cluster of financial words around the word 'donate' - the giving business

Philanthropy is a big economic deal in North America. In Canada, which has the second-largest non-profit sector in the world, there are more than 161,000 non-profit organizations contributing more than $106 billion to the GDP. In the U.S., non-profits contribute $878 billion. They employ over 1.2 million people in Canada, and over 11 million Stateside, and they’re growing. It’s fantastic that working to make the world a better place has become a significant and structural part of our economies. The ways in which this upward trend has been achieved bear some watching, though, as it’s not clear whether our expanded culture of giving is a sign of a world ready for change, or a sign that change itself is being coopted by those who have the most vested interests in maintaining the status quo.

As organizations grow and revenues increase, the structure of the contemporary non-profit has become increasingly corporate. The percentage of frontline workers has shrunk in comparison to the number of people who work in roles that echo the business world they’re coming to parallel. Look to the staff directories of major charitable organizations and you’ll inevitably find marketing, communications and branding professionals, layers of senior administrators and an army of publicity people, all of whose jobs are to secure, manage and distribute funding.

Alison Bernstein traces this trend back to the early 20th century days of ticker-tape parades and American millionaires, whose charitable efforts were increasingly overseen by businessmen as the influence of churches and universities declined. Andrew Carnegie and John Rockefeller modelled their philanthropy on the simple religious precept that if you have things, you should be willing to give them away (although I completely agree with you that the thoroughness of that commitment wouldn’t bear up under any form of investigative pressure). Later millionaires, and then companies, created foundation boards and filled them with bureaucrats, shifting their focus from the act of giving to the management of the gifts. Bernstein argues that this has created a reciprocal concern with transparency and accountability in agencies that receive private funding.

That’s not especially worrisome. It might even be a good thing to make sure that the money donated to an organization is spent wisely and not thrown giddily out of a window in a fit of wild abandon. But making economic efficiency the hallmark of a successful organization is a serious limitation on the kinds of things an organization can do because success is not a neutral term.

What counts as economic success is completely dependent on whatever economic ideology is current, which means that success is determined first and foremost by what’s considered economically possible. For example, the American government could have saved the U.S. economy by buying homes for every person who defaulted on a mortgage in 2008 rather than spend billions of dollars on banks who were defaulting, but that wasn’t considered feasible, let alone a path to success. Actually, I’m pretty sure it wasn’t even considered.

The new managerial climate of non-profits has put stress on the markers of economic responsibility that characterize the for-profit sector. In this model, donors become like clients, and donor stewardship becomes a form of customer service. Genevieve LeBaron and Peter Dauvergne argue that this shift in donor relations has changed the way non-profits tackle the issues, “dividing advocacy into projects with concrete and easily-measurable outcomes in order to demonstrate ‘returns on donations.’”

We’ve already seen from countless campaigns that this system often prioritizes projects that are marketable over projects that are necessary. People connect to feel-good causes, but the things we’re emotionally moved by aren’t necessarily the things we should really be putting our efforts into. After the 2004 tsunami, for example, donations rushed in to help save children affected by that disaster, a move that resulted in some empty orphanages because aid agencies had to spend the money earmarked for that purpose, even though Thailand didn’t actually need them. Aid agency hands were tied because the most important people to satisfy weren’t the people in need, but the ones with the money.

The responsibility to satisfy donors makes organizations much more conservative than they would be if they just had free rein to do what they needed. It also risks curtailing what change might look like. If an agency survives on private funding, they’re not likely to suggest that what would really help is a redistribution of wealth. If they rely on public funding, they might not be willing to work against a government’s drive for national economic growth at all costs. Bernstein worries that the idealization of the corporate model “may undermine the diversity of the philanthropic world.” In a bigger-picture way, a customer service orientation keeps all the usual class (and race, gender and colonial) hierarchies in place, even though those hierarchies are responsible for many of the problems organizations are trying to solve.

LeBaron and Dauvergne believe that adopting business models and values “legitimizes the trade and consumption” that many non-profits critique. There’s a pretty big irony to charitable organizations looking to the economic system that creates injustices to also provide solutions. Environmentalist or social justice groups depending on money from influential players in a capitalist system are depending on that system to address the inequities and patterns of overconsumption on which the system is based. It’s like a sophisticated version of trickle-down economics. Even if a company, private foundation or wealthy individual does throw money at a problem, that won’t address the root causes of most issues although we might be persuaded into thinking it does because of all the effort that’s been put into convincing us that spending and helping are the same thing.

To be fair, sometimes money is the answer, but it definitely isn’t the answer for all problems ever. We’re sliding into an ideological box from which we soon won’t be able to see that what happens to the donation money is not a very good indicator of progressive social change, which is ultimately too uneven, multivalent, long-term and diverse to be measurable. It’s risky to think that it is because powerful tools for transformation could fast become conspicuous displays of commitment to social change that don’t really change anything at all.

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