Generous donations do little for deficit

WASHINGTON (AP) — It’s mostly checks for $10 or $15, but one man sent real gold, and an 84-year-old Minnesota woman chipped in $15,235 to help pay off the national debt. A few benevolent souls even tucked a little something extra in with their tax returns.
The Minnesotan, retired librarian Gudrun Hertsgaard of Minneapolis, makes $5,000 in charitable donations each year, $3,000 of which goes to the U.S. Treasury.
“I work on all my friends to do it, only they kind of laugh at me,” she said. “When it gets to their pocketbook, they won’t cough it up.”
Since 1961, Americans have sent the Treasury $56.8 million to help put the nation back into the black. That sounds generous, but it would cover the interest on the $5.5 trillion national debt for about an hour and a half.
And contributions — ranging from inheritance checks to proceeds from a car wash — have been waning in recent years. Some worry that expectations of a balanced federal budget this year for the first time in nearly three decades have caused people to mistakenly believe the national debt has been erased.
Not only is the debt still here, it’s growing.
People have always been able to send the government money, but not until 1961 did Congress allow them to earmark contributions for the national debt. Since the 1982 tax year, the Internal Revenue Service has included instructions in its tax booklet on how to do it.
On page 29 of this year’s tax guide, taxpayers are advised to write separate checks payable to the “Bureau of the Public Debt.” Even if taxpayers simply want to forfeit their refunds, they need to write separate checks.
In fiscal 1996, 366 Americans slipped checks totaling $85,378 to reduce the federal debt inside their tax returns. That was down from the 3,570 taxpayers who sent in $347,700 in fiscal 1983.
Most contributions to the debt come in separately from tax forms.
“A couple years ago, somebody actually sent in some gold. We went to a metals dealer, got it appraised and sold it. It was a couple hundred dollars’ worth,” said Peter Hollenbach, a spokesman for the Bureau of the Public Debt in Washington.
A Lithuanian immigrant sent in a five-figure check.
“The man just wanted to show his appreciation for the freedom and democracy he’s appreciated since he was living here,” Hollenbach said.
Many letters sent with contributions ooze with patriotism. Others lament the government’s stack of promissory notes.
One from Arizona said: “I know it’s only a drop in the bucket, but every little bit helps.” Another from New Hampshire said: “I would like my first month’s Social Security check to be applied to reduce the national debt.”
When Minnie Vogel died in 1984, she left $153,000 to retire the debt to “show my appreciation and love in helping my country in this small way.” After a four-year legal battle over whether her home state of Kentucky was entitled to inheritance taxes, the state got $30,000, the Treasury a little more than $100,000.
The government never knows how much in contributions to expect.
From 1961 to 1983, annual contributions ranged from about $3,000 to $900,000.
The total topped $1 million for the first time in 1984 and shot up to $4.5 million in 1992, when independent presidential candidate Ross Perot was wielding his charts and graphs about the budget and the debt.
Interest died down after President Clinton’s election, and contributions slipped to $1.84 million in 1993. An anonymous large donation sent the 1994 total shooting up to $20.7 million, but by last year contributions had dropped to $956,000.
Some worry that contributions could drop off even more if Americans continue to confuse the debt with the deficit. The national debt primarily represents the mountain of budget deficits that have stacked up over the years. The deficit — or surplus, as expected this year — is the difference between government revenues and spending in a given year.
“People hear there’s a surplus, and they think the debt is done,” Hollenbach said.
Still, some enterprising Americans aren’t deterred by talk of a surplus.
Students at Carson-Newman College in Jefferson City, Tenn., soaped about 50 cars at their “Drive Down the Debt” car wash, passed the hat and sent the government $300.
The Richmond, Va.-based Eskimo Pie Corp. pledged a nickel for each box of ice cream bars it sold in one month. In May 1993, it unloaded 1,437,890 nickels on the lawn of the U.S. Capitol.
The government wasn’t keen on counting them.
“We told them to put the nickels back in the truck and send us a check,” Hollenbach said.
The company did.