Funding for activists, and the strings attached

THE RISE of non-governmental organizations (NGOs) and the non-profit sector in the developing world has been the subject of several studies over the last twenty years.1  Revolutionaries have taken a highly critical view of this phenomenon, and this interpretation seems to be gaining credence in the broader radical left. 2

Curiously, however, these studies have largely not been carried over into the developed (imperialist) countries, even though the role of non-profits is substantial. In the United States, “charitable” foundations control $500 billion in assets, and there are over 830,000 registered non-profits, excluding religious organizations.(7)3 The national leadership of several social movements, for instance the antiwar movement, is effectively in the hands of NGOs. 4

The “NGO-ization” of the U.S. Left has been a cause of distinct unhappiness—even dismay—amongst radical activists, but no accessible literature has attempted to address it. The Revolution Will Not Be Funded is a welcome initial contribution to the discussion, although it exhibits several serious weaknesses that must be criticized.

The question of control
The contributors to The Revolution Will Not Be Funded coin the term “non-profit industrial complex” (NPIC) to suggest the penetration of the non-profit sector by big business and the state. Unfortunately, they do not do too well in defining the scope and shape of the NPIC itself. Dylan Rodríguez defines the NPIC as “the set of symbiotic relationships that link together political and financial technologies of state and owning-class proctorship and surveillance over public political intercourse,” which Andrea Smith accepts as a working definition in her Introduction.(21-22, 8)

It is not at all clear what this is supposed to mean. The strict legal definition, based on the Internal Revenue Service’s Regulation 501(c)(3), is also inadequate. 5

As Christine E. Ahn points out, “The majority of [foundation] grants go to universities, hospitals, research, and the arts,” so in fact the bulk of the NPIC is composed of institutions—fancy schools, opera houses, and the like—whose bourgeois nature is no surprise.(68) What the volume is truly concerned with, of course, is the expansion of the non-profit model into the realm of progressive politics, previously the domain of social movements and political parties. Since the funding for these “civil society” NGOs does not derive from members, control of these organizations is necessarily undemocratic. Alienation of constituents from material supporters is characteristic of the NPIC.

Ahn’s essay points out that funding bureaucracies are disproportionately white and male.(66) Paul Kivel argues that the staff of non-profits are drawn from the ranks of the professional and managerial middle classes, which coincides with Amanda H. Pérez’s observation that “[a]dapting to corporate culture and developing business skills have become an additional challenge” in non-profit organizations; people from middle-class origins are more likely to have such skills, or attain them easily.(99) Thus the leadership structures of the NPIC are completely in the hands of those in the top twenty percent of incomes.

Tax-deductible noblesse oblige
The pioneer models for the NPIC were established during the Gilded Age, “when the first multimillionaire robber barons, such as John D. Rockefeller, Andrew Carnegie, and Russell Sage, created new institutions that would exist in perpetuity and support charitable giving in order to shield their earnings from taxation.”(4) Charity was also seen as an effective way to limit class struggles by offering individual relief instead of collective action.

In the postwar era, foundations continued to grow, both as tax dodges and as agents of social engineering. The Ford Foundation, for instance, played a pivotal role in the introduction of “Green Revolution” agricultural technologies into Mexico and India. But the NPIC is of even more recent origin, dating to the dawn of the neoliberal period of world capitalism. Gerard Clarke notes: “In a neoliberal climate of disenchantment with the state…multilateral donors and their bilateral partners channeled increasing amounts of funding from the early 1980s through…NGOs.”6  Although Clarke is referring to the international problem, the same phenomenon occurred in the United States. Kivel summarizes:

Beginning in the 1980s with the Reagan-era cutbacks in social services, many non-profits experienced even more pressure to provide basic human needs services to growing numbers of people. As they became com­pletely reliant on private donors, private foundations, or dwindling government dollars to cope with ever-increasing demands, many non-profits began spending inordinate amounts of time writing proposals, designing programs to meet foundation guide­lines…�and other fundraising techniques. Their work had to be developed and then presented in such a way as to meet the guidelines and approval of the ruling class and its representatives.(139)

That is to say, NGOs became a way for the state to “outsource” its responsibility to the bottom eighty percent of its citizens while slashing taxes for the top one percent.

It is worth stressing the latter point. Ahn demonstrates how a paterfamilias with $200 million in assets could, by parking his wealth in a foundation, save his family a $100 million inheritance tax bill upon his death.(66) In turn, the foundation is required to pay out a mere five percent of its assets per year—including rents, salaries, and other administrative costs. This is, for instance, a respectable way for rich families to provide their idle youth with a nice office and six-figure salary. Attempts to raise the required payout, or exclude administrative costs, have been defeated by the foundations’ extensive lobbying efforts—which can, amusingly, be counted towards their five percent minimum!(73)

The non-profit model also allows the rich to dispose of their wealth to the benefit of their own favored projects, which tend to have a certain serendipitous correspondence to their business interests. Conservative foundations spend millions to produce “educational” propaganda in favor of pro-corporate programs. The Bill and Melinda Gates Foundation spends billions buying pharmaceutical drugs for Africa—which shields intellectual property laws, so critical to Microsoft’s business model, from criticism.(68-69, 72-73) On the crackpot end of things, billionaire hotel mogul Leona Helmsley left most of her fortune to a charity for dogs, rather mocking the value of “philanthropy” in both the social and etymological sense.7

The rise of the NPIC has allowed the neoliberal ruling class to achieve three interlocking goals: first, it has provided them with a monumental tax dodge; second, it has given cover for the retreat of the state from social welfare goals; third, it has increased the penetration of bourgeois ideology into all areas of social and political life—including the Left. On the last point, American Indian Movement veteran Madonna Thunder Hawk writes:

Many people will get involved…but avoid rocking the boat on an ongoing basis because if they do, they might lose their funding.… People in non-profits are not necessarily consciously thinking that they are “selling out.” But just by trying to keep funding and pay everyone’s salaries, they start to unconsciously limit their imagination of what they could do.(105)

Mistaken identity
Class is the natural and correct framework in which to analyze the problem of the NPIC. However, several of the contributors are committed to forms of identity politics, which is sometimes imposed mechanically and rhetorically onto their analysis. This is particularly noticeable in the chapters by Rodríguez and Tiffany Lethabo King and Ewuare Osayande. These writers cant vaguely and lazily about “white civil society,” “white liberal hegemony,” the “white Left” (who are “lovers” and “friends” of the “white Right”), the “white-privileged person on the street,” and so on.

It is, of course, an empirical fact that the NPIC is quite white, due to the legacy and continuing practice of racism. But can we say that the NPIC is somehow intrinsically “white,” thereby justifying talk of “white civil society,” and so on? No. Indeed, if “civil society” did not include a certain layer of privileged members of oppressed racial groups, it could not possibly be effective in co-opting the struggles of the oppressed. This is a point made quite explicitly by Robert L. Allen, who writes:

[I]t is relatively easy for…representatives of the privileged black bourgeoisie to take control of organizations ostensibly dedi­cated to militant reform.… If this process of takeover goes unchecked, the united front is transformed into an instru­mentality serving the interests of the black middle class alone. The needs of the popular black masses go by the board, and a new oppressive elite assumes power.(54)

This “takeover” could never be achieved by the white majority of the ruling class. The intervention of Black elites, however small in number, is absolutely essential. But these Black elites are not merely servants of white power—they act in their own interests as elites. “They call themselves nationalists and exploit the legitimate nationalist feelings of black people in order to advance their own interests as a class.”(62) Therefore the identity politics framework is misleading and without analytical value.

“Horizontal”—or just flat on our backs?
Also problematic are the solutions offered by the essays in Part III of the volume, which attempt to articulate alternatives to the NPIC model. All four essays in Part III endorse the anarchist program of “horizontality,” which situates the failures of the non-profits in their hierarchical, or “vertical,” decision-making structures. It is definitely true that non-profit organizations are, in general, “mini-corporations…[whose] structure is based on a corporate model.”(187) Of course some kind of structure is implicit in any organization, but the structure of the non-profit is not organic, arising from the political tasks of the organization itself. Rather, laws such as IRS Regulation 501(c) (3) dictate it in the interests of the accountant and the taxman.

The contributors in Part III telescope this simple and correct observation into an embrace of horizontality, a theory of political practice arising from the Latin American experience of “a whole set of revolts without leadership, without organizational memory or central apparatus.”(199) The Zapatistas in Mexico, the Landless Workers’ Movement (MST) in Brazil, and the piqueteros of Argentina are offered as examples. This review cannot take up a full historical or theoretical critique of this tendency.8  Suffice to say that, with the evidence of history at hand, the principle of horizontality cannot command the uncritical enthusiasm it receives. For example, despite Paula X. Rojas’s claim that the piqueteros “were thinking beyond the state, and even beyond an alternative version of current institutions,”(202) a significant section of the movement has in fact been integrated into the neo-Peronist machine of the Kirchners.9  Horizontality is, apparently, no guarantee against co-optation.

Indeed, the concept of horizontality, which rejects the “old Left” notions of political program, political parties, and the centrality of class, enabled the rise of the NPIC. James Petras notes “NGO ideology depends heavily on essentialist identity politics.”10  Clarke elaborates: “[L]arge-scale social movements that once were ideologically and organizationally cohesive, fragmented amid a shift in the ‘themes’ of social mobilization.… [David] Lehmann argues, ‘In the place of large formal organizations, we find a myriad of small-scale dispersed movements engaged in an enormous variety of conflicts.’” 11

Without denying the problems of the “old Left,” or the tragedy of Maoist “party-building” efforts, it is beyond dispute that the fragmentation of the Left into the various “New Social Movements” helped foundation capital to co-opt it “piece by piece.” As Eric Tang writes, “These [New Social Movements] would...become the social justice silos that guided the funding strategies of philanthropic foundations.”(219)

Horizontality is not a solution to the rise of the NPIC—it is, on the contrary, a historical precondition of the NPIC.

Where to begin
In spite of its weaknesses, The Revolution Will Not Be Funded is a laudable initial attempt to tackle the problems of the role of NGOs in the U.S. Left, and deserves to be read by all committed radical activists. The contributors have done a considerable service by starting the discussion, even if their proposed solutions are lacking. If the Left is to make use of the financial advantages of non-profits, it will need to find ways to subordinate them in practice to democratic political organizations—a flexible, albeit definitely centralistic, approach. But mostly, we can’t expect big money to flow to those who seek to change the world radically, since the people who have big money have a stake in keeping the world pretty much as it is. As Madonna Thunder Hawk puts it: “Activism is tough; it is not for people interested in building a career.”(106)

  1. Gerard Clarke, Politics of NGO’s in Southeast Asia: Participation and Protest in the Philippines, (New York: Routledge, 1998), 1-2.
  2. See, for instance, James Petras, “NGOs: In the service of imperialism,” Journal of Contemporary Asia, 29(4) (1999): 429-440; Arundhati Roy, “Public Power in the Age of Empire,” speech at the American Sociological Association, 16 August 2004, online at and Ji Giles Ungpakorn, “NGOs: enemies or allies?” International Socialism 104 (2004). A critique of the “NGO-ization” of left-wing politics is also implicit in the work of the highly fashionable radical philosopher Slavoj Žižek.
  3. Page numbers in parentheses refer to the reviewed work.
  4. United for Peace and Justice (UFPJ), the leading national antiwar coalition, is highly grant-funded; see the financial reports for 2003-2005 at Unfortunately financial reports after 2005 do not appear to be extant. However, given the decline in the number of large antiwar protests—a major source of small-donor income—since the Democratic victory in 2006, it is likely that UFPJ is even more reliant on extra-activist funding than previously.
  5. Recent additions to the NPIC outside the 501(c)(3) framework are the so-called “527s,” a product of the latest comical attempt to reform the U.S. campaign finance system. 527s played a major role in the 2004 election cycle, the most infamous example being the Republicans’ “Swift Boat Veterans for Truth.” But in fact the Democrats used the 527s far more extensively; see, for instance, Ralph Nader, “Parties to Injustice,” Washington Post, September 5, 2004, B03.
  6. Clarke, 7.
  7. Christopher Caldwell, “Philanthropy goes to the dogs,” Financial Times, July 4, 2008.
  8. See, however, Paul D’Amato, “The powerlessness of anti-power,” International Socialist Review 27: January–February 2003; and ­Claudio Katz, “Problems of autonomism,” ­International Socialist Review 44: November–
  9. December 2007.
  10. Chris Harman, “Spontaneity, strategy and politics,” International Socialism 104: August 2004.
  11. Petras, “NGOs: In the service of imperialism,” Journal of Contemporary Asia, 29(4) (1999): 429-440.
  12. Clarke, 8.

Issue #103

Winter 2016-17

"A sense of hope and the possibility for solidarity"

Interview with Roxanne Dunbar-Ortiz
Issue contents

Top story