Too Much or Too Little?

In a provocative working paper prepared for the Washington Legal Foundation, and discussed recently at the fall meeting of Giving USA Foundation my colleagues Suzanne Garment and Les Lenkowsky - scholars at the Center on Philanthropy at Indiana University - attempt to make the case that " ... [w]e are witnessing the most aggressive challenge in 80 years to the idea that the private sector is largely capable of running its affairs without government intervention" and that this applies specifically to the non-profit sector (as well as business and finance).

In particular Suzie and Les take on the National Committee for Responsive Philanthropy (NRCP) whose recent report Criteria for Philanthropy at its Best: Benchmarks to Assess and Enhance Grantmaker Impact says that "grant-making foundations, supported by federal and state tax subsidies - have generally proved inadequate or unwilling to meet the charitable obligations tax breaks are supposed to stimulate." Put another way foundation dollars are, NRCP asserts, "partially public dollars." But are they? Les and Suzie argue they are not and particularly assail the notion that foundations have failed to serve the needy, an idea that they say is not "easily" verifiable.

Citing other scholarly investigations Suzie and Les conclude that [the claim] "that foundations are not doing enough for the underserved should be greeted skeptically" and refute NCRP's argument that "generous tax subsidies ... make the government and the public partners with philanthropists" because this concept does not rest on historical or legal fact but is simply a political fig leaf. Their paper Public Philanthropy?: The Unpersuasive Case for More Government Control - the basis for a forthcoming book - is I believe a long shot in the national dialogue.

A few days following the Foundation meeting another colleague, and old friend, Pablo Eisenberg a scholar at Georgetown University (and founder of the Center for Community Change) opined in the Wall Street Journal. Pablo has exactly the opposite view and he takes on foundation and individual giving frontally: "Much of current philanthropic giving, by foundations and individuals, neither meets the needs of our charitable organizations nor addresses some of our most urgent public needs." Re foundations Pablo's arguments boil down to [1] getting foundations to increase their payouts (from the required 5% to a higher minimum) and [2] much greater accountability in partial justification for the tax subsidies they enjoy as a matter of public policy.

I have been thinking about this coincidental juxtaposition of opposite scholarly opinion for the past few weeks. In some personal ways I am a left wing libertarian; call it my savage side: I detest the role of government in purely private business, e.g. reproductive choice. And I am preternaturally anti-authoritarian (i.e. my wife says I'm an eight year old): In practice I rarely work professionally for a sub-division of government.

Like you I am living through, and been much affected by, the recession to which the government, in my view, has delivered too little too late. The nearly trillion dollars put out so far has dripped down slowly and benefited the least needy the most. To many economists, viz Paul Krugman of the Times, the feds have done about half of what will be ultimately needed.

In the end I am intrigued by the intellectual position set out by Suzie and Les. because it confronts and contravenes the conventional view. But in my opinion they're wrong at the working level. I agree with them, in theory, that we don't need more government control. But for me it's hard to escape the idea that in this day and in this hour we need more - not less - from government!

That Was Then ...

I was recently asked to write about my early years in this business. A few years ago I covered that topic in a speech. So I dusted off my remarks, did a bit of updating and sent this along. I hope you enjoy reading it as much as I enjoyed writing it.

On August 1st 1956, I went to work for Lee Tracy, executive director of the community chest in Paterson, New Jersey, the Sodom and Gomorrah of organized fund raising. About a dozen struggling charities hung by their deficits. Our campaign goal was $200,000. The in-the-office campaign slogan was "Help support a sagging chest!" I hired on as public relations director, a title invented by Lee to elevate my self-esteem, and keep me working cheap. The salary was $75 a week, $10 more than I had been offered as a general assignment reporter for the Paterson Evening News. Lee was a defrocked social worker, a serious daytime drinker, a poet, and sober or not, one of the two best people for whom I’ve ever worked the other Harold Oram, of course. Here is some of what happened to me during my first campaign: The pastor of the Dutch Reformed Church of Prospect Heights kicked me out of his office when I told him the Bible didn’t mention the Dutch Reformed Church of Prospect Heights. I offered this observation only after he told me the Bible mentioned neither the community chest nor township campaigns. Two large, round, tattooed gentlemen escorted me from a steel extrusion plant on the edge of town. I erred in believing that workplace solicitation for the community chest was a movement whose time had come. The newspaper called Lee a drunk in print. Lee and I went to the bar of the Alexander Hamilton hotel where I wrote the denial. We had report meetings. Over at the Alexander Hamilton hotel, volunteer solicitors gathered at breaking light. Following God’s blessings, watery scrambled eggs with little pieces of bacon floating in them, pastry of uncertain manufacture, and tepid coffee, these worthies told in tones of abject defeat the result of their failed entreaties to the merchants and counting houses of the city. It was a heady start on the day. Lee had me write my first direct marketing piece, an earnest plea to the shoe stores, dry cleaners, butchers, hardware purveyors, barbers, pizza parlors, tarot readers, pool halls, bodegas, saloons and other tenders of Paterson’s commercial life. For inspiration, I repaired to the Tree Tavern, where warmed by wine and bloated by pasta, I wrote my heart out. In the fullness of time, Alexander Hamilton left Paterson. Allen Ginsberg left Paterson. And so did I. My next stop was nearly nine years at the Greater New York Fund, now United Way of Tristate, where I learned how to work effectively with CEOs of big companies, and how important good tradecraft was and is. I was well trained as a fundraiser, and mid-level manager. I was promoted twice, and I had a shot at a top job either in New York, or elsewhere within the United Way movement. I don’t see a lot of good tradecraft or training today ­ despite the proliferation of workshops, degrees, conferences, and what not. PowerPoint has dulled the senses, and almost no one can write a simple declarative sentence. The volunteers with whom I worked at the Fund were mostly terrific. As top executives in the city’s major firms, they were usually white, Protestant, and Republican. They were always hiring away my Fund colleagues, which was fine by me. I never bought the corporate rap. I played the part. I never truly believed in the script. I remember one top solicitor from those years. This citizen was a partner at Morgan Stanley, and had pulled Fund duty because one of his clients had recruited him to the campaign. At the Fund, we used institutional leverage effectively, to raise volunteers and money. This guy had me to lunch at one of the restrictive downtown clubs and over his version of soul food told me utterly without irony that there were three important things in life: Morgan Stanley, the Episcopal Church, and the Republican Party. Certainly not the Greater New York Fund, a conservative place, sexist, ageist, racist, politely anti-Semitic in the manner of the time, homophobic, a simulacrum of the business community ­ which is exactly what it aspired to be. In those days, I dressed for success, and I was quite a picture. The rule was to mimic the titans of trade: white button down shirts, dark pinstripes, rep four-in-hands, black wingtips, fedoras, and yes, by God garters to hold up the black socks! It was so perfect it was almost a send-up of the IBM look. The women wore dresses or skirts, and not those genderless dress-for-success-suits that came along later. A woman who showed up in pants would have been sent home. After she’d been fired. The Fund was stultifying boring. My outside stimulation was graduate school, local Democratic politics, and involvement in many of the major social issues of the day, especially civil rights. Every mid-level manager on the Fund’s campaign staff had to take a turn running one of two major luncheons a year. These huge, soporific affairs were held in the Grand Ballroom of the Waldorf Astoria. The carte de jour was the greasy, gray rubber chicken bred especially for the captive banquet trade, wrinkled little peas that tasted like grapeshot, and the spongy mystery cake covered with viscous red sauce. There was little comic pause, but I was witlessly responsible for one memorable moment. We used a double dais to seat 60 volunteers, and in the backstage holding area, per the luncheon operations manual, I laid out 60 names on 60 chairs. As the band struck up "East Side, West Side," or whatever, I goosed the lead guy, and the grand entrance began. Unfortunately, I had reversed the seating chart backstage. The lower level dais was now the upper. Stage right was stage left! Toward certain confusion these merchant princes and plumed dukes of commerce advanced. Like a pack of squealing pigs on ice, they skittered from one end of the stage to the other, half the moguls climbing to the upper dais, half bumping their way down to the lower. Party time! … Clearly, I had absorbed all I could from this job. It was time to move on. -*- It was late 1963. I had just turned 30. My daughter, Janet, had only weeks before presented herself to the planet, and I had $100 in the bank. I answered a blind ad in the New York Times. Eve Bates, one of Oram’s vice presidents had run it. … What luck! I had heard a lot about the Oram firm, and the clients they served. I showed up at the appointed hour, all kitted out in the IBM rig, and was shortly conducted into the commanding presence of Harold Leonard Oram, HLO. He offered me an 11am cigar, a Dewars, (I accepted both), and after a nice bit of patter, sent me away, having asked for a writing sample. A few days later, Harold telephoned to tell me he wanted me to "take a campaign" in Fulton, Missouri, at Westminster College, which had gained a moment of fame as the site of Churchill’s famed "Iron Curtain" speech. I had spent eight months at Fort Leonard Wood, generally described as the cloaca of military posts. No way was I going back to Missouri, or for that matter, any other landfill between New York and L.A. I turned him down. In those days, firms signed a campaign at 5 pm Friday, and needed a body with a pulse, on site, at 9 am Monday. Three months later, HLO called back, and said he wanted me to work on a campaign for Hampton Institute (now University), then and now one of the nation’s preeminent historically black institutions, and the first of 14 HBCUs I have since served. Before I could spurn him again, he thundered, "There’s no money in Hampton. We’re going to run the campaign from here." And we did. Harold Oram’s retinue of walking furniture included three VPs, all women, one of whom was African American, unusual for the time, and still pretty rare in the consulting business -- and the trailing edge of junior staff (including a second African-American) to which I had been seconded. Most other consulting firms either had no women on staff, or dunked them in the steno pool. No doubt about it: the Oram firm was really a different animal. We cherished a strong anti-corporate corporate culture, we were cause-driven, and we served liberal and left wing counter-cultural organizations. Harold had come into this business as a publicist/fundraiser for the Lincoln Brigade, the American leftists, liberals, and idealists who fought on the anti-Franco side in the Spanish Civil War. It was the middle of the Great Depression, a time of one-cent candy, two-cent newspapers, and three-cent stamps. When I went to work for his company Harold had already carved out a brilliant career as advocate and money raiser for unpopular, often vanguard causes, and activists of every kind. Many of them couldn’t pay fees and we took them on anyway, hoping for the best. We often never collected and as sometimes happens friends became ingrates. He gave free office space to any crony, cause, or luckless stray who asked for it. This habit of welcoming wildly different people of strong intellect and uncertain temperament led to many strong encounters in our clutch of airless Manhattan offices. Discordant personalities, invariably in need of unrestricted funds and unlimited photocopying, crossed paths with our small staff of equally eccentric and sometimes goofy people (two Mensa members out of a staff of maybe 20) whose common denominators were passion for causes and devotion to Harold. I fit right in. When I washed up on the Oram beach, I knew immediately this was where I belonged, I knew this was the work I wanted to do, and that is still true every day of every week. We were a company (if you could call it that) of motivated, eclectic, multi-ethnic, noisy, opinionated, brainy men and women, vying for Harold’s time and attention. He was more loyal to us, and the retinue he towed, than any Tammany boss, and the flawed or fallen were like as not assigned to the compassionate payroll. Often ravaged by personal demons, they added zest and overhead. Harold Oram’s world vision was coherent and purposeful. He was a political and social democrat, a one-worlder, and his true agenda was to make the globe a better place. That became my goal too – and still is. Clients were taken or turned away on that basis. Raising money was only a means. He revered the written word and the compelling idea dramatically put. He expected felicity of expression in my and others’ writing. He was the best copywriter I ever knew. A compulsive editor, reviser and re-arranger, he rubbed copy raw until he got what he wanted. He was tough on the copy, but never on the writer. So naturally, I’d go back to my shared cubicle, broken desk and sprung typewriter, composing well into the night, hoping for his praise in the morning. Each afternoon around five or six, anyone who was around gathered in Harold’s office for the best seminar on this business that anyone could possibly imagine. Clients, staff, jobseekers, and hangers-on drank his Dewar’s, and smoked what they brought. It was apt to be anything. Harold shared, smoked, chewed, and spat truly terrible Bock panatelas. And he held forth on clients, how we should serve them, how to approach their problem creatively, and he constantly exhorted us to think, think, think! At one such twilight collation, after a meeting with an impossible client, he resigned the account, and declared that "the pattern of client relations is ingratitude!" Often true, and I liked the ring of it. I prevailed on one of the failed academics we were then sheltering to render it in Latin. He came as close as he could to the vernacular and the framed rendition was right under HLO’s picture. It read "Patrono ingrates cliens semper cernitur," and it hung on my office wall until our devastating fire in 2007. I moved up in the firm, and was given stock. Though I loved the madcap environment, I pushed us to become a business because I realized we could not survive otherwise. We went corporate in the 70s, as the staff grew. I caused the compassionate payroll to disappear, and gradually jettisoned the supernumeraries. The client base broadened, and we moved to larger quarters. The quote "interior designer," another of Harold’s bi-polar rescues, managed to retain our look of impecuniosity and imminent demise. The late afternoons in Harold’s office became infrequent, and lacked the intimacy and bite of the late ‘60s. In 1978, I bought the business. The day after the contract of sale closed, Harold announced he was withdrawing his "working capital." That turned out to be $80,000, and it was a few days before I had to meet my first payroll. This was a lesson not previously imparted in the Dewar’s Seminars. Though dependent on the success of the business for over half of his annual income, Harold did not hesitate to blow on the cards, then and thereafter. For many years after he retired, we had, at best, an ambivalent and mutually costly relationship. But in the last few years before he died on August 22, 1990, at the age of 83, I am glad to say we made it up. I had bought the firm with the invaluable help of two demanding and eccentric outside investors whom I had come to know because we represented organizations in the peace movement, in social justice, civil rights, population issues, and the like. These guys were impact donors to all of them. Stewart Mott, whose fortune came from General Motors, was brilliant, erratic, always true to his principles, and the family outcast. He was a libertarian marijuana grower -- in his Park Avenue penthouse -- devotee of Renaissance music, unpretentious but definitely odd. For example, he generally received any and all in his skivvies. When he wasn’t doing pot, he smoked an exotic brand of Egyptian tobacco that smelled like burning rubber and swamp gas, combined. Despite considerable wealth in the coinage of the time, and of course everybody was after it, Stewart was for a long time the Most-Eligible-Man-in-New-York-Never-to-Get-A-Second-Date-With-the – Same-Woman. His courting style was truly pathetic. But no matter. The ladies came in hope, and left in tears. Feminine raiment accessorized his bachelor lodgings. Stewart passed away in 2008, still a fervent believer in peace, family planning and all the other causes that had claimed his time, intellect and money. Robert Wallace Gilmore was in personality totally different from Stewart, but equally off. He had some money of his own, and he had married into the Publishers Clearing House family. A Yalie, an ex-CIA man some said (I never found out), and Quaker do-gooder, he was a dreamer for peace and global justice. He and his wife Joyce established the Joyce Mertz-Gilmore Foundation. They both died years ago. … Alas. …They lived on West 11th, in Greenwich Village, across the street from the townhouse the Weathermen blew up. Stewart and Robert backed me because they wanted to perpetuate the causes they helped so much. I remain devoted to the work they cared about even as I seek to serve a broader range of bill-paying, mainstream philanthropies. Mott, Gilmore, their accountants, Harold Oram and I, constituted The Oram Group board of directors. One of the bean-counters was a sweet man who struggled with Stewart’s wilder riffs. The other was nice enough, but a hard-nosed guy, ever determined to save Robert from investing all his money in truly hopeless causes, into which category he had largely classified The Oram Group. For several years after he sold to me, Harold was Honorary Chairman of the Board. God. At one point he and I were suing each other over money. Robert was dreaming up an intergalactic peace movement, and Stewart went off on equally corky, incoherent ideas. Board agendas were basically place mats. Our meetings were sometimes chaotic to say the least. That the company lost money in about as many quarters as we made it added a certain zest to our deliberations. With Harold’s death, I was quite truly on my own. Working for Lee Tracy and the Greater New York Fund, I learned fund raising. Working for Harold, I gradually learned consulting, basically by making many -- and correcting some -- mistakes. Their gift to me was and is intellect, passion, and leadership: the ability to see things before others do, and to act accordingly. And I absorbed the simple truth of the old Romany proverb: "Sometimes you get the bear. Sometimes the bear gets you."

Bailout? Bail Out The American People

"In light of the auto bailout, the bank bailout, the stimulus package,
the public option fight is a surrogate for how much government is
too much." (New York Times, October 15, 2009)

-- Kenneth M. Duberstein
Chief of Staff/Reagan White House

If "the public option fight is a surrogate for how much government is too much," then for sure the fact that our country is literally falling apart must be a surrogate for how much government is too little.

The outcome of health care reform is still an unknown. Every special interest but one - the American people - has been able to put a big wet dog in this hunt. Michael Moore's shambling theatrics and bumbling delivery aside "Capitalism, A Love Story" nails the lobbyists' takeover of the Congress. Like you I have spent this last year watching the bailout at work, i.e., the privatization of corporate profit and the socialization of individual loss.

This film exacerbated my peasants-should-storm-the-castles feelings which is ridiculous for anyone my age. I should know better. But I don't. The professional world I inhabit is, and has long been, a mutually interdependent amalgam of private-public money. Private philanthropy - no matter how robust - cannot make up for the absence of government support, my rant for years. There is no better proof than the havoc the Great Recession has wrought upon US charities, especially human services, and reflected in the down-drift of contributions last year. (Giving USA 2009). I am slightly to moderately optimistic for 2010 if the market holds up. (Viz. Oct. 13th post).

Private industry - except when fertilized to the root by taxpayer money - will not deal with our tottering infrastructure, lagging public education, underfunded scientific research, support for the color green in all its manifestations, essential social services and yes, that past-its-sell-by-date piece of mackerel marked "health care reform." The American people are losing out. In just about any category of accomplishment in which we were once first we are now the trailing edge - except for advances in throwing out immigrants and making airport security even wackier than the Mad Hatter.

It is hardly a wonder that government and legislators, at every level, are despised by most of the American people; nor is it a surprise that almost 60% of the voting eligible would rather sleep in on election day or water the plants.

Time is running down for President Obama on health care. He never had the right. The left is mad but the left doesn't matter. The center? So far it all comes down to a Senate Republican from Maine. That's scary.

It makes me want to reach for my bucket. But not for bailing.

Is It A Turnaround Or Are We Just Running In Circles?

At this moment the Dow is up another 96 points (Wed. Oct. 14th, 11a EDT). The spectacular run-up in the stock market since the March low may or may not be a chimera. The high unemployment rate shows that all is not well in the economy and it is established fact that Wall Street is not really connected to the rest of the country. So what for next year? Six months or a year from now I'll look back at this post and see how well I did.

The huge grant-making foundations and university endowments lost money but are now making back much of that loss. They may not get back to their all-time highs anytime soon, or maybe never. But the question is if the market surge continues will grant-making and endowment income improve in 2010? If you are a nonprofit board member you should be asking your managements if they are budgeting for an improvement in the foundation line in 2010. Those on June 30 and September 30 fiscal years are already into the 2010 fiscal year and their boards (presumably) have approved budgets. Of course they can be amended - but should they? There are no signals coming from the foundation world to guide us that I have seen. They seem hunkered down, quietly amassing gains.

So here I go (again): if you are already a grantee I would ask/hope for a modest increase in funding - say 5-10%. If you're a new supplicant I think you'll find that most foundations have not opened the window. I doubt they will much before the late mid-last quarter of 2010.

Old line corporate philanthropy will not see much of a boost in 2010 but the trend to cause-related marketing will, I think, continue to widen and deepen with more and more charities trying to get in. One CRM firm I work with is running ahead even this year. By the way if you are familiar with the statistics Giving USA publishes annually keep in mind that they don't report on CRM because they haven't quite figured out how to get the data: what's charity (which is what GUSA measures); what's marketing?

That leaves individuals and family foundations. I think that as 2010 wears on we will see a very health boost in individual giving and we all know that - dead and alive - individual giving is about 80% of all giving as measured by GUSA.

In "Back To School," my September 9th post I advocated caution. I still do but a month later I have loosened the belt one notch.

I have been telling clients and professional colleagues all this year to plan for the turnaround. Is the turnaround here or are we just going in circles?

Hold That Crime Wave!

This morning's issue of the Chronicle of Philanthropy reports that "Nearly 30% of Nonprofit Leaders Took a Pay Cut This Year; Pay in 2008 Grew Quickly." NPR's Morning Edition picked up the story and played it this way: "It's one of those things that irks charitable givers no end - the high salaries paid to some nonprofit CEOs." The reportage went on to say that "the top pay at the nation's largest nonprofits rose again last year. ... But the survey also found signs that these high dollar salaries may be starting to turn around."

Ken Berger who heads rating agency Charity Navigator said that many donors go to the site, find out what a CEO's salary is "and vow never to support them again." He says this is the number one comment he gets.

Clearly there are horrendous salary abuses that make hot stories hotter and then there's the Chronicle's ridiculous and unsupported assertion that "The increases that nonprofit leaders received in 2008 are especially noteworthy considering the sharp drop in pay earned by for-profit executives." Huh? Why noteworthy? Among the 325 large charities surveyed nearly 100 leaders took a cut; half got raises; half pocketed smaller increases or saw their salaries drop.

In any organization setting the CEO's salary is a work of art. For me the test should be less about the CEO's salary (and perks) standing alone and more about his/her compensation in relation to the organization's total budget and the total responsibility assigned. Looked at that way I can make a pretty good case that even the highest paid CEOs in the kingdom of nonprofits are grossly underpaid! Take NYU - one of the institution's named. President John Sexton earned $1.3 million in 2008. Leaving aside the brilliance and verve he has brought to the job (non-quantifiable of course) the university's 2008 revenue budget was over $2 billion and it had assets on the balance sheet of nearly $6 billion. Even if you add in the perks like housing, car(s), entertainment allowance(s) etc. and goose his pay up to say $1.8-2.0 million I don't think he's near to being overpaid.

If you look at who's on his board of trustees there aren't many who don't have even sunnier paydays than Sexton for jobs of comparable scope and responsibility - plus the stock options (in some cases) that are of course not available in nonprofits. I'm sure Sexton will appreciate my plumping for a pay increase. But that's not my point. My sniff test is reasonableness. He passes.

At MOMA and at the Metropolitan Opera the Chronicle reports that directors Glenn D. Lowry and Peter Gelb respectively took pay cuts from their $2.1 million and $1 million+ salaries. Each man has brought innovation and excitement to his job - assets that don't show on the balance sheet of either institution. MOMA's assets exceed $1.6 billion and their revenues are about $150 million. The Met's assets (a few years ago - the latest available) were about half a billion and revenues about $140 million. These are huge numbers for arts organizations and few around the country come anywhere close. But I think given the responsibilities involved these guys are not overpaid. I believe their compensation is reasonable.

If you climb down the charity ladder you could apply the same is-it-reasonable test to any organization. I think you'd find most would pass, a few egregious abuses would be found, but for the most part, the men and women who run these organizations are - in my experience - less well compensated than their counterparts in the other world.

Years ago I was a stringer for the two dailies in Paterson NJ. Because I had a day job I spent more time at the morning paper because it went to bed late the evening before. One slow news night I was hanging about hoping to be asked to do something, anything. An older reporter told me to go over to police HQ and copy out the evening's entries from the booking blotter. There was a story the next day - under his byline - "Crime Wave Hits Paterson." Wow.

A Mighty Wheeze From Little ACORN Grows!

ACORN - (Association of Community Organizations for Reform Now) is the nation's largest community organization of low-and moderate-income families, working together for social justice and stronger communities. In other words they serve the poor through their advocacy and have been at it since 1970. Fuhgeddaboutit.

Some acorns fall further away from the tree than others. At ACORN as the NY Times recapped this morning "... some workers were videotaped offering advice to conservative activists who were posing as people interested in establishing a prostitution business," and allegedly those workers told them how to do it and how to evade taxes.

"Conservative activists" have long abhorred ACORN. They tried to make it an issue in the Obama campaign (nudge-nudge, Obama was a community organizer). Health care legislation, wars in Iraq and Afghanistan, nuk-el-er proliferation in Iran, financial legerdemain, pervasive conflicts of interest, ethical lapses, seedy sex and other hypocritical conduct is not keeping the Republicans (and alas some Democrats) - in both houses of Congress - busy enough. Industrious as they are ACORN is the dog days diversion. The House has voted to prohibit any federal funding of ACORN programs; the Senate is not far behind. This appears a largely symbolic act given that most of its revenues come from members' donations and other non-governmental sources.

The real issue here is not ACORN but the "war on poverty;" not that war, not Lyndon Johnson's famous coinage but the right's war on the poor. For as long as I can remember the image of the peasants storming the castles and seizing all that is ours has inflamed the imagination of the perfervid right. Ronald Reagan of blessed memory brought us the "Welfare Queen" tooling around in her Caddie as he and his cohort systematically disemboweled the Legal Services Corporation (largely succeeding in truncating its ability to defend poor people in civil litigation). The current hullabaloo over immigration is a first cousin to the war on the poor - viz Lou Dobbs a privileged big-mouth whose rantings goose ratings.

As a long time board member of PICO National Network (www.piconetwork.org) a similar but smaller organization doing like work in 50 communities nationwide I have learned that despite their huge numbers (currently 13.2% of the nation's population according to the guv-mint) individual by individual the poor are invisible. But when they act collectively (a word inciting hydrophobia among the likes of Fox News, much of CNN, Hannity, Beck, Dobbs Savage et. al.) on matters like housing, safety, immigration, education, health care and anything else you can think of in which the haves crap on the have-nots they get results. In PICO's "actions," (similar to ACORN'S methods - except we take no government money) carefully organized presentations to legislators locally, statewide and nationally as well, produce results - especially at local levels.

The right wing hullabaloo and stacked "town meetings" railing against Obama's health care initiatives "you lie" (boy) - The Times Maureen Dowd really nailed it! - has at its institutional core racism, pure and simple.The organized war against health care reform and the war on the poor is the same war. Its battlefields are America's inner cities and essentially the people of color who live in them. Though there are millions of people of color in the rural US - African Americans, Hispanics and Native Americans - there are actually more poor whites. The whites out in the sticks and the hundreds of thousands of Native American poor on reservations - not benefiting from casinos and cigarettes - are even more invisible than the urban poor.

Congress's latest blather and diversion from the nation's business is not about ACORN. Think of cave dwellers blinded by the light.

Back to School

With the last quarter of the year on the near horizon it seems America's nonprofits are and have been struggling with endowments sliced nearly in half, deep cuts in government funds and giving in general off anywhere from 10-30%. Admittedly these data are impressionistic, reliant on trade gossip, press reports, direct experience and a tremulous gut. Some groups I know will come out technically ahead this year because they budgeted conservatively in January - reducing projections substantially from previous highs. Others with cock-eyed fiscal years, poor forecasting or both are showing significant losses in two calendar years running.

Though I can't prove it I truly believe it will get at least a bit worse before it gets better. In past recessions what I saw was philanthropy as a lagging indicator - meaning it plopped after the rest of the economy and a leading indicator in the recovery - coming out of the swoon sooner. If I'm right for 2010 charities will have to be even more diligent in setting expectations and in assuring fiscal prudence. If I'm wrong they will not be hurt by being careful.

A few thoughts:

• During the troubles we have heard people urge like nonprofits to merge to save money. Horse pucky. Nonprofits have trouble merging in the best of times when both parties bring strong balance sheets and profit and loss statements to the table. In these times one party is likely to be much weaker than the other and the acquiring organization may be taking on trouble. Ergo: if you're hurting look at a possible merger. But more realistically get your boards to concentrate on rebuilding the balance sheet and improving the P. and L. from the inside out. The frog won't turn into a prince. Better to plan for the princess turning into a frog.
  

• When you buy a new car you get a better deal by bargaining up from the dealer's true cost rather than haggling down from his posted list price. That's how I think you should be looking at your organization. Assume the government money is not coming back any time soon. Individual and family foundation donors - contrary to Madoff and other exaggerations - have been less hurt by the recession than foundations and corporations. But many have been hurt. Plan for a modest comeback for individual giving in 2010.

• Grant-making foundations are asset driven. The so-called market recovery has not yet come close to attaining previous highs. That means foundation assets haven't either. Multi-year grants are unlikely and if you're not already on their books the odds lengthen.

• With corporations it will continue to be pick and play. Big banks, investment houses, oil and many entertainment companies are doing well. Retail and big box are mixed; communications, food, real estate are mostly sucking wind.

• Until employment rebounds the economy will not fully recover. No one I read is forecasting a quick recovery.

In a word caution for 2010. Stick to the basics. Don't forget your galoshes.