Wisconsin Says No to Money for Nonprofits
Governor Walker's ideology requires that people who need assistance seek private charity and that private charity be deprived of the means of assisting them.
Boy, this guy is the gift that just keeps on giving: Wisconsin Governor Scott Walker, not content to interfere with the provision of public services by destroying public-sector unions, has now decided to refuse to sign off on nonprofit grant applications to the Federal government that might “lead to ongoing programs that would need money from state taxpayers later.” The first wave of grant applications deprived of the state’s endorsement would have supported health services, including programs to reduce binge drinking, an unhealthy activity in which Wisconsin leads the nation.
The hard Right has long argued that government services are unnecessary because nonprofits can step into the breach. This claim was always nonsense, but at least its exponents didn’t also take on themselves the task of interfering with the charities’ overwhelmed attempts to do so. Wisconsinites will pay the same Federal taxes whether or not the state receives Federal grants to support its nonprofit sector. So clearly the point is not to shelter the state’s citizens from confiscatory taxes but to punish people who need help. Governor Walker’s ideology apparently requires not just that people in need of assistance seek private charity but that private charity be deprived of the means of assisting them.
And let’s be clear about the legal antecedents of what’s going on here. Groups of citizens of a single state are being deprived of access to something available to all other citizens of the United States—just as groups of citizens of the states of the Old Confederacy were once deprived of the vote. Then, “states’ rights” was a buzz-phrase meaning “the opportunity to mistreat black people without interference from those durned Feds.” Now, in Governor Walker’s view, the phrase is even more expansive, meaning “the opportunity to mistreat unhealthy and/or poor people of every race to make the point that those durned Feds have no right to interfere.” Anyone who’s enthusiastic about the states’ rights claims in the governors’ lawsuit against the Affordable Care Act should check out Wisconsin for a foretaste of what states’ rights really mean to the rights of states’ citizens.
The Voting Rights Act of 1965 made clear that citizens’ right to vote trumps states’ rights. Thus—and despite many recent efforts to enact barriers to that right—there’s a reasonable chance that Governor Walker will lose his legislative majority in the next few weeks, whereupon the appropriate state-federal balance can be restored.
The Constitution can be restored.
Kelly Kleiman, who blogs as The Nonprofiteer, is principal of NFP Consulting, which provides strategic planning, Board development and fundraising advice to charities and philanthropies. She is also a lawyer and freelance journalist whose reportage and essays about social justice, the arts, and woman’s issues have appeared in the Chicago pages of the New York Times as well as in the Wall Street Journal, Washington Post, Christian Science Monitor and other dailies; in magazines including In These Times and Chicago Philanthropy; in the Alternative Press; on Chicago Public Radio and the BBC; and on websites including The Huffington Post.
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COMMENTS
BY ThisArticleIsSuchOneSidedView
ON August 10, 2011 10:28 PM
Amid the downgrade by S&P and the scrutiny by Moody’s on US’s long-term bonds, the analysts from these ratings agencies have been warning state and local governments that a large portion of their total state and local budget are too entrenched with federally directed funding.
A state would have a clearer and stronger financial record over the long-run should it be more independent from federal fund.
Granted, your argument is about non-profit applying for federal money instead of state or local government directly applying for the federal grant. Like any organizations, the leader of a non-profit should take charge and convince community donors the benefits of its program to generate revenue. Marketing the non-profit’s value prop and the benefit to the community is part of being an executive director/president or its development staffs; otherwise, even if these non-profit eventually received the federal money and they don’t possess proven ability to attract community capitals and to demonstrate their value-propositions through prototypes, then these non-profit will eventually just continuously reliance on governmental resources. Which brings to the question: If these non-profits really deliver the benefits, ROI, etc. as they have claimed but still have not able to receive enough initial capitals and sustainable contributions from the market, then perhaps, there are other non-profits that are able to deliver more values or perhaps the business proposal needs to be revised for greater impact with less dollars.
In the above cases, once these non-profits runs out of funding from the federal grant and can’t no-longer reapply, then the non-profit would shift its funding focus from the state-government, regardless whether the state has a binding or matching grant to those federal grants.
Thus, this brings back to my original point. If states continue to rely on federal-directed dollar as part of its total state budget, it will eventually leads ratings agencies’ downgrade, which has a huge ramification to the state’s borrowing cost, its capital spending as well as pension funds not able to hold those bonds. If that happens, the citizens living in those downgraded state will have worsen quality of life and everyone living in the state will share the cost.
I like your altruism and I admire that; however, if one takes a 50,000 foot views, then perhaps, not taking federal grants, for better or for worse, is better choices for both the non-profit and the states. The former will taken more of its staff time to market its benefits to local community and the state will be less likely to be too much reliance on federal funding.
BY Kelly Kleiman
ON August 11, 2011 12:44 PM
Actually, my whole point is that “altruism” is not the issue: the issue is access to taxpayer dollars to support services to taxpayers. The possibility that a state’s credit rating will be downgraded for participating in the Federal revenue-sharing system that’s been in place for at least 40 years strikes me as remote.
As for your argument about stating the “value prop,” etc. for any given nonprofit’s activities, that translates to a claim that the only nonprofits that should succeed are those that could just as easily be for-profit, because they have a readily saleable product. But much of what nonprofit agencies, particularly social service agencies, particularly health-education agencies, have to sell is actually pretty unappealing: needle exchange to reduce the spread of AIDS, programs to reduce binge drinking when casual drinking is so widely accepted, etc. The nonprofit sector exists precisely to support and sustain essential services that AREN’T attractive or appealing to the marketplace.
And the states exist to foster their citizens’ well-being, not to interfere with it. Someone should mention that to the governor of Wisconsin.
BY ThisArticleIsSuchOneSidedView
ON August 11, 2011 02:49 PM
The U.S. bonds has been top rating standing and have never downgraded, but it recently did. Hence, a historical view does not translate into perspective decision making process. States and local government are indeed have been under reviewed and still are by rating agencies due to the tie on federal funding.
http://www.bloomberg.com/news/2011-07-19/5-states-debt-ratings-on-review-by-moody-s-for-u-s-dependence.html
The cost of downgrade to state and local can further hamper existing services in state- and local- level such as education, healthcare, etc. Stepping in your point of view without looking at this issue from a big-picture perspective, if the state will have to forgone more of its public service in a large, statewide scale because of higher cost of governmental service, then it actually would defeat your purpose of argument because higher cost of governmental expenditure will in turn hurt more of the state’s and local’s citizens’ well-being more so in quite a wide-scale.