If, as Alexis de Tocqueville wrote, every presidential election in the United States is “a cause of agitation” and “a period of national crisis,” this year’s did not disappoint. The nonprofit world played its part, mobilizing voters, assisting at the ballot box, and raising issues it considered priorities. By one estimate, philanthropy spent at least $1.3 billion on election administration alone.
With JD Vance, its most vocal critic in the Senate, about to become vice president, the “crisis” for philanthropy is unlikely to end any time soon. In fact, the 2024 election results showed considerable voter displeasure with several progressive causes nonprofits have championed. Like the Democratic Party, foundations and their allies will need to reassess how they can gain more public support for the field as a whole and for the issues they care about. Here are the areas that will require the greatest attention:
The 2017 Tax Cuts and Jobs Act. The tax legislation passed during the first Trump administration comes up for reauthorization in the new Congress. That bill ended tax exemptions for university endowments by imposing a 1.4 percent tax on net investment incomes for larger universities with big endowments. In the last Congress, Vance introduced a bill that would increase the tax rate to 35 percent and extend it to endowments of $10 billion or more. His past criticisms of large foundations suggest he might not object to taxing them as well.
If the Trump administration endorses these proposals, universities and foundations will have to make a convincing case that they are spending their endowments effectively, not hoarding them or using them to underwrite partisan causes, as Vance has claimed.
The tax code’s incentives for individual charitable giving will also be up for reconsideration. Because of changes put in place in the 2017 bill, most taxpayers no longer itemize their deductions, including for donations. During the debate over the legislation, nonprofit groups argued that the changes would cause giving to drop substantially, although studies now suggest a modest decline at most. But expanding tax breaks for donors remains high on nonprofit wish lists.
During the campaign, Donald Trump endorsed measures that would reduce taxes for people with lower incomes, such as those who rely on earnings from tips or social security benefits. If enacted, changes like these would be expensive and may leave little left over for increasing charitable deductions.
Programmatic priorities. The election results will make it harder for the nonprofit world to address a range of issues that have dominated their work in recent years. At the top of the list is immigration. Efforts to liberalize immigration laws, for example, will undoubtedly be on the backburner as the Trump administration tries to implement deportations and other restrictive measures. Pro-immigration groups will have to decide if they want to continue fighting or look for common ground.
Similarly, increasing access to higher education will likely be an uphill battle, especially given Trump’s pledges to reverse student loan forgiveness. Proposals to remove college-degree requirements for government employment are also likely to grow, since both Trump and Vice President Kamala Harris endorsed them.
At the state level as well, progressive causes may be losing steam. In California, voters spoke out against foundation-backed criminal justice reforms that shortened sentences for shoplifting and drug offenses. And while several states passed new laws or constitutional amendments protecting abortion, Americans seem increasingly reconciled in the post-Dobbs era to leaving abortion policy to the states, as Trump now says he wants.
One area of possible collaboration is the child tax credit. Vance has called for increasing the credit, which progressive social welfare groups have long viewed as a successful anti-poverty measure. With American fertility-rates at an all-time low, the time may have come for new steps to help families with children, including reducing the cost of child care and preventing surprise medical bills for childbirth services. Measures like these will have support among Trump constituencies as well as foundations.
On the other hand, if Robert F. Kennedy Jr., a long-time critic of vaccines and other public health measures, is confirmed as secretary of the Department of Health and Human Services, scientifically oriented donors and nonprofits may be in for a rough ride.
The identity debate. The election results revealed, as New York Times columnist Maureen Dowd wrote, that the Democratic Party suffered from “a case of mistaken identity politics” which verged on condescension toward minority groups. By misreading Black and Hispanic voters as chiefly concerned about inequality and discrimination, it overlooked other issues that mattered to them, such as crime, education, and inflation. That left an opening for the Trump campaign, which increased its support among minorities. Even the widely predicted gender gap turned out to be “unremarkable,” the Associated Press concluded.
Philanthropy could learn a lesson from this. In recent years, much money and effort have gone toward promoting diversity among nonprofits. But considering this year’s election, philanthropy should examine if it has become what James Carville calls too “identitarian” — his word for “woke” — in its thinking, and too unmindful of the diversity within the nation’s minority groups. Not least of all, it should stop categorizing these groups in ways their members refuse to accept, such as using “Latinx” to encompass all Hispanic people.
Conservative donors. Foundation leaders will need to familiarize themselves with conservative nonprofits that are likely to have influence in the second Trump administration, including advocacy groups, think tanks, publications, and student groups that have emerged in the past decade. Among the most prominent: America First Policy Institute, whose board chair, Linda McMahon, co-chairs Trump’s transition team, and the Center for Renewing America, led by Russell Vought, Trump’s former director of the Office of Management and Budget.
And then there’s the old guard, most notably the Heritage Foundation, whose conservative roadmap, Project 2025, became a lightning rod during the election and whose authors included members of the first Trump administration.
The philanthropic sector, apart from a handful of conservative foundations led by everyone from free-market traditionalists to MAGA enthusiasts, has had little contact with these people. It will have a lot of catching up to do if it wants to affect policy in the new Trump administration.
Of course, grant makers may not want to go that route. In principle, if not in practice, philanthropy has long prided itself on its independence from government and ability to resist public opinion. Going into opposition with the new Trump administration has its attractions. But doing so will again raise the question of where philanthropy fits in a democracy once the voters have spoken.
