Diversity Debate Rages On
posted on: Wednesday, April 30, 2008
by Yna Moore
The debate over California's AB 624 legislation continues. The bill would require the state's largest foundations to disclose diversity information regarding their board, staff, grantees and vendors.
Many foundations and their trade associations have strongly opposed the bill, arguing that their decision to fund an organization is based solely on their likelihood of achieving the most impact.
However, “improving the societal impact of foundations and improving their support for diverse communities need not be mutually exclusive propositions,” said Aaron Dorfman in a recent posting on this issue. “In fact, there is growing evidence that diversity and effectiveness go hand in hand.”
In a recent commentary on the Chronicle of Philanthropy (Foundations Should Be Required to Disclose Data on Charity, May 1), Pablo Eisenberg[1] notes that despite being “poorly crafted,” the legislation’s purpose—to require foundations to disclose race and gender information of their boards and grantees—is fundamentally sound. The bill will “provide the public and the foundations, at least in California, with a more accurate picture of the extent of diversity at foundations and their grantees,” said Eisenberg. “Armed with this information, as well as their growing awareness of the problem, foundations hopefully will begin to take much more seriously their responsibility for adequately supporting what has now become the majority of Americans.”
In a separate article (California’s Legislation Won’t Achieve True Diversity At Foundations), Mark Rosenman argues for foundations to truly reflect on their missions and how they translate this into practice. Beyond the numbers, the issue of diversity is about redistribution of power among foundations and nonprofits.
In an earlier post on this blog, Pete Manzo suggests that we’ll need better information than what AB 624 mandates to improve how philanthropy responds to the needs of underserved communities. He proposes a system that allows us to view where foundation dollars are going, the demographic attributes of those places, and information on the subsets of people being served by those grants.
Do you think it’s necessary to have legislation like AB 624 requiring foundation disclosure of diversity information? Why or why not? Do you think AB 624 is an effective way to channel more foundation funding to nonprofits serving communities of color and other marginalized groups? If not, how might this legislation be improved (assuming that you think legislation is needed)? Are there other ways to go about measuring and disclosing more accurately and effectively the current state of diversity in foundation practices and grantmaking? Tell us what you think!
[1] Pablo Eisenberg is a co-founder and former board chair of the National Committee for Responsive Philanthropy.
Yna Moore is communications director at the National Committee for Responsive Philanthropy.Labels: accountability, diversity, regulation, transparency
The debate over California's AB 624 legislation continues. The bill would require the state's largest foundations to disclose diversity information regarding their board, staff, grantees and vendors.
Many foundations and their trade associations have strongly opposed the bill, arguing that their decision to fund an organization is based solely on their likelihood of achieving the most impact.
However, “improving the societal impact of foundations and improving their support for diverse communities need not be mutually exclusive propositions,” said Aaron Dorfman in a recent posting on this issue. “In fact, there is growing evidence that diversity and effectiveness go hand in hand.”
In a recent commentary on the Chronicle of Philanthropy (Foundations Should Be Required to Disclose Data on Charity, May 1), Pablo Eisenberg[1] notes that despite being “poorly crafted,” the legislation’s purpose—to require foundations to disclose race and gender information of their boards and grantees—is fundamentally sound. The bill will “provide the public and the foundations, at least in California, with a more accurate picture of the extent of diversity at foundations and their grantees,” said Eisenberg. “Armed with this information, as well as their growing awareness of the problem, foundations hopefully will begin to take much more seriously their responsibility for adequately supporting what has now become the majority of Americans.”
In a separate article (California’s Legislation Won’t Achieve True Diversity At Foundations), Mark Rosenman argues for foundations to truly reflect on their missions and how they translate this into practice. Beyond the numbers, the issue of diversity is about redistribution of power among foundations and nonprofits.
In an earlier post on this blog, Pete Manzo suggests that we’ll need better information than what AB 624 mandates to improve how philanthropy responds to the needs of underserved communities. He proposes a system that allows us to view where foundation dollars are going, the demographic attributes of those places, and information on the subsets of people being served by those grants.
Do you think it’s necessary to have legislation like AB 624 requiring foundation disclosure of diversity information? Why or why not? Do you think AB 624 is an effective way to channel more foundation funding to nonprofits serving communities of color and other marginalized groups? If not, how might this legislation be improved (assuming that you think legislation is needed)? Are there other ways to go about measuring and disclosing more accurately and effectively the current state of diversity in foundation practices and grantmaking? Tell us what you think!
[1] Pablo Eisenberg is a co-founder and former board chair of the National Committee for Responsive Philanthropy.
Yna Moore is communications director at the National Committee for Responsive Philanthropy.
Labels: accountability, diversity, regulation, transparency
posted by NCRP at
11:56 AM
|
0 comments
links to this post
You Asked for It
posted on: Monday, April 28, 2008
You Asked For It
Gary Snyder
For years, I have written that if the leadership of the nonprofit sector didn’t self-regulate, others would. Well hear it comes…and it’s coming from an unexpected player and on issues that are quite unexpected.
The Independent Sector has spent millions of dollars producing a document addressing governance and ethical problems facing charities. In doing so, they invited the government to assist them in resolving them. In spite of IS’s protestations that they wanted to self-regulate they have embraced the Internal Revenue Service inaugural efforts to regulate, educate and enforce new rules on charities.
On April 23, 2008, Steven Miller, Commissioner, Tax Exempt and Government Entities of the Internal Revenue Service in an address that the IRS “will educate, engage and, yes, irritate…” He noted that the IRS is going to go full bore on the issue of governance.
It starts with the revised Form 990 that virtually all nonprofits must fill out. The IRS wants to know about the composition and independence of the governing body, about policies and procedures and how and whether governance and financial information is available to the public. It has even developed a tutorial on its website. To date they have concentrated on board composition.
The rules are going to be a hit across the bow of the charitable sector. Accordingly, no agency is too small to not have an active, engaged board of directors overseeing the organization.
Miller further noted that the IRS, will focus on internal financial controls and large-scale decision-making.
Apparently, some have asked the IRS to prove the relationship between good governance and tax compliance. They “will be working on that”. In the enforcement area, Senate Finance Committee Tax Counsel, Theresa Pattara, said, “To ensure that filers answer Form 990’s governance questions, Congress might formulate stronger penalties for organizations that file incomplete Forms 990.”
He assured that all charities should look forward to a more broadly based program in the future.
While there is a compelling need for a broad and in-depth intervention into nonprofit governance, I am perplexed as to why the IRS is making such suggestions. I cannot understand why organizations such as Independent Sector, state associations, Board Source and others could not pick up the mantle and institute a program that meets the needs of the charitable sector.
The issues have been apparent for the past decade. All have seen stabilizing or diminishing contributions based on the cost of living, an increase in poor governance resulting in fraud and abuse at an astounding rate; a pounding on the charitable sector by the press; and, a consistent loss of confidence by donors.
The IRS was invited to the party. As a guest with little confidence that the sector has the capacity to resolve it’s own internal problems, the IRS, with the imprimatur of Congress, will gladly show charities the right road…by regulating them.
Best guess: the consequences will be profound.
Gary Snyder is managing partner of Nonprofit Imperative and author of Nonprofits: On the Brink and Nonprofit Imperative. He can be reached at gary.r.snyder@gmail.com. His website is: www.garyrsnyder.com.
Gary Snyder
For years, I have written that if the leadership of the nonprofit sector didn’t self-regulate, others would. Well hear it comes…and it’s coming from an unexpected player and on issues that are quite unexpected.
The Independent Sector has spent millions of dollars producing a document addressing governance and ethical problems facing charities. In doing so, they invited the government to assist them in resolving them. In spite of IS’s protestations that they wanted to self-regulate they have embraced the Internal Revenue Service inaugural efforts to regulate, educate and enforce new rules on charities.
On April 23, 2008, Steven Miller, Commissioner, Tax Exempt and Government Entities of the Internal Revenue Service in an address that the IRS “will educate, engage and, yes, irritate…” He noted that the IRS is going to go full bore on the issue of governance.
It starts with the revised Form 990 that virtually all nonprofits must fill out. The IRS wants to know about the composition and independence of the governing body, about policies and procedures and how and whether governance and financial information is available to the public. It has even developed a tutorial on its website. To date they have concentrated on board composition.
The rules are going to be a hit across the bow of the charitable sector. Accordingly, no agency is too small to not have an active, engaged board of directors overseeing the organization.
Miller further noted that the IRS, will focus on internal financial controls and large-scale decision-making.
Apparently, some have asked the IRS to prove the relationship between good governance and tax compliance. They “will be working on that”. In the enforcement area, Senate Finance Committee Tax Counsel, Theresa Pattara, said, “To ensure that filers answer Form 990’s governance questions, Congress might formulate stronger penalties for organizations that file incomplete Forms 990.”
He assured that all charities should look forward to a more broadly based program in the future.
While there is a compelling need for a broad and in-depth intervention into nonprofit governance, I am perplexed as to why the IRS is making such suggestions. I cannot understand why organizations such as Independent Sector, state associations, Board Source and others could not pick up the mantle and institute a program that meets the needs of the charitable sector.
The issues have been apparent for the past decade. All have seen stabilizing or diminishing contributions based on the cost of living, an increase in poor governance resulting in fraud and abuse at an astounding rate; a pounding on the charitable sector by the press; and, a consistent loss of confidence by donors.
The IRS was invited to the party. As a guest with little confidence that the sector has the capacity to resolve it’s own internal problems, the IRS, with the imprimatur of Congress, will gladly show charities the right road…by regulating them.
Best guess: the consequences will be profound.
Gary Snyder is managing partner of Nonprofit Imperative and author of Nonprofits: On the Brink and Nonprofit Imperative. He can be reached at gary.r.snyder@gmail.com. His website is: www.garyrsnyder.com.
posted by Gary at
10:01 AM
|
1 comments
links to this post
Are grant application and reporting procedures impediments to efficiency and effectiveness?
posted on: Friday, April 25, 2008
by Niki Jagpal
This week Project Streamline, a joint effort of grantmaking and receiving organizations to improve reporting and application procedures, released a new report Drowning in Paperwork, Distracted From Purpose. The report identifies ten ways that current application and reporting systems inhibit nonprofit effectiveness including insufficient net grants and lack of trust between nonprofits and funders. The report makes four recommendations for grantmakers based on the study’s findings.
Project Streamline’s report comes at an opportune time; a recent article in the Chronicle of Philanthropy (subscription required) highlights efforts by the Internal Revenue System (IRS) to increase the effectiveness and efficiency of charitable organizations. Steven T. Miller is the current commissioner of the IRS’s tax-exempt and government-entities division. As the Chronicle notes, he made a series of remarks at a conference on tax-exempt organizations convened by Georgetown University Law Center Continuing Legal Education Department this week. One strategy Miller suggests is for the IRS to “create and enforce a standard to ensure that organizations spend in line with their resources.” While monitoring is not currently the purview of the IRS, Miller said that the IRS would be “more aggressive” in keeping a watch over the “efficiency and effectiveness” of charitable organizations.
If nonprofits are to be truly empowered to achieve their missions by focusing on effectiveness and efficiency, it is clear that cumbersome application and reporting procedures have to be addressed. But the process of grant applications and reports is only part of the solution; as Miller states “[…] every charity should be make responsible and appropriate use of its resources to achieve its charitable purposes. That is what the tax-exempt subsidy is for.” [emphasis added]
Moreover, while the Chronicle article and Miller’s remarks discuss revisions to the IRS’s 990 form, the publicly available informational tax returns filed by nonprofit grant recipients, the same standard of effectiveness and efficiency ought to apply to the form 990-PF, the IRS’s tax form filed by private foundations. While efforts to include “efficiency indicators” in the revised 990 forms failed, the new forms will include questions about nonprofit governance and management policies. Miller sees the link between increased transparency and enforcement: “the question is no longer whether the IRS has a role to play in [governance] but rather what that role will be.”
Project Streamline’s work is commendable and adds value to sector-wide attempts to improve the grantmaker-grantee relationship. Now, imagine what the charitable sector would look like if we had simple criteria on the 990 PF forms for measuring philanthropic management and governance to support Miller’s vision of more effective and efficient charitable organizations?
Niki Jagpal is the research director at NCRP.Labels: Best Practices, IRS, regulation, transparency
This week Project Streamline, a joint effort of grantmaking and receiving organizations to improve reporting and application procedures, released a new report Drowning in Paperwork, Distracted From Purpose. The report identifies ten ways that current application and reporting systems inhibit nonprofit effectiveness including insufficient net grants and lack of trust between nonprofits and funders. The report makes four recommendations for grantmakers based on the study’s findings.
Project Streamline’s report comes at an opportune time; a recent article in the Chronicle of Philanthropy (subscription required) highlights efforts by the Internal Revenue System (IRS) to increase the effectiveness and efficiency of charitable organizations. Steven T. Miller is the current commissioner of the IRS’s tax-exempt and government-entities division. As the Chronicle notes, he made a series of remarks at a conference on tax-exempt organizations convened by Georgetown University Law Center Continuing Legal Education Department this week. One strategy Miller suggests is for the IRS to “create and enforce a standard to ensure that organizations spend in line with their resources.” While monitoring is not currently the purview of the IRS, Miller said that the IRS would be “more aggressive” in keeping a watch over the “efficiency and effectiveness” of charitable organizations.
If nonprofits are to be truly empowered to achieve their missions by focusing on effectiveness and efficiency, it is clear that cumbersome application and reporting procedures have to be addressed. But the process of grant applications and reports is only part of the solution; as Miller states “[…] every charity should be make responsible and appropriate use of its resources to achieve its charitable purposes. That is what the tax-exempt subsidy is for.” [emphasis added]
Moreover, while the Chronicle article and Miller’s remarks discuss revisions to the IRS’s 990 form, the publicly available informational tax returns filed by nonprofit grant recipients, the same standard of effectiveness and efficiency ought to apply to the form 990-PF, the IRS’s tax form filed by private foundations. While efforts to include “efficiency indicators” in the revised 990 forms failed, the new forms will include questions about nonprofit governance and management policies. Miller sees the link between increased transparency and enforcement: “the question is no longer whether the IRS has a role to play in [governance] but rather what that role will be.”
Project Streamline’s work is commendable and adds value to sector-wide attempts to improve the grantmaker-grantee relationship. Now, imagine what the charitable sector would look like if we had simple criteria on the 990 PF forms for measuring philanthropic management and governance to support Miller’s vision of more effective and efficient charitable organizations?
Niki Jagpal is the research director at NCRP.
Labels: Best Practices, IRS, regulation, transparency
posted by NCRP at
3:52 PM
|
1 comments
links to this post
California Foundation Diversity Bill: Best Way to Boost Results for Low Income Communities of Color?
posted on: Thursday, April 17, 2008
A California Assembly bill is causing quite a stir in the philanthropic and nonprofit worlds. Spurred by a series of studies by the Greenlining Institute, the bill, AB 624, sponsored by 23rd District Assembly Member Joseph Coto (D-San Jose), would require California
- the ethnicity, gender and sexual orientation of foundation board and staff members;
- the number of grants and grant dollars awarded to organizations reporting that 50% or more of their board or staff members are ethnic minorities;
- “the number of grants and grant dollars awarded to “organizations specifically serving African-American, Asian-American, Pacific Islander, Caucasian, Latino, Native American, and Alaskan Native communities, lesbian, gay, bisexual, and transgender communities and other underrepresented communities”
- “the number of grants and grant dollars awarded to predominantly low-income communities"; and
- "the number and percentage of business contracts awarded to African-Americans, Asian-Americans, Pacific Islanders, Caucasians, Latinos, Native Americans, and Alaskan Natives."
The current draft of the bill is available here.
The problem is, if the ultimate result sponsors hope to achieve is increased benefits from philanthropy flowing to either communities of color, or low income communities[1], compliance with the bill, as written, looks very unlikely to accomplish that.
First of all, complying with the bill would not be easy, both because of the fairly vague or uncertain definitions of the information to be collected, and also because of the amount of energy that would go into collecting that information, both at the foundations and on the part of their grantees. The bill is imperfectly drafted, so much so that the Nonprofit and Unincorporated Organizations Committee of the California Bar Association’s Business Law Section, a group of attorneys expert on exempt organization law, have issued a statement of opposition raising numerous objections, and concluding that the bill is “fatally flawed.”
The problem I see in the bill is that it does not require information be collected that would establish who is served by grant dollars (more on the feasibility, and wisdom, of trying to establish that below). Rather, it simply requires foundations to tally up the numbers, grant dollars and percentages and publish those. In its current form, a foundation could simply publish the aggregate figures (e.g., “300 grants, in the amount of $400 million, to organizations specifically serving communities of color”, or “250 grants, in the amount of $300 million, predominantly low income communities.” While it would be interesting to track whether those numbers go up or down, they are practically useless, otherwise, for advocates. The data likely wouldn’t provide any evidence that philanthropic support to low income people of color living in particular regions or geographic communities is rising or falling, or how the distribution of grant funds within those communities is shifting over time. (Also, the data likely would not be aggregated somewhere, so to get the bigger picture, advocates would have to cull information from dozens of foundation sites.)
As Aaron Dorfman , NCRP’s Executive Director, has pointed out in this space, if diversity in grantmaking is important, it should be measured. Opponents of the bill actually agree on this point, but object that the challenge will be how to measure it completely, and how to measure it in ways that are most useful to advocates for more responsive grantmaking. The leaders of The California Endowment, The William & Flora Hewlett Foundation and The James Irvine Foundation all have published op-eds or letters to the editor opposing the bill. Ironically, these three foundations are among the handful of large foundations with statewide reach most prominent in pushing policy advocacy and systems change to benefit low income communities of color. The controversy over AB 624 seems to be an example of what a friend of mine calls “heated agreement,” where people who basically agree and should be pulling in the same direction instead divide and argue over minor points.
Irvine
A better place to start would be making visible the flow of grant dollars to specific places, the demographic and other attributes of those places, and even the specific subsets of people served in those places. (Another irony: the specific reach of grants for policy advocacy or systems change will be harder to define, but this challenge can be solved, as I will explore in a future post). To do so, we’ll need to make the grants data already disclosed by foundations more accessible to advocates, and supplement that with data about the geographic and demographic reach of those grant funds. This would mean bringing the grants databases out from behind the firewalls of services like the Foundation Center
In the end, AB 624 is unlikely to become law anytime soon (It has a rough road ahead in the California Senate, and if it passes both houses, Governor Schwarzenegger is likely to veto it.) That should give all supporters of responsive philanthropy, within foundations and the broader community, plenty of time to develop approaches more targeted to improving results for low income communities of color.
Peter Manzo is an NCRP board member and the Director of Strategic Initiatives for the Advancement Project, a civil rights advocacy organization based in Los Angeles and Washington, D.C. His opinions are his own and do not necessarily reflect those of NCRP or the Advancement Project.
[1] 1) Oddly, there is no such straightforward statement on Greenlining Institute’s Web site that this is the purpose, as opposed to more generically making foundations more “effective and efficient.”
[2] 2) HealthyCity.org, a partnership of nonprofits in Los Angeles sponsored by the Advancement Project, already has built tools and methods for making the flow of grant dollars visible, for public agencies and private funders, to help them assess their grants in Los Angeles County and throughout California Labels: diversity, Legislation, Measuring Impact, Philanthropy's role in society, responsive, transparency
A California Assembly bill is causing quite a stir in the philanthropic and nonprofit worlds. Spurred by a series of studies by the Greenlining Institute, the bill, AB 624, sponsored by 23rd District Assembly Member Joseph Coto (D-San Jose), would require
- the ethnicity, gender and sexual orientation of foundation board and staff members;
- the number of grants and grant dollars awarded to organizations reporting that 50% or more of their board or staff members are ethnic minorities;
- “the number of grants and grant dollars awarded to “organizations specifically serving African-American, Asian-American, Pacific Islander, Caucasian, Latino, Native American, and Alaskan Native communities, lesbian, gay, bisexual, and transgender communities and other underrepresented communities”
- “the number of grants and grant dollars awarded to predominantly low-income communities"; and
- "the number and percentage of business contracts awarded to African-Americans, Asian-Americans, Pacific Islanders, Caucasians, Latinos, Native Americans, and Alaskan Natives."
The current draft of the bill is available here.
The problem is, if the ultimate result sponsors hope to achieve is increased benefits from philanthropy flowing to either communities of color, or low income communities[1], compliance with the bill, as written, looks very unlikely to accomplish that.
First of all, complying with the bill would not be easy, both because of the fairly vague or uncertain definitions of the information to be collected, and also because of the amount of energy that would go into collecting that information, both at the foundations and on the part of their grantees. The bill is imperfectly drafted, so much so that the Nonprofit and Unincorporated Organizations Committee of the California Bar Association’s Business Law Section, a group of attorneys expert on exempt organization law, have issued a statement of opposition raising numerous objections, and concluding that the bill is “fatally flawed.”
The problem I see in the bill is that it does not require information be collected that would establish who is served by grant dollars (more on the feasibility, and wisdom, of trying to establish that below). Rather, it simply requires foundations to tally up the numbers, grant dollars and percentages and publish those. In its current form, a foundation could simply publish the aggregate figures (e.g., “300 grants, in the amount of $400 million, to organizations specifically serving communities of color”, or “250 grants, in the amount of $300 million, predominantly low income communities.” While it would be interesting to track whether those numbers go up or down, they are practically useless, otherwise, for advocates. The data likely wouldn’t provide any evidence that philanthropic support to low income people of color living in particular regions or geographic communities is rising or falling, or how the distribution of grant funds within those communities is shifting over time. (Also, the data likely would not be aggregated somewhere, so to get the bigger picture, advocates would have to cull information from dozens of foundation sites.)
As
A better place to start would be making visible the flow of grant dollars to specific places, the demographic and other attributes of those places, and even the specific subsets of people served in those places. (Another irony: the specific reach of grants for policy advocacy or systems change will be harder to define, but this challenge can be solved, as I will explore in a future post). To do so, we’ll need to make the grants data already disclosed by foundations more accessible to advocates, and supplement that with data about the geographic and demographic reach of those grant funds. This would mean bringing the grants databases out from behind the firewalls of services like the
In the end, AB 624 is unlikely to become law anytime soon (It has a rough road ahead in the California Senate, and if it passes both houses, Governor Schwarzenegger is likely to veto it.) That should give all supporters of responsive philanthropy, within foundations and the broader community, plenty of time to develop approaches more targeted to improving results for low income communities of color.
Peter Manzo is an NCRP board member and the Director of Strategic Initiatives for the Advancement Project, a civil rights advocacy organization based in Los Angeles and Washington, D.C. His opinions are his own and do not necessarily reflect those of NCRP or the Advancement Project.
[2] 2) HealthyCity.org, a partnership of nonprofits in
Labels: diversity, Legislation, Measuring Impact, Philanthropy's role in society, responsive, transparency
posted by Pete at
2:23 AM
|
0 comments
links to this post
Structural Racism and Inequity Show Impact on Philanthropy
posted on: Wednesday, April 16, 2008
by Yna Moore
Sherece West, new NCRP board member and president of the Winthrop Rockefeller Foundation, recently shared her thoughts on structural racism and inequity, and what this means for philanthropy in Diversity in Philanthropy's Executive Commentary. "An aspect of effective philanthropy is about undoing structural racism," said Ms. West.
Steve Mayer, director of Effective Communities LLC, also tackled this issue in a commentary in March.
The issue of diversity in foundations' leadership, grantmaking and business dealings has received tremendous attention during the bast few months, thanks to AB 624, a bill in the California legislation sponsored by Rep. Joe Coto. The bill, if passed, would require the state's largest foundations to disclose diversity information regarding their staff, board, grantees and vendors.
Do you think AB 624 is an effective way to channel more foundation funding to nonprofits serving communities of color and other marginalized groups? Tell us what you think!
Kristina ("Yna") Moore is communications director at NCRP.
Labels: diversity
Sherece West, new NCRP board member and president of the Winthrop Rockefeller Foundation, recently shared her thoughts on structural racism and inequity, and what this means for philanthropy in Diversity in Philanthropy's Executive Commentary. "An aspect of effective philanthropy is about undoing structural racism," said Ms. West.
Steve Mayer, director of Effective Communities LLC, also tackled this issue in a commentary in March.
The issue of diversity in foundations' leadership, grantmaking and business dealings has received tremendous attention during the bast few months, thanks to AB 624, a bill in the California legislation sponsored by Rep. Joe Coto. The bill, if passed, would require the state's largest foundations to disclose diversity information regarding their staff, board, grantees and vendors.
Do you think AB 624 is an effective way to channel more foundation funding to nonprofits serving communities of color and other marginalized groups? Tell us what you think!
Kristina ("Yna") Moore is communications director at NCRP.
Labels: diversity
posted by NCRP at
12:20 PM
|
2 comments
links to this post
A Compromised Charitable Sector
posted on: Tuesday, April 15, 2008
A Compromised Charitable Sector
By Gary R. Snyder
If anyone thought that the bright light on nonprofit misdeeds was going to fade with the change in Senate Finance Committee leadership they are grossly underestimating the festering problem. Granted the loss of Dean A. Zerbe as a principal staff point person on this matter to Ranking Member Senator Charles Grassley is a significant blow. The direction may have changed but the intense interest in setting the nonprofit sector straight has not subsided.
The Senate Finance Committee’s ongoing concern in nonprofit ineptitude was joined by the House Oversight and Government Reform Committee, which held hearings. Among the embarrassing issues was how veterans’ charities gave small proportions of revenue to veterans and their families. An article in the Chronicle of Philanthropy stated that committee members used terms such as “immoral”, “fraud” and “sickening betrayal” with a promise to have additional hearings as the issues unfold.
These terms of endearment are consistent with the donor’s diminishing confidence in the charitable sector. Heightened scrutiny has resulted in increased stories in the media with the recent study on $30-40 billion annual nonprofit fraud (Greenlee, Gordon) being unveiled in an arresting New York Times (March 29, 2008, Report Sketches Crime Costing Billions: Theft From Charities) article. The cumulative effect of the focus of the public attention on charity malfeasance is still unknown, but certainly isn’t going to play well in Congress or at the local nonprofit agency.
The problems continue to center on the abuses by the board, executive and volunteers. All have failed to be diligent in exercising their fiduciary duties. As the Independent Sector notes, few know what their responsibilities are. Even if they did understand what their role is supposed to be, few have the skills to adequacy address the misdeeds.
This is underscored by the Independent Sector’s Panel on the Nonprofit Sector request for government assistance in educating board and professional leaders because both are not aware of the expectations and requirements imposed upon them.
While tens of billions of dollars are taken from those to which it is intended, sector leaders continue to say that it is a “few bad apples”. Last year, the General Accounting Office noted that nearly 55,000 tax-exempt organizations had almost $1 billion in unpaid taxes with some owing tens of millions of dollars.
The fallout in loss in the nation’s misdeeds from charities is profound. According to the National Priorities Project----a $20 billion loss is equivalent to any of the following:
• healthcare to 7.721 million people, or
• 438,768 public safety officials, or
• 1861 new elementary school, or
• 3.1 million Head Start places for children, or
• 290,081 elementary school teachers, or
• 299,496 port container inspectors
or, $54,794,520 per day
Leadership at the local, state, and national levels is virtually nonexistent. The use of words such as transparency and accountability have become jargon—buzzwords---that fail to be meaningful without substance behind them.
The sole of the charitable world is under scrutiny. Integrity, credibility and effectiveness are proxy measures of the soundness of any organization. Without those, the sector is severely compromised
Gary R. Snyder is the author of Nonprofits: On the Brink. He is a frequent lecturer and author of articles in numerous publications and blogs. His email is gary.r.snyder@gmail.com; website: http://garyrsnyder.com, phone: 248.324.3700.Labels: accountability, government oversight, senate finance committee, transparency
By Gary R. Snyder
If anyone thought that the bright light on nonprofit misdeeds was going to fade with the change in Senate Finance Committee leadership they are grossly underestimating the festering problem. Granted the loss of Dean A. Zerbe as a principal staff point person on this matter to Ranking Member Senator Charles Grassley is a significant blow. The direction may have changed but the intense interest in setting the nonprofit sector straight has not subsided.
The Senate Finance Committee’s ongoing concern in nonprofit ineptitude was joined by the House Oversight and Government Reform Committee, which held hearings. Among the embarrassing issues was how veterans’ charities gave small proportions of revenue to veterans and their families. An article in the Chronicle of Philanthropy stated that committee members used terms such as “immoral”, “fraud” and “sickening betrayal” with a promise to have additional hearings as the issues unfold.
These terms of endearment are consistent with the donor’s diminishing confidence in the charitable sector. Heightened scrutiny has resulted in increased stories in the media with the recent study on $30-40 billion annual nonprofit fraud (Greenlee, Gordon) being unveiled in an arresting New York Times (March 29, 2008, Report Sketches Crime Costing Billions: Theft From Charities) article. The cumulative effect of the focus of the public attention on charity malfeasance is still unknown, but certainly isn’t going to play well in Congress or at the local nonprofit agency.
The problems continue to center on the abuses by the board, executive and volunteers. All have failed to be diligent in exercising their fiduciary duties. As the Independent Sector notes, few know what their responsibilities are. Even if they did understand what their role is supposed to be, few have the skills to adequacy address the misdeeds.
This is underscored by the Independent Sector’s Panel on the Nonprofit Sector request for government assistance in educating board and professional leaders because both are not aware of the expectations and requirements imposed upon them.
While tens of billions of dollars are taken from those to which it is intended, sector leaders continue to say that it is a “few bad apples”. Last year, the General Accounting Office noted that nearly 55,000 tax-exempt organizations had almost $1 billion in unpaid taxes with some owing tens of millions of dollars.
The fallout in loss in the nation’s misdeeds from charities is profound. According to the National Priorities Project----a $20 billion loss is equivalent to any of the following:
• healthcare to 7.721 million people, or
• 438,768 public safety officials, or
• 1861 new elementary school, or
• 3.1 million Head Start places for children, or
• 290,081 elementary school teachers, or
• 299,496 port container inspectors
or, $54,794,520 per day
Leadership at the local, state, and national levels is virtually nonexistent. The use of words such as transparency and accountability have become jargon—buzzwords---that fail to be meaningful without substance behind them.
The sole of the charitable world is under scrutiny. Integrity, credibility and effectiveness are proxy measures of the soundness of any organization. Without those, the sector is severely compromised
Gary R. Snyder is the author of Nonprofits: On the Brink. He is a frequent lecturer and author of articles in numerous publications and blogs. His email is gary.r.snyder@gmail.com; website: http://garyrsnyder.com, phone: 248.324.3700.
Labels: accountability, government oversight, senate finance committee, transparency
posted by Gary at
10:40 AM
|
0 comments
links to this post
Does Welfare Corrupt Society and Lead to Personal Irresponsibility?
posted on: Friday, April 11, 2008
By Niki Jagpal
In a recent Yuma Sun op-ed Dr. Tibor R. Machan makes some striking arguments about how the corporate welfare state leads to irresponsibility as evidenced by the behavior of corporations that are bailed out by the federal government. Citing the recent federal response to the collapse of the subprime mortgage market, Machan argues that corporate irresponsibility parallels personal irresponsibility. He asserts:
“[…] The injustice of the welfare state there is also the fact that it leads to
massive corruption throughout a society and severe misconceptions about what it
really takes to make a reasonably prosperous life for oneself, both in personal
and business affairs.”
Dr. Machan is correct to highlight the “rip-offs that constitute the welfare state where politicians and bureaucrats extort funds from innocent citizens so as to support unsuccessful business enterprises.” Yet, his comparison of the federal bailout of big business deserves at least two additional qualifications. First, corporations are granted personhood rights under the 14th Amendment to the Constitution, as noted by Joel Bakan and other scholars. Yes, the same Amendment that was intended to grant all U.S. citizens, regardless of race, equal citizenship rights and protections, provides the same guarantees to corporations. Second, Dr. Machan fails to note the inherent contradiction of the federal government’s ideology and practice. Republicans repeatedly call for limited government, contraction of the social safety net and emphasis on personal responsibility. Yet, it is a Republican administration and its officials that have infused billions of taxpayer dollars into the failing banks to avoid a total economic collapse.
Lastly, while Dr. Machan is correct to compare corporations to individuals in light of the 14th Amendment protections given to big business, I disagree with his statements that our welfare system provides an incentive for individuals to abdicate a sense of personal responsibility. Anybody familiar with The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 knows that the complete overhaul of our social safety net programs resulted in measures that mandate “personal responsibility” eligibility criteria for welfare benefits. The replacement of AFDC by TANF is probably the most well-known example. Changes made during the 1996 welfare reforms require TANF recipients to demonstrate that they have either worked or actively searched for work to remain eligible for assistance, including those working single-parent headed households, which Dr. Machan would define as, “people who create huge families they are unable to support on their own.”
Dr. Machan’s critique of the government’s bailout of the big business points to two important issues: the personhood rights afforded corporations and the abuse of federal tax dollars to do so. But his comparison of individual welfare programs to the recent federal response is falsely premised and only serves to perpetuate the myth of the ‘welfare queen’ and the lack of any idea of a social contract that obligates government to care for those in need. Dr. Machan asserts that philanthropy and charity should provide those in times of need with assistance but his piece raises more questions than it answers. How can philanthropy or individual charity possibly address the broad needs of those least well-off when our tax dollars are subsidizing bad business practices? The nonprofit sector is not a substitute for the public sector, nor could it be – philanthropy’s contribution to the nonprofit sector is dwarfed by tax revenues. It’s like forcing apples to become oranges on many levels, though it does remind me of the cover of Stephen Levitt’s Freakonomics.
Niki Jagpal is research director at NCRP Labels: Government off-loading, Philanthropy's role in society
In a recent Yuma Sun op-ed Dr. Tibor R. Machan makes some striking arguments about how the corporate welfare state leads to irresponsibility as evidenced by the behavior of corporations that are bailed out by the federal government. Citing the recent federal response to the collapse of the subprime mortgage market, Machan argues that corporate irresponsibility parallels personal irresponsibility. He asserts:
“[…] The injustice of the welfare state there is also the fact that it leads to
massive corruption throughout a society and severe misconceptions about what it
really takes to make a reasonably prosperous life for oneself, both in personal
and business affairs.”
Dr. Machan is correct to highlight the “rip-offs that constitute the welfare state where politicians and bureaucrats extort funds from innocent citizens so as to support unsuccessful business enterprises.” Yet, his comparison of the federal bailout of big business deserves at least two additional qualifications. First, corporations are granted personhood rights under the 14th Amendment to the Constitution, as noted by Joel Bakan and other scholars. Yes, the same Amendment that was intended to grant all U.S. citizens, regardless of race, equal citizenship rights and protections, provides the same guarantees to corporations. Second, Dr. Machan fails to note the inherent contradiction of the federal government’s ideology and practice. Republicans repeatedly call for limited government, contraction of the social safety net and emphasis on personal responsibility. Yet, it is a Republican administration and its officials that have infused billions of taxpayer dollars into the failing banks to avoid a total economic collapse.
Lastly, while Dr. Machan is correct to compare corporations to individuals in light of the 14th Amendment protections given to big business, I disagree with his statements that our welfare system provides an incentive for individuals to abdicate a sense of personal responsibility. Anybody familiar with The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 knows that the complete overhaul of our social safety net programs resulted in measures that mandate “personal responsibility” eligibility criteria for welfare benefits. The replacement of AFDC by TANF is probably the most well-known example. Changes made during the 1996 welfare reforms require TANF recipients to demonstrate that they have either worked or actively searched for work to remain eligible for assistance, including those working single-parent headed households, which Dr. Machan would define as, “people who create huge families they are unable to support on their own.”
Dr. Machan’s critique of the government’s bailout of the big business points to two important issues: the personhood rights afforded corporations and the abuse of federal tax dollars to do so. But his comparison of individual welfare programs to the recent federal response is falsely premised and only serves to perpetuate the myth of the ‘welfare queen’ and the lack of any idea of a social contract that obligates government to care for those in need. Dr. Machan asserts that philanthropy and charity should provide those in times of need with assistance but his piece raises more questions than it answers. How can philanthropy or individual charity possibly address the broad needs of those least well-off when our tax dollars are subsidizing bad business practices? The nonprofit sector is not a substitute for the public sector, nor could it be – philanthropy’s contribution to the nonprofit sector is dwarfed by tax revenues. It’s like forcing apples to become oranges on many levels, though it does remind me of the cover of Stephen Levitt’s Freakonomics.
Niki Jagpal is research director at NCRP
Labels: Government off-loading, Philanthropy's role in society
posted by NCRP at
7:22 AM
|
2 comments
links to this post
Benefiting from Mission-related Investing
posted on: Wednesday, April 09, 2008
By Meredith Brodbeck, Communications/Development Assistant, NCRP
In Compounding Impact: Mission Investing by US Foundations, the Foundation Strategy Group (FSG) explores three approaches to mission-related investing (MRI), one of which is shareholder advocacy and proxy voting. The report defines this as a foundation using “its investments as a means to engage in shareholder advocacy – through dialogue with corporate management, shareholder resolutions, and proxy voting – to influence a corporation’s behavior on issues relevant to the foundation’s mission.”
Recently, a number of foundation leaders encouraged their peers to exercise shareholder powers during the 2008 proxy season to help ensure that companies act responsibly toward climate change and global warming.
The Investor Network on Climate Risk (INCR) announced the filing of 54 global warming shareholder resolutions with U.S. companies that are facing extensive business impact due to climate change. Furthermore, the number of resolutions is nearly double what it was two years ago, and 14 of the 54 resolutions are already seeing results.
INCR as an organization is also seeing results; their membership has grown from 10 investors managing $600 billion in assets to 60 investors managing $5 trillion in assets.
According to Dave Beckwith of The Needmor Fund, value-based investing can be financially rewarding. “Through careful construction of investment policies and selection of consultants, managers or investment vehicles, it’s possible for foundations to do less harm and more good while growing their financial assets,” Beckwith says in an article for the summer 2007 issue of NCRP’s Responsive Philanthropy.
In analyzing the financial performance of mission-related investments, those done through loans provided the most data due to their popularity. FSG was able to conclude that, “of the 653 loans in our study, 85% were fully repaid.”
Clearly, it is possible for foundations to have a strong investment portfolio that aligns with their mission and values. So why aren’t there more foundations involved in MRI? Is this simply a case of old habits dying hard? Or perhaps foundation trustees are just doubtful? What do you think needs to be done for more foundations (and other organizations) to take the MRI plunge?Labels: Mission-related investing
In Compounding Impact: Mission Investing by US Foundations, the Foundation Strategy Group (FSG) explores three approaches to mission-related investing (MRI), one of which is shareholder advocacy and proxy voting. The report defines this as a foundation using “its investments as a means to engage in shareholder advocacy – through dialogue with corporate management, shareholder resolutions, and proxy voting – to influence a corporation’s behavior on issues relevant to the foundation’s mission.”
Recently, a number of foundation leaders encouraged their peers to exercise shareholder powers during the 2008 proxy season to help ensure that companies act responsibly toward climate change and global warming.
The Investor Network on Climate Risk (INCR) announced the filing of 54 global warming shareholder resolutions with U.S. companies that are facing extensive business impact due to climate change. Furthermore, the number of resolutions is nearly double what it was two years ago, and 14 of the 54 resolutions are already seeing results.
INCR as an organization is also seeing results; their membership has grown from 10 investors managing $600 billion in assets to 60 investors managing $5 trillion in assets.
According to Dave Beckwith of The Needmor Fund, value-based investing can be financially rewarding. “Through careful construction of investment policies and selection of consultants, managers or investment vehicles, it’s possible for foundations to do less harm and more good while growing their financial assets,” Beckwith says in an article for the summer 2007 issue of NCRP’s Responsive Philanthropy.
In analyzing the financial performance of mission-related investments, those done through loans provided the most data due to their popularity. FSG was able to conclude that, “of the 653 loans in our study, 85% were fully repaid.”
Clearly, it is possible for foundations to have a strong investment portfolio that aligns with their mission and values. So why aren’t there more foundations involved in MRI? Is this simply a case of old habits dying hard? Or perhaps foundation trustees are just doubtful? What do you think needs to be done for more foundations (and other organizations) to take the MRI plunge?
Labels: Mission-related investing
posted by NCRP at
3:02 PM
|
0 comments
links to this post
What Happens to a Dream Deferred?
posted on: Friday, April 04, 2008
What happens to a dream deferred?[1]
By Niki Jagpal
On the 40th anniversary of the assassination of Dr. Martin Luther King, jr., it seems appropriate to review the progress we’ve made as a country toward achieving, or at least advancing, Dr. King’s vision as articulated in his famous “I have a dream” 1963 speech.
The Milton S. Eisenhower Foundation recently released a report called What We Can Do Together: A Forty Year Update on the National Advisory Commission on Civil Disorders. The report tracks progress in areas ranging from education, health, income and wealth to crime and poverty, and is a follow up to the informally known Kerner Commission Report of 1968, which investigated the causes of the 1967 riots in Newark, Detroit and New Brunswick, and suggested mechanisms to prevent reoccurrence.
Contrary to Johnson’s assumption that ‘militant groups’ like the Black Panthers were responsible for the ‘race riots,’ the report concluded, “Our nation is moving toward two societies, one black, one white--separate and unequal.” So 40 years later, it is fair to ask: is our nation still moving towards two societies, still separate and unequal? And what role can philanthropy play in addressing the needs of our evolving, pluralistic democracy?
Let’s compare some findings and statistics from the original report to those in the 40th anniversary report by the Eisenhower Foundation:
The criminal justice system:
“To some Negroes police have come to symbolize white power, white racism and white repression. And the fact is that many police do reflect and express these white attitudes. The atmosphere of hostility and cynicism is reinforced by a widespread belief among Negroes in the existence of police brutality and in a "double standard" of justice and protection--one for Negroes and one for whites.” – Kerner Commission Report
Today, the numbers paint a picture of little progress. According to the Eisenhower Foundation report:
• Minorities face a greater likelihood of receiving the death sentence than Whites. Minorities are also given longer sentences than Whites for the same crimes. Crack cocaine, which is used disproportionately by minorities, carries much longer sentences than those for powder cocaine, used more frequently by Whites.
• Scholars continue to find that regardless of their qualifications, some employers push minority applicants into the worst jobs. Further, many real estate agents steer minorities to less desirable locations, than Whites and fewer minority mortgage applications are accepted than White applications
• From the 1960’s to the 1980’s, school desegregation made rapid advances but was reversed dramatically by the courts.
Residential segregation and the “ghetto”
“Within the cities, Negroes have been excluded from white residential areas through discriminatory practices. Just as significant is the withdrawal of white families from, or their refusal to enter, neighborhoods where Negroes are moving or already residing. About 20 percent of the urban population of the United States changes residence every year. The refusal of whites to move into "changing" areas when vacancies occur means that most vacancies eventually are occupied by Negroes.
The result, according to a recent study, is that in 1960 the average segregation index for 207 of the largest United States cities was 86.2. In other words, to create an unsegregated population distribution, an average of over 86 percent of all Negroes would have to change their place of residence within the city.” – Kerner Commission Report
So 40 years later, how integrated are our neighborhoods?
• In the 1990s, overall residential segregation declined for African Americans but it rose for African Americans younger than 18 years of age.
• From 1980 to 2000, Hispanic residential segregation increased in several major metropolitan areas
• The overall levels of residential segregation remain disproportionately high for communities of color.
Communities of color and poverty
“Although there have been gains in Negro income nationally, and a decline in the number of Negroes below the "poverty level," the condition of Negroes ill the central city remains in a state of crisis. Between 2 and 2.5 million Negroes-16 to 20 percent of the total Negro population of all central cities live in squalor and deprivation in ghetto neighborhoods. …
In 1966, about 11.9 percent of the nation's whites and 40.6 percent of its nonwhites were below the "poverty level" defined by' the Social Security Administration (currently $3,335 per year for an urban family of four). Over 40 percent of the nonwhites below the poverty level live in the central cities.” – Kerner Commission Report
Today’s numbers on poverty rates among African Americans and Hispanics are:
• At a time when the U.S. is the richest country in history, 37 million Americans live in poverty today.
• Very poor African Americans are 3 times as likely and very poor Hispanics are twice as likely as Whites to live below half the poverty line, which is about $10,600 for a family of four.[2]
A Paradigm Shift
The Kerner Commission’s conclusion that our country was headed towards two societies, separate but unequal, seems to have borne out, despite the report’s intent for government to make policy changes to address racial inequality.
What the authors of the original report probably didn’t know was that their recommendations presaged a radically different way of analyzing racial inequality in the U.S. – structural racism. Discussions of race that focus exclusively on class obscure the impact of public and private institutions in perpetuating racial inequality. Structural racism argues that the combined impact of institutional arrangements and structures have racialized outcomes, even when these structures appear to be racially neutral, such as those affecting economic mobility.
Re-conceiving race and racism require an intellectual paradigm shift, and this has practical policy implications for addressing gaps in achievement versus gaps in opportunity. It is time for a policy paradigm shift, as Dr. Stephen Mayer recently noted. Let’s consider reframing affirmative action by adding class-based criteria to race.
What does this mean for philanthropy?
Philanthropists and private foundations can choose to invest their dollars in structural change; this isn’t ‘ivory tower’ academia inserting itself into philanthropy. It’s about focusing on the groups who are engaging in work on a daily basis that produces long-term sustainable results that benefit their communities. Foundations should seek out opportunities to invest their limited contributions in grants to local community organizations that are working on structural barriers to racial equality in the U.S.
As diversity remains a ‘hot topic’ in philanthropy, the time is right to remember Dr. King’s closing statement at the March on Washington, D.C. in 1963 through the lenses of structural barriers to racial equality, including class, gender, age, disability and, yes, public policy. Class-based affirmative action may be the first step towards allowing us to achieve Dr. King’s dream:
“And when this happens, when we allow freedom to ring, when we let it ring from every village and every hamlet, from every state and every city, we will be able to speed up that day when all of God's children, black men and white men, Jews and Gentiles, Protestants and Catholics, will be able to join hands and sing in the words of the old Negro spiritual, "Free at last! Free at last! Thank God Almighty, we are free at last!"”
Niki Jagpal is research director at NCRP.
[1] Langston Hughes (1951). Harlem, from Montage of a Dream Deferred. Quoted in the 2008 Eisenhower Foundation report
[2] 2008 HHS Poverty GuidelinesLabels: Foundations supporting advocacy and organizing, government oversight, Social justice philanthropy
By Niki Jagpal
On the 40th anniversary of the assassination of Dr. Martin Luther King, jr., it seems appropriate to review the progress we’ve made as a country toward achieving, or at least advancing, Dr. King’s vision as articulated in his famous “I have a dream” 1963 speech.
The Milton S. Eisenhower Foundation recently released a report called What We Can Do Together: A Forty Year Update on the National Advisory Commission on Civil Disorders. The report tracks progress in areas ranging from education, health, income and wealth to crime and poverty, and is a follow up to the informally known Kerner Commission Report of 1968, which investigated the causes of the 1967 riots in Newark, Detroit and New Brunswick, and suggested mechanisms to prevent reoccurrence.
Contrary to Johnson’s assumption that ‘militant groups’ like the Black Panthers were responsible for the ‘race riots,’ the report concluded, “Our nation is moving toward two societies, one black, one white--separate and unequal.” So 40 years later, it is fair to ask: is our nation still moving towards two societies, still separate and unequal? And what role can philanthropy play in addressing the needs of our evolving, pluralistic democracy?
Let’s compare some findings and statistics from the original report to those in the 40th anniversary report by the Eisenhower Foundation:
The criminal justice system:
“To some Negroes police have come to symbolize white power, white racism and white repression. And the fact is that many police do reflect and express these white attitudes. The atmosphere of hostility and cynicism is reinforced by a widespread belief among Negroes in the existence of police brutality and in a "double standard" of justice and protection--one for Negroes and one for whites.” – Kerner Commission Report
Today, the numbers paint a picture of little progress. According to the Eisenhower Foundation report:
• Minorities face a greater likelihood of receiving the death sentence than Whites. Minorities are also given longer sentences than Whites for the same crimes. Crack cocaine, which is used disproportionately by minorities, carries much longer sentences than those for powder cocaine, used more frequently by Whites.
• Scholars continue to find that regardless of their qualifications, some employers push minority applicants into the worst jobs. Further, many real estate agents steer minorities to less desirable locations, than Whites and fewer minority mortgage applications are accepted than White applications
• From the 1960’s to the 1980’s, school desegregation made rapid advances but was reversed dramatically by the courts.
Residential segregation and the “ghetto”
“Within the cities, Negroes have been excluded from white residential areas through discriminatory practices. Just as significant is the withdrawal of white families from, or their refusal to enter, neighborhoods where Negroes are moving or already residing. About 20 percent of the urban population of the United States changes residence every year. The refusal of whites to move into "changing" areas when vacancies occur means that most vacancies eventually are occupied by Negroes.
The result, according to a recent study, is that in 1960 the average segregation index for 207 of the largest United States cities was 86.2. In other words, to create an unsegregated population distribution, an average of over 86 percent of all Negroes would have to change their place of residence within the city.” – Kerner Commission Report
So 40 years later, how integrated are our neighborhoods?
• In the 1990s, overall residential segregation declined for African Americans but it rose for African Americans younger than 18 years of age.
• From 1980 to 2000, Hispanic residential segregation increased in several major metropolitan areas
• The overall levels of residential segregation remain disproportionately high for communities of color.
Communities of color and poverty
“Although there have been gains in Negro income nationally, and a decline in the number of Negroes below the "poverty level," the condition of Negroes ill the central city remains in a state of crisis. Between 2 and 2.5 million Negroes-16 to 20 percent of the total Negro population of all central cities live in squalor and deprivation in ghetto neighborhoods. …
In 1966, about 11.9 percent of the nation's whites and 40.6 percent of its nonwhites were below the "poverty level" defined by' the Social Security Administration (currently $3,335 per year for an urban family of four). Over 40 percent of the nonwhites below the poverty level live in the central cities.” – Kerner Commission Report
Today’s numbers on poverty rates among African Americans and Hispanics are:
• At a time when the U.S. is the richest country in history, 37 million Americans live in poverty today.
• Very poor African Americans are 3 times as likely and very poor Hispanics are twice as likely as Whites to live below half the poverty line, which is about $10,600 for a family of four.[2]
A Paradigm Shift
The Kerner Commission’s conclusion that our country was headed towards two societies, separate but unequal, seems to have borne out, despite the report’s intent for government to make policy changes to address racial inequality.
What the authors of the original report probably didn’t know was that their recommendations presaged a radically different way of analyzing racial inequality in the U.S. – structural racism. Discussions of race that focus exclusively on class obscure the impact of public and private institutions in perpetuating racial inequality. Structural racism argues that the combined impact of institutional arrangements and structures have racialized outcomes, even when these structures appear to be racially neutral, such as those affecting economic mobility.
Re-conceiving race and racism require an intellectual paradigm shift, and this has practical policy implications for addressing gaps in achievement versus gaps in opportunity. It is time for a policy paradigm shift, as Dr. Stephen Mayer recently noted. Let’s consider reframing affirmative action by adding class-based criteria to race.
What does this mean for philanthropy?
Philanthropists and private foundations can choose to invest their dollars in structural change; this isn’t ‘ivory tower’ academia inserting itself into philanthropy. It’s about focusing on the groups who are engaging in work on a daily basis that produces long-term sustainable results that benefit their communities. Foundations should seek out opportunities to invest their limited contributions in grants to local community organizations that are working on structural barriers to racial equality in the U.S.
As diversity remains a ‘hot topic’ in philanthropy, the time is right to remember Dr. King’s closing statement at the March on Washington, D.C. in 1963 through the lenses of structural barriers to racial equality, including class, gender, age, disability and, yes, public policy. Class-based affirmative action may be the first step towards allowing us to achieve Dr. King’s dream:
“And when this happens, when we allow freedom to ring, when we let it ring from every village and every hamlet, from every state and every city, we will be able to speed up that day when all of God's children, black men and white men, Jews and Gentiles, Protestants and Catholics, will be able to join hands and sing in the words of the old Negro spiritual, "Free at last! Free at last! Thank God Almighty, we are free at last!"”
Niki Jagpal is research director at NCRP.
[1] Langston Hughes (1951). Harlem, from Montage of a Dream Deferred. Quoted in the 2008 Eisenhower Foundation report
[2] 2008 HHS Poverty Guidelines
Labels: Foundations supporting advocacy and organizing, government oversight, Social justice philanthropy
posted by NCRP at
9:19 AM
|
0 comments
links to this post
