Philanthropies as Government Shadows

americas-shadow-government-1New Orleans       Whoa!  You just know it’s getting hard out there when you find yourself nodding your head in some agreement with a senior fellow of the hardcore conservative Manhattan Institute, which over the years has been in the first ranks of community organizing attackers and ACORN-baiters.  There it was though, a Wall Street Journal op-ed by  James Piereson called “Philanthropies as Creatures of Government,” and there my head was, bobbing uncontrollably in agreement.

Of course much of his argument was poppycock and the usual fear-the-government, semi-Big Brother, line, but then there was this paragraph:

But the reasons the philanthropic sector should be independent of government have nothing to do with government spending or taxes.  Philanthropy is an integral part of civic society and, as such, offers alternative ways to address public problems.  Private philanthropy, at its best, can insure that new and sometimes unpopular ideas are funded and are not crowded out by political pressures or the bureaucratic groupthink that evolves when organizations are turned into instruments of government.  It allows those who have accumulated wealth to apply their own insights to alleviating poverty, improving education or strengthening the arts.  That was the original purpose of the philanthropic sector: to support programs privately that government could not or should not support.

He then talks about how the demarcation lines are collapsing between the private and public sector, quoting Irving Kristol, one of the intellectual saints of the conservative pantheon.  Of course the full-on assault of business and their conservative vassals for privatization of governmental services pulled this wall down, but that doesn’t take away from a point of agreement that the left and right seem to share about philanthropy, that it is squandering its mission by being unwilling to take risks, innovate, and fund programs and projects that are controversial and that government would not support.  The point of philanthropy should not be simply to leverage government, but step up where government has to step down, to break new ground, when government bunkers in the hillside.

Recently talking to lawyers about the necessity of their giving community organizations options, rather than advice, particularly if they had not looked at all of the consequences of such advice, I used the example of the corporate and tax status of community organizations. I used the standard example that being a nonprofit did not require incorporation at all since unions and many others are unincorporated associations of groups.  Furthermore as a nonprofit the question of being tax exempt is heavily freighted and electing a tax status, especially if not necessary, might handcuff future directions and actions of the organization.  Too many lawyers as a kneejerk reaction advise applying for 501c3 or 501c4, tax exempt status, and it’s wrong for many, if not most organizations, and cripples their ability to move independently of government and the politics that drives policy.  One voice in the room, simply and quietly, said, there was little choice because “funders” were demanding such tax decisions.How tragic!

Philanthropy has to have a higher purpose than providing the rich with a tax deduction, just as nonprofit work has to have a higher purpose than bending and tailoring our mission to the demands of money, private or public.  We may have a place though that the right and left can find agreement that philanthropy cannot simply be a shadow shackled to government.  We will never agree on the “ends,” but we might have consensus on the “means,” when it comes to foundations and the fact that they need to maintain their independence.

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