Profits for Justice (Page 3)

Progressive Resistance

To many progressives, the notion that nonprofits can enlist the power of entrepreneurship to gain independence and increase their effectiveness is heresy. Philanthropy guru Pablo Eisenberg's view is that "neither charities nor foundations and other donors should harbor the illusion that more than a minuscule number of nonprofit groups can ever become self-sufficient by running businesses or charging fees for their services. Their missions do not lend themselves to self-sufficiency."

The fear that a nonprofit mission will be warped by business values is not, of course, unfounded. J. Gregory Dees of the Duke University Fuqua School of Business argues, for example, that the entry of the YMCA into the exercise and health club business pulled it away from its original mission to serve at-risk young men and made it an upper-middle-class organization. Many community development corporations (CDCs), founded in the 1960s to lead the fight against poverty, now build crass shopping malls and sprawling neighborhoods for the middle class. The bottom-line logic of business can lead these enterprises to neglect people without money, including the young, the old, the poor and the sick.

However, critics overlook the fact that many of these dangers already swirl around those rattling a tin cup for "soft money" from wealthy individuals and foundations. Building a philanthropic base of support instead of an entrepreneurial one can cripple an organization's mission, and wreck it altogether when the well runs dry. Most progressive nonprofits have engaged in a kind of fundraising arms race in which our best leaders focus more time, energy and resources not on changing the world but on improving their panhandling prowess to capture just a little more of a philanthropic pie that actually expands very little from year to year. Armies of "development" staff spend as much as a third of an organization's resources not to advance the poor or other needy groups but to cultivate wealthy donors. Significant numbers of our colleagues create campaigns, direct-mail pitches, telemarketing scripts, newsletters and other products exclusively to "care and feed" prospects, and frame positions and adopt tactics that will not offend the rich.

Those of us who chase foundation dollars must make a devil's bargain with a system (as one of us argued in these pages seven years ago; see Shuman, "Why Progressive Foundations Give Too Little to Too Many," January 12/19, 1998) that often undermines the effectiveness of progressive beneficiaries through small, single-year, single-issue, project-oriented and action-over-thinking grants. In this context, successful fundraising may well reduce the chances of effecting significant social change, because too many foundation overseers, despite admirable intentions, discourage the long-term, systemic thinking progressives so desperately need. And increasingly, major foundations are actively setting social-change agendas themselves, often with little consultation with grassroots groups, pulling these same groups into new and distracting coalitions and bringing more and more projects in-house.

As Pablo Eisenberg notes, the Philadelphia-based Pew Charitable Trusts "has built a reputation for pouring millions of dollars into its own environmental projects and creating new organizations." Moreover, its recent decision to convert from a foundation into a charity means that "Pew will find it easier to bring many of its programs in-house and become less dependent on nonprofit organizations to run its programs and carry out its mission."

If Mohandas Gandhi were a typical leader organizing in a nonprofit environment like ours, he would probably be wearing a three-piece suit and working in a plush office with his law degree prominently displayed. He would have little time to lead protests, since every other week would be spent meeting with donors--and those power lunches would hardly go well with fasting. He would be careful to avoid initiatives like salt marches or cotton boycotts, so as not to offend key donors. To sharpen his annual pitch to foundations, he would be constantly dreaming up new one-year projects on narrowly focused topics, perhaps a one-time conference on English human-rights abuses, or a PBS documentary on anti-colonial activities in New Delhi. To insure that various allies didn't steal away core funders, he would keep his distance and be inclined to trash talk behind their backs. In short, there's little doubt that the British would still be running India.

The real Gandhi, of course, promoted personal and community self-reliance, so that people would have the time, energy and resources to participate in a serious mass movement. It's no accident that some of the most successful social-change organizations in the United States have achieved a modicum of self-reliance through membership dues, fees for service and active community-based chapters. The strong membership bases of Greenpeace and the Sierra Club enabled them to take bold stands against free trade and NAFTA long before their foundation-dependent brethren like the Natural Resources Defense Council.

We believe it's time for American progressives to break free of their philanthropic habit--and for truly progressive funders to help them do so. Those of us serious about social change increasingly must get down to business, figuratively and literally. Every nonprofit may not be able to generate all its funding through revenue-generation, but every nonprofit certainly can generate a greater percentage than it is doing now. According to an IRS sampling of charitable filings in the year 2000, fees for service already account for two-thirds of all nonprofit budgets, yet relatively little of this is being done by progressive nonprofits.

• « Previous
• 1
• 2
• 3
• 4
• 5
• 6
• 7
• Next »

• Get The Nation at home (and online!) for 68 cents a week!
• If you like this article, consider making a donation to The Nation.
• Reprint this article. Click here for rights and information.