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The Stimulus and Philanthropy: Meaning Beyond Money

By Tom Watson on January 23, 2009No Comment

The Stimulus and Philanthropy by Susan Raymond

It also is about to embark on a different kind of history, one for which there are (thankfully) few precedents — the righting of a badly listing economy that threatens to take on water faster than anyone can bail.

Estimates vary, but the last 18 months have seen something on the order of $10 trillion in disappeared assets in the American economy, as much as $25 trillion globally.  Storied names in finance are no more.  Whole industries teeter.  Unemployment creeps toward double digits.  This is not the end of the economic world, however much the itchy fingers of banner headline writers wish to press those keys.  But it is a very, very serious time indeed.

As part of the government response, the new Federal government in its early days will embark upon the adoption of an economic stimulus package of currently unknown proportions.  It will certainly be upwards of $750 billion, however, which added to previous commitments in the banking, mortgage and auto industries, will bring the public funds expenditure commitments to over $1.2 trillion.  By any definition, this is serious money in these serious times.

How does this flurry of policy activity relate to philanthropy and the nonprofit sector, if it relates at all?  And how, if at all, should philanthropy and nonprofits react?

Let me begin by admitting that the first reaction of any organization to a stream of $1.2 trillion is, how shall I get my share?  This is natural. It is also not what I mean by the question.  The relation to the stimulus package is importantly not about getting the money.

We have written many times that philanthropy and the nonprofit sector are the expressions of voluntary commitment of people to community in civil society.  This is a critical partner to, not a replacement for, public policy and public resources.  The opposite is also true, however.  Public resources are not a replacement for private voluntary action in open, civil societies.  In a time of crisis — such as that which the nation faces for at least the next year — the flow of public resources for jobs, infrastructure, the preservation of home ownership reflects critical public policy commitment.

The nonprofit and philanthropic sectors must, however, treat that public financial commitment as more than money.  The strategy discussion that must take place in the sector is not about how to get the money, but how to strengthen philanthropy and voluntarism through the very presence of the stimulus package itself.  The financial stimulus is an organizational opportunity of a lifetime for the nonprofit sector.

First, the stimulus package would not exist if the economic pain were not so broad and deep across the nation.  It is likely that everyone knows someone who has lost a job.  Every business that hangs on knows a business that has failed.  Every grocery cart in every aisle across the country is pushed by someone who is reading the price tags.  We are in this together.  The stimulus package — its size and scope — is Exhibit A to this fact.  This is an opportunity for nonprofits and philanthropies to deepen community ties and commitments, reinforce a sense of common cause, breathe life into community voluntarism which may have faltered as everyone chased the brass ring of seemingly limitless credit.  The Federal budget will strengthen public works; the nonprofit sector must use that time to strengthen the work of public engagement in community.  Now is the time — the opportunity — for significant growth in outreach to build volunteer networks, to bring community leaders into nonprofit Boards and programs, to become, in effect, the “people partners” of public finance.  The Federal government may bring the money; the nonprofit sector can bring engagement.

Second, if successful, the stimulus will create jobs.  Indeed, if it does not create jobs it will be a complete failure.  Nearly 4 out of every 5 dollars given to charity come from individuals.  Not in billion or even million dollar denominations, but in ones and fives and tens.  Puzzled by the weak correlation between macro-economic measures and philanthropic data, we recently narrowed our analytics to look at individual giving relative to unemployment rates.  It seemed a reasonable hypothesis: if most giving is individual, then what happens to individuals is more telling than what happens to overall economies.  Indeed, in work to be released by Changing Our World in the coming weeks, the correlation is much stronger.  So, jobs matter.  The nonprofit and philanthropic sector’s task in partnership with the stimulus package is not to get the money, it is to establish (or re-establish) strong relationships with those who can return to the workforce, and to provide them with the reason and the means to connect their restored incomes to the problems of the societal commons.  The opportunity is to reconnect, and reconnect more deeply, with the people, establishing impactful relationships that will survive not only the economic downturn but, more importantly, the inevitable upturn.

Finally, economic turmoil and political change have created a new set of leaders at all levels of public policy.  The role of private philanthropy as a partner to public effort, as a complementary resource that represents community voice, needs to be underscored to new leaders.  The time for that dialogue is now, while policy is focused with unity on the task before us and before the inevitable tug of political disputes, power struggles, and electoral jockeying muddies the waters.  The stimulus package provides an opportunity for nonprofits and philanthropies to pick up the phone and call public leaders — local, county, state, and federal — and offer not to take the money but to stand together to build private voluntary commitment as finances build roads and bridges and schools and hospitals.  The sector has the opportunity to be seen by a new set of public leaders not as a contractor, but as a partner in strengthening community engagement in the economic recovery.

The future is going to take all of us working together.  Government can and will be a part of restoring stability and making progress, but it will take all of civil society to climb the hill.  This is not a burden.  It is who we are and where we come from, and so it is an opportunity to be who we are as a nation, and hence a tribute to the vision of our forefathers.

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