Non-Profits: A Successful Model for Meaningful Change? Introduction

“We should be sustainable” Jim told me numerous times.

I tried to tell him that becoming a 501(C)(3) (non-profit) is sustainable. I tried to MAKE him understand that we would only accept grants when there were no strings attached, when we and the community could decide what to do with the money, unburdened by any external influences dictating or influencing our decisions and direction. Although, this line of reasoning contains buzz-words, trendy themes and may sound great, it masks the real issues. For a long time, this line of reasoning was gospel to me. It made sense, it was simple, tried and tested. Or so I had been conditioned to believe.

The frigid wind tore at my skin as I sped back home late last night. Like most people in Central City, when I arrived home I was greeted by air unencumbered by insulation, which even in balmy New Orleans means COLD when in the month of November. I immediately jumped in the shower to take refuge from the freezing temperatures (roughly translated as below 60 degrees in New Orleans). As the warm water flowed over my body, thoughts flowed through my mind. I thought about the letter my brother wrote me that I re-read the day before, I thought about some drills to incorporate into the next soccer practice, I thought about how conflicted I was because I REALLY had to pee but I was SO comfortable in the warm shower. Then, like one of the Three Stooges, it hit me! It was clear, resoundingly clear, embarrassingly clear: sustainability and 501(c)(3)s are incompatible!!

Non-profits purport to tackle all sorts of social problems. They are generally viewed as creative, caring, and dedicated and they go to great lengths to present themselves as such. They present themselves as answers, as models for a better society. If only everyone were as creative, caring, and dedicated as non-profits, the world would be a better place. But whether they are aware of it or not, all of their flowery language and warm feelings serve as a smokescreen, a distraction from real solutions to VERY real problems. Of course there are all different kinds of non-profits with all different kinds of goals, visions and impact. The fact that many non-profits may be doing great work however does not change the fundamental reality that they are all dependent upon and beholden to the corrupt system that created and perpetuates the inequalities they seek to change. 

Becoming a non-profit is extremely financially beneficial. Non-profits are exempt from all federal taxes (excepting employee taxes) as well as state sales and property taxes in most states. But more importantly for most non-profits, their 501(c)(3) status makes them eligible to receive certain private and government grants and low-interest loans that they would otherwise be unable to receive. Additionally, being a non-profit allows an organization to solicit donations from individuals/groups that provide the donor with huge tax-deductible incentives.

These tax exemptions, tax incentives, grants and low-interest loans are tantamount to government subsidies and are problematic for four main reasons: 1.) They provide an economic, rather than a human incentive to support justice 2.) They are based on an economic foundation, making community activism too easy and breeding waste, laziness, hypocrisy and ineffectiveness 3.) They define the parameters of what are socially acceptable and effective means of community activism. 4.) They reinforce boundaries between the “helpers” and the “helped”.


BLESS


LUKE 12:48