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Making the Pot Boil Over

A few weeks ago Peter Buffett, son of Warren Buffett, caused an uproar in the non-profit and philanthropic worlds with his New York Times piece: “The Charitable Industrial Complex.” His premise was that philanthropy is a carefully structured system whereby the 1% invests a small amount of money in socially attractive efforts that effectively keep the status quo in place:

“But this just keeps the existing structure of inequality in place. The rich sleep better at night, while others get just enough to keep the pot from boiling over. Nearly every time someone feels better by doing good, on the other side of the world (or street), someone else is further locked into a system that will not allow the true flourishing of his or her nature or the opportunity to live a joyful and fulfilled life.”

I’ve been on the staff and boards of non-profits – we weren’t trying to sustain anyone’s oppression. I’ve given money (although not at the Buffett level, to be sure) and I wasn’t trying to protect my own privilege. At the micro, day to day level, Buffett’s charge doesn’t ring true.

At the larger, macro level I think he’s onto something, but I’d like to suggest a broader, and ultimately more difficult conclusion.

Buffett is asking what could drive true structural change in society. That’s not a particularly difficult question. Systems don’t change from within; they change only in response to pressure from without. Two examples from completely different arenas:

In the 1980’s, when empowered entitled white men began dying from AIDS, they were stunned to learn that being inside systems like Wall Street, government, science, etc didn’t make much difference. Those systems were unyielding to their pleas for change.

It wasn’t until those guys took off their suits and ties and took to the streets, blocked traffic with die-ins, shut down government offices, put a massive condom over Jesse Helm’s home that change began to happen.

Within a decade, massive infusions of government funding, and tremendous philanthropy from the pharmaceutical industry created hundreds of non-profit social service agencies focused on direct service and prevention education.

That funding also destroyed those organization’s ability to drive change. They were now part of, funded by, dependent on the very system they’d opposed. Its part of the self-protective behavior of massive systems to neutralize their invaders, often with money.  

A decade earlier, a chain smoking, coffee pounding investor named Bill McGowan, tried to bring competition to the long distance phone market, and found, not surprisingly, that the system wasn’t open to change. AT&T had a national monopoly, and the government wasn’t interested in challenging that.

Undaunted, McGowan sued, and only after he’d brought suit did the Justice Department follow and join with MCI to sue AT&T, leading to the breakup of AT&T which has made today’s competitive telecom market, and the explosive growth of the internet possible.

So that’s the difficult conclusion. The non-profit sector, dependent on government and philanthropic funding, is never going to be able to drive change. Sure, we’ll help lots of individuals. But true systemic change is impossible when you’re that embedded in the system.

If Peter Buffett wants real systemic change, then he needs to apply his money to making the pot boil over. He needs to find and fund the Bill McGowans and the Larry Kramers – those profoundly difficult, overbearing, egotistical disrupters who are willing to do whatever it takes to bring about change. He needs to experiment with ways to sustain the energy that was behind Occupy Wall Street.

And then he needs to retreat back to safety to weather the storm he will have unleashed.

Are you up for that Peter?

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3 thoughts on “Making the Pot Boil Over

  1. Tony Hain says:

    Mike, just found your blog and enjoying it. This post really resonated with me. I’m reminded of the controversy surrounding Dan Pallotta in the 90’s. His mega,multi-day, experiential fundraising events—AIDS Rides & Breast Cancer Walks– took a business approach to marketing, awareness and finding new dollars.

    His events were hugely successful at mobilizing thousands to raise incredible amounts of new money for their causes and to take action and engage on a cause. However, his model ultimately fell due to critics and media coverage about high overhead and the profit he and his company were making.

    I know he has many detractors and I think he’s another example of someone shaking up the system. In addition to organizations becoming part of the system they’re trying to change, we’ve also created an evaluation system for non-profits and charities that is so focussed on how many dollars go to direct support of the cause, that we’ve handicapped charities abilities to make the necessary investments and take the same risks (along with the subsequent failures and rewards) that the private sector does to create most of our business and technology innovations.

    In effect, our societal evaluation model of charities encourages the status quo, rather than innovative solutions. Are we willing to empower these organizations to take bold steps and risks that are necessary for bold outcomes?

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