I think of the AARP as a good organization, one that looks out for the needs of its elderly members and keeps them informed on relevant issues. As such, I would have thought that the AARP would be one of the most non-controversial advocacy groups in Washington. But apparently not.
Politico recently reported that a new anti-AARP group is being formed to counteract what it believes is a left-wing agenda of the AARP. The new group, which is called the Alliance for Retirement Prosperity [update 01/12/12: There used to be a link here, but I took it down because the site had turned into an ad site. I guess the Alliance didn’t work out], has its cross hairs fixed on repealing President Obama’s recent health care law and reforming Medicare and Medicaid. Its purpose is to provide a “conservative challenge” to the AARP. With a only about $5 million in funding compared to the AARP’s $1.42 billion (with a “b”) in revenues in 2009 alone, it has its work cut out for it. But it seems to be off to a fairly decent start.
What intrigues me most about this group is its business model. The Alliance will be a for-profit endeavor. Alliance President Larry Hunter, who is also a top Republican advisor, believes the group’s for-profit status will differentiate it from other advocacy groups that have unsuccessfully attempted to compete with the AARP. Hunter stated:
As a for-profit business, the Alliance will use the market forces of competition among its vendors to deliver a wider array of products and services at better prices to its members.
In contrast, most advocacy groups (like AARP) are non-profit. I am an advocate for nonprofits and have represented a fair number of them. But I must admit that at times I don’t see a policy justification for exempting certain activities from taxation. And I have sometimes wondered if the lack of a profit model contributes to the lackluster performance of some membership-based nonprofits. I expect that most folks will view the stated purposes of the Alliance with it’s for-profit model in mind. After all, we know that some people could get rich off of this, and we must assume that this is at least one if not the primary purpose of the group’s founders. But it will be interesting to see the organization can overcome the “taint” of the for-profit motive to achieve its policy objectives.
I wonder when profit became an evil thing in America. I am sure you strive for a profit in your practice.
AARP made over $600,000,000 in profit on their insurance arm in 2009 alone – which I might remind you is a For Profit Entity – but pays no taxes.
Yet, AARP gets to launder their profits via a special Private Letter Ruling that Obama gave them in 1999.
By my back for the envelope calculation … since 1999 they have avoid over $3 billion in taxes.
It is a welcomed thing that a honest and truthful competitor has arrived.
Obama wasn’t even President in 1999 so how could he have given them a Private Letter Ruling? The money AARP makes on their insurance arm subsidizes the membership dues, which are very low for what they provide. That is not laundering profits. And the “honest and truthful competitor” you worship wants to privatize your social security and medicare. Good luck with that.
I think the non-profit/for-profit tension goes back to the original nonprofit sector, consisting mostly of churches and religious organizations. These organizations have traditionally depended on donations for support, which wouldn’t work if the donors believe their contributions are lining someone’s pockets instead of promoting the greater good.
But, like most areas of tax policy, tax exemption is now convoluted and driven by political objectives that create too much distortion in the free market. I have advised nonprofits to convert to for-profit status in some cases and believe that it is a viable business model for much of what qualifies for tax exemption today.
And if an organization can operate as a for-profit, it should. In my view, there isn’t a legitimate ground for extending the benefits of tax exemption to organizations that could operate without it. I’m just curious to see which category the Alliance will fall into.
AARP doesn’t represent American seniors! I just tore up my renewal and mailed it back to AARP. First, why would anyone join AARP when they don’t even listen to their members. For an example, AARP supported the President and Democracks on healthcare and swore that the majority of its members did the same too. The election proved them wrong and showed that the elite AARP few are ignoring their own survey results and member inputs. I have written AARP three times and have never received any response. Second, AARP advertizes that they have all of these senior discounts. My advice is to shop around. I stayed with my AAA club and beat the AARP travel club hotel reservations by 40%. The AARP Car Insurance is a “RIPOFF” too because I stayed with my State Farm policy and beat their “BIG” discount by 25%. I went and googled an insurance rate search and found many major companies that beat AARP’s published life insurance rates by at least 20%. If you are a conservative American, you should be tearing up your AARP membership and sending it back to them in their enevelope and allow them to pay for the postage. AARP should be allowed to be in business.
AARP may not represent you, but it does represent most seniors because some of its policies support liberal positions and some support conservative positions. Sorry that you didn’t get the discounts you wanted. Maybe the Alliance will work out better for you.
Seems to be a real viable alternative for the senior voice.
This is the best reason to start paying my AARP dues!!!! Just check out their Sci-Tech page. My computer is still trying to load that page. Seriously!!!