What does an Obama administration mean for the nonprofit sector?
How will this new President work with this sector that now controls nearly 10% of the Gross Domestic Product (GDP)?
Will he build on the work of the Bush Administration's Office of Community and Faith-Based Initiatives? Or will he wipe the slate clean and start anew?
Will his proposal to provide college loans to students in return for community service be implemented -- and how will it be received by the nonprofit community?
Will his health care proposals pass -- and how will they affect nonprofits that provide medical care to the uninsured? Will universal health coverage be the ultimate game changer for the health segment of our sector?
How can we, as social entrepreneurs, prepare to engage the next President in our shared mission of making this the best country that it can be?
Over the past few months, the U.S. Treasury has begun sending economic stimulus payments to more than 130 million households. These families will each receive checks ranging from $600 to $1,800.
“This money is going to help Americans offset the high prices we're seeing at the gas pump and at the grocery store, and it will also give our economy a boost to help us pull out of this economic slowdown,” said President George W. Bush about the Economic Stimulus Act of 2008 that he signed into law earlier this year.
The total amount of the economic stimulus package is estimated at $152 billion, or about one percent of the nation’s Gross Domestic Product (GDP).
Reports from across the country indicate that many families are either holding onto the funds or using them to pay down part of the nation’s approximately $60 billion in credit card debt. Although the intent of the law was to generate immediate consumer action, Americans are showing some unforeseen “retail restraint” that is confounding some of the architects of the stimulus package.
This should come as no surprise with gas surpassing $4 per gallon and the USDA’s recent forecast that food prices will continue to increase by 4.5 to 5.5 percent in 2008. Considering this, families that choose to save these funds or use them to pay down debt should be applauded for their wise stewardship.
However, if we truly want to use these funds to turn the economy around, allow me to offer a challenge for families interested in being truly effective stewards: donate your economic stimulus payment to a charitable organization that provides emergency assistance to our poorest neighbors.
Across the country, food banks are seeing an average increase in demand of more than 30% compared to this same time last year. Their partners on the front lines are the food pantries and soup kitchens that are facing longer lines than ever before, including many people who have never before had to rely on charity.
Organizations that meet emergency needs do far more than simply help the neediest members of our community: they multiply the impact of dollars donated to them, frequently on an exponential level. For example, the North Texas Food Bank enables organizations like Central Dallas Ministries and the SoupMobile to purchase nearly $10 of food for every dollar that they receive.
The low-income families helped by these organizations spend almost 100% of their money on basic needs. Every dollar that a food pantry can save them on grocery costs is a dollar will be used to purchase medicine, pay rent, buy clothes, secure transportation and more.
Want to generate a real economic stimulus for Dallas? Donate a portion of your economic stimulus payment to a local charity that provides emergency food relief to our community. You can provide a $6,000 to $18,000 boost to our local economy without spending a penny of your taxable income – and still receive a tax deduction!
You can determine how much you should expect to receive through the economic stimulus payment calculator at http://www.irs.gov/app/espc/.
---------------------------------- What do you think? Please click the COMMENTS button below.
Thank you to Tactical Philanthropy for inviting me to respond to their One Post Challenge.
What is the definition of power and influence in the philanthropic sector?
The NonProfit Times has offered an attempt to answer this question by issuing lists of the people whom they consider to hold said power and influence. Their 2007 list was the subject of one of my recent blogs as well as Phil Cubeta's reply on his Gift Hub blog.
The attached image comes courtesy of a 2005 post on adoption curve dot net, which I discovered when running a Google Image search for "power and influence." The analysis struck me as a very fitting image to portray the ideas that I outline in my previous blog.
But their power is not unexpected, and their influence fairly predictable in all but the most extreme circumstances. The "power and influence" of this particular Top 50 list, therefore, is fairly minimal.
Allow me to offer that a far more powerful list -- a philanthromap, as it were -- would be a more revelatory list such as:
The Top 50 Non-Profit Leaders Who are Quietly Changing the Sector
Or, as I with my conspiratorial bent would prefer:
The Secret Leaders of the Philanthropic Revolution
Who are these leaders? What are their defining traits? Are they the sort of folks whom we would be proud to invite to speak at our child's school, or are they of that ilk that should be on some sort of public list that is carefully watched by the shadow government -- or both?
Who, I ask, truly holds the power in the philanthropic sector?
Who, as the diagram at the top portrays, are the true "players" as opposed to merely the "context setters"?
I would propose that the following traits would make for a fairly short but substantive list of the truly powerful leaders of our sector, the likes of which NonProfit Times in all its illustrious glory would never publish:
Their organization is not a household name (i.e. their national and local office are likely the same);
They regularly voice their ideas in speeches, blogs, print publications or other media -- and they write their own material;
As the above image from adoption curve dot net blog illustrates, they have a high stake in the outcome of their actions/publications. This stake is deeply personal, far beyond compensation; that is, they have an intimate connection with the future of our sector.
I also think that an important consideration is whether or not they are compensated for their thoughts (i.e. they are part of a think-tank), or whether their publications are a veiled attempt to gain consulting contracts or sell services/products. This certainly should not fully eliminate people (love it or hate it, Terry Axelrod has made a lot of money while significantly changing our sector through her "Raising More Money" model). But there is a significant difference between Ms. Axelrod's motivation in writing a blog and that of someone like the anonymous writer of Don't Tell the Donor, who certainly has spent more resources on their blog than they will ever reap from its luminosity.
What names would you add to such a list? Phil Cubeta and I offered some initial suggestions in the aforementioned blogs. These are but a beginning.
Please add me your own nominations to this philanthromap as comments on this post, and I will publish the final results on my blog, The Raiser's Razor.
I am writing to you today on behalf of the global community of fundraisers. We need your help -- but we do not need you make another donation.
We need you to help us change the way that donations are made.
The future of philanthropy may not be entirely paperless, but the trend away from traditional forms of fundraising cannot be denied. Within the past five years, the amount of donations processed online has risen from the millions to the billions. Although overall giving has grown during this time, the majority of this increase is a result of changing behaviors among donors who would have previously donated offline.
This trend is merely the latest manifestation of a larger move away from writing checks in favor of utilizing credit cards to process donations.
I have two chief concerns within this reality:
First, the vast majority of fundraisers do not see this as a concern at all. In fact, many welcome the shift with open arms, praising the increase in overall giving as a result of providing donors with a quick, efficient way to make a gift.
While I am certainly grateful that the credit system has further opened the wallets of the world's donors, I am troubled by the fact that few question the effectiveness of this new tactic. Specifically, I am baffled as to why more of my peers do not share my next concern:
Such transactions require processing fees that result in a loss of millions of dollars that donors intended to go directly to charitable organizations.
In 2005, it's estimated that over $4.5 billion was donated online. Even at a rate of 4% (far lower than what many charities pay per transaction), that is over $180 million in processing fees.
Surely, there must be a better way to provide donors with a quick and efficient way of making a gift.
Admittedly, the challenge of changing something as entrenched and as powerful as the credit system is daunting. Much of the world's wealth is, quite literally, set against such a challenge. But could it be done?
Could a network of foundations pool their capital to fund the creation of a social enterprise capable of processing over $4.5 billion at little or no cost to non-profit organizations?
Could a visionary leader -- a Bill Gates, a Richard Branson, a Pierre Omidyar -- leverage the resources necessary to change the way that the credit card companies do business?
What systems would need to be in place? What barriers would need to be overcome -- not just financial, but also political?
Is there another way?
I believe there is. And I believe that you, the venture philanthropists of the world, are the ones with the resources, knowledge and connections to make it a viable reality.
Imagine the impact of:
Matching every $0.96 donation with an additional $0.04,
Decreasing the entire sector's fundraising costs by 2-4%, and
Removing the barriers that prevent smaller non-profits from accepting online donations.
The trend towards credit-based philanthropy will not stop. This year, non-profit organizations will surely receive more than $5 billion online. And yet there still will be too few resources to meet the needs, and every penny spent on processing a credit card is a penny that could have been spent on feeding the hungry, healing the sick, housing the homeless and more.
