Hitchhikers Guide to Philanthropy

Wrote this in 2009 for the Central and Eastern European Trust for Civil Society and they still let me on stage as closing plenary speaker that year…

It was a dark and stormy night…
A colleague and I were waiting for the bus home from a village where we were working.  For some reason, the bus drove straight past us – literally leaving us in the dust.  Plan B was hitch hiking.  Unfortunately I look like a Viking and my colleague looks like a member of Hells Angels (albeit a smiling one).  We did not think we had much hope.  Sooner or later, the autumnal darkness of Transylvaniadescended.  We were considering a campfire when a gentleman stopped.  As we made small talk on the ride the kindly driver asked about our work.  We described a campaign to encourage citizens to use their 2% tax redirection in support of the projects and NGOs they think best serve the community.  The helpful chauffer pondered the concept for a moment then said, “No way.  People here don’t help each other.”

Let the irony sink in for a moment.  Here, the man who stopped to pick up two strange characters in the middle of the night was arguing that people like him do not perform mutually supportive acts.  The icing on the cake was when he would not take any money to cover his gas.  “My pleasure” he said as we thanked him.

I believe this story is telling about civil society in Central and Eastern Europe (CEE) and the challenges faced by the civil society movement.  This story matters because it is one average man’s reflection on our collective work.  Somewhere along the way, individuals like him, members of the society we serve, seem to have been left out of the civil society loop.  Our ability to connect with people like him, will determine our success or failure in the next 20 years.

I have chosen to look at the disconnect between our chauffer and civil society through the lens of philanthropy.  First because I believe that without active philanthropy, and the pursuit thereof, there is not much hope for our field.  Second, developing philanthropy is my job as the director of a community foundation and these are the questions we deal with everyday.  Third, I believe CEE Civil Society has developed a line of charity-focused development that is unsustainable, questionable in its service to civil society, and in need of rethinking as the era of major foreign donors draws to a close and the European Union becomes our new reality.

Grassroots giving and philanthropic foundations
Before proceeding I should clarify what I mean by ‘philanthropy’ and ‘charity’ and how I see them as different.  Webster’s Dictionary defines philanthropy as “goodwill to fellow men, especially: active effort to promote human welfare.”  At a recent conference I heard a group postulate that philanthropy can be further divided into philanthropy of community and philanthropy for community.  In their terms, philanthropy of community is based on people helping people in a mutually beneficial and reciprocal form of self help.  When discussing philanthropy in this article, I mean philanthropy of community.  Thus, when I speak about philanthropy, I mean the ‘active effort to promote human welfare’ based in mutually beneficial systems for self help.  This may not be altruistic enough for some but we will get to that later…

Philanthropy for community, on the other hand, as defined by the group from South Africa, involves resource transfer from those of high net wealth, to those of lesser net wealth.  I will call this charity.  If you look up the definition of ‘Charity,’ you find terms and phrases such as “giving, aid given to those in need, institution founded on charitable gifts, etc…” Charity, unlike philanthropy, is more of a financial proposition and inevitably involves more than a transfer of wealth.  To access charitable gifts, one must accept a transfer of ideals, morals, and priorities.

On one hand we have philanthropy as a more horizontal, mutually beneficial, peer-to-peer, community support system and on the other we have charity as a more vertical transfer from those who have to those who have not.  Before addressing the assertion that charity has become the modus operandi of CEE civil society, it is helpful to consider some historical context contrasting this region and the United States.  Why the United States? Because in most of my discussions regarding civil society in CEE, NGO folks refer to U.S. models, often on dubious grounds.

First, a brief history of philanthropy in CEE…  Pre-communist philanthropy in Eastern Europe seems to have been primarily a system of charitable patronage.  Beginning in the Middle Ages wealthy families built churches.  Wealthy churches occasionally built schools and hospitals, often based on gifts from wealthy families.  Later, groups of merchants sometimes organized funds for a civil project to aid in commerce.  By the turn of the last century in our community there were some fascinating examples of charity such as a miller who donated his Saturday profits to charity, a women’s group who raised funds for children, and some middle class organizations such as book clubs, hunting clubs etc…  In our community (and I doubt this was unique) there was also a parallel philanthropic tradition based around communal work.  This tradition was based on work, not wealth. Where work needed to be done, citizens organized themselves and their resources to complete projects.

History of philanthropy in the United States is somewhat different.  While charity existed, civil society seems to have been much more focused on systems of mutual support.  The Colonies (later the United States) were set up to export their resources with as little investment as possible, forcing citizens to create their own institutions.  Volunteer organizations arose to cover everything from firefighting to libraries, universities and militias.  The ‘Founding Fathers,’ understood that these small, locally driven organizations taught civic duties, and entrusted them with the responsibility of creating good citizens and teaching responsibility in the inherent capitalism of the American system.

As industrialization began shaping modern America, philanthropy also industrialized.  The first large foundations (Carnegie, Rockefeller, Ford, etc…), sought efficient and ‘scientific’ approaches to understanding and solving ‘root causes’ of social ills like poverty and hunger.  A class of NGO professionals was cultivated and they came to see their work as different from the myriad of local credit unions and food shelters who were dealing with the effects of these problems.  Some argue that this process has actually weakened civil society by redirecting power from local communities to a class of NGO professionals who manage the charitable order.  Regardless of its current form, American civil society spent hundreds of years as a largely philanthropic, mostly voluntary, sector, building trust and indoctrinating citizens.  The movement began as a grass roots response to local needs and, over time, has morphed into a blend of major charitable donors and locally driven organizations.

While this was happening, Eastern Europe saw the rise and fall of communism and arguably the erasure of non-governmental civil society.  What happened after communism?  One of the most amusing answers I have received is that “someone said we needed civil society, and it was the only thing paying, so we got a civil society.”  Civil society promised democracy and healing for the ‘post-communist man’ who is still often described as cynical, atomized and driven by self-interest alone.  Civil society promises to rebuild social capital and major donors have invested significant amounts pursuing this promise.  But how to lay the foundation of civil society – grass-roots philanthropy or the more ‘scientific,’ charitable approach?

Charity picks up the tab for philanthropy and the challenges therein…
It seems like the answer has been a combination of both with a tendency towards charity.  Enlightened donors have supported the development of grass roots philanthropic society through a system of charitable contributions.  These contributions were necessarily charitable in nature.  Funding had to come from somewhere, and since there was no visible indigenous civil society, it had to come with a model, morals and ideals which could offer guidance and a rubric to measure results.

In short, charity was supposed to pay for philanthropy.  Did it work?  Yes and no.  Yes in that in most countries in the region, philanthropy and volunteerism are reportedly on the rise.  There are thousands of local NGOs, and young people are getting involved in the civil sector (albeit often against the wishes of their parents).

On the other hand, our Good Samaritan chauffer did not believe philanthropy had a chance.  Nor would he associate stopping to help us with philanthropy (which it is if you accept our earlier definitions of mutually beneficial “goodwill to fellow men, especially: active effort to promote human welfare”).  The driver’s disbelief, reflective in some ways of a lack of understanding of, or trust in, NGOs, indicates that the philanthropic ideal has not been communicated to regular people.  Thus, charity paying for philanthropy has not fully succeeded.  This is partly the fault of local NGOs who have not communicated well or invited people like our driver to participate in philanthropy.  In my experience, few CEE NGOs communicate well, citing reasons ranging from lack of confidence or media savvy to outright shame.  Whatever their reasons, community members like our driver don’t get the message.  I have heard from numerous NGOs that communication with locals ‘is not necessary thanks to foreign support, which is fine because we don’t want to do it anyway.  It feels like begging.’

This difficulty in communicating is complicated by the language in use.  Audre Lorde’s famous statement ‘The master’s tools will never dismantle the master’s house’ suggests it is basically impossible to conceptualize a new system when using the language of an existing one.  I believe there is some of the same happening here.  CEE NGOs, and in particular the civil society development organizations who train them, have been trained in the process of charity by foreign donors while being asked to seed philanthropic ideals they could never have practiced.

The combination of poor communication skills, a charity-based education, lack of indigenous models, and the fact that simply telling people what to do and paying them to do it is easier, keeps the charity-based system alive.  The system shows itself in discussions about fundraising which focus almost solely on major donors, in trainings where developed NGOs push theoretical models which have few practical examples in CEE, and anytime an NGO leader feels entitled to say that average citizens don’t know what they need and don’t have the time to care.  It becomes apparent in their fundraising when NGOs copy and paste their ‘need’ statement from one application to another to meet donor needs without stepping outside to ask anyone whose needs they are ostensibly to meet.

There is real danger in perpetuating charitable models because charity is not motivational to average people.  It does not reach out and build social capital or invite people into the civil sphere.  One reason for this is that the power structure implicit in charity is too often patronizing.  I have seen civil society professionals walk into communities and explain without any hesitation what needed to be done to fix the local problems and local people.  Unsurprisingly the programs never took root and did not find support from locals like our chauffer.  Who likes to be told they have problems instead of asked what problems need fixing and, moreover what those problems are and how to fix them, instead of being asked what problems impact their daily lives? And is this the point of building a civil society?  Or is it an attempt to force one?

When I ask specifically about encouraging local philanthropy, NGOs tend to trot out flashy acts of charity such as rewarding big donors with media coverage and galas.  This can be lucrative but may prove unsustainable and self-defeating in the long-term.  Big donors are often managed through Donors Clubs (yes, we have one too) which are often not based on mission, but on being part of a group which has the power and responsibility to give.  Clubs are easier to manage but when markets crash, big donors disappear, quickly undermining sustainability as we have all seen in recent months.  An often repeated note in support of major donor is that if a few big fish contribute, the little fish will follow.  When we talk to average citizens, however, they have proven highly skeptical of large charitable giving, often convinced that it is somehow money laundering.  In fact, it threatens to turn regular citizens away as they have been shown the rewards system for major gifts and begin to question the efficacy of their own smaller contributions.

Though big donor giving can be an important part of philanthropy, promoting only big donor charity can be self-defeating.  If average people are not motivated to invest in mutually beneficial systems, they will not learn the value of investing in civil society and soon there is no foundation from which to develop local fundraising capacities, involve volunteers or get communities to solve local problems.  People learn helplessness; they learn that the best way to solve a big problem is to wait for a wealthy person to come along and fix it for them.  If there is no long-term training of locals then there is no long-term trust building and the big local donor of tomorrow’s charitable campaign will simply not exist.  Further, we have found local donors more apt to give if the masses are shown as supportive.

What about philanthropy? And whatever happened to Altruism? 
So, if professional NGOs are perpetuating charity systems, what about the rest of civil society?  In our experience, there is a healthy grass-roots movement that is fairly philanthropic in practice.  As a grantmaker we are constantly encouraging small grass-roots initiatives to market themselves and reach out.  A critique we hear from professional NGO folks (reflecting the root cause vs. effects argument) is that these small initiatives do not really change anything.  I would argue that these small initiatives, driven by people who see a local problem and wish to solve it, represent ideal civil society.  We believe, as an organization, that by encouraging small initiatives based on real local needs and solutions, the initiators may be inspired to establish nonprofits and continue their work.  So far we have been rewarded in this with 4 new and sustainable initiatives beginning out of 20 grants in the last year.

And, if charity can lead to a bit of downward spiral, can philanthropy be used to build civil society?  I hear a lot of doubt because philanthropy too relies on social capital.  However, though there may be little trust from person to person, the building blocks of social capital are here.  Individuals, when directly, asked will often volunteer, give to a cause they understand and organize around issues relevant to their lives and the future of their children.  We have seen this in our work both locally in our small town and in nearby villages.  Secondarily, after decades of deprivation, individuals seem quite happy to act in their own self interest.  This is a feeling that can be harnessed but requires us to drop some pretense around altruism as a necessary component of philanthropy.

But we often hear NGO professionals claiming citizens should participate out of some altruistic purity of soul and intention.  And I agree with this in principle, so why question the efficacy of promoting altruism as part of philanthropy in CEE?  Without getting into a debate about whether or not altruism even truly exists, we can perhaps agree that an environment that encourages people to perform altruistic acts is lacking in CEE where individuals have no recent background in philanthropy and little understanding of how NGOs are currently serving them.  Another reason to question altruism as motivational lies in language and recent history.  Since volunteerism is a good example of altruism, I offer the following quote about the perfect volunteer: “He should have a great sense of duty, a sense of duty toward the society we are building, toward our fellow men as human beings and toward all men around the world… And along with that: deep sensitivity to all problems, sensitivity to injustice; a spirit that rebels against every wrong, whoever commits it … Each and every one of you must think about how to change reality, how to make it better…” 

Sounds great.  Sounds like descriptions from the ‘what makes a good volunteer’ session of a workshop we hosted this year.  But this speech was delivered by Ernesto ‘Che’ Guevara describing the perfect Young Communist.  The similarity in the terminology promoted by selfless (altruistic) service to civil society and communist propaganda brings up an interesting point.  As with fears around using the word ‘volunteerism’ due to an historical context of forced labor, could it be that the very language of civil society as we understand it, built upon altruistic idealism, sets off alarms in CEE?

Inviting and showing by doing 
If so, and this deserves some study, we need to reclaim this language through positive examples and leadership.  In the meantime, however, we simply cannot rely on altruism. What we can trust people to do is look out for themselves.  This self-interest can be leveraged into philanthropic acts based on mutual interest, particularly if the entry bar is set low, leading to a base from which philanthropy can grow.  The challenge to all of us then, is to develop the communications and programs that show individuals that acting for community is in their own self-interest.  We have seen this in our work through simple, concrete actions such as volunteer playground renovations.  We asked the community if they would like to revive the communal work tradition that was mentioned in the history section.  They said yes and we said, where?  Bloc associations and local groups identified playgrounds, provided labor and some funds.  On the first day, more than 100 volunteers painted and repaired equipment at 4 playgrounds.  Afterward, several organizations applied to our small grants fund to do their own renovations.  It was very personal, concrete and direct – – you can make the playground your kids use a safer place to play.  And, this program is becoming sustainable.  We have launched an employee giving campaign specifically around this program seeking 1 RON (about .25 euro per employee) per month to keep the bar low.  So far, we have more than 90% uptake and individuals are giving on average 5 RON per month.  We included a 15% administrative cost to cover operations and this has been both appreciated and acceptable to donors.

More abstract philanthropy seems possible as well.  For instance, the 2% for Odorhei campaign (the one our chauffer had doubts about) asked individuals to redirect 2% of their taxes to local NGOs we had screened for quality programming and transparency.  The campaign slogan was “What can my 2% do for Odorhei?”  but the campaign also challenged citizens to exert a bit of control over this small percentage of tax, “keeping it in our community working for you.”  Again direct, but not so simple – this campaign required a leap of faith that the funds would go to work in the community without immediate visible results.  And still individuals participate – over 3 years, campaign participation has gone up from 14% of local tax-payers to 43%.

A business example is a loyalty card campaign we launched with a local grocery chain.  When the consumer uses the card, s/he receives a 1% discount plus special sales.  Additionally, 1% of their bill is donated to the Foundation.  The consumer saves some money and the Foundation benefits financially, which is returned to the community in grants.  The business benefits financially through customer loyalty.  Both benefit from the reputation of having organized something good in a difficult time.  Unlike a sponsorship negotiation with the business, this was an easy sell and consumers are excited.  As the fund grows and projects are supported, we will invite the list of card carriers for volunteer and fundraising campaigns and they should be conditioned by their usage to respond.  We hope it grows into a model for ‘doing well by doing good.’

Why bother?
Philanthropy is a lot of work.  It is slow and the results are often small.  Is it worth it?  The answer to this question depends on what you think civil society should do – build social capital?  Improve quality of life?  Get individuals involved in their own futures?  If you think it is any one of these then I believe that the focus on philanthropic systems is not only worth while, but necessary.  Investing in philanthropy is an investment in your own organization and others because the process of building local support is educational and helps overcome the communications barriers described earlier in relation to charity.  When you get someone involved in what you do, you can create a life-long supporter of civil society.  This has been most apparent in our work with individuals who have become volunteers.  Most of them cannot wait to volunteer again and we have redirected several of them to other organizations.  They have become donors for the first time and more importantly, some of them have started their own initiatives.  This is good for all of us.

Finally, with the exit of foreign donors (USAID in Romania, for example, built numerous NGOs before exiting as E.U. programs began and others are planning to depart) and the transition to E.U. funding it is imperative to develop local philanthropic systems.  I have yet to be convinced that the E.U. is good for grass roots or medium sized civil society initiatives due to the inherent administrative challenges.  With others leaving too and the E.U. not quite meeting the needs of civil society, we must lay the base for development locally.  In our work, we must support and encourage small and medium sized initiatives that can inspire and train future leaders.

Again, the work is slow but it means that we may build a sustainable movement.  It also means that the next time my colleague explains what we are doing to a strange man in a car, in a field, in the middle of the night; he might be less incredulous…  The future of philanthropy and civil society is in convincing this man and others like him, to come into our missions and see for themselves why our work is important to them and their community.  As we look ahead into the next 20 years, I believe we must think honestly about how we approach development of the civil sector, show some social capital of our own and trust others to lead themselves as a basis for long-term development of our movement.

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