New Orleans       A friend and comrade shared an email with me last week on the advice from philanthropic foundations for nonprofits in the wake of the across-the-board attacks and funding freezes announced by Trump for the federal government.  The headline condensed the painful truth in a nutshell, blaring that “Foundations Turn Mostly Speechless Amid Nonprofit Funding Turmoil.”

Reading the email, the advice to the readers was either lame or bizarre.  There was the standard reminder that charitable foundations funded by the rich would not be sufficient to cover the gaping chasm created by the government’s exit.  Later, they share something more akin to gallows humor, even as it was presented as gratuitous advice, saying “Among the suggestions from experts: Boards and executive teams should work together to do scenario planning and cash-flow analysis.”  They must mean counting the chairs on the Titanic, which means the days until bankruptcy, since other reports indicate that most nonprofits have only have one-month in reserves with a smaller minority able to make it for three months.

On a similar front, we all read about the rich donor revolt in universities and elsewhere around the Gaza protests last year, but I hope New York University still has an ironclad tenure policy, because two professors, Hans Taparia and Bruce Buchanan, may need it after the donors read their “reveal” in an op-ed in the Times called “The Impossible Math of Philanthropy.”  The title of the piece is sort of a whitewash disguise, because the essay is a full-on assault at the fiction of superrich and corporate foundation giving.  They start slowly with the usual disclaimer that philanthropy can’t cover the gaps from the government and social services, despite the fiction many Americans believe that “charities as organizations … pick up where the government leaves off…..”  It doesn’t take them long to forecast their conclusion that the rich “earn moral credit for donating a penny to a problem they made a dollar creating.”

Buttressing the case for their obvious truths, they begin with the subsidies that underpin the low wages in fast food and other service industries, where “about half of Americans earn less than a living wage” that would cost employers “$1.9 trillion more in wages and salaries,” but which is only offset in 2023 by “$77 billion of all American charitable dollars [that] went toward so-called human service organizations, such as food banks and homeless shelters.”  Going past food and shelter, they do the numbers on the corporate impact on the environment, and it doesn’t get better.  Using Coca-Cola as a case in point, they look at the company’s switch between glass and plastic bottles, “effectively outsourcing the cost of recycling to municipalities, or, more accurately, the cost of plastic pollution to the world.”  Citing estimates of $3.7 trillion per year to clean up plastic pollution, they note that would be “three times the company’s net income in 2022,” when Coke’s donation to charitable causes in the same year was less than “95 million, a small share of which went toward recycling programs.”  They note that the combined federal and state environmental protection budget, under attack in many places from Washington on down, is perhaps $32 billion, “a tiny fraction of what it would cost to fix the damage corporations inflict on the environment each year.”

Finally, in a big finish, they throw their jobs against the wall, speaking truth to power – and money – saying,

…corporations could be legally rechartered so that their bylaws compel them to put public interests ahead of their shareholders. Both approaches would hurt companies’ profit margins.

For this to work, the public would also need to develop greater skepticism of the rich entrepreneurs who, with more cash than they could ever spend, donate portions of their wealth to favored causes. Lionized for their achievements and revered for their compassion, they bask in their status as society’s saviors. Meanwhile, the corporations they own extract wealth and externalize costs on a scale that dwarfs their largess. With one hand they generate supernormal profits by plundering society, and with the other they dole out a few crumbs to “save the world.” But they never will. The math simply doesn’t work.

 

Amen!