Uncharitable: How Restraints on Nonprofits Undermine Their Potential (Civil Society: Historical and Contemporary Perspectives)
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Uncharitable goes where no other book on the nonprofit sector has dared to tread. Where other texts suggest ways to optimize performance inside the existing paradigm, Uncharitable suggests that the paradigm itself is the problem and calls into question our fundamental canons about charity. Author Dan Pallotta argues that society’s nonprofit ethic acts as a strict regulatory mechanism on the natural economic law. It creates an economic apartheid that denies the nonprofit sector critical tools and permissions that the for-profit sector is allowed to use without restraint (e.g., no risk-reward incentives, no profit, counterproductive limits on compensation, and moral objections to the use of donated dollars for anything other than program expenditures).
These double-standards place the nonprofit sector at extreme disadvantage to the for profit sector on every level. While the for profit sector is permitted to use all the tools of capitalism to advance the sale of consumer goods, the nonprofit sector is prohibited from using any of them to fight hunger or disease. Capitalism is blamed for creating the inequities in our society, but charity is prohibited from using the tools of capitalism to rectify them.
Ironically, this is all done in the name of charity, but it is a charity whose principal benefit flows to the for-profit sector and one that denies the nonprofit sector the tools and incentives that have built virtually everything of value in society. The very ethic we have cherished as the hallmark of our compassion is in fact what undermines it.
This irrational system, Pallotta explains, has its roots in 400-year-old Puritan ethics that banished self-interest from the realm of charity. The ideology is policed today by watchdog agencies and the use of “efficiency” measures, which Pallotta argues are flawed, unjust, and should be abandoned. By declaring our independence from these obsolete ideas, Pallotta theorizes, we can dramatically accelerate progress on the most urgent social issues of our time. Pallotta has written an important, provocative, timely, and accessible book—a manifesto about equal economic rights for charity. Its greatest contribution may be to awaken society to the fact that they were so unequal in the first place.
wanted to build relationships with all of our riders and walkers nationwide, across all of our causes. We wanted them to know who we were, as well as who the charities were. We wanted to do this so that people would talk to their friends about Pallotta Team-Works—so that they could make a mental connection between an event we were producing in Los Angeles and one in Boston in the hope that, because of their good experience with us in Los Angeles, they might do our Boston event as well or tell
http://harvardbusinessonline.hbsp.harvard.edu/b01/en/hbr/hbr_current_issue.jhtml; jsessionid=EWABL3ILJNQY0AKRGWDR5 VQBKE0YIISW, accessed January 30, 2007. 124. Community Wealth Ventures, Inc., “Venture Philanthropy: Landscape and Expectations,” Morino Institute Youth Social Ventures (Reston, VA: The Morino Institute, 2000). 125. Gary A. Tobin, “Getting Megagifts to the Neediest Causes,” Chronicle of Philanthropy: The Newspaper of the Nonprofit World online, May 1, 2003,
as things can get. It was the Puritans’ religious belief that human beings are evil, that we are obnoxious in the eyes of God, and that the self is depraved. Logically, this meant that the self had to be negated. Charity became the monument to this belief, a compensation for human depravity. From that core belief grew a complex array of rules and secondary beliefs designed to preserve it. As a result, the merchants, farmers, and carpenters of the world got an economic system that indulged
American charitable giving hovers at around 2.1 percent of gross domestic product. Over the past thirty-five years, it has not fluctuated a great deal. At its lowest, around the end of the 1970s, it was at 1.7 percent, and at its highest, near the end of the tech boom, it reached 2.3 percent. But it was at 2.1 percent in 1969, was still at 2.1 percent thirty-six years later, in 2005, and came in virtually unchanged, at 2.2 percent in 2006.223 This share of the national wealth has proved to be
discourse, infinitely greater urgency, and a catalogue of the impossible things that would need to happen if we were even to come close to achieving our goal. It reveals operational requirements never before considered. It produces the engineering plans for a new reality. In the final analysis, we don’t need to concern ourselves with dismantling an ideology. We don’t need to concern ourselves with a strategic plan. We need to reclaim our forgotten hopes and dreams. They are the only reason for