Can non-profits change the world?

I made a living working for non-profits for nearly 20 years doing community organizing and blah blah blah, so you could well accuse me of biting the hand that has fed me. But you could also say the same of a union member exposing the damages done by their company.

In this case, it’s a whole sector that needs examination, especially by those who choose to work in it. “Non-profits.” Makes it sound like, hooray, they are outside of the capitalist system doing good for the little people. So we progressives and radicals, particularly those of us who are not from the working class, flock to jobs that purport to do God’s work or Marx’s work or Alinsky’s work or whomever – at least it’s not Mammon’s work. (And while organizing jobs may not make you rich, they pay better than working at a nursing home or McDonald’s, jobs working class people are more likely to be stuck with.) Other countries don’t call it the non-profit sector, they call it the non-governmental sector, which may be more clear: this sector is not some third way, outside of the capitalist system.

There have always been “voluntary” organizations, groups of people banding together for common projects. Like providing services. Like political change. Like revolution. Organizations that didn’t need anyone’s permission for anything. Non-profits are a form of voluntary organization, but they are defined by their federal tax status, exempt since their work does not financially benefit private individuals. To get the exemption, the tax code also puts in place numerous rules that an organization must follow, including allowing government scrutiny. “While the idea of exempting charitable organizations from paying taxes is old, it was in 1954, the year of the McCarthy hearings which aimed to root out and destroy communist sympathizers and progressives through defamation and scare tactics (after successful anti-capitalist organizing by the above throughout the 30s and 40’s) that the tax code was revised to say that no political activities (except an “insubstantial amount” of non-partisan education on issues) were allowed by organizations seeking tax exemption. The main upshot over time has been the growth of social service not social change organizations.  There’s a political history, as with all laws, in 501(c)3 of the Internal Revenue Code.”

So why have so many of us stopped forming or joining organizations that collect dues or contributions without having to register with the government, follow their rules (such as requiring a hierarchical structure), stop engaging in explicit political action, and having to hide our radical analyses under a barrel? Why do we want to do our political work through a non-profit?

Funny, but it comes back to money. Capitalist culture has infected all of us, and it’s damn hard to get anyone to pay dues, even though they are, like taxes, the price we pay for enabling our organizations to carry out goals we say we agree with. So instead of relying on dues paid by many low-income individuals, we think it would be easier to raise money from big grants or from individual wealthy donors. And once we become dependent on those funds, we find ourselves defending the non-profit sector.

And it’s not a sector that warrants defending, since it opposes the socialization of problems and solutions, and undercuts radical organizing.

First, look at the foundations and donors. We know the origins of wealth in the theft of land and labor, but that’s another story. Today, many wealthy donors give away money to avoid paying higher taxes. But their choice of what and who to fund is a completely individual decision, and does not need to be based on anything communities identify as priorities. Most dollars go to right wing causes by the way; it’s not surprising that many of the rich use a “charitable” designation to do research, education, and advocacy to promote charity to other folks like themselves, a really twisted version of “charity begins at home.”

And even among those that do want to help the poor, their good intentions may well pave the road to hell. For example, the gi-normous Gates Foundation spent billions on their pet idea of “small schools,” which messed up many a public school before that funding stream stopped and left the schools in the same rough shape as before. Notice how the schools in this case but also service and organizing non-profits follow the money and implement the foundations’ strategies, not the other way around. It would be better if everyone paid more in taxes, because at least there is a socialized process for deciding how to spend the national budget. More and more of our nation’s assets are held in private charities – now over two trillion dollars. Just think how much we could do as a society with that amount of money! (Some may say that tax dollars go to things we don’t agree with, like the military. But that is what is meant by “socialized” decision making; if the majority of the people want their dollars spent on the military, then it’s up to those of us to who disagree to organize to change those priorities.

In addition, those assets are invested in the financial sector, not in increasing productive capacity and creating jobs (except for in non-profits which is not productive labor), so the growth of

Approved by whom? And for what?

charitable organizations is contributing to our nation’s economic problems. I served as a private foundation Trustee (and it was unusual for such a foundation to invite a community organizer onto the Board) at the same time I was organizing around access to health. I found out we had investments in the for-profit hospital industry: we were investing big bucks in exacerbating the problem and rooting for higher profits for these predatory hospitals so we’d get bigger returns – and then granting small bucks for little organizations to fight them! The idea was to increase the endowment to give out more grants, but those are usually contradictory goals.

Individualism also fuels the proliferation of non-profits like mushrooms on a rotten log – between 1985 and 2004 the number on file tripled to 933,000, and the trend is not slowing. Too many individuals who are creative, energetic, and progressive decide to form new organizations, led by themselves of course. Some ideas do turn out to be excellent, some not so, but these are self-anointed saviors.

In some cities on the left and right coasts, you can trip over a non-profit every ten feet; often there are several organizations doing practically the same thing.  The non-profit sector promotes competition on a  capitalist model. Wealthy investors choose who they deem to be the most efficient and weed out the rest, forcing organizations to spend a lot of time and effort on embroidering their successes. The search for funds (often itself consuming a good part of the organization’s budget – Development Directors often make as much as the ED) can lead to unhealthy competition and fracturing of those forces who should be acting in solidarity.  It also leads to organizations focusing on one tiny issue, while people need holistic approaches; the pressures of running non-profits means you have little time to work collaboratively. Since funding is often year to year and renewals are dependent on showing “progress,” their work looks at short-term fixes, rather than the long-term systemic changes that real solutions will require.

Grant dollars do not go where they are most needed. They go where there are donors or to places that interest donors. In some more rural areas and in the South and Southwest, there are few foundations or people able to get up any funds. Most people with wealth are white and fail to understand the significance of race: while people of color make up a third of the population and are three times more likely to be poor than whites, the amount of money going to groups that address racial inequality does not hit 5 percent.

Non-profits also promote growth on a capitalist model. They are always trying to grow and expand. It’s rare that a non-profit will close up the shop even after they have achieved their original aim. Again, money paid in taxes going into a national pot based is more likely to set priorities based on social criteria.

I could go on but I’ll pick one more point in the nay column: non-profit status can take the wind out of a movement. In the 70’s, community people formed their own health centers in those inner city and immigrant neighborhoods with no access to health care. “People” includes doctors, other health professionals, community leaders, and ordinary folks. They ran voluntary health centers without money, and were dedicated to improving whole communities, not just treating individual illnesses. Yes, it was a victory when the health centers received federal status – and federal dollars – and became non-profits, an example of using tax dollars for programs demanded by the people. Over time however, it became clear that victory was a double edged sword. They became service centers with the usual separation between professionals and clients, losing their original analysis that all were valued and contributing members of the same community, and all were needed to accomplish their aims. They dispensed medicine, but they stopped dispensing the idea that even the poorest of the poor have the power to make change – a basic tenet of the radicals and communists that began the health movement. People with power in and of itself improves community health.

But, you say, if they hadn’t gotten federal recognition, those clinics might be gone. You say, if more

Black Panther breakfast program, started in 1968 in San Francisco, Photo San Francisco History Center, SF Public Library

money went to taxes, we’d still need non-profits to organize people to make sure tax dollars go to where they are most needed. Both valid; our choices are not great – heads you lose, tails they win. So what’s a red blooded progressive or just a plain red to do in these times?

One option is to pick a place to take a working class job where there is some organizing potential. I spent nearly 20 years working in hospital food service departments; I got kicked out of one hospital for organizing, and the other had a weak go-along get-along union. By fighting for fellow workers and pushing them to take up issues like the racial occupational segregation within the hospital as well as to encourage the union to support non-work related issues such as the return of President Aristide to Haiti, progressives were able to win the leadership of the union. In a non-profit, you’re hired, not elected. All too often, middle class organizers without experience as grunts become the spokespeople for worker struggles, reproducing capitalist power dynamics. As a rank and file worker, you’ve got to earn your leadership.

But if you do choose to work for a non-profit, we can learn how to get as much as we can from working within them.  The best example I heard came from the Phillipines, where, for example, people working as health outreach workers took it as an opportunity to do their own social investigation of the conditions and mood, and to identify indigenous leadership in the neighborhoods. However, they had lots of people in a voluntary political organization able to carry out a coordinated strategy.  There are a few non-profits here in the US where explicit strategic thinking on the part of those committed to fundamental change have moved those organizations to be able to make more radical inroads – Right to the City comes to mind. Workers centers in some cases have simply provided services, but where leaders base their work on a radical analysis such as with the Immokalee workers, those centers have raised consciousness and produced a new layer of leaders who can navigate the waters of global capitalism. Of course, many of those immigrant leaders have had political organizing experience in their home countries.

In non-revolutionary times, non-profits can play a role in engaging new people to challenge what doesn’t work in this society and to spread a culture of organizing and critique of the system.  To make this most effective, the specific work should be put into the context of an analysis of how the system works overall. When I worked on access to health care, I made sure we didn’t just talk about access to insurance, which is like coming in at the tail end of the story: we organized people around poor housing conditions that caused asthma, and showed how racism allowed the hospitals to fail to serve the people who lived in their neighborhood.

No matter where you work, it’s important to be open about your politics. Wherever I’ve worked, including as a foundation Trustee with bankers and lawyers and investment brokers, I have been explicit about being a socialist and belonging to a socialist organization. Letting people know that helps people see that if you’re successful, it’s not because you’re an extra talented individual, but because you’ve learned an analysis from and with a bunch of other like-minded folks. Of course, if you’re a big flop, they blame socialism – so be sure to do a great job! :-) And, I’m sorry to say, my identifying myself as a member of Freedom Road Socialist Organization didn’t deter even more conservative folks from working with me. We are not as scary as we like to think! I’m kidding – it’s a good thing. Part of our task is to show that yes, there is an alternative.

And it has nothing to do with the non-profit sector!

Whatever choices we make about where we earn a living, we need to re-build the voluntary sector. To transform our economy and our society, more than ever we need organizations that don’t have to mimic imposed structures, or to ask permission. That’s the sector where we can be effective, creative, inclusive – revolutionary!

This post is also available in: Spanish

Meizhu Lui

About Meizhu Lui

Meizhu Lui is a founding member of Freedom Road Socialist Organization. She is the co-author of The Color of Wealth: the Story Behind the U.S. Racial Wealth Divide. Her views have also appeared in mainstream news media such as the Washington Post, CNN, and She describes herself as a “professional troublemaker!”
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