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Friday, March 24, 2006

Barbara Bush's Hurricane Donation Earmarked for Son's Business

Associated Press: Hurricane Donation Earmarked for Bush Firm:

Former first lady Barbara Bush gave relief money to a hurricane relief fund on the condition that it be spent to buy educational software from her son Neil's company. The chief of staff of former President George H.W. Bush would not disclose the amount earmarked for purchases from Ignite Learning.

Houston Chronicle:  Katrina Donation Ignites Debate; HISD Says Focus on Neil Bush's Software Didn't Violate Policy:

As Barbara Bush spent two hours championing her son's software company at a Houston middle school Thursday morning, a watchdog group questioned whether the former first lady should be allowed to channel a donation to Neil Bush's Ignite Learning company through Houston's Hurricane Katrina relief fund.

"It's strange that the former first lady would want to do this. If her son's having a rough time of it, couldn't she write him a check?" said Daniel Borochoff, founder of the American Institute of Philanthropy, a Chicago-based charity watchdog group. "Maybe she isn't aware that people could frown upon this."

Some critics said donations to a tax-deductible charitable fund shouldn't benefit the Bush family.

http://taxprof.typepad.com/taxprof_blog/2006/03/ap_barbara_bush.html

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Comments

Barbara Bush - "Let them eat my tax deductions"

Posted by: Robert | Mar 24, 2006 4:27:36 PM

What a shame. There is plenty of money being pumped into housing, feeding, burying, etc. Katrina victims...but I'll bet this is the very first that anybody's thought about their alternative-curriculum educational needs - and the woman gets BASHED for it!

Posted by: Richard | Mar 24, 2006 4:40:58 PM

This does seem odd.

How is is possible to "earmark" a tax-deductable donation to a (I presume) **for profit** company? Especially one that Barbara Bush is part owner of as an investor? This seems like money laundering and tax fraud by my inexpert opinion...

Posted by: Curious | Mar 24, 2006 4:41:08 PM

Here's the long and short of it. It's a scam. Barbara Bush's personal loan to her son's company won't be all that wonderful to investors. In fact, if word came out at all, it would mean that the company is struggling. Instead, if a large donation was made with the intent of a large scale purchase, this would artificially inflate the value of the company.

What we have here, ladies and gentlemen, is a way to circumvent the Trade Commission. In addition to fringing on being tax evasion and fraud, it in fact is morally repugnant and in bad form.

I used to respect Barbara Bush for the work she did back between 1988-1992, but I've been disgusted at her lack of tact and sheer disrespect for the world as it is today. Just like her son, she seems to be looking at the world as she wants it to be.

Posted by: Adam | Mar 24, 2006 5:58:59 PM

this family donates nothing. everything is an investment.

Posted by: truth hurts | Mar 24, 2006 6:07:57 PM

Hey give her a break. She knows as well as anyone how badly the money would be managed if it were given in a more direct way to the relief efforts being guided by her retarded son's administration.

Posted by: Seamus | Mar 24, 2006 6:24:25 PM

I doubt that I can legally donate money to my university's annual fund with the stipulation that it be used to buy me a new computer.

Posted by: Brian Boru | Mar 24, 2006 7:00:10 PM

Kudos to whomever dug up this dirt.

Yeah, it's probably legal. There's probably some obscure loophole or exception, probably invented by one of their surrogates in congress.

Posted by: Bush_White_Collar_Crime | Mar 24, 2006 8:07:45 PM

dubyuh is the acorn
from bar'bra's oak;
they don't know how to mourn
for honest folk;
i wish
their priv lege
to revoke

Posted by: cam revilo | Mar 24, 2006 8:35:53 PM

Answers:
1. You cannot earmark the donation for a specific recipient
If, in fact, the donation was contingent on spending it with Neil, Barb has not made a deductible contribution and won't attempt to deduct it.
To begin with, one would presume Barb was politically required to contribute. To kill 2 birds with one stone, I would say "Curious" is probably close on the other bird, pumping up Neil's company without the "family bailout" stigma.

Posted by: david | Mar 24, 2006 9:36:15 PM

TalkingPoint Memo has a complete list of investors in Ignite and as you can see Barbara and George are investors in the company!

Isn't this a violation of tax law for 501c3
http://www.irs.gov/charities/article/0,,id=96430,00.html --No to mention another big slap in the face to Katrina victims?

It appears as though charities are going to really suffer because of these types of charades.

March 24, 2006 -- 03:37 PM EST // link)
Back on the question of how Barbara Bush donated money for Katrina aid and 'earmarked' part of it for the purchase of educational software produced by Ignite!, the company her son, Neil Bush, to bag money from international potentates, tycoons and crooks. Taxprof's got a post on a subject I've been curious about. George and Barbara Bush -- like a lot of other folks investment for non-economic reasons -- are actually investors in Ignite!

So how is it exactly you get away with making a tax subsidized contribution that you stipulate must be used to purchase products from a company in which you are a partial owner?

Isn't that a scam of some sort?

-- Josh Marshall

Posted by: Marilyn Garis | Mar 24, 2006 10:56:31 PM

Good questions, Richard. Donating money to a non-profit with the stipulation that money be used to purchase goods/services from a for-profit company in which the donor has an ownership position may be legal. Anyone know?
But, even if it is, it certainly isn't good policy. It seems to me another instance of the scary confluence of the public purse, corporate interests, "charitable" donations, and benefits to wealthy individuals that we've seen so much of recently. Contracting of military services to private companies, the creation by elected officials of "charities" to receive corporate donations, lobbyists actually writing legislation, the increasinly-revolving door between government and the private sector, and much more.
Whether you're "left" or "right", I don't think anyone can argue that this is the way our democracy is supposed to work.
If Barbara Bush wants to donate to Katrina relief, she should simply donate. I'm not naive enough to think that her son's software wouldn't be purchased anyway, but that's another story.

Posted by: jrw | Mar 25, 2006 1:37:24 AM

Maybe this is the way the current system operates. GW said during remoarks about Negraponte's appointment as Intel Czar that those with access to decision makers influence policy ...what else needs to be said ..this statement alone makes all of those political donations which gain access to decision makers look like bribes ....

Posted by: Mitch | Mar 25, 2006 6:22:54 AM

Come on, guys! Barb is just taking No Child Left Behind to heart.

She's just focusing on *her* children.

Posted by: lori | Mar 25, 2006 7:51:15 AM

It amazes me that anyone is surprised at anything the Bush family ever does. George W is just a chip off the old block, only bigger, longer and unabashed.

And people like them will always get away with whatever they end up doing because they have the POWAH.

Posted by: Michael S | Mar 25, 2006 11:16:21 AM

As someone said above, I don't think there donation itself could be illegal. It's just a question of whether the person tries to claim a tax deduction.

Posted by: Dave | Mar 25, 2006 11:49:25 AM

While I'm not fan of the Bush's, I don't see legal issue at hand, or is it just appearances? After all, didn't the children of Houston get millions of dollars of free educational software?

No matter what it *looks* like, or how craven the motives, she donated $ and the kids benefited... if it also benefited her and her son (and other investors), that might appear craven, but when all is said and done, what's the harm done?

Maybe there ought to be a law that says you can't benefit personally from a donation you make to charity, but so far in these comments (or anyplace else), I haven't come across one.

Posted by: Lee | Mar 25, 2006 4:33:09 PM

So Babs is laundering money through a Katrina charity. Big deal. This sort of thing is how the Bushes got--and stayed--rich in the first place.

Posted by: Jimmmmm | Mar 25, 2006 9:09:24 PM

It's all very unseemly (but that should surprise no one, given how unbelievably crass the Bushes are) but I think the only time it would cross over into the illegal would be if she tried to deduct the donation.

That's a layman's take on the whole thing--it would be interesting to hear from a pro. Would this type of thing vary from state to state?

Also, there's this interest-piquing quote in the AP article: "Two years ago, the Houston school district board wrestled with conflict of interest concerns over the Ignite program. Neil Bush had helped raise $115,000 for the district's philanthropic fund from donors who insisted the money be spent on his company's software."

OK, so, here's a test--were any of those donors also investors in Neil "I Got Syphillis From Any Number of Thai Hookers" Bush's company, and did they then deduct the contribution? IE, was any follow up done on the issue?

Posted by: chisholm | Mar 26, 2006 11:33:12 AM

It's all very unseemly (but that should surprise no one, given how unbelievably crass the Bushes are) but I think the only time it would cross over into the illegal would be if she tried to deduct the donation.

That's a layman's take on the whole thing--it would be interesting to hear from a pro. Would this type of thing vary from state to state?

Also, there's this interest-piquing quote in the AP article: "Two years ago, the Houston school district board wrestled with conflict of interest concerns over the Ignite program. Neil Bush had helped raise $115,000 for the district's philanthropic fund from donors who insisted the money be spent on his company's software."

OK, so, here's a test--were any of those donors also investors in Neil "I Got Syphillis From Any Number of Thai Hookers" Bush's company, and did they then deduct the contribution? IE, was any follow up done on the issue?

Posted by: chisholm | Mar 26, 2006 12:09:34 PM

I'm not surpised at anything that Cow would do. It popped into her beautiful mind...

Posted by: Albert | Mar 26, 2006 11:13:15 PM

Writing a check is one day relief and she tries to make long-term donation.

Posted by: Helen, software developer | Apr 4, 2006 10:39:57 AM

She is making long-term self playing donation.

Posted by: Helen, software developer | Apr 4, 2006 10:49:05 AM