Let’s face it: if we are, in political scientist Robert Putnam’s words, “bowling alone,” it really is for want of trying.

When Putnam first advanced the thesis that Americans were increasingly opting out of civic and civil engagement—voting less often, retiring their Masonic tie-pins, and abandoning their bowling leagues—he helped focus new attention on a sector of American society whose civilizing role was little understood and largely ignored.

This “independent” or “third” sector consists of more than 1.5 million tax-exempt organizations and religious congregations with budgets ranging in size from zero to hundreds of millions of dollars. Its ranks include environmental advocacy groups, mutual assistance associations, conservative and liberal think tanks, trade associations, hospitals, universities, libraries, and many prominent literary institutions like this blog.

Well represented in this bewildering variety of organizations are the 61,000 social and recreational clubs registered with the IRS—bowling leagues included.

Yet despite the pervasiveness and continuing growth of this sector, not-for-profit organizations appear to constitute a community under siege. While many of the essayists in the anthology Philanthropy and the Nonprofit Sector in a Changing America rightly celebrate the profound contributions of the third sector to the civic and social life of this country, they also worry about its future.

Increasingly in the 1930s and well into the 70s, the federal government became very active in the provision of essential social services, often encroaching on what had once been almost exclusively the province of private-sector charitable organizations. In her essay, “Reinventing Philanthropy,” Leslie Lenkowsky describes how a quarter-century ago, when leaders of the philanthropic world met to discuss the state of the sector, they “focused principally on whether or not, if then-current trends continued, there would be much left for them to do.” This concern seems rather outdated today. If the old worry was that nonprofit organizations would have little left to do, the new worry, in this era of devolution, is that too much might be expected of them.

Conservative demands for local rather than big government solutions to our social problems, and for the devolution of funding decisions to states and cities, have put new strains on state- and community-based organizations. In part to address these conservative demands, several of the authors in Philanthropy and the Nonprofit Sector cite the limited resources available to nonprofit organizations that struggle with the intractable problems associated with persistent poverty and other pressing issues. Where will the money to address these issues come from, these authors ask, if not from taxes paid to the government? Is it reasonable to expect that total private giving will increase enough to underwrite the independent sector’s new responsibilities?

The data on philanthropic giving are rather sobering. In his article, “The Economy and Philanthropy,” Edward Wolff reminds readers that total charitable contributions have remained at less than 2 percent of the gross domestic product for the past 50 years. More alarming still, his analysis of philanthropic data indicates that “charitable giving does not respond to changes in either the level of poverty or the standard of living of the poorest families in our country. As the fortunes of the poor decline, there is little indication that the rich become more generous and that charitable giving increases.”

It’s worth reminding ourselves, as Elizabeth Boris does in her article titled “The Nonprofit Sector in the 1990s,” that nonprofits do more than care for this nation’s indigent, and that too often, “the welfare dimension dominates political discussion in the United States.” While the largest proportion of nonprofits are categorized as “human services” and “health” organizations, substantial numbers toil in other fields.

New pressure on the third sector has come from the funding community, some of whose members have insisted that nonprofit organizations diversify their sources of revenue and explore market-based mechanisms for raising new capital. While few nonprofits have the capacity to raise substantial sums of money through the sale of merchandise and other “cause-related marketing” mechanisms, some have done extremely well at it—so well, in fact, that new concerns have been raised about the over-commercialization of the sector. In their essay titled “The World We Must Build,” editors Clotfelter and Ehrlich argue that trust in the nonprofit sector is sustained, in part, by its separation from commercial concerns. This presents a dilemma for charitable organizations. On the one hand, they find it increasingly difficult to survive unless they can find new sources of revenue to fulfill their responsibilities. On the other hand, public trust in the sector is eroded when money-changers enter the temple of philanthropy.

Other worries abound. Over the past ten years, the nonprofit world has been rocked by a number of highly publicized scandals involving the misappropriation and misuse of charitable funds. In his essay titled “Public Trust in Not-For-Profit Organizations and the Need for Regulatory Reform,” Joel Fleishman argues persuasively that the current accountability-enforcing efforts of the state and federal governments are entirely inadequate, and that more must be done to police and safeguard the sector before it loses all public confidence. Fleishman decries the fact that when it comes to the reporting of nonprofit misdeeds, the press too often neglects the background of good against which these misdeeds occur. Largely free from public scrutiny until they erupt onto the front pages of our nation's newspapers, nonprofit organizations draw intense fire for their offenses, tempting some legislators to overregulate the sector and thereby quell its effectiveness.

Some of the challenges to the nonprofit sector as a whole apply with equal force to one of its little-understood subsets—the philanthropic sector. Consisting as it does of some 40,000 private, corporate, and community foundations, this sector exercises an influence way out of proportion to its $200 billion in total assets. In his elegant essay, “The Evolving American Foundation,” James Allen Smith outlines the history of these mysterious institutions whose roots can be traced to the publication of Andrew Carnegie’s essay “Wealth” in 1889, and to John D. Rockefeller's decision two years later to hire a full-time “philanthropic advisor.” Since that time, the growth of the philanthropic sector has been explosive. More than 16,000 new foundations came into being between 1980 and 1995 alone. The new wealth being created in this country and an impending $43 trillion intergenerational transfer of wealth promise to swell their numbers even more.

Interestingly, Philanthropy and the Nonprofit Sector brims with admonitions to the leaders of the foundation world. Among these, for example, is the very pointed suggestion that foundations stop experimenting with new models of health care delivery and simply start caring for the sick. And yet one wonders who is there to heed these admonitions, or how much of an impact $12 billion in annual foundation grants would have on the health of the nation. The arguments against using foundation dollars to fund direct services for the indigent are by now so well rehearsed that it seems unlikely these appeals will change how philanthropy conducts its affairs. Change in the sector will more likely come, as it has in the past, through regulatory adjustments and through shifting public perceptions of need and opportunity.

Arguments over the appropriate use of philanthropic assets are nothing new, and the actions (and inactions) of foundations and their nonprofit beneficiaries have always been mired in controversy. Depending on which side of the liberal/conservative divide we fall on, we will perceive in the affairs of a given charity or foundation either great malice or great good. It’s worth remembering, however, as we survey the accomplishments and shortcomings of this vibrant third sector, that its function is often not to promote a liberal or a conservative conception of the good, but rather to keep the conversation alive, and, on occasion, to keep us from bowling alone.

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