Monday, November 17, 2008

They don't know what we got

I have had a unique experience this past couple of weeks. I attended a conference on charities in China (the Global Philanthropy Forum) and then I attended one in the US (The Independent Sector annual conference). The contrast is amazing. In China, they are talking about the creation of a charitable sector, whereas the US has the largest and most well funded (by private contributions at least) charities in the world. In China it can take years to have an application approved to become a charity, in the US we give out the designation like candy. As noted in last week's blog, at the Global Philanthropy Forum in China they implored Charity Navigator to come and help; in the US many low rated charities would like us to just go away!

At the US conference, we had a local Congressperson talk to us about the lack of awareness among our political leaders about the size and impact of the non-profit sector. She informed us that many did not even realize that government money is used to pay for many of the services charities provide (last estimate I heard was nine percent of charities' funding comes from some governmental entity - that translates to well over one hundred billion dollars). Think about that. The largest non-profit sector in the world and some representatives of one of the most significant funders do not even know that they fund you! Pretty amazing. It is therefore not surprising that laws are often passed with no consideration of their impact on the charitable sector.

Such a lack of awareness is all the more frightening in the current economic climate. With government agencies at all levels cutting their budgets, there is a danger that critically needed programs can fall under the axe before there is time to educate legislators on the full implications of the cuts. Therefore, I believe that ongoing education of our governmental officials is needed on: 1) the role of the non-profit sector in solving critical problems in our society, 2) its tremendous size and vital role in the economy (one out of every 10 jobs in this country, for example) and 3) the critical support it receives from government for everything from community health care to low income housing to the arts and humanities. To this end, one encouraging effort that is being undertaken is the creation of a Philanthropy Caucus in both the House and the Senate. Currently these caucuses are in their early stages (about 43 representatives in the House and 5 in the Senate participate so far) but going forward this could be a critical vehicle for education on the federal level. I believe there also need to be comparable entities on the state level. Pennsylvania now has such a caucus and hopefully other states will follow suit. There is also a recommendation being made that the Executive Branch should establish a high-level office to coordinate education and oversight efforts in all federal agencies that are directed towards improving the capacity of nonprofit organizations to serve communities. This sounds like another good idea to help our political representatives to make better informed decisions as well as to maximize coordination and efficiency of charitable funding and monitoring at the federal government level in a time of fiscal challenge.

China is looking to countries like the US for guidance on how to create a charitable sector. I realize that part of the contrast noted earlier relates to the stage of development of each country, as well as our radically different systems of government. Our system allows for more voices to be heard and a complex array of checks and balances. As Churchill said, "...democracy is the worst form of government, except for all the others ..." I suppose we could make a similar pronouncement about charities in the US. "Charities are the worst vehicle to address many of society's problems, except for all the others". So in the end, it is not surprising that we still have a long way to go in educating our own society on that charitable sector. I had to go to the other side of the world to further appreciate what a precious jewel we have in our charities. I only had to travel a couple of hours away to appreciate how little our government understands that jewel.


Anonymous said...

They (government legislatures and administrators) are too self-absorbed to recognize the diversity and reach of U.S charities. So be it and fortunate for the charities!

Ken Berger said...


It is not fortunate for charities when government makes across the board cuts without understanding the impact on critical services provided by charities.