Reflections and Predictions in the World of Philanthropy

With federal funding cuts, threats to the Johnson Amendment, and a slew of unprecedented natural disasters, 2017 was nothing if not an eventful year for nonprofits and funders across the United States. How have recent events affected the world of philanthropy? What developments lie ahead as 2018 gets underway? Here we’ve compiled some reflections and predictions from across the nonprofit newswire.

2017 in Review
If you are seeking some 2017 bright spots, or perhaps a bit of levity, we recommend checking out Inside Philanthropy’s 2017 IP Philanthropy Awards. Illuminating the highs, lows, and ironies of 2017, the Awards range from traditional categories, such as Foundation President of the Year (former Open Societies Foundation President, Chris Stone), to the more esoteric (Top Philanthropic Action Hero: Betsy DeVos). Interestingly, the top theme for 2017 was “resistance” due to the fact that a number of grantmakers, big and small, have stepped up to the plate to counteract changes coming from the top levels of government. Speaking of which, the article “Trump Effect: Six Ways Philanthropy Has Changed in the Past Year” summarizes Inside Philanthropy’s reporting over the past year on this issue. Please note that Inside Philanthropy does require a subscription; however, non-subscribers are able to access up to five articles per month.

Framing the Debate in 2018
Perhaps the best way to get a big picture view of the year ahead in philanthropy is to analyze the language used to frame the discussion. Lucy Bernholz, a self-proclaimed philanthropy wonk and Senior Research Scholar at the Stanford Center on Philanthropy and Civil Society, offers some linguistic predictions in “Impact Washing, Data Refuges, Big Bets, and More: Philanthropy’s 2018 Buzzwords.” Many of these words focus on technology, with our favorite being “data refuge,” defined as “a volunteer-led effort to make backup copies of digital data that governments and others might decide to destroy to impede their opposition.” And, yes, “resist” makes the list. As Ms. Bernholz explains, “The word travels beyond the United States and English, as we see in marches and protests around the globe.” If you are interested in a deeper exploration of Ms. Bernholz’s predictions, you can download the report Philanthropy and Digital Civil Society: Blueprint 2018.

The Effects of Tax Reform
With the recent overhaul of the U.S. tax system, those working in the nonprofit sector may be apprehensive as to how this might affect them.

Philanthropy News Digest (PND) has published a couple of interesting articles on this topic. The first article presents the good news. The movement to repeal the Johnson Amendment was not successful, at least for now. As many of you are aware, an earlier version of the tax bill included a provision which would have enabled nonprofit and religious organizations to support or fundraise for political candidates, raising a number of concerns in the nonprofit community. This was removed from the final version.

How will tax reform affect charitable giving in the U.S.? PND’s second article suggests that, as the tax changes become active in 2018, the sector may witness a reduction in charitable donations. It cites one estimate that total individual giving may decline by as much as $14 billion in 2018, representing a five percent decline from 2016 levels.

The article “Nonprofits Must Move Swiftly to Fight for Sound Public Policies,” published in The Chronicle of Philanthropy, offers further insights into upcoming tax changes. Penned by two officials at the National Council on Nonprofits, the article characterizes the new law as having “created the most dangerous policy environment across the state, local, and federal levels that we’ve ever seen in the decades we’ve spent focusing on how governments and nonprofits interact.” The authors offer an analysis of likely ramifications of the new law on the nonprofit sector and actions steps that organizations can take. They also predict that attacks on the political neutrality of the nonprofit sector will continue to arise.

Further Predictions for the Coming Year
Nonprofit Quarterly’s (NPQ) article entitled “NPQ Presents 7 Trends of 2017 and 11 Predictions for 2018—Please Chime In!” starts off with a review of last year’s trends, which included a boost in activist and constituent donations, the most impressive of which may be the $24 million raised by the ACLU in one weekend. Unsurprisingly, NPQ has predicted further attacks on civil society and substantial cuts to the federal safety net in the coming year. Not to worry, though, as “the sense of an inexorable march toward doom will persist alongside unaccountable joy at small victories.”

Inside Philanthropy’s “Philanthropy Forecast, 2018: Trends and Issues to Watch,” analyzes social trends and how these may affect giving in the year to come. Interestingly, many predictions relate to how growing inequality in the U.S. will affect philanthropy. The article forecasts a widening of the giving gap between one percenters and ordinary Americans, as well as the emergence of new mega-givers (on the heels of over 170 billionaires signing The Giving Pledge) and the strengthening of existing ones, such as the Chan Zuckerberg Initiative and Bloomberg Philanthropies.

Final Thoughts
While the dizzying pace of news may make the future seemingly impossible to predict, these articles do provide some interesting insights. In terms of what’s in store for grantmakers and grantseekers, one thing does seem abundantly clear: As individual charitable giving decreases and federal funding cuts kick in, there will be increasing pressure on private foundations to fill the funding gap, and heightened competition among nonprofit organizations seeking funding. On the bright side, this will hopefully foster even more innovation in the philanthropic and nonprofit sectors as they work together to tackle society’s greatest challenges.