Philanthropy Feature 2: High Impact Philanthropy

In 2000 Americans gave a record $152 billion to charity, but today - with the weakening economy and increased belt-tightening - the prospect of continued, record-setting charitable giving is at best questionable. Certainly Americans responded generously to the call for aid after the September 11th attacks - but many nonprofit organizations are worried that perhaps they "spent out" and that generosity after the attacks, combined with the soft economy, will prompt many Americans to tighten the purse strings in 2002.

Kay Sprinkle Grace: I think what happens when we get into an economic downturn is there's a lot of psychic poverty - where people feel like they're not sure they're going to be wealthy any more.

Kay Sprinkle Grace is a fundraising consultant and author of the book "High Impact Philanthropy".

Kay Sprinkle Grace: But unless we have a 1929-type depression - I mean even the 1987 crash bounced back. It took a while, some people a while - but I don't think it should have an effect - as big an effect as people might think it will b/c a lot of that money has been pretty securely tied away.

Paul Schervish runs the Social Welfare Research Institute at Boston College.

Paul Schervish: If we were to add up what every charity says it is losing as a result of the NY tragedy or the economy we would probably find an astounding amount of money being declared as lost or potentially lost - and it will be a far larger number than is really the case.

Progressive Insurance Corporation chairman Peter B. Lewis agrees. In fact, he takes it a step further, saying, essentially, that nonprofits are crying wolf.

Peter B. Lewis: People say to me your stock isn't down therefore you should do something b/c everybody else's stock is down... so that's a new solicitation technique. Don't they start crying poor before they're poor?

But are nonprofits just "crying wolf"? Or is a real crisis looming? A recent survey by the philanthropy research group Independent Sector finds that 26% of those who donated to September 11th relief and recovery efforts planned to scale back or eliminate their giving to other charities. Nearly half of those polled said they would cut back on giving if the economy worsens-in fact, giving by individuals isn't the only concern. There's also giving by foundations - many of whom have seen their stock portfolios dwindle with the downturn in the market. The John D. and Catherine T. MacArthur Foundation has seen its assets fall from a high of $4.5 billion to $3.8 billion.

The real issue, though, is not the amount of money donated to charity in 2002... but the numbers of charities splitting the pie and the number of people needing their services. There are roughly 650,000 nonprofits in the U.S. and that number goes up daily. Many new nonprofits have been formed in the wake of the September 11th attacks - and even if charitable giving remains constant there are now more organizations vying for that money. And - according to Donald Bassham, who directs a homeless shelter in Huntsville, Alabama - the weakening economy will only drive more people to seek help from charities like his.

Donald Bassham: We are maxed out here in terms of what we can handle. Not what we want to handle, just what we're capable of handling right now. My concern is for that other 10 or 12 percent that's still laying out there unassisted that can get back out there and be productive citizens in society and they have no place to go.

That, says Bassham, will force many more charities to do the kinds of grassroots fundraising he's been doing for years.

Donald Bassham: You basically just work every possible entity you can to find any kind of food or financial help you can from any source... so it's constantly word of mouth - well if you can't help who do you know who might can? So it's nine thousand phone calls to accomplish one thing. It's sort of like the slaves in Egypt when they were building the pyramids - a thousand of them pulling one stone one at a time. That's basically what you do here - you try to build little bitty stone that what manpower you got can pull and you get that one to the top of the mountain and you run back down and you start pulling at another.

For 90.3 WCPN, I'm Tanya Ott.

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