es report about the declining stock market, the continuing rate of home foreclosures (pictured left), and the decrease in GDP. Just as the recession is causing increased levels of unemployment in the corporate world, it is also creating strife in the non-profit sector. Cuts in non-profit organizations hit society twice as hard- not only do they result in job losses, but they also correspond with a diminishing level of vital services in the community. Clearly this downturn has contributed to more than just the overall negative mood of the economy- it has also hurt the American morale and diminished the spirit of fundraising. With "Hope" and "Change" as his credo, President Barack Obama recently encouraged active citizenship and has drafted legislation in the most recent Economic Stimulus Plan in order to regenerate a sense of community involvement and in turn create resurgence in the economy.It is imperative to first understand the current economic fluxes in the non-profit sector, then to examine how these changes have adversely effected fundraising, and finally discuss ways to ameliorate the present situation. A report from the Association of Fundraising Professionals explained that the 4th quarter of the year is typically the most lucrative season for non-profit organizations. From October to December charities typically raise up to one half of their yearly monetary donations, however, 2008 proved to be lackluster in comparison to previous years as most organizations fell significantly below past years donation totals. As a result of these shortcomings, food banks are now running low on resources, homeless shelters are over capacity, and nursing homes and hospitals are understaffed to name just a few social services that have been hit hard by the economic crisis. Thus a severe imbalance has been created: more people need to utilize social welfare services, yet fewer organizations are capable of accommodating the growing needs of society.
While companies in every industry are laying off members of their staff, the plunge in employment in non-profit organizations is a serious threat to the nation’s job market. Less commonly known, non-profit organizations make up ten percent of the American work force. With 9.4 million employees and 4.7 million volunteers nationwide, non-profits consist of more people then the auto and financial industries combined. Therefore the effects of staggering employment rates and evaporating funds in non-profits trickle to other larger segments of the workforce causing a domino effect of hardships in the overlying economy. Yet with all of this information readily available, non-profits have only recently been considered a topic in the economic debates.
Following negotiations in Congress, the House of Representatives passed the compromise version of the Economic Stimulus Plan last week. The $787 billion American Recovery and Reinvestment Act of 2009 passed both branches of Congress and is very likely to be signed into law by Obama this Tuesday. The purpose of the Act includes, "to preserve and create jobs and promote economic recovery as well as to assist those most impacted by the recession.” While the bill grants $50 million for the National Endowment of the Arts, $50 million for a new program designed to strengthen non-profit groups, and $200 million for AmeriCorps, critics of the bill feel that not nearly enough has been done to support the non-profit sector. The bill does not include money for either the Low-Income Home Energy Assistance Program or for Social Services Block Grants, which give money to states to offer social services to vulnerable people among other potentially beneficial charities that can help the economy.
Understanding the dynamics of the current fragile economy an
d the importance of community service work, Obama (pictured below) seeks to emulate his predecessors to motivate as well as provide incentive for citizens to volunteer. In an advertisement in this weekend's NBA all-star games Obama requested small favors from the citizens of America hoping that such small actions will improve the economy from the bottom up. Restructuring the format of philanthropy, Obama does not ask American’s to open their wallets to spur change, instead he asks for people to donate their time and services. Although such actions do not produce immediate monetary gains, the impact of reading to a child or assisting a youth group to beautify a community park may offer the feel-good bond needed to unite people in such a bleak economic situation as well as enable American’s to confront and surmount their present struggles together.Following the precedent of John F. Kennedy’s legendary “Ask not what your country can do for you” speech, Obama plans to create more opportunities for Americans to serve their country and hopes that the American will to help will prevail and conquer the perils of the current economy. His websites USAservice.org and MyBarackObama.com present a multitude of options to support charities and organizations in which people can volunteer their time rather than their money. Building off Clinton’s AmeriCorps Foundation, the Serve America Act aims “to expand and improve domestic and international service opportunities for all Americans.” Creating such an act enables individuals in every stage of life and with any type of interest to have a position in addition to an obligation to meet specific national challenges. Moreover, Obama provides incentive to citizens for their contributions. The President hopes to incorporate service learning early on in the education system so that children will be inspired and committed to a lifetime of service. Additionally Obama wants to employ programs in which student volunteers earn a college tax cut of four thousand dollars off annual tuition for every hundred hours of community service completed while a student is in high school. For working adults Obama also plans to enact a tax incentive for employers who allow employees to take paid leave for full time service. Lastly, Obama hopes to structure service programs with the needs of retirees in mind by providing legislation that will enhance incentive for retirees to give a year of service.
By giving every individual a position in society and a forum to contribute in not only boosts American’s morale, but also contributes to increasing levels of productivity. Thus each individual that volunteers has the potential to alleviate the present financial hardships and remove the current constraints imposed by this recession.
Your post offers unexpected insight into the economic crisis. While news and the fledgling print media focus on the obvious foreclosures and unemployment rates, focusing on the domino-effect this downturn has had on the non profit sector reveals one of the many ironies of the recession mentality. As you so aptly state, “more people need to utilize social welfare services, yet fewer organizations are capable of accommodating the growing needs of society”. This suggests that as the encroaching fear of economic ruin pervades society, people become so preoccupied with safeguarding their own wealth that we put the community on the back burner, thereby aggravating each person’s sense of isolation and helplessness. When in reality, if everyone volunteered perhaps not their money, but their time, the much needed optimism we are in such desperate need of would serve us all and steer us in the right direction. President Obama’s message has been direct and somber. The power behind it, however, lies in the ever-present faith and optimism that, working together and sacrificing for the common good is the only way to move forward. By doing this, he, as you do, implicates us all in the success or failure of the moment we are experiencing and brings Americans together after years of alienation and discord.
ReplyDeleteHowever, I would ask you if what you ask is realistic in these uncertain times? Charity giving and volunteer work are often the privileges of the wealthy. We live in a culture that is so individualistic that, in my opinion, it would take a dramatic change in the way we live our lives and perceive our responsibility to the “other”. The debate on universal health care, which is null and void in successful social democracies such as France, Finland, Canada and Norway to name a few, finds little support in the U.S. Throughout years of so much plenty and so much power abroad, the American culture has become too focused on the self, without paying enough attention to the individual as a working part of a community where sacrifice is not seen as such. Perhaps this will be the Grotian moment when, faced with the threat of economic failure, we will reach out to one another and truly strengthen the most powerful economic engine of this country – its people.