However, carrying out the enabling change in the tax code could easily open up a can of worms that may be very difficult to keep under control.

For example, there are several yeshivot, institutes of higher Jewish learning, that are located outside of the pre-1967 borders of Israel. Some are as close in to Israel as East Jerusalem. Would Jews in America lose their ability to contribute to these yeshivot? What about hospitals and clinics that serve residents of the West Bank? Many of these serve Israelis and Palestinians alike.

More importantly, who will determine which charities are supporting activities in the West Bank, and to what extent? Could this not lead to loss of tax deductions for just about any charity operating in Israel because some of their funds might wind up in the settlements?

While we're talking slippery slopes, what about organizations that support charitable causes elsewhere in the world where we have an interest? Shall we prohibit tax deductions to charities that support hospitals and schools across Africa or southern Asia, just because we don't like the regime that's currently in power? Shall charitable causes be turned on and off as American political winds blow?

It makes sense to limit Americans' tax deductions on implements of war, just as it makes sense to limit Americans' taxes being spent on such items by our government. The devil, however, lies entirely in the details.

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