When President Donald Trump released his “skinny budget” in March, one historical analogy dominated the coverage. As The Washington Post declared, “President Trump’s governing blueprint represents the most ambitious effort to cut domestic spending and pare back the federal government since former president Ronald Reagan came to Washington in 1981.”
In thinking through how President Trump’s spending priorities might affect nonprofits, the precedent established by the Reagan administration does offer a valuable perspective. Yet the ways in which Mr. Trump’s approach to budget-making diverge from that of his GOP predecessor are just as instructive. To put it bluntly, one president had a theory — ultimately discredited — of nonprofit-government relations. The other hasn’t even put forward a theory to dispute.
The most significant similarity is that President Trump, like Mr. Reagan, sees federal funding of nonprofits, and of the fields in which they operate, as a prime source of trimmable budget fat.
President Trump’s reticence about volunteerism is ironic given that his campaign was saturated with talk of his philanthropy.
By 1985, for instance, after adjusting for inflation, the Reagan administration’s proposed cuts in spending would have reduced federal support to social-service organizations 64 percent below its level in 1980, according to calculations by the nonprofit scholars Lester Salamon and Alan Abramson.
The cuts that Congress actually enacted were not as steep and were partially offset by booms in Medicare and Medicaid spending.
But they were still significant: According to estimates by Salamon and Abramson, federal support to nonprofits outside the health sector (which benefited disproportionately from the rise in Medicaid and Medicare spending) fell by 27 percent from 1980 to 1984.
Although no similar aggregate calculations have yet been made for President Trump’s initial budget, the cuts would likely be similarly steep.
To cite just a few examples, the elimination of the $3 billion Community Development Block Grant program, the AmeriCorps service program, the National Endowment for the Arts, the Legal Services Corporation, and the Choice Neighborhoods program would all result in a significant loss of federal funding going to nonprofits. And that support matters.
According to the Urban Institute’s Center on Nonprofits and Philanthropy, total funding from government sources in 2013 accounted for nearly one third of public charities’ revenue.
The most significant difference between Donald Trump’s and Ronald Reagan’s approach to the budget involves the broader ideological framework in which their proposals were situated. President Reagan’s budget proposals were presented as part of a larger argument about the proper scope of government and civil society. In this worldview, government provision of social services, primed by New Deal and Great Society enthusiasms, had constrained volunteerism and impeded development of strong charities.
If government reduced its support for such services, citizens and nonprofits would feel more inclined to step in. And so, as one aide to President Reagan explained, charities could be expected to “pick up the slack” of the budget cuts.
The revitalized role for nonprofits became one of President Reagan’s favorite themes in his early public addresses.
“With the same energy that Franklin Roosevelt sought government solutions to problems, we will seek private solutions,” he announced in an October 1981 address to the National Alliance of Business. “Voluntarism is an essential part of our plan to give the government back to the people.”
The president elaborated on this point the following year. “Today, we’ve become so used to turning to government rather than taking the personal time and effort required to help those in need,” he declared at a White House luncheon for religious leaders in April 1982. “We must recapture the spirit of brotherhood … of family and community that once was the hallmark of this country.”
Two weeks later, the White House established the White House Task Force on Private Sector Initiatives and then, after the task force disbanded later in the year, the Office of Private Sector Initiatives.
For a host of reasons — in part because the administration always cared more about shrinking government than about making it an ally of volunteerism — this early focus did not translate into any coherent program that reimagined or redefined government-nonprofit relations. But the attention that President Reagan cast on these issues itself had a significant impact.
The president’s frequent rhetorical invocation of volunteerism sparked research efforts, led by Mr. Salamon and Mr. Abramson, to quantify nonprofit reliance on federal subsidies, which had mushroomed in the previous decades.
In doing so, they underscored the irony of Ronald Reagan selling budgets cuts that would slash funding to charities as a way to revitalize those charities. President Reagan’s spending cuts would increase demand for nonprofit services while reducing the resources that charities had to provide them. Their work helped to puncture what has been termed the “voluntarism fantasy” — the belief that private charity was adequate to meet the nation’s most pressing social needs — and to highlight the financial entanglements between nonprofits and government. It was one crucial block of research that helped public-private partnerships mature over the following decades.
President Trump, in contrast to Ronald Reagan, has barely mentioned volunteerism in his first months in office. (One notable exception is within the “skinny budget": When detailing a cut of $35 million from funding to an affordable-housing program, the budget explained that it was “duplicative of efforts funded by philanthropy and other more flexible private-sector investments.”
This lack of prominence is somewhat ironic, given that the campaign that brought Trump to the White House was more saturated by talk of the candidates’ philanthropy than any that had come before. Yet those discussions should have prepared us for philanthropy’s diminished status in Trump’s public pronouncements. As recently noted by The Washington Post’s David Fahrenthold, who ended up winning a Pulitzer for his sleuthing into the Trump Foundation, Trump’s charitable record “seemed to have no theme.” His giving was often grudging, and was driven largely by social and business connections.
There was certainly no large idea or animating cause behind it. So it is not terribly surprising that, as The Chronicle of Philanthropy noted, Mr. Trump broke with “decades of presidential history” by not highlighting themes of voluntary service early in his term. His recent donation of a part of his presidential salary — which he had vowed to forgo during the campaign — to the National Park Service was not accompanied by any larger discussion of the role of charity in civic life. (And, as his critics pointed out, the gesture was undermined by the fact that his budget called for steep cuts to the Interior Department, which houses the park service.) The president’s most forceful engagement with nonprofit policy and with nonprofit-government relations — his call to repeal the Johnson Amendment — focused almost entirely on houses of worship. In the White House’s advocacy for the position, its effects on public charities was clearly an afterthought.
When President Reagan vowed that “private solutions” would replace government programs, he always paired business enterprise with voluntary and charitable work. But Mr. Trump focuses almost exclusively on corporate America.
Take, for instance, the recent news that President Trump’s son-in-law, Jared Kushner, would lead an effort to make government “run like a great American company,” as Mr. Kushner explained. Yet in the White House announcement of the establishment of this Office of American Innovation, there was little hint that the president regards nonprofits as important partners in the campaign or vital instruments of American innovation.
(Early reports that the office would work with Salesforce CEO Marc Benioff and Bill Gates, two tech titans who have a definite regard for the power of philanthropy, were more encouraging, though it’s likely that their recruitment stemmed more from their status as entrepreneurs than as public benefactors. Benioff, for his part, has since denied that he will have a role.)
Ultimately, President Trump did not issue his budget proposal within the context of any clearly articulated relationship between nonprofits and government; the public reaction that his budget provoked lacked such context as well.
This vacuum is now being filled with alarm and defiance. Observers have noted, for instance, the popularity of “rage donations,” funds that donors pour into charitable causes and organizations as a sign of resistance to the Trump administration. The president’s budget announcement triggered precisely such a torrent of giving.
Meals on Wheels, a national program with some 5,000 local offices that provides meals for the homebound elderly, found itself an especially prominent beneficiary. During a news conference with the president’s budget director, Mick Mulvaney, a reporter referred to the program and asked whether reduced federal support for Community Development Block Grants (which help to fund it) could leave thousands of elderly people in Texas hungry.
Mr. Mulvaney seemed nonplussed, and many took his response to this query to imply that he believed that Meals on Wheels could not prove its effectiveness and so should expect to have its funding cut. (In fact, he was speaking more generally about the block grants.) Soon after, the Meals on Wheels national office reported levels of daily donations 50 times greater than normal.
This response could be interpreted as a public affirmation of support for Meals on Wheels, which could bolster the case for sustained federal support. But, paradoxically, it could also be taken as a sort of validation of Reaganesque devolution, an instance of charities “picking up the slack.”
Rage donations can be cathartic and might be an appropriate response to emergency shortfalls in funding. (Full disclosure: I’ve made such gifts myself.) But they do not make a coherent case for any particular model of government-nonprofit relations.
Thankfully, some nonprofit leaders are making such a public case. In an age of sector agnosticism, it’s important to keep the faith regarding the distinctive capacities of key parts of our society. For instance, in a recent lecture delivered at the Kennedy Center, Darren Walker, president of the Ford Foundation, defended the “necessity of government investment” in the arts.
“Neither philanthropy nor Kickstarter is sufficient to support the arts in America,” Mr. Walker declared, “and we shouldn’t want them to be. Because while private donors support elite and mostly urban institutions — and while crowdfunding favors those projects that can be marketed online — government investment in the arts has a much broader reach, a deeper and more profound impact.”
Meanwhile, Marc Kastner, president of the Science Philanthropy Alliance, has emphasized that over the last half-century the federal government has funded basic research that has ultimately produced essential technological innovations (such as the studies of the magnetism of atomic nuclei that led to the MRI) but that lacked the short-term payoffs to attract private industry.
Although Mr. Kastner notes that philanthropy does have a role in funding riskier research projects, such support does not have the scale “to replace government funding or even to make up for cuts of the size proposed in the administration budget.” (The Alliance estimates total philanthropic funding of basic science last year at $2.3 billion; the federal government invested approximately $40 billion.)
It’s not hard to understand why the media has locked onto the rage-donation story line. It provides a neatly packaged redemption narrative: A charity is imperiled by some sinister force and then saved by the generosity of the public. But it leaves much confusion in its wake in terms of the roles government and nonprofits should play in our society.
To dispel that confusion, and to complement the rage-donation narrative in the public discourse, more nonprofit leaders will have to lay out clear demarcations among what charities, the market, and government can accomplish. And some old-fashioned Gipperesque eloquence on that front couldn’t hurt.
In other words, in the face of proposed federal budget cuts and a lack of presidential vision on the issue, nonprofit leaders are indeed going to have pick up the slack — intellectually and rhetorically.
Benjamin Soskis, a historian of philanthropy, is research associate at the Urban Institute’s Center on Nonprofits and Philanthropy and a co-editor of the HistPhil blog.
Correction: White House budget director Mick Mulvaney’s name was misspelled in an earlier version of this column.
