Fiscal Cliff Negotiations Hold a Range of Implications for Goodwill®

Sign showing dollar signs tumbling over fiscal cliffLast Friday, December 7, the Department of Labor (DOL) released a mixed monthly jobs report. While the report noted that the November unemployment rate had dropped to 7.7 percent from 7.9 percent and that more jobs were created than expected, DOL also found evidence that many jobs seekers have given up looking for work.

Bottom line: the report demonstrates that the economy is recovering, albeit very slowly, from the worst recession experienced since the Great Depression. But we are far from being out of the woods and the recovery is extremely fragile. How fragile? While economists now know that the job market is strong enough to improve — even in the face of a superstorm slamming into the Northeast — most economists are less optimistic that the recovery is strong enough to survive a plunge over the fiscal cliff.

With the election a fading memory, Congressional leaders and the president are finally engaged in serious negotiations about a deficit reduction deal. While questions about whether such a deal will be achieved and what it may look like makes terrific political theater for political junkies, it’s important to remember that, over the course of several years, many factors have led to this decisive moment in our history.

All the while, as it has been since 1902, Goodwill® has been on the front lines helping people to overcome their employment challenges. While Goodwill’s store revenue represents the bulk of the funds Goodwill uses to support its delivery of job training, employment services ($3.1 billion in 2011),  a range of government investments also leverage Goodwill’s resources and expertise.

These government investments come in various forms including tax deductions for individuals who donate to Goodwill, government grants and fees for service, and federal contracts for goods and services. Unfortunately, all of these investments are on the table as negotiators consider proposals to raise revenue or reduce spending. Such proposals include:

  • Limiting or capping the charitable tax deduction.
  • Cutting non-defense discretionary funding, including the resources that support job training, employment services and other supports that help people to find work and advance in careers.
  • Reducing funding available for federal contracts, including the AbilityOne Program, the largest source of employment opportunities for people who are blind or have significant disabilities.

Goodwill understands that policymakers face a difficult challenge in reducing the deficit while stretching limited resources to cover an increasing and dynamic range of priorities. As Congress works to develop its deficit reduction deal, Goodwill urges Congress to protect resources that enable nonprofit organizations such as Goodwill to help the communities they serve.

Click here to urge your members of Congress to protect investments that leverage Goodwill.