Amid persistent upheaval, including the overturning of Roe v. Wade and mass protests over police brutality, donating to nonprofits has become a go-to response to crises. But with the influx of giving, debates have surfaced about which nonprofits deserve the public’s hard-earned cash.
David Hammack, a history professor at Case Western Reserve University, defines nonprofits as formal, self-governing, voluntary, private organizations that don’t distribute profits and provide a public benefit. This definition covers a range of nonprofits that are big and small, wealthy and grassroots. Some organizations have the capacity to do transformative work, but others fall short of their objectives.
In recent years, high-profile nonprofits have come under scrutiny. For instance, the leaders of the Black Lives Matter Global Network Foundation were accused of using funds for their personal benefit. (Patrisse Cullors, a cofounder of the Black Lives Matter Global Network Foundation, denied the accusations, and per the organization’s Twitter, she “received a total of $120,000 since the organization’s inception in 2013.”) Time’s Up, an organization formed in response to the #MeToo movement, unspooled in 2021, after a prominent board member was revealed to have advised former New York governor Andrew Cuomo on handling his sexual assault allegations.
These controversies reveal a more fraught side of the nonprofit sector, beyond the research reports, well-funded initiatives, press conferences, and social media posts. A web of critiques regarding industry norms and the fundamental purpose of mainstream nonprofit work is often described by a single term: “the nonprofit industrial complex” (NPIC).
How do activists define the nonprofit industrial complex?
The NPIC draws on similar terms like “the prison industrial complex” and “military industrial complex,” which describe how the private and public sectors partner to profit off human suffering under the guise of safety and national defense, respectively. The NPIC framework was popularized in 2004 by INCITE!, a collective of radical feminists of color organizing against state and domestic violence.
The NPIC framework argues, essentially, that nonprofits function as a form of soft social control to placate the masses and maintain order. On INCITE!’s website, the NPIC is described as a “system of relationships” between nonprofits, foundations that fund them, the local, state, and federal government, and “the owning classes.”
According to INCITE!, the implications of these relationships are profound: The organization argues that the state uses nonprofits to professionalize organizing, curb activism’s ability to disrupt the status quo, “encourage social movements to model themselves after capitalist structures rather than to challenge them,” funnel money that would otherwise go toward taxes into private foundations, allow corporations to perpetuate oppression under the guise of charity, and “control social justice movements.”
Grassroots organizers say the existence of the NPIC raises a fundamental quandary: If the issues we face are rooted in systems of government oppression and capitalism, how can we expect nonprofits, which are complicit in the same systems, to solve them?
In the foreword to INCITE!’s anthology The Revolution Will Not Be Funded, Soniya Munshi and Craig Willse maintain that the NPIC is a system that doesn’t negate the transformative work of some nonprofits and the people working for them. “We also must be cautious not to mistake individuals in those settings for the institutions themselves,” they wrote. “Life within the NPIC… requires constant negotiation of how those complexes constrain and enable transformative work.”
How was the NPIC created?
Philanthropy has been present since America was founded, albeit in different forms. Some credit Gilded Age robber baron Andrew Carnegie with articulating the modern nonprofit philosophy, in which he saw charity as a way of preserving capitalism by ameliorating the widening gap between the haves and have-nots. He invoked the idea of the “undeserving poor,” professing in an essay on wealth that modern charity should create opportunities for men with, as historian Peter Dobkin Hall quoted, “genius for affairs” rather than “the slothful, the drunken, and the unworthy.” Hall concluded that the proliferation of foundations and nonprofits by tycoons such as John D. Rockefeller “helped Americans accept the idea that wealth could be something other than predatory and self-serving.”
In post-World War I America, a burgeoning establishment of progressive institutions flourished. Hall wrote that nonprofits and foundations both softened the effects of capitalism and brought it into “every aspect of private life.” The interwar era saw corporations and the federal government become increasingly involved in philanthropic work, as corporate leaders began serving on charitable boards and President Herbert Hoover partnered with the nonprofit Better Homes to address unemployment and housing access.
Currently, there are 19 categories of nonprofits with different restrictions. The Internal Revenue Act of 1954 established a 501c3 tax exemption, which applies to charitable organizations, as well as religious, educational, and other organizations. This tax-exempt status has been a boon for the nonprofit sector. The code arguably encourages elites to divert money otherwise spent on taxes to private foundations where they can distribute funds as they see fit.
After President Ronald Reagan’s budget cuts in the 1980s, nonprofits became more businesslike and helped fill the gap in social services. Today, statistics paint a robust picture of the nonprofit sector, which includes about 1.8 million nonprofits in the United States. According to the Urban Institute’s 2021 report, 501c3's have spent $1.94 trillion, and the Bureau of Labor Statistics reported that, in 2017, some 12.5 million people held jobs at nonprofits.
What are some critiques of the NPIC?
Critics argue that the reliance on funding for nonprofits makes them vulnerable to the influence of elites. Funds or grants can come with stipulations, which may result in “mission drift.” Mission drift occurs when organizations move away from their original priorities, sometimes emphasizing quantitative goals, like the amount of funds raised, over the qualitative impact on people’s lives.
Some staffers at nonprofits say relationships with their funders can get messy. On the condition of anonymity, Z, a worker at a tech nonprofit, tells Teen Vogue that her organization created an app to ease access to food stamp benefits while it received donations from Wal-Mart, a corporation notorious for paying workers an unlivable wage.
Several interviewees agree that the industry ultimately rewards wealthy nonprofits with connected leaders over smaller, grassroots nonprofits. Gracie Willis, an attorney with the Southern Poverty Law Center (SPLC), succinctly describes the industry for Teen Vogue as a “closed loop.” She says further, “You don't get the funding if you don't have the clout, but you don't have the clout if you don't have the funding.”
In terms of working conditions, nonprofits and corporations aren’t that different. As former nonprofit worker Amy Piñon tells Teen Vogue, “Nonprofit is a tax status, not a business model.” Multiple interviewees from across the nonprofit sector report to Teen Vogue that long hours and low pay are expectations in the nonprofit sector, and that the good will of an organization’s mission can be weaponized to quash attempts at accountability.
For the SPLC, an organization that specializes in legal civil rights advocacy, workers say their low wages conflict with the organization’s values. Employees at the SPLC have been negotiating for more equitable working conditions for about 18 months, and finally reached an agreement for a new contract in July. Rose Murray, an attorney who works for the SPLC, tells Teen Vogue that higher-ups have said the organization’s hefty endowment will not be used to increase worker salaries. (Teen Vogue has reached out to the SPLC for comment.)
“Black women who’ve been working at this organization for decades are still making under $50,000 a year while executives are making, probably, four times that, if not more," Murray points out. "It’s such an incredible disconnect. How do you not see [fair pay as part of] eradicating poverty?”
In a comment to Teen Vogue, the SPLC says it is “committed to being a socially responsible employer and we continue to partner closely with our employees to create a great workplace.” The organization adds: “All of our employees, including those represented by the union, should receive fair compensation and working conditions. The SPLC looks forward to reaching a collective bargaining agreement soon and hope — for our employees, stakeholders, and community partners in the South and beyond — to keep making significant progress and contributions to racial justice and equity.”
There are also barriers to getting a job at a nonprofit in the first place. Many positions require degrees in nonprofit management or social work and potentially require staff to keep up with that astronomical cost of living in large cities like New York and Washington, DC.
As with many industries, the nonprofit sector has seen increased interest in unionizing since the beginning of the pandemic, confirms Katie Barrows, president of the Nonprofit Professional Employees Union.
But this isn’t a problem that’s confined to the United States. K, a Canada-based nonprofit worker who has asked to remain anonymous, tells Teen Vogue that her organization withheld raises from unionizing employees. “[For] a program that's supposed to be supportive of mental health, and [their] whole thing is helping youth at risk, to go to very extreme union-busting moves is really unfortunate,” she says.
What are alternatives to the NPIC?
In addition to pointing out the pitfalls of nonprofits, INCITE!’s anthology contains radical prescriptions for the NPIC. Indigenous activist Madonna Thunder Hawk drew inspiration from 20th-century Native organizing, which relied on community generosity for resources. Paula X. Rojas and Adjoa Jones de Almeida of the Sista II Sista Collective spoke of the need for organizers to build their own infrastructure outside of state control, referencing the Zapatista movement.
Nonprofit workers who have spoken with Teen Vogue suggest more immediate remedies to the NPIC, such as greater government funding for small, community-based organizations. Lisa Wright, SPLC’s corporate-gifts coordinator, tells Teen Vogue that the ultimate corrective requires thinking outside the systems currently in place. “There is no fixing a system that's designed to do exactly what it's doing," she points out. "We have to approach it in a whole new way.”
“Is that realistic?" Wright continues. "Probably not. But there's got to be a better way than paying someone $300,000 to tell the person that's doing the work, 'You're not worth $50,000 after doing this work for 30 years.’” SPLC’s union confirms for Teen Vogue that, previously, some workers with decades-long careers were not making more than $50,000, but that has changed with the new contract.
University of Minnesota associate professor Ceema Samimi emphasizes for Teen Vogue that, after the next social crisis inevitably hits, it is especially important to do research, including on an organization's financials, before donating. Samimi stresses that people should find out how the organization is impacting the target community it claims to help.
Samimi asks further, “What’s the organization actually doing to make people feel empowered and include them and their names and their voices in the work?”
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