Progressive philanthropies are driving a wedge between nonprofits and the folks who want to support them.
Progressive philanthropies are driving a wedge between nonprofits and the folks who want to support them.
‘T he bottom is falling out.” That was what Woodrow Rosenbaum, chief data officer for GivingTuesday, told the Chronicle of Philanthropy recently. Rosenbaum, who is one of the authors of a new report showing that the number of small donors to nonprofits is on a steep and steady decline, says, “That’s an indicator as a sector that we’re not ready for a recession.”
Nonprofits have been sounding the alarm for a while now. Indeed, this is the fifth straight quarter of decline in the number of individuals giving to charity. Generally speaking, charitable giving is correlated with GDP. But this decline started before our current economic troubles. And, with record-high inflation, it will weigh even more heavily on the nonprofit sector.
The GivingTuesday report found that, compared with the first half of 2021, the number of people making charitable contributions of $100 or less dropped by more than 17 percent, and the number donating between $101 and $500 fell 8 percent. Why are small donations in particular falling? One reason could be that nonprofits are spending their resources courting large donors. In principle, this shouldn’t be a problem. An organization’s work could appeal to those able either to give a few dollars or a few million. But it is also possible that nonprofits’ messaging has changed.
Even as the number of small donors has declined, the number of eye-popping grants from large foundations seems to be rising. Take the WK Kellogg Foundation’s $90 million Racial Equity 2030 Challenge, which seeks “bold solutions to drive an equitable future for children, families and communities across the globe.” One of the grantees, the Latino Community Development Center, has as its mission the promotion of “financial literacy, affordable housing, and economic development for low-income Latino and other immigrant communities in North Carolina.” But the grant that the group won from Kellogg is for “leveraging this model of financial inclusion, civic engagement, and cultural pride.”
Or take ActionAid Brazil, which for the past couple of decades has protected girls from sexual exploitation and helped women and children in developing countries get access to clean water and education. But the group’s grant from Kellogg is going toward “Building an Anti-Racist Public Education System in Brazil.” Large foundations with vague goals like ending racism by 2030 are less interested in ‘boring’ causes like clean water. But a donor who gives under $100 might prefer the ‘boring’ cause.
It’s easy to see the temptation for organizations that previously focused on providing vulnerable populations with food or shelter or better youth programs in their communities to lean into more “organizing.” Such institutions might follow the lead of larger ones, such as the Ford Foundation. That foundation, which has given hundreds of millions in recent years, now says its “work is to support the courageous people and organizations at the center of this fight to achieve lasting political and social change.” An institution that might once have been committed to helping individual women who are facing domestic violence or who have a crisis pregnancy may now be more inclined toward advocacy work.
It is perfectly possible that many of these organizations were already engaged in fighting for abortion rights or were pushing for the use of critical race theory in the classroom. But when most of the large, well-known foundations are rewarding nonprofits for their political activities, nonprofits may inevitably start to shift their own resources and also their development pitches. Grants featuring this woke work will be placed on organization’s home pages. And the people who are doing the fundraising — often the very people who have been bred in the rarified circles of charitable foundations — will shift their messaging.
This will not only repel donors who don’t share the political perspective of the foundations, but may also make small-donor donations seem insignificant. For example: Mackenzie Scott just gave the Girl Scouts $85 million. Scott, who has already given hundreds of millions to LGBTQ causes, will provide much support to those in the organization who accepted biological males as members. So why should a typical cookie-buyer bother this year?
There are hundreds of thousands of nonprofit organizations in this country. No doubt many of them will engage in political advocacy. But for those who want the broad base of support that comes from having a lot of small donors (not to mention volunteers), political activism might not be the best way to achieve their goals. The Left often complains about the outsized influence that the wealthy have in this country, compared with ordinary Americans. But the truth is that progressive philanthropies are driving a wedge between nonprofits and the folks who want to support them.
James Piereson is a senior fellow at the Manhattan Institute. Naomi Schaefer Riley is a senior fellow at the American Enterprise Institute and the Independent Women’s Forum.