Nonprofit University Blog

Last week, the United States Supreme Court made a decision that could have huge implications for nonprofits across America, regardless of their missions.

In Citizens United v Federal Election Commission, No. 08-205, the Supreme Court relied on the First Amendment protection of free speech to say, according to Justice Kennedy who wrote the majority opinion, that Congress may not fine or jail “citizens, or associations of citizens (emphasis added), for simply engaging in political speech.”  In other words, with its 5-4 decision, corporations are no longer banned from spending money in political campaigns—whether it is taking out an ad explicitly endorsing a candidate or conducting a mail campaign praising a candidate’s particular position, for examples.  In fact, it would be outright unconstitutional to ban such activity.

What is particularly interesting in this case is that the plaintiff in the case is not a big oil company or a major Wall Street player or some other mega-billion dollar for-profit company; rather, the plaintiff is a nonprofit.  Citizens United had produced a 90-minute documentary that was apparently unfavorable to Hillary Clinton who was, at the time, running for President.  Citizens United lost its suit against the Federal Election Commission to allow it to show the documentary on an on-demand station and run TV ads for the showing.  Appeals brought it to the Supreme Court.

Many pundits are seeing the dark side of this decision:  corporations with their deep pockets will now have the ability to drown out the voices of the rest of us—the individual citizen and all of the rest of the groups that are “associations of individuals.”  And while I agree that is true, I am choosing to look at the bright potential of this decision.  Given that the decision is planted fully under the free speech protection of the First Amendment and extends it to groups of citizens (in addition to individuals), and the Fourteenth Amendment guarantees equal protection of the laws to all citizens—can we have one class of associations of citizens—corporations—receiving different treatment than another similarly situated class of associations of citizens—nonprofits?

As a non-lawyer, it seems to me that the question may hinge on whether these two classes of associations of citizens are truly similarly situated.  A huge question, I know.  But if corporations are going to be taking their unrestricted profit dollars and spending them, as they please, on endorsing political candidates, and without having to check with their shareholders to see if they approve of having a share of their dividends go to endorse specific candidates, shouldn’t nonprofit organizations be able to use their unrestricted dollars to do the same? And similarly, without restrictions from the government?  Or, are nonprofit associations of second-class citizens?

Does this Supreme Court ruling open wide the door to challenge the IRS’ ban on campaign activities by 501(c)(3) organizations? It would certainly seem so, and I doubt there will be a dearth of organizations willing to mount that challenge!

For more on this different perspective on the Supreme Court decision, check out OMB Watch.

This chart helps define what Citizens United means for nonprofits >

How do I say write this without sounding like an old fuddy duddy?  With great difficulty and a low likelihood of success!

I think it is absolutely marvelous that the Red Cross has collected over $100 million from around the globe for the victims of the Haitian earthquake, predominantly through the texting of pledges.  (Well, actually, I think it is marvelous that $100 million has been raised; I am a little dubious about the Red Cross receiving all of that money as their recent track record of using money collected for major disasters has not had the greatest integrity.

But I hope all of the changes they have made since Katrina have corrected all of that.)  But as Americans—I won’t speak for the rest of the world—we generally respond well to disasters.  And when we make responding to disasters easy—such as texting a donation on our phone, giving money at the cash register, etc.—we do even better.

Texting donations is great, as is dropping money in a bucket that is placed directly in front of us.  And responding to heart-wrenching photos of massive destruction and children bloodied and crying in the streets is a no-brainer.  But what about responding to the daily needs—food, clothing, shelter, education, health care–of people struggling to make it through the day without natural or man-made disasters?  What about responding to the need to preserve our open space, natural resources and cultural richness so that there are places to find solace from the storms all around us?  How are we going to ensure the on-going support our communities need to remain healthy, virbrant and humane?

Texting alone will not do it.  We must teach the value and importance of philanthropy And we must value it wherever and however it is found.  Peter Singer, in The Life You Can Save, makes the statement that Americans have norms against being “too charitable” and that we believe “that caring is in some ways deviant, the exception rather than the rule.” Is that really true?  Does, as he says, “selfless behavior makes us uncomfortable?”

Then let us hope that we get used to a lot of discomfort.  More and more elementary and secondary schools are building into their curricula the teaching of philanthropy.  Service-learning is well entrenched in institutions of higher learning; so now let’s add the teaching of philanthropy.  Civically-minded corporations encourage their employees to volunteer and may even match donations made to charities; some take it a step further and require that their future leaders serve on boards of nonprofits.  And some even take it a gigantic step yet further.  The former Bear Sterns (which would not win my praise in many other areas of performance) required more than a 1,000 of its senior managing directors to give 4% of their salary—and bonus—to charity.  And tax returns had to be produced to prove the giving!  Goldman Sachs recently announced, juxtaposed to the pending payment of large annual bonuses, that it is considering a mandatory charitable giving problem a la Bear Sterns model.

If that were to happen, and Goldman Sachs’ program hovered around the same mandatory 4%, estimates are that this program could produce hundreds of millions of dollars for charities.  (This giving program shouldn’t challenge our comfort level, however, as there is a clear suggestion that this program is being created to try and win public favor.)  Though not a fan of coerced behavior, there is enough literature out there to suggest that coerced behavior can lead, eventually, to similar volunteered behavior, so I’ll take it.

What is at stake here is the future quality of all of our lives.  We cannot rely on catastrophes or ease of giving to lead people to philanthropy.  There simply are too many needs and causes in our everyday lives that require on-going support.  We must engender in all an on-going sense of caring and appreciation for the power of philanthropy.  We need to get very uncomfortable.

Ever since my son got his drivers’ license, anytime he and his best friend from high school want to have a serious conversation, they get in the car and drive.  Long, long drives to no where.  Doesn’t matter what time of day or night, a conversation becomes a road trip.  Every once in a while, however, the road trip becomes the conversation.

I am not often privy to the content of these conversations, but every once in a while, I get lucky and get a text  that sheds some light on the conversation (fortunately the texter is the friend, who is the passenger).

Last Friday night, as they were driving to New York for a 21st birthday party, I got the following text:  did u learn in undergrad or from reading?  I needed to clarify if they were asking whether I had learned as a result of going to classes, hearing the professors’ lectures and the discussions of my professors and peers, or simply from doing the assigned readings.  Neither, was the response.  Did I learn more from my undergraduate education (they are both juniors in college) or from the reading that I have done throughout my life?

That was a much easier question to answer.  As a voracious reader, there is no question that throughout the many decades of my life, I’ve learned far more from reading that I ever could have possibly learned from four years of undergraduate education.  And this is no slight on my undergraduate education, which was superb.  It, unlike so many undergraduate educations, actually fostered learning from reading.

But the learning I’ve gained from reading has been intentional.  While I confess I do not read in every field and every discipline, I have a very varied reading repertoire.  I read that which I know will help me develop in my profession, and am frequently thrilled when something not on that intentional list does the same trick, as well as that which I know will simply give me a deeper and richer pool of examples, analogies and food-for-thought.   It seems that having spent so much time as an academic, however, I do segment my reading, assigning fiction to the summer and holidays, while non-fiction is for year ’round.  I’m trying to work on that.

And I read everything, from serious tomes to headlines to the inside of bottle caps; from the two page essay to the 52 chapter book.  And from all of it, I learn.  I get Google’s daily nonprofit alerts – must reads. .  Sometimes it is just the headline; other times, the full article.  And from there, I’ve gotten fodder for blogs and ideas for developing new classes for The Nonprofit Center.   I read and re-read books to see what I glean at time one that is different—because I’m different—at time two.  (I even date and color code my notes with each reading.  (Did I hear someone say nerd?)

When I first read Jim Collins’ seminal works, Good to Great and Built to Last, I read them as an academic, teaching traditional academic classes.  Years later when I reread them, I was the executive director of a nonprofit and part-time consultant, and I saw very different messages that needed to be conveyed.  I’ve told executive directors and board presidents who bemoan the state of their boards to buy every board member a copy of The Source:  Twelve Principles of Governance That Power Exceptional Boards, and have everyone read one principle in preparation for each board meeting and then discuss it.  A mini book club that can move a board—and therefore—an organization forward!

While reading should not be the sole source of professional development used by an individual or an organization, its power and value should not be undervalued, particularly in these tight financial times.

For a variety of reasons, many of us are happy 2009 is over. But that doesn’t mean 2010 will be our knight in shining armor.   As I’ve said before in this space, the economic fat lady hasn’t sung for any of us yet, least of all the nonprofit sector.  She’ll be singing for us years after she’s sung for others.

So, what’s a nonprofit to do?  Ask the tough question.

I don’t believe in this thing called “human nature.”  There are just too many discrepancies.  Let’s take survival, for instance.  People who believe in human nature will tell you that it is human nature to want to survive.  We hear of people going to great lengths—even intentionally inflicting harm to a portion of their bodies in order to save the whole—in order to survive.  And yet, at the same time, we hear of others who choose not to survive—those who choose suicide, ask that life-sustaining measures be stopped, engage in activities where the odds of not surviving—short or long term—are great.  The desire to survive is not wired into our nature; it is determined by the situation in which we find ourselves at a given point in time in our lives.  Thus, sometimes the right choice is survival, while sometimes it is not.

The same is true of organizations.   Sometimes, survival—particularly when it is mere survival—is not the right or best option.  Sometimes the best option is to close down.

That, I understand, is not a popular option.  But that doesn’t make it the wrong option.  I recently received questionnaires I’d sent to eight executive directors of venerable organizations, each of which was also doing good and important work in their communities.  But in answer to the question what are the five top issues facing your organization, funding came back loud and clear—sometimes repeated five times.  And it was said with exhaustion by battle-worn leaders.  Underlying these statements was the unspoken question of how long can I—this organization—continue to fight for every penny in a landscape where the pennies are fewer and further between?

So, in 2010, do yourself and your organization a favor and ask and answer that tough question:  should we survive?  At all?  in some version of our former self?  as we are?  And don’t do it in a half-assed way, based solely on emotion and history.  But do it based on data and reality, the needs of the community you serve, the competition, the ability to deliver quality services, the long-term availability of funds, etc.  Regardless of the outcome of your discussion, your clients, organization, staff, and board will be served better.

I know this goes against the tide of up-beat new year’s resolutions and I will accept any accusations of being a killjoy.  But if ever there were a time to be honest and look ourselves squarely in the eye, 2010 is it.