Just how ‘charitable’ is Greenpeace?
Thomas Deichmann reports from Germany, where Greenpeace looks set to lose its charity status over its explicitly political campaigning.
The environmental group Greenpeace is recognised as a charitable non-profit organisation in Germany. But now the German government is planning to reduce the tax benefits associated with this status – and Greenpeace activists are furious. But is Greenpeace really a ‘charitable’ organisation? Does society benefit from its campaigning?
German Greenpeace activists are a persistent lot. The organisation spends millions of Euros every year on sometimes spectacular initiatives. It also publishes numerous leaflets and pamphlets, many of which focus on arguing against the introduction of genetic engineering (GM) technology into agriculture and food production in Germany. Its efforts have made an impact: public scepticism about GM remains high, and German politicians are wary of openly promoting the planting of GM crops.
One reason why the Hamburg-based organisation has been able to carry out such high-profile activities is because it is accorded charitable status, which means it is exempt from big tax burdens. Recently, however, the German government announced its plans to reform German laws on charitable organisations and donations, and Greenpeace, and other groups, have been up in arms ever since.
Greenpeace may have a high public profile, but donations to the organisation have stagnated in the past few years. In December 2006, Greenpeace leaders announced that they were laying off 20 of their 160 employees in Germany, and cutting the pay of the remaining workers. Two months earlier, in October, German Greenpeace announced that it was discontinuing its Einkaufsnetz campaign, which it had launched in 1997 to encourage Germans to change to more fuel-efficient cars, buy organic foods and invest in alternative energy sources. Apparently, the project turned out to be too costly, and had a limited success rate. Now, the government’s announcement of reforms to the law on charitable organisations puts Greenpeace’s very existence at risk.
What is a charity?
The background to the German government’s planned reforms is the steady growth of the so-called ‘third sector’ of charitable societies, churches and associations. Since the charity laws were amended in 1989, it has been fairly easy for these kinds of organisations to be certified as charitable institutions exempt from certain taxes. Such tax breaks have, according to government figures, led to a decline in tax revenue of some 10billion Euros a year. In August 2006, the scientific advisory committee of the German Ministry of Finance published a report that did not mince its words. It argued that there had been a ‘chaotic proliferation’ of charitable organisations, which had allowed special interest groups to avoid paying certain taxes and to win excessive public influence as a result. The advisory committee said there is an urgent need for a ‘clear restriction of the tax privileges presently associated with charitable status’.
Various organisations are protesting against the proposed reforms, many of them fearing that they will not be able to survive in a free market. One of the most vocal groups is the German Association of Non-Statutory Welfare Services, which represents the market leaders in Germany’s welfare services: the Protestant Diakonie and Catholic Caritas, the Workers’ Welfare Association, the German Red Cross, and the Paritätischer Wohlfahrtsverband. These organisations have unanimously rejected the proposed reforms, since the present tax laws guarantee their existence as big corporations. With approximately half a million full-time employees, Caritas is Germany’s largest private employer. Taken together, all non-statutory welfare services currently provide around 1.5million jobs, and these services have an estimated annual turnover of 55billion Euros (according to the Cologne Institute for Economic Research). According to Hamburg economist Dirk Meyer, the exemption of these non-statutory services from corporate tax and trade tax gives them a competitive edge of around 600million Euros.
German Greenpeace, too, benefits significantly from tax privileges. At the end of 2006, it had 550,000 supporters and generated annual returns of approximately 40million Euros. This means that the Hamburg offices have the highest income of any national Greenpeace outfit, coming top of the list of Greenpeace’s 27 branches around the world. Consequently, if German Greenpeace has its charitable status revoked or undermined, then it could have implications for Greenpeace International, for the entire organisation. The Hamburg office regularly pays a large proportion of the costs of global Greenpeace activities. In 2006 alone, Greenpeace International spent more than 12billion Euros on international campaigns.
The expert committee of the Ministry of Finance regards the current law as far too generous in awarding tax breaks. One of its key reform proposals is to develop a clearer definition of ‘non-profit status’ for the tax code. The experts want tax benefits to be awarded only to organisations that provide ‘real collective goods’ – in other words, organisations which not only claim in their statutes that the general public benefits from their activities, but which also provide proof of those benefits. The decision-makers in Berlin now largely agree that church-run and other charitable welfare initiatives should continue to receive tax benefits, but there is evidence that they want to restrict such benefits for advocacy groups that describe themselves as charities – including Greenpeace.
The charitable non-profit status of Greenpeace derives from its declared goal of acting as ‘an international ecological organisation to increase awareness of global environmental problems and prevent the destruction of the natural resources that form the basis of human, animal and plant life’. The German tax code explicitly lists protection of the environment as a cause that qualifies for tax benefits. However, the experts at the Ministry of Finance are calling for a more precise way of measuring the ‘collective goods’ offered by green groups. They propose that, in order to qualify as a charitable activity, environmental protection should not be aimed ‘primarily at political influence on public opinion’; instead the specific results of environmental activities should be closely evaluated and proven.
Some Greenpeace activities meet these requirements. For example, Greenpeace recently revealed that pesticides whose licences had been withdrawn are still available in the agricultural industry and can be found in certain fruits. This could be considered a measurable act of ‘environmental protection’. However, there is a reason why the expert committee seems to be focusing on Greenpeace. It has noticed that Greenpeace campaigns aim strongly – perhaps even primarily – at exerting political influence on public opinion. Greenpeace even seeks to influence parliamentary decision-making and public voting behaviour. This is clear in the group’s advocacy of phasing out nuclear energy and banning genetic engineering in Germany.
The cost of these efforts to influence public opinion along certain lines is considerable. In the financial year of 2004, communications expenses accounted for 7.7million Euros in German Greenpeace’s budget. Another 2.5million Euros were spent on advertising. The expenditure for various other campaigns amounted to a further 26.6million Euros. If the advisory committee’s recommended reforms are put into practice, the Hamburg financial authorities would have to evaluate to what extent Greenpeace ‘awareness-raising campaigns’ contribute to real improvements in environmental protection.
The advisory committee’s report is not the first to express doubt as to whether the prime goal of Greenpeace activities really is to protect natural resources. Patrick Moore, who co-founded Greenpeace in Canada in 1971, has his doubts, too. He believes that the thrust of the group’s campaigns has, for some time, been geared primarily towards self-promotion. And he argues that such misguided priorities can actually end up being harmful to the environment. For example, Moore points out that the sinking of the Brent Spar oil platform owned by the Shell Corporation in 1995 – which Greenpeace protested against by calling for a global boycott of Shell – would have done no damage to the environment. In Germany, Greenpeace officials had to concede that they had misled the public by exaggerating the risk of pollution from oil residues on the Brent Spar platform. Moore also believes that Greenpeace’s outright rejection of genetic engineering does not benefit the ‘public good’, since it tends to scaremonger about pretty safe and good advances in crop production and agriculture more broadly.
Since 2004, Greenpeace has stepped up its campaigns against ‘green’ genetic engineering; almost a third of the press statements it has released over the past two years have been devoted to GM. Here, the relationship between the organisation’s statutory environmental objectives and the real world is tenuous indeed. As an advance in classical plant breeding, green genetic engineering offers a range of options for making agriculture more efficient and more environment-friendly. This fact is attested by scientific organisations around the world; the global trade in GM seeds is growing steadily, because they tend to be good-quality products. Estimates suggest that the total cultivation area of GM plants around the world will increase from 102million hectares (the current level) to 200million by 2015. Yet Greenpeace campaigns against this public good, aiming to put a halt to GM advancements.
Given the questionable content of some of Greenpeace’s campaigns, it isn’t really surprising that it is having its charitable status challenged. Since the late 1990s, the financial authorities in Hamburg have received numerous requests to review Greenpeace’s tax benefits. In late 1999, Hermine Hecker, then a Hamburg district representative of the Christian Democratic Union, called for the withdrawal of charitable status from Greenpeace on the grounds that the group was violating German law with some of its more edgy protests and campaigns. Hecker called for the Decree on the Application of the German Tax Code (AEAO) to be applied, which says organisations should only be granted charitable non-profit status ‘if their activities observe the constitutional order’. The financial authorities examined the matter, but did not withdraw charitable status.
In spring 2001, the ministers of the interior of the northern German state made another attempt to force a review. After Greenpeace protested against the transport of Castor nuclear waste containers, Heiner Bartling of the SPD, who was then interior minister of Lower Saxony, argued that such activity should not be subsidised by the state. The Hamburg tax authorities investigated, but notified Greenpeace in 2003 that its tax status would remain unchanged. In late 2004, Greenpeace was obliged to notify its sponsors yet again that it might lose its charitable non-profit status. The tax authorities this time criticised the organisation for failing to disassociate itself from illegal protests.
Later, companies and politicians in Saxony-Anhalt and Bavaria called for withdrawal of the Greenpeace tax privileges for the financial years of 2004 and 2005. That is because Saxony-Anhalt had become a focus of Greenpeace campaigning after the state government there decided to subsidise trial crops of GM plants starting in spring 2004. Greenpeace opened a branch in the state capital, Magdeburg. It first made headlines in March 2004 when about 120 Greenpeace activists successfully prevented the sowing of transgenic wheat for research purposes by scattering several tons of ‘eco’ wheat on the two test fields near Bernburg and ploughing some of it into the ground. Several charges were brought against Greenpeace; the public prosecutor’s office in Dessau instituted investigations against 92 suspects. And yet, in early 2004 persons unknown uprooted the last of the GM wheat from the section of the field that had remained usable for the experiment. Greenpeace ‘genetic engineering expert’, Henning Strodthoff, subsequently said that the seed company had provoked the conflict and should ‘not be surprised by the response’. The company abandoned its research project in Germany shortly afterwards.
Since 2004, Greenpeace has campaigned with the same vigour against the Müller Corporation in Bavaria and its so-called ‘gene milk’. Greenpeace described the use of GM feed by farmers as cow fodder as a scandal, giving the impression that the milk these cows subsequently produced would somehow be infected, unsafe. In fact, there was much scientific evidence to the contrary. Yet such evidence – or the fact that all agricultural products in Germany are subject to comprehensive safety tests before being approved, and that GM feeds are widely used in the global agricultural market – received very little publicity. More than 90 per cent of mixed cattle feed is now classified as ‘genetically modified’. Many scientists have pointed out that the Greenpeace campaign against ‘gene milk’ was utterly out of touch with reality, and lacking in any scientific foundation.
This has given rise to another question regarding Greenpeace’s charitable status. The German tax code requires that ‘the general public’ must benefit ‘in material, spiritual and moral ways’ from the work of non-profit groups. But where is the spiritual or moral benefit of a campaign that ignores scientific findings? Science can provide factual evidence of the safety of permitted GM feed; Greenpeace claims that the opposite is true. The organisation is perfectly entitled to express its opinion – but is the dissemination of unscientific opinion on scientific issues in any way beneficial to ‘the general public’? Clearly not, I would argue.
Charities and the law
Greenpeace’s various illegal activities have been cited as a reason for withdrawing its charitable status. In the first round of actions it took against the Müller Corporation in 2004, Greenpeace repeatedly broke the law. After protests on dairy premises and in supermarkets, Greenpeace was inundated with charges of trespassing, coercion, damage to property and defamation. Even the Berlin newspaper Tageszeitung, which is generally sympathetic to Greenpeace, recently wrote that the ‘eco-activists’ from Hamburg were known for their ‘aggressive campaigning’. It certainly seems that lawbreaking has been a hallmark of some Greenpeace campaigns in recent years. Consider its activities in 2006.
In April 2006, Greenpeace members entered the barns of a dairy farmer near Neutrebbin in Brandenburg who supplies the Campina dairy corporation. The activists, including the agronomist Martin Hofstetter, noted that the cows were being given GM feed. The campaign leaders claimed that this normal feeding practice was a scandal; they were subsequently charged with trespassing and theft. In July 2006, Greenpeace activists went to over 100 supermarkets and flagged products from Campina’s ‘Landliebe’ range as containing ‘gene feed’, even though Greenpeace was already under a court order to refrain from such actions as a result of its Müller campaign. In August 2006, Greenpeace visited another Campina milk supplier, this time a farmer in Wölsickendorf in Brandenburg. There, 15 activists invaded his fields to collect GM maize which they planned to unload in front of the Campina headquarters in Heilbronn. The protest was halted by the police, who briefly took the activists into custody and recovered the stolen maize.
Other campaign groups and individuals have also publicly called for ‘field liberation’ – that is, the theft or destruction of GM crops from farms around Germany. Greenpeace generally does not comment on such appeals. However, incidences of crop destruction have increased since Greenpeace stepped up its campaign against genetic engineering. From 1993 to 2003, there were around 60 protests on agricultural land. From January 2004 to the end of 2006, 30 such events were recorded. The Association of German Plant Breeders (BDP) estimates that the cost of the damage caused by such actions is around 1.5 to 2.5million Euros a year.
Some critics claim that Greenpeace’s ‘location map’ of GM crop fields in Germany shows that the group supports field destruction. The map is published on the Greenpeace website, providing detailed information on the location of GM crops. Of course, there is a big difference between words and actions in law, and Greenpeace is indisputably entitled to freedom of expression and freedom of protest. Also, it cannot be held responsible for the unlawful acts of other groups. Nonetheless, is it right that a group which sometimes uses or supports illegal methods to stop scientific breakthroughs and crop production should be subsidised by the government? The tax exemption laws clearly state that charities must work within a constitutional framework.
Of course, Greenpeace is entitled to argue against GM crops and other scientific advancements as much as it wants to. But when it is effectively given state support to make these arguments, then that adds extra weight to its claims, even though they are often unscientific and anti-technology. Greenpeace is an advocacy group which, in my view, stands as a barrier to scientific progress. If it can raise enough money independently to carry on making its case, then good luck to it; those of us who disagree can make our arguments in response. But it is another matter entirely when such a group is privileged over others and given a tax-exempt platform from which to do its political campaigning.
Some of us have a very different view to Greenpeace about what is in the public interest and the public good. Debate about these things should be put on a level playing field, instead of this situation where one side of the argument is favoured and elevated above the other.
Thomas Deichmann is editor in chief of Novo magazine and a freelance journalist and author. His most recent books are Natur & Technik and Mensch & Gesundheit (Munich 2006), which he co-authored with Thilo Spahl for einfach wissen, a new series published by dtv. An edited version of this article appeared in Frankfurter Allgemeine Zeitung on 24 January 2007.