Anti-Racism 101

25 Non-Profit Industrial Complex


The Problem of Philanthropy for Social Movements

“So many non-profit organizations are hoping to cash in on funding from philanthropic organizations that often contribute to the harm they are responding to.

Based on the research of the group INCITE!, which produced the book, The Revolution Will Not Be Funded, it is important to provide a framework for thinking about the nature of philanthropy and foundations.

According to INCITE, ‘The non-profit industrial complex is a system of relationships between:

  • the State (local and federal governments)

  • the owning classes

  • foundations

  • and non-profit/NGO social service & social justice organizations

With these kinds of relationships, it often results in the surveillance, control, derailment, and everyday management of political movements. The state uses non-profits to:

  • Monitor and control social justice movements;

  • Divert public monies into private hands through foundations;

  • Manage and control dissent in order to make the world safe for capitalism;

  • Redirect activist energies into career-based modes of organizing instead of mass-based organizing capable of actually transforming society;

  • Allow corporations to mask their exploitative and colonial work practices through ‘philanthropic’ work;

  • Encourage social movements to model themselves after capitalist structures rather than to challenge them’”

–Jeff Smith

“If there’s a downside to the surge, it’s that these new resources may be unequally distributed. Ironically, despite a renewed focus on issues of power, equity, and race in the social sector, these issues are playing out among nonprofits and reflected in which ones are capturing new funding. It’s not surprising, but in our interviews, large, well-branded organizations are more likely to be experiencing the surge in donations, while smaller, grassroots organizations on the frontlines of serving marginalized communities are having to address additional challenges under greater pressure with fewer resources.

Additionally, as attention shifts away from the federal government to state and local organizing, much of the organizing that needs to be done is dependent on local leaders. Community-based groups are being asked to show up, mobilize their base, and act as conduits for both service delivery and policy advocacy. But just when these grassroots groups are needed most, they sometimes struggle to deliver—in part because they are not sufficiently resourced. Historically, many social-justice nonprofits have been ignored, their leaders overlooked, and their programs deemed too “niche” for large funders. Organizations led by marginalized communities (people of color, women, LGBTQ, etc.) tend to be smaller, younger, and have less history of philanthropic investment. As one social-justice leader shared with us, ‘When movements are led by women of color, they are largely ignored both for funding and for leadership development.’

Relatedly, as wealth becomes more concentrated, new philanthropic resources aren’t making their way to the communities most in need. Rather, the funding is going to more established institutions and larger nonprofits at scale— resulting in a strong ‘grass-tops’ but an anemic ‘grassroots’ base. As another interviewee said, ‘The bias towards larger organizations—that, in theory, should trickle down resources to smaller organizations—isn’t working. The communities most affected by new policies need the most resources. It should not be about who has the best relationship or writes the best proposal. It has to be about who has the most needs and who is on the ground with the community.’” –p 10 from the following link