Every year in the U.S., individuals, foundations, and corporations donate around $47 billion a year to non-profit organizations that focus on child welfare, food security, homelessness, and other areas that fall under the domain of "human services." In comparison, federal, state, and local government spend around $411 billion a yearproviding similar safety-net services.
In his recent book The Givers: Money, Power, and Philanthropy in a New Gilded Age, Inside Philanthropy founder David Callahan warns that we "face a future in which private donors – who are accountable to no one – may often wield more influence than elected public officials, who (in theory, anyway) are accountable to all of us."
And yet as statistics like the ones above suggest, even today’s most ambitious philanthropists are hard-pressed to match the resources the government has at its disposal.
Thus, a compelling strategy for philanthropists looking to leverage the impact of their donations emerges: Invest in non-profits that increase the efficiency and effectiveness of government institutions. After all, which outcome seems most achievable: Doubling annual contributions from every donor in the country, or making current government spending 10 percent more effective?
As the Networked Age creates a new global sense of connectedness and accountability, philanthropy’s role in creating public good will only increase – especially as the Internet continues to democratize philanthropy through platforms like Change.org, Kiva.org, and Donorschoose.org. As Callahan notes in The Givers, "the bulk of charitable dollars take the form of modest contributions by millions of people." And it has never been easier than it is now to find new communities of participation, and new causes to support.
Meanwhile, with the Giving Pledge, Bill and Melinda Gates and Warren Buffet have created new norms amongst society’s wealthiest individuals about the moral commitments of great wealth and what role philanthropy should play in their lives.
Today, people like Bill and Melinda, Mark Zuckerberg and Priscilla Chan, and Laurene Powell Jobs aren’t just writing checks – they’re operationally active and inventive in their giving. That business leaders with deep experience in capital allocation and building effective organizations and solutions at scale want to work on the planet’s most wicked problems is an extremely positive development.
As Callahan notes in The Givers, many of today’s major philanthropists "are zeroing in on precisely those problems that our political system has fumbled" and are attempting to "solve problems in ways that get around partisan gridlock or dated ideas or entrenched interest groups."
While Callahan recognizes that philanthropists with significant resources often have more "freedom and agility" than public officials to attack big challenges, he also worries that the ascendance of philanthropy will ultimately weaken our democratic process.
But is the relationship between philanthropy and democracy really so zero-sum?
As I’ve written elsewhere, government is the operating system of society – it creates stability, security, rule of law, and other key institutions and foundations which enable private-sector innovation and investment.
At the same time, as I proposed to Atlantic writer Alana Semuels in a recent conversation, it’s a false dichotomy to position private philanthropy and government as fundamentally at odds with each other – with any increase in the former leading to a reduction of the latter. In reality, we can support both privately funded efforts to promote public good and support government as well.
Many of the non-profits and other social impact efforts I support including Change.org, Do Something, Kiva.org, and Crisis Textline – are platforms that in some sense "compete" with government in that they create new spaces and mechanisms for the pursuit of collective good. But my support for them doesn’t diminish our need for a strong, well-funded, and efficiently functioning government.
Indeed, while the Trump Administration aims to "dismantle the administrative state," it’s more important than ever to look for opportunities to address the real challenge of government – namely, how can we make government operate more effectively and efficiently, instead of simply cutting crucial safety-net services and other programs that millions of people use to make their lives better?
In pursuit of good government, a core component of my own philanthropic efforts involves funding creative non-profits that update and improve the services that “We, the People” have already committed to, using the principles and practices of the consumer technology industry. While such efforts are still relatively new, we’ve already seen how improving the implementation of existing government functions can have as much impact as advocating for new policies and new programs.
Code for America, a non-profit I’ve supported for the last three years, has led the way in proving this theory of change.
As the organization’s Executive Director, Jennifer Pahlka, suggested in a recent Washington Post op-ed, modernizing "federal government IT so that it can deliver the digital services that the American public deserves" represents a huge opportunity we have now to improve the lives of every citizen.
Take, for example, the work Code for America has done in making it easier for individuals in California to clear their criminal records of old, non-violent felony offenses that decrease their opportunities to get jobs, student loans, housing, and other resources that could help them become more productive citizens.
In 2014, voters approved Proposition 47, a component of which expands the number of people who are able to reclassify old, non-violent felonies as misdemeanors — but only if they persist through a fairly complicated application process.
This process starts with going to a legal aid clinic with limited hours, waiting in line there, and filling out a long and confusing paper form. Then, individuals have to obtain their criminal records from the relevant police departments, wait two weeks to learn if they’re eligible, wait even longer for a court date, show up to court, wait some more, complete more paperwork…and then do it all again if they have a conviction in another county.
Thanks to such bureaucratic hurdles, only about 7 percent of eligible people in Los Angeles County have even started this process, and even fewer have successfully navigated it.
But by developing a mobile phone app, Code for America is helping to change that, and thus helping to realize the full potential of the proposition that California voters approved three years ago.
With Code for America’s mobile phone app, individuals who hope to reclassify their old felonies no longer have to start the process by going to a legal aid clinic – they do so on their phones. Then, these users receive text messages that guide them through the rest of the process, prompting them when they need to provide more information, reminding them of court dates, etc.
Approaches like this don’t just provide a workaround to get better outcomes. Instead, they fundamentally instrument government processes so that public servants can understand how to improve them over time.
For example, the text messages that are exchanged as people try to clear their records evolve into a real-time database of the operational barriers that applicants encounter in the course of this process. All of this becomes data that public defenders, attorneys general, and court administrators can use to streamline processes for their benefit and the benefit of the people they represent.
Take the Supplemental Nutrition Assistance Program (SNAP), i.e., food stamps. Code for America has created a mobile app for SNAP participants that helps them move through application process with clear online forms and follow-up text messages, just like its app for reclassifying old, non-violent criminal offenses.
Over the course of this project, Code for America has been tracking the barriers that users encounter, then working closely with welfare offices to remove those barriers, one by one.
When its data showed that many applicants in one county were receiving letters informing them of their interview date after the date of the interview, government officials quickly fixed the problem. When data showed that eligibility workers in another county were asking for unnecessary documentation and paperwork, government officials set them straight.
Do this enough times and we have services that are not just easy to apply for – but easy to actually use. And they cost taxpayers dramatically less to administrate because they take three steps, not thirty.
Conventional wisdom holds that government is reluctant to innovate, and reluctant to adopt the iterative and consumer-focused mindset that private-sector companies use to improve their products and services. But Code for America’s work with state and local governments and the work of the United States Digital Service in the White House prove otherwise.
Still, government is designed to move more slowly than the private sector, and non-profits like Code for America need investment and patience to show results at scale. But the fact that the State of California has officially adopted many of Code for America’s practices and contracted with them to take their SNAP program to every county, and that other states are eager to follow suit, means this movement is on track to have huge impact.
In an era of massive technological change and the uncertainty and political upheaval that creates, major philanthropists looking to pursue the greatest possible social impact have an incredible range of options to pursue. That so many wealthy individuals now feel inspired to spend a great portion of their resources, in their own lifetimes, on philanthropic causes they are personally passionate about, through new means and methods, is an overwhelmingly positive trend.
At the same time, it’s also extremely important to strengthen the public sector through philanthropic support of organizations like Code for America. Investing in this manner provides both a smart way to leverage one’s impact, and also an opportunity to improve the one institution that is designed to serve us all.