discourse – Habits of the Heart

Hi-networth giving in America : a symptom of another gilded age?

Felicity Huffman’s sentencing to 14 days in jail this week could be a turning point in American charity. It is among the few indictments of a rich person who used their money or influence to gain an advantage for them/their family.

But a change in American attitudes towards charity and a turning point? How so, you might ask.

Huffman, a celebrity and well known figure is among the few who ever get punished for using their money to unduly influence processes. In this case, it was for getting her daughter admitted to the University of Southern California.

At a time when income inequality is a hot button issue and corruption among the elite is a topic that gains attention, the issue of philanthropy and the corruption is breeds is also gaining traction, and for good reason.

I suspect that this case may establish not only a legal precedent but also a moral one that may start questioning the benefits of hi-networth giving and the actual benefits that the giver receives. While the assumption (which holds true in many cases) is that rich folk give money to fulfill some sense of mission or obligation, there are many cases where the motives are not as pure.

Besides, may be living in yet another ‘Gilded Age’, where the rich and mighty bought favors, got laws written in their favor and basically gamed the system. This has happened in the past, with the Rockefellers, Carnegies and Fords.

With several dozen other rich and famous people accused of misusing their money and influence to help their kids get into this top-ranked university, the question naturally arises : Are Americans becoming tired/ jaded of a certain strand of philanthropy :that of the super-rich?

It may be too soon to say that this is a major shift, but there are indications that more people are paying attention.

For sure, there has been a decline in public confidence in public institutions, as this study points out. There has always been a skepticism of hi-networth philanthropy, among the informed segments of American society.

The philanthropic landscape in the US is quite complex, with people’s understandings, motivations and trust varying across levels. While almost 1/3 of philanthropy takes places towards religious institutions, one can see how confidence in religious institutions remains somewhat high, despite various scandals.

However, given the individualistic nature of giving in the US, there seems to be some skepticism of hi-networth giving.

While this scandal involving philanthropy and education may pass, it may awaken a new understanding among people (and perhaps the elite philanthropists too) that buying your way into anything may have consequences. And that hard work may after all, count for something!

America’s philanthropy problem?

A debate that is becoming salient, over the past few years is if philanthropic foundations are becoming powerful by the day? A recent article in The Huffington Post points this out. The writer points out, correctly, that Jeff Bezos solicited ideas for his philanthropy, just a few days before the purchase of Whole Foods. PR stunt? Astute move to buy some social capital? Or perhaps a combination of both?

For some, this is a problem – arguing, as does the Huff Post writer, Matt Stoller. But for others, this is nothing but a transactional idea. A means of buying some legitimacy in a world where raising questions such as this is moot. The battle of ideas over the legitimate use of power is over, in this other world-view. The capitalists have won and rightfully decide what needs to happen in our world. Whether it is by monopoly or other means is irrelevant.

A friend recently pointed out Hypernomalization, a documentary that also makes this point. The thesis in this documentary, that giving away of democratic power to those with wealth is dangerous and has brought us to the current state of affairs – with a climate change denying President and a world where the state is increasingly being made irrelevant and the real power resides in the handful of oligarchs around us.

This is not just a political problem but also a social problem. And in that sense, a philanthropic problem as well. For those of us who study (and practice) philanthropy, this should be disconcerting – simply because of the ramifications of how the act of philanthropy is perceived. Whether it is a genuine act – aimed at bringing about social change or a PR stunt depends as much on one’s motivations and style of managing it. The current tilt towards hi-networth philanthropy makes it less egalitarian and ‘normal,’ it seems.

Can celebrity philanthropy be harmful?

Remember the ads in which Angelina Jolie comes out and shames the world for ignoring the plight of refugees? Or the Bono concert for helping AIDS victims? While each of them have done incredible good in the world, there is an argument out there; and it is a fairly strong one that goes like this : Since these celebrities are part of a governing regime of capitalism that causes this poverty in the first place; they are not doing anything substantive to address/ ameliorate poverty. They are just putting a bandage over a wound that is bleeding a patient to death.

Here is a scholarly paper by one of my PhD committee members, who helped me think about this aspect when I was a Phd candidate. I was aware of some of the negative influences of celebrity culture. This whole notion of attention seeking has never appealed to me. While attention seeking for a purpose is OK, most celebrities seek attention for the sake of attention, that has never appealed to me.

Patricia Nickel says in her paper “modern-day parables of philanthropic celebrities powerfully govern the oppositional impulse as they impart as sense of ‘benevolence’ in the form of an individualized disposition towards well-being and entitlement.” She further argues that this ‘governing regime’ which the celebrities sanitize with their appeals to charity is itself rotten.

In another paper, she, along with another scholar Angela Eikenberry argue that “However, this discourse (of celebrity philanthropy) falsely conveys a community of individuals with access to a venue for shaping social change. Rather than providing an open, discursive space for imagination, philanthropy as it has come to be defined, disguises its own discourse in its portrayal of the mediums of consumption, profit, and media celebration as the basis for benevolent human relations.” So, the issue that is problematic is one of relying on the market to manage relationships of benevolence. The buying of a laptop to eradicate AIDS (Red’s campaign) is problematic, according to Nickel and Eikenberry. This is also problematic given the ‘end of discourse’ that they suggest is going on.

This is also to suggest that while celebrities bring up certain problems, they don’t really talk about the structural problems that caused the crisis we are in, in the first place. This is the real issue with celebrity philanthropy.

While I agree with her assessment that there is an over-reliance of market mechanism for philanthropic activities, we seem to be enveloped in the market, the world over. There seems to be little space, if any for transactions or discourses to occur outside of the market mechanism. How does one impact lives outside of the market mechanism?

There are mechanisms and tools available to reach people and meet their needs. One is to explore traditional systems of charity, for instance religious giving to one’s place of worship or charitable organizations that are faith-affiliated. My dissertation work looked at some of these possibilities.

Indeed there needs to be greater space for personal benevolence and charity to occur, but the manner and speed with which celebrity philanthropy is occurring is not without its flaws.

How will the new administration and its policies impact the Nonprofit sector?

I recently attended the ARNOVA Conference, the annual conference of ARNOVA, a leading organization that is dedicated to research of the Voluntary and Nonprofit sector. As one of the most important convenings of its kind; this conference brings together both scholars and practitioners from around the world.

This year, there were close to 1000 attendees, from around the world. As someone who pays attention to this sector, I was interested in documenting some of the key changes that one can expect in the coming year, with a Trump administration. What would the sector look like, in the coming year and what factors would contribute towards that? Here are some key points, based on a conversation that took place between three leading practitioners/ observers of the sector :

The changes in the Affordable Care Act – or Obamacare – as it is popularly known will impact all levels of government, both local and federal. As the Council on Nonprofit’s Tim Delaney pointed out, this is one of the biggest shocks that may hit the system. Depending on how the Obamacare is rolled back, this may mean that states have to pay up more of the Medicare funds etc. and any moves at the federal level can trickle down to the state and local governments
The second key point is that ‘repealing the estate tax and capping itemized deductions at $100,000 for individuals and $200,000 for couples.’ This, according to one analysis, ‘would cause charitable giving to decline by between 4.5 percent and 9 percent, or as much as $26.1 billion per year.’ This is a significant change, if it occurs.
Nonprofit Electioneering Ban : As the NCNP argues, the ‘Johnson Amendment’ that prohibits 501 c 3s from engaging in political campaigning may be lifted, as that is one of the promises made by the Trump administration.

As Stacey Palmer of the Chronicle of Philanthropy pointed out, there may be more introspection on part of nonprofits and scholars, in terms of what nonprofits can do and their limitations. The public may get swayed by rhetoric that nonprofits can fix all problems, but that is simply not true, she warned; pointing out the severe resource constraints that many nonprofits work under.

So, what will the new administration bring, that will shake up the sector? potentially quite a few changes, but one can hope that these are not deleterious to the sector or the people that it serves.

“What about public service?” you ask…

When it comes to the discourse of charity, philanthropy and ‘doing good’ most people don’t consider working for the government, in a ‘public service’ role as being particularly altruistic. But consider this : Most public servants ( whether working for federal government, state or even a nonprofit) make much less salary than a comparably educated person, at a ‘for-profit’ firm. I have met some of the smartest, best educated people working for the government; with the motivation to ‘serve.’ While this may sound hunkie-dory for the capitalists amongst us, I would like to believe that there is such a thing as a public service motivation and it is important to sustain this motivation, to ensure there is a solid, working bureaucracy and a society that honors such traits.May be it is our evolutionary disposition to value those who sacrifice something for us, or a social norm to value those who do good.

Regardless, this trait is something to be considered when evaluating how one spends one’s life, and is often a criterion for selecting leaders in the public sphere. Particularly, in a society where time is money, and in some cases more important than money; giving of one’s self, to others; in the form of time; efforts and psychic attention and energy is a valuable commodity.

Volunteer hours are also quantified by nonprofits, just so you know. Most nonprofits report them in their annual reports.

As a group of people, Americans need to be reminded now, more than ever – given the election cycle – that such a ‘service’ motive is indeed important, to serve common good. Not just the ability to make money and throw it away.

If not for profit, for what?

nonprofit

I sat next to an older gentleman on my flight from D.C. to Atlanta, GA. While he was quite in the beginning and was absorbed in his newspapers, a quick smile and conversation started him talking. And despite his strong southern accent – he was from Alabama – we managed to discuss a lot of ideas on this short trip.

One of the first things he said when I pointed out that I was working in the nonprofit sector was that it’s all a sham. “It is all about tax write-offs, ultimately, someone has to pay for all that service.” He argued.

While I do meet the occasional Libertarian, who brushes off all feel-good work of nonprofits as just instances of market catallaxy, or the ‘entrepreneur’, who quite genuinely scoffs at the idea of the nonprofit being a sector, the truth is that about 10 percent of Americans are employed in this sector and it is one of the most enduring parts of American work-force and cultural landscape. Nonprofits today are growing and thriving, if anything. There is no denying that this sector is important and worthy of our attention, even if we don’t believe in how it operates or its assumptions.

This conversation brought to mind the famous book by Dennis Young, ‘If not for profit, for what’? In this book, he has argued for a behavioral theory of studying the nonprofit sector. In terms of framing the study or discourse of nonprofits, young suggests that the demand side of nonprofits has been studied quite extensively, i.e, how nonprofits provide public goods as studied by Burton Weisbrod and as providers of ‘trust goods’ as offered by Henry Hansmann – where nonprofits ‘asymmetric information led consumers to prefer nonprofits over less trustworthy for-profit providers.’ What this means is that there is a market-gap in most areas, where consumers/ citizens don’t have access to the best information and in the absence of that, for-profits would – given their motivation to make as much money as possible- make use of this gap. On the other hand, a non-profit, which has a service motive is not likely to indulge in this sort of behavior.

Young offers an explanation that the ‘supply’ side of nonprofit behavior has not been extensively analyzed and this can help understand the motivations for why people work in this sector and why it even exists. He uses entrepreneurship as a motivating factor to understand the sector. His framing of the nonprofit sector leadership and motivations as ‘entrepreneurship’ is key to our discussion. Most nonprofit leaders and organizations are trying to solve some social problems for which there is no market solution. Or if there is, it is too expensive or exclusionary.

As Peter Frumkin, writing in this book suggests “The value of his (Young’s) early contribution was and continues to be his focus on the way the values, personal traits, and skill sets of individual entrepreneurs are a useful starting point in understanding where nonprofit ideas and organizations originate.” By this means that the focus of most scholarship and discourse has been on why market failure has been responsible for the rise of nonprofits, while there hasn’t been much focus on the supply side – meaning why individuals do what they do, in the context of social organizations and institutions. The study of values, motivations and drives is key as well. This also explains the rise of the civil society sector in the U.S., which Alexis De Tocqueville wrote about, in Democracy in America.

Back to the question: if not for profit, then for what? The answer to this lies in both normative and philosophical dimensions. Sometimes profit is not the key motive. It could be service or the desire to make a difference. The motive to serve public and do ‘good’ is inherent in the social sector, of which nonprofits are a part. This also means that we need to take into account other motives, other than pure profit motive, that drives individuals to serve and work in these forms of organizations. The market and government cannot provide all answers to questions before us, hence the need for nonprofits.

How to fix the world – Use your head or heart?

Climate change. Refugee crisis. Unemployment. Poverty. Think of these issues or any other countless ‘wicked’ problems and if you are reasonable, like most people; one question sounds in your head: “Do we know all the facts?”. Do we know the ‘right’ approach to fix these issues? While the ‘facts’ are available to address and solve most of these problems, often, what triumphs in the form of policies and actions taken are based not on technocratic solutions, but value laden opinions. You think policy makers use their head all the time? Think again.

Fix-the-world-321

In a discussion with a senior administrator of a major research university, last week; I brought up this question. To my query of whether most decision makers use the ‘head’ or ‘heart’, she gave me a very interesting answer. The person ( let’s call her Ms.A) said that most of the times, she has seen less of technocratic solutions and more of normative answers. Technocracy or ‘methods’ based solutions are offered very few times and often are not the ones chosen because such solutions can only take us so far. How does one, for instance, deal with a million people showing up on your borders – when your own country is dealing with unemployment? Do you turn these desperate people and shove them in the sea, to drown? Or do you appeal to normative and moral claims, to tackle the issue, at hand? While there are multiple perspectives at hand, and those who want to justify their decisions on technocratic basis: we are undergoing a recession, OR ‘These people don’t fit in here’ can use any combination of excuses to make the decisions that reflect their values. But ultimately, all such decisions that take place in the public domain are at the end, reflective of our normative values. Even bureaucrats don’t blindly implement laws, but rather implement them based on their own interpretation of it. Dwight Waldo, one of the greatest contemporary thinkers and scholars of Public Administration showed this, in his work.

Even when we write ‘laws’ and ‘rules’ to do things, most decisions take place in a gray area, where idealism meets pragmatism. It is important to be aware of this, as much as this may be against or for our interests. Sometimes, bad laws get passed because they reflect the values of those who make them and at other times, good laws get made and implemented. To lay claim to a pure ‘objectivity’ in matters of public discourse and action, is foolish. Perhaps, it is the heart that triumphs, most of the time. We just need to ensure that those who make laws have theirs, in the right place.