The South’s economic history is dominated by extractive industry, artificially cheap labor, unbridled economic development, and exploitation of the region’s human and natural resources.
As different as the region’s mountain hollers and Sea Islands may seem demographically, politically and economically, they share this history. The fate of Appalachian coal miners and Lowcountry farmers is linked.
And as nonprofit and community leaders in the Lowcountry and in Appalachia understand, dramatic economic transition for many Southern communities is underway. Community-led economic development organizations are breaking down barriers to access to wealth-building tools for historically excluded Southern communities. They are changing the narrative about the region’s economic past and future. They are capitalizing on the South’s rich assets: its people, its land and its culture.
With increased philanthropic engagement to capitalize on assets that already exist and build assets where they are needed, Southern communities can successfully transition to new economies built around equity and inclusion.
Based on conversations with nonprofit and community leaders across the South, there are some philanthropic approaches to funding community economic development that are more likely to succeed, and some that are counterproductive in the long run.
1. DO understand the long-shared past of Southern communities and their long-term vision for their shared future.
The history of inequitable economic development and exploitation in the South is long. It will take sustained, thoughtful investment for decades, not years, to begin building a new future. Funders need only listen to their grantee partners to know that short-term investments often mean low-impact investments.
2. DO bring the full range of your financial resources to bear on investments in Southern community economic development.
For funders to play a role in jump-starting a new economic future in Southern communities, they will need to embrace outside-the-box practices. In addition to grants, consider methods like program- and/or mission-related investments, funding revolving loan funds and of course funding the operating expenses of community economic development organizations. As always, asking grantee partners what is most needed is the best way to discern effective new practices.
3. DO invest in the diversity of community assets present in any Southern community.
Community assets go well beyond real estate, hard skills or mineral resources. If funders take the time to explore community assets with grantee partners, they’ll learn that in some communities, music, art, food and artisan work are promising assets worth investment too. In Southern communities with environmental and cultural assets, community economic development strategies are integral facets of grantmaking strategies that seek environmental sustainability and women’s economic security.
1. DON’T invest in community economic development that does not include meaningful community representation.
Without the “community” in “community economic development,” some community members are bound to be left out of an economic transition process and left behind. Funders have a role to play in ensuring their grantee partners represent those most affected by income, gender and race inequality, and that they have practices and processes in place that collect rich, honest community input frequently.
2. DON’T underestimate the structural change potential in community economic development.
Often philanthropic leaders think of community economic development as building new apartments or a job training center. Foundations that prioritize structural change may overlook community economic development strategies because of a misperception that they reinforce rather than disrupt systemic inequities that arise from our capitalist economy. But when community economic development is approached with the intention of increasing access to financial tools, housing, healthy food or sustainable agriculture for communities that historically been excluded, they can and should be part of a structural change grantmaking framework.
National funders seeking alternative economic models will find them in the Southern community economic development ecosystem. And Southern funders concerned about integrating marginalized communities into the economic mainstream of burgeoning Southern economies need to consider the valuable increase in access that comes with community-controlled economic development.
3. DON’T write off Southern grantee partners because of capacity needs.
Community economic development initiatives that are truly community-controlled often start at the grassroots, with little or no formalized 501(c)3 capacity. If foundations write off these organizations and community leaders, they miss a chance to nurture organic structural change infrastructure. Consider instead the ways investing in such grassroots community economic development organizations can leverage small capacity-building grants into much larger public and private investments in marginalized communities.
Photo by JonathanLamb. Used under Creative Commons license.
Advisory Committee and Coal Country + Lowcountry Interview and Focus Group ParticipantsREAD MORE
Section 4: Getting StartedKEEP READING