June 28, 2016

Philanthropy in a Time of Turmoil: 3 Cheers for the Establishment

Erik McGregor/Pacific Press/LightRocket via Getty Images

The Audrey Lorde Project organized the 12th Annual Trans Day of Action in New York City, a yearly march and rally to raise awareness about the issues affecting growing transgender community.

Earlier in this roiling election cycle, I found myself in a heated political discussion — shocking, I know — and faced this snappy dismissal: "Oh, I get it. You’re one of those nonprofit people."

Why, yes — I am. What my antagonist meant to suggest, though, is that I am a card-carrying member of the philanthropy establishment and therefore of The Establishment, the bane of so many angry voters across the political spectrum.

To these would-be revolutionaries, organized philanthropy must indeed seem like a fortress stuck in time. Grants are made. Budgets are set. Results are recorded. We continue to donate the equivalent of about 2 percent of the nation’s GDP on nonprofit programs and institutions year after year, in good times and bad.

Slow-moving and inward-looking, the social sphere stands in stark relief in a time of populist hot takes. Incrementalism is decried as the compromise of the weak. From both left and right come clarion calls for a kind of purity of thought and ideology that frankly disqualifies most of the organizations I work with and the nonprofit leaders and social entrepreneurs I meet.

But there’s good news for nonprofiteers saddled with the "establishment" tag, though it might not make for a T-shirt slogan or trending hashtag. Citizen movements constantly challenge conventional wisdom on social change, and the wood-paneled boardrooms of Big Philanthropy have consistently been open to new models, new causes, new methods — and new money. That shift continues and provides several reasons the philanthropy establishment is well worth preserving.

The establishment is permeable.

American philanthropy will never be mistaken for a form of pure democracy, but the foundations and nonprofits I know are very attuned to the national mood and to insurgent forces in their issue areas. The change might seem slow, in programmatic terms, but grass-roots demand for it gets through. I don’t know anyone working on overhauling criminal justice or civil rights who doesn’t pay attention to Black Lives Matter. I don’t know anyone working on feminist issues and gender equality who is unaware of or untouched by the evolution of the women’s movement. I don’t know a single nonprofit leader working on immigration issues who is not connected to the Dreamer organizers. The same goes for philanthropy involving gun control, the environment, LGBTQ rights, and so on.

Outside forces, when well organized, can move the powers that be to embrace a new direction. I’m reminded of Franklin Roosevelt’s famous meeting with labor organizers after he was elected president in 1932. Hearing their proposals for workplace reforms, FDR replied, "I agree with you. I want to do it, now make me do it."

The establishment is changing.

Our philanthropic landscape is shifting rapidly. It might not satisfy activists or candidates who rail against wealth and privilege, but the entrance of new money into American do-gooder precincts is bringing about a reconsideration of what works and what doesn’t. Think of the developments over the past 10 or 15 years: B corporations, donor-advised funds, crowdfunding and online causes, and the arrival of ever-younger, ever-richer, and often very impatient donors on the scene.

As Stanford University psychiatry professor Keith Humphreys noted in a recent USA Today essay headlined "I Like The Establishment and You Should, Too," "The Establishment has been very good at reforming itself in response to increasing diversity in society and attendant demands for equality, including by absorbing people of diverse religious, racial, and ethnic backgrounds."

There’s a growing maturity of thought around what’s possible as well. A decade or so ago, the "great man" theory of corporate and political leadership was very much in vogue. But after the 2008 meltdown, it faded, helped greatly by the widespread use of digital communications to spread ideas, protests, campaigns, and causes. You hear much more about the importance of partnerships and collective impact in civil society than you do about the importance of a single charismatic leader.

The establishment saves lives.

In a June 10 editorial, The New York Times defended United Nations Secretary General Ban Ki-moon, who had come under fire from human-rights organizations for deciding, under pressure from Saudi Arabia, to remove the Saudi-led military coalition in Yemen from a list of rights violators. I was struck by this passage, which zeroed in on the necessity of big institutions like the U.N. in a dangerous and changing world:

"For all its inefficiency, the United Nations provides a unique venue for nations to mingle and meet and, through its many agencies, one of the most effective global means of gathering and distributing development and medical aid, helping children around the world, protecting world heritage sites, supplying peacekeepers to separate warring armies, and doing myriad other global missions. As the cliché has it, if there were no United Nations, you’d have to invent it."

That cliché applies to so many nonprofit organizations and philanthropies around the country, from settlement houses and community centers to disease foundations and relief agencies. If they didn’t exist, someone would have to create them. That’s because the need is there and lives are often on the line. The much-reviled establishment, at least in civil society and the social sector, is also a safety net for those in desperate need and a guardrail against civic and social breakdown.

The recent success of the gay-rights struggle is instructive. As quickly as the proscription against same-sex marriage seemed to crumble, the credit belongs to a decades-old coalition of organizations and organizers. "The struggle for marriage equality was in fact a study in patient incrementalism," as Georgetown University law professor David Cole, author Engines of Liberty: The Power of Citizen Activists to Make Constitutional Law, put it recently in an essay for The Nation.

"Gay-rights groups embarked on a strategy of gradual reform that lasted decades," Mr. Cole wrote. "Similar stories can be told about women’s suffrage, progressive labor laws, health care for the indigent, the dismantling of segregation, and police reform. The struggle for justice is long and slow. It is built on small, pragmatic steps in the right direction. It is easy to be frustrated by this fact, and to be inspired by those who promise radical reform immediately."

Any nonprofit professional or philanthropist working on, for example, alleviating urban poverty will recognize that sentiment. In cities across the country, there’s a nonprofit establishment of human-service agencies, settlement houses, soup kitchens, homeless shelters, employment centers, and other organizations working to serve the needs of the poor, the sick, the displaced. That establishment changes slowly, but it saves lives every year.

The establishment is growing.

This seems counterintuitive, but in terms of the U.S. nonprofit sector, it’s true. More people are giving more money to institutions and counting on them to deliver results. In the last decade or so, the aforementioned success of serious social-justice movements is creating new corners of our nonprofit establishment while cementing stable long-term funding, committed leadership, and deep grass-roots support.

In addition, the number of philanthropists and the amount of formal giving keeps growing. In 2014, there were 86,000 U.S. foundations — up from 81,000 just three years earlier — with $715 billion in collective assets, according to the Foundation Center. The recovery from the 2008 financial crash continues at an unprecedented pace: Charitable donations rose 5.4 percent in 2014 and 4 percent in 2015, "Giving USA" reports. Last year’s record total of $373.4 billion represents 2.1 percent of American GDP, a tick up from the average of 1.9 percent over the past three decades. These numbers represent steady growth rather than a revolution, but that incrementalism redistributes billions of dollars in wealth toward social-good programs every year.

The establishment is us.

As my interlocutor in that vitriolic political discussion might put it, there are an awful lot of those nonprofit people: at least 11.4 million of us, or 10.3 percent of all nongovernment jobs (and that doesn’t count the consultants). We do indeed make up the establishment in the American nonprofit world.

In this populist year, that might put a scarlet letter on the tunics of those who dirty their hands with the process of philanthropy, public-private partnerships, and social entrepreneurship. But we’re willing participants in the advancement of social justice and the transfer of wealth from individuals, foundations, and corporations to programs serving those in need.

That still might not fit on a T-shirt, but I’ll happily wear the scarlet "E."

Tom Watson is president of CauseWired, a consulting firm that advises nonprofits, and a lecturer at Columbia University. He is a regular columnist for The Chronicle of Philanthropy.