For those interested in understanding the complexity of US non-profits, much of which is similar in Canada, you might find the Philanthropy and Digital Civil Society: Blueprint  by Lucy Bernholz to be quite interesting.

Here is a description “Philanthropy and Digital Civil Society: Blueprint is an annual industry forecast about the ways we use private resources for public benefit in the digital age. Each year, the Blueprint provides an overview of the current landscape, points to big ideas that matter, and directs your attention to horizons where you can expect some important breakthroughs in the coming year.”

 

Here are a few quotes for example:

The year 2020 may well be remembered as the year most universally referred to as a “dumpster fire.” I hope it comes to be seen not only for a widespread (but not yet wide enough) puncturing of White, wealthy disregard for structural injustices generally, but also, for philanthropy and the nonprofit sector, as a turning point toward more engaged, just, and equitable institutions and economics. The realization of this hope will require a sustained commitment, by individual organizations and the sector as a whole, to facing and addressing the following hard truths that 2020 laid bare.

Second, foundations and nonprofits— many of which see themselves as part of the solution—are produced and privileged by the very same political and economic systems that perpetuate those inequities, and therefore must engage in a deep analysis of their own complicity before they can hope to truly bring forward justice and equity for all.

 

To be specific, the philanthropic sector as a whole cannot achieve equity or justice as long as it:

◼ Supports toxic tax structures that prioritize the growth of the tax-exempt sector while perpetuating wealth inequality and the defunding of public services.
◼ Ignores the costs of dependencies that leave the sector digitally vulnerable and beholden to commercial priorities that run afoul of civil society values.
◼ Continues to act as a stand-in for public services, knowing it cannot actually provide the far-reaching and long-term solutions that are government responsibilities.

My hope for the years ahead is that the entire sector will abandon those practices and positioning, and instead will:
◼ Examine the role it plays in preserving the status quo rather than advancing change.
◼ Support tax reform that serves equity and social justice goals.
◼ Protect people’s ability to assemble, take action, and protest. This requires legal actions to protect the digital and physical means of assembly; to resource advocates and nonprofits in ways that center safety and recognizes the long-term trauma of this work; and to support deeper, experience-informed research and policy about assembly in the digital age.
◼ Help nonprofits not just get technology, but imagine, create, purchase, and maintain a digital infrastructure and tools aligned with democratic and pluralistic logics. These are necessary to allow the sector to safely exist and remain independent of corporate and government capture.

◼ Develop policies, protections, platforms and new rules so that civil society and democracy can thrive in our digital reality.
◼ Support, amplify, and move into leadership positions those people and communities that have been fighting for equity and justice for generations, for therein lies success.

 

 

…In the decade since I began writing the Blueprint series, there have been numerous efforts to change the rules for U.S. civil society, which have in turn impacted philanthropy. In 2010, for example, the U.S. Supreme Court handed down a decision in the case of Citizens United v. FEC. The case (along with others, such as McCutcheon v. FEC), changed campaign finance law in the United States and legitimized the idea of corporate personhood.  These decisions created the opportunity for political donors to use charitable nonprofits as a means of laundering their names off of political contributions and as such have had a huge impact on the philanthropy sector.

At the same time, the oversight body for the charitable sector (the IRS) has been steadily gutted of funding over decades. And the last year brought on an adjacent effort to defang the oversight body for political organizations (the FEC) by encouraging the resignation of commissioners (and not replacing them) until there was no longer a quorum.

Ten years on, the effects of this are seen not only during election cycles but in the everyday workings of U.S. civil society. There seems to have been growth in the number and size of organizations deliberately using
charitable (c3) and political (c4) structures to pursue missions through legal struggles that seem almost anachronistic given the extensive and deliberate efforts to blur lines between the charitable, political, and
corporate sectors. (The data on this are bad, which is a fixable problem.) By contrast, individual donors at all levels mix and match political behavior—that is, both action and giving—with charitable behavior, and they are focused much more on issues and causes than on legal categories.2  In parallel, the importance of tax benefits for certain activities and not others appears relevant to fewer and fewer donors, although much more research on this is necessary.3

 

The fact is, while giving and caring for others are human values that pre-date any form of government and extend across cultures, languages, time, and place, foundations and nonprofits—along with donor-advised funds, LLCs, political action committees, political parties, social enterprises, family offices, and trust companies—are institutions sanctioned, and chartered and regulated by governments and sold by lawyers, bankers, and wealth advisors. Unlike the basic human instinct to give and care for others, they are regulated products, bound by government rules and market incentives.

The fact is foundations and nonprofits are products of toxic tax policies that use the promise of philanthropy to justify inequality. In the United States today, our current tax laws starve our schools, hospitals, transit, and elder care systems. They allow individuals to become trillionaires and corporations to pay nothing. They encourage companies to hide marketing expenses as charitable donations, enabling corporate price gouging in the
name of benevolence.9

And they enable the amassing of philanthropic fortunes so large that people turn to them when government efforts fail, which is exactly what we have seen during the Covid-19 pandemic. Philanthropic institutions stepped in to provide basic protective equipment for frontline workers when the federal government abdicated this responsibility. They shipped masks and gloves to places that needed them, upped donations to
food banks, and provided money to and negotiated with hotels to enable homeless people to quarantine. They donated hardware and software to help students attend remote classes. And they provided hundreds of millions of dollars in grants to state governments to protect the November election, a public responsibility that cannot possibly be seen as an appropriate role for private actors.10 Yet philanthropic fortunes, created at the
expense of shared investment in government programs, will not and cannot remedy the afflictions that are at work in the current syndemic, such as structural racism; inequitable health care, education and housing; or insufficient efforts to halt climate change. Those failures are ours collectively, as citizens. Only together can we solve them. It isn’t simply that the funding doesn’t add up, it’s that relying on philanthropy and nonprofits to do the public’s work is a form of lower-cost outsourcing with less accountability. It’s not democratic. And it’s not working.

To put it another way: any reader will be familiar with the claim—made during previous economic crises—that some companies or industries are too big to fail. What the syndemic we face now shows us is that our current philanthropic sector is too big to succeed. Philanthropy has become so big partly because of government priorities that put a higher value on capital accumulation and private wealth than on public well-being, but it’s not big enough to replace government. In an ouroboric irony that must be called out: we’ve starved our public systems to encourage private action, knowing full well that private actors are neither able to nor appropriate for meeting public needs. Indeed, as generous as they have been during this crisis, foundations will slow their giving as soon as their endowments begin to shrink, or they get

bored of paying for basic services. And they could never even hope to begin covering the cuts resulting from state budgets decimated by Covid-19. The broader process at work here is one of privatization—of public responsibilities, of government functions, of accountability— and it is a trajectory toward failure.11 What most distresses me is the degree to which many in the sector are acting as if everything is OK, we just need more philanthropy and we need it now. Decades of tax and corporate regulations to minimize tax bills for the wealthy and induce more philanthropy have brought us to this moment. Moreover, the sector’s own infatuation with size (as measured by assets, percentage of GDP, and jobs) is an accelerant to political frames that minimize public investment and decrease public services. In using its size and scale as political leverage, and in refusing to take on policy issues that might limit the growth of philanthropy,  the sector contributes to the privatization of public obligations. We don’t need more philanthropy covering our basic public responsibilities. We need public resources, public governance, and public accountability. More philanthropy will not get us to a just or equitable society. Philanthropy done better will help, but more fundamentally, what is needed is an honest evaluation of what we’ve let philanthropy become and where it should fit in relationship to public responsibilities. In order to overcome the syndemic that is upon us, we need to reclaim public control over the corporations and technologies that shape our right to speech, assembly, association, and privacy, and to overturn public policies that protect those rights for some people (White, wealthy) and not others. We need to repair the long-term damage of racism—in society writ large of course, but also in the sector—before we can even arrive at a starting line for pursuing equity.

We need an economic overhaul that prioritizes human dignity over wealth hoarding. And we need to listen to the wisdom and follow the lead of people whom our systems have always oppressed, for they are the ones most experienced in imagining and working toward liberation.

 

You can read more at Philanthropy and Digital Civil Society: Blueprint  by Lucy Bernholz