The scope and scale of the Trump administration’s ambitions are now strikingly clear, as is the degree of the administration’s hostility for the nonprofit sector in the U.S. and around the world.
A White House memo issued Friday, February 7 states: “The United States Government has provided significant taxpayer dollars to Nongovernmental Organizations (NGOs), many of which are engaged in actions that actively undermine the security, prosperity, and safety of the American people. It is the policy of my Administration to stop funding NGOs that undermine the national interest.”
National Council of Nonprofits (NCN) CEO Diane Yentel responded almost immediately:
Let’s be clear: the security, prosperity, and safety of the American people that the Memorandum expresses concern about are enhanced by the work of nonprofits and NGOs. Removing this vital funding or dismantling these organizations will not just diminish the United States here at home and around the world, it will cost lives. The work that nonprofit organizations do day in and day out to meet their lofty missions touch all of our lives, in each of our communities, and are truly what makes America great in the eyes of the world and at home.
This is the unequivocal truth. And it’s astonishing that it has to be said at all.
My warning of mid-January about the political targeting of nonprofits now reads as almost naïve. I worried about a few specific organizations being targeted; I didn’t expect a wholesale assault on the nonprofit sector.
It’s worth noting that “NGO” is a strange term to use in a domestic context, as historian Ben Soskis pointed out on LinkedIn. He asks whether it was an attempt “to make nonprofits seem like alien, oppositional institutions?” Nonprofits, of course, are anything but; on the contrary, they’re embedded in every community doing crucial work helping Americans — Republicans, Democrats, and Independents alike — live better lives. Former President George H.W. Bush famously described community-based nonprofits as “a brilliant diversity spread like stars, like a thousand points of light in a broad and peaceful sky.”
Nonprofits that receive funding from the federal government (and this is so obvious it’s weird to have to say it) are funded to undertake specific programs and activities that have been authorized by Congress. We’re talking about organizations like Meals on Wheels, which gets funding through the Older Americans Act and domestic violence shelters from Arkansas to Hawaii, funded through the Family Violence Prevention and Services Act.
If President Trump wants to gut those (or other) programs, he must persuade Congress to do so, according to our Constitution anyway. Absent that, the executive branch’s role is to implement what Congress has legislated, as Yuval Levin, the director of social, cultural, and constitutional studies at the American Enterprise Institute, describes in this conversation with Ezra Klein of The New York Times. That’s how our system works — or has worked for well over two centuries — as Levin, a conservative, explains.
The NCN and its new CEO Yentel (talk about an onboarding!), whom I quoted above, have been doing heroic work to make this argument, fighting the initial attempt to cut off federal funds in the courts (in partnership with others, in particular Democracy Forward). So far, they have had success, including in particular, securing Temporary Restraining Orders on Trump’s freeze on agency grants and loans. NCN has also been working tirelessly to educate affected nonprofits about the implications of the tsunami of pronouncements and executive orders, including those related to Diversity, Equity, and Inclusion (DEI). DEI, as I noted here two weeks ago, is both perfectly legal and, when pursued thoughtfully, leads to better organizational performance and more, not less, merit-based workplaces.
The White House memo of February 7 (issued four days after the latest restraining order that NCN helped secure) represents a clear statement of intent by the White House to pull federal funding. It also seems intended, just like the pronouncements on DEI, to instill fear.
We all have a role here, and certainly foundations (and other grantmakers) do in particular. We need to stand up for this sector in all its great diversity — and remind people what it is and who it serves: everyone. The stunningly inhumane shut-off of USAID funding and activities, and the ensuing horrific human consequences, should clarify the level of hostility this administration seems to have toward organizations that seek to help those in need. To defend these kinds of organizations isn’t partisan, it is essential and patriotic. As people begin to understand it better, this defense should garner support across the ideological spectrum.
Candid reports that “at least 30 percent” of U.S. nonprofits that file form 990s receive government grants. Urban Institute puts the number of organizations getting government funding much higher, at two-thirds, with “over a third” of nonprofits receiving “more than a quarter of their revenue from the government.” Whatever the precise numbers, the loss of federal funding would be devastating to the millions of people who depend on services from these organizations.
It’s hard for foundations and other funders to know exactly what to do. There is great fear of “putting a target on our back” — a phrase I have heard more times from people I have spoken with in the past three weeks than in the decade prior. This fear is real and understandable.
Knowing that everyone’s circumstance is different, let me offer up some questions I think every grantmaking institution should be asking in this moment.
1) Do we know what our grantees need, and do they know we’ve got their backs? “Ask your grantee partners what they need most,” advises Nick Tedesco of the National Center for Family Philanthropy. Then decide what you’re willing to do, some of which you probably did during the pandemic.
Possibilities include more unrestricted support; streamlined reporting; convening; and access to legal advice. Once you decide, communicate that clearly and frequently to those you fund. Not surprisingly, given what CEP does and how we do it, I suggest that you’ll get the best information if you ask grantees how they are being affected by this climate and what they need in a way that also protects their individual identities (reach out to us if you want to know more about how you might do this).
2) Can we use our voice effectively in this moment? So far, funders, with a few notable exceptions, have been relatively quiet, as the Chronicle of Philanthropy noted in this article last week. Some I have recently talked with have questioned the value of speaking out and expressed concern about “putting a target on our back” (that phrase again). More than a few have cited what happened to “the college presidents” — though I am not quite sure, given the many constituencies that college presidents have to manage, this is an apt comparison.
I believe voices like those of Gates Foundation CEO Mark Suzman, who posted last week about the crucial importance of U.S. international assistance, and Robert Wood Johnson Foundation President Rich Besser, who issued a statement countering the “backsliding on DEI and health,” matter a great deal in this moment. I also appreciated this message, of this morning, from Skillman Foundation President and CEO Angelique Power. Everyone’s situation and sphere of influence is different, but fear shouldn’t be the dominant decision criterion: the question is whether speaking out might help avert worse outcomes. It’s crucial to draw a line and stand up for the truth
3) How are we defining risk? I have heard many stories of leaders and their staffs, acting on the advice of legal counsel, scrubbing language from websites or taking other steps to “mitigate risk.” I understand these concerns and recognize the need to be strategic, but let us not retreat from crucial (and legal) objectives out of fear.
The risks we consider should not only be risks of action that are parochial to our institutions, but also risks of inaction — to our missions, values, the people we seek to help, and, indeed, our democracy. Put another way, it’s about “purpose before organization,” as Anne Wallestad describes in her landmark 2021 Stanford Social Innovation Review article on purpose-driven board leadership.
4) What else can we do? It’s understandable that individuals and even institutions feel powerless in the face of what seem like overwhelming obstacles. I have heard, for example, from those who point to the dismembering of USAID, or the potential cut-off in domestic federal funding, and say, “philanthropy can’t possibly fill those gaps.” That’s true, but it’s also not the whole story.
Nonprofits that suddenly lose funding they’ve depended on for years will have to make unthinkable choices about what to prioritize. In that terrible context, extra support, even at a level that is a fraction of what they’re losing, could be crucial. The choice is not “do it all” or “do nothing.” No one is powerless, and perhaps least of all not large, endowed, and longstanding institutional foundations. As funders think about what they can do, they’ll need to explore new possibilities to meet the moment. As I have argued in previous posts, it will be essential to communicate more effectively about the ways in which nonprofits positively affect us all.
Michael Roth, the president of Wesleyan University (my alma mater), puts it well in a piece in Slate this past weekend:
Since the 18th century, thinkers associated with conservatism and classical liberalism have emphasized the importance of having an independent civil society, the informal networks in a country that are adjacent to the political sphere. Businesses and schools, libraries and neighborhood associations, are crucial elements of that sector. … Authoritarians, by contrast, have long known that total control will elude them if they don’t eradicate the autonomous support engendered within civil society by cultural, religious, commercial, and educational institutions.
Roth is directing his message to his fellow college presidents, in particular, urging them not to “put on a demure face and stay silent while civil society is undermined by the diktat of executive orders.” His words also apply to those leading foundations and other grantmaking institutions.
Now is the time to ask ourselves the tough questions — and act. We are confronted, as Martin Luther King Jr. said in another time of crisis, with “the fierce urgency of now.”
Phil Buchanan is president of the Center for Effective Philanthropy, author of the 2019 book Giving Done Right: Effective Philanthropy and Making Every Dollar Count, and co-host of the Giving Done Right podcast.
