When You Give, Where Does Your Donation Go?
|June 28, 2012||Posted by Jeffery J. Smith under News|
Do Gifts Fund Cancer Research or Salaries & Overhead?
Why do we give charities a pass? Have they cast a spell on us? Would economic justice — or “geonomics” — work better? This 2012 article is from Truthout, Jun 12.
by Ellen Leopold
All charities that address disease tap into a vein of magical thinking, exploiting the atavistic hope that donations might win favor with a higher power, ward off the evil eye, buy us — or a loved one — time.
No disease is more likely to provoke this response than cancer. And no organization has done more to capitalize on this reaction than the American Cancer Society. With its origins lost in the mists of time (1913), it enjoys the protected status of a national icon, above the political fray.
Despite the billions of dollars that government agencies pour into research — public funding that dwarfs private giving — Americans still believe that their own individual money might make the difference and turn the tide of research toward the ultimate cure. So, they give and give again.
Over the past few decades, scores of new cancer charities have sprung up, tapping into this propensity to give. Charity Watch, the philanthropy watchdog that evaluates nonprofits, gives a failing grade to many groups with names designed to snare the unwary — the F-rated American Breast Cancer Foundation and United Breast Cancer Foundation, for example, are easily confused with the A-rated Breast Cancer Research Foundation. Despite obvious warning signs and some pending lawsuits, such operations still manage to pull in millions.
The American Cancer Society (ACS) aggravates the problem by overstressing personal responsibility. Instead of pointing the finger at environmental toxins and encouraging Americans to make common cause against them, the ACS places the burden of prevention on individuals. Fundraising campaigns target unhealthy “lifestyles” as the source of most cancers. This is essentially victim blaming before the fact; if you fail to shape up — to stop smoking, drink less, exercise more, get screened — and a diagnosis follows, you have only yourself to blame. Never mind that known risk factors can explain only half of all cancer diagnoses or that early detection does not always save lives.
We probably picture the ACS as a coordinator of volunteers and an efficient middleman, bundling and redistributing donations at minimal cost. The ACS promotes this image, defining itself as “the largest voluntary health organization in the United States.” Yet with 9000 employees, the ACS is also the largest employer of paid staff in the nonprofit cancer world.
In 2010, the ACS reported expenses of over $500 million in salaries, benefits, and payroll taxes, not a penny of which leaves the building. Added to that is ACS’s accumulated pension obligation. At $600 million, it is three times the charity’s outstanding commitments to cancer research.
It’s one thing to follow the money going out of a foundation and quite another to follow it going in, with the door closing behind it.
What do ACS employees actually do for that $500 million payout? About a quarter of it is dedicated to fundraising. This does not include fees paid to professional fundraisers, who work as outside consultants. Nor does it include the work of volunteer fundraisers, who may also solicit donations over the telephone and elsewhere. Of course, volunteers carry out many other tasks as well, helping to run a wide range of programs and services — providing rides to treatment, offering postoperative advice and support, organizing fundraising events, staffing online support communities etc. Also volunteer cancer scientists give their time and expertise for a modest honorarium. So, where does volunteer work end and paid employment begin?
When revenues contract, as they did during the recent recession, the charity’s response was to reduce the total value of its program grants by more than it reduced its payroll. It also significantly curtailed its use of outside consultants; between 2008 and 2010 “professional fees” dropped by 21 percent, while payroll costs fell by less than 2 percent. The extravagant compensation for ACS top executives has become a hallmark of corporate excess.
The charity’s phenomenal growth is primarily the consequence of demographic change for which it can hardly claim credit. It is the inexorable logic of a growing and aging population that accounts for much of the increased “demand” for its services.
The absolute number of Americans afflicted by cancer (the natural constituency of all cancer charities) has grown steadily over the past century — an estimated 1.6 million new diagnoses are expected this year — even as the incidence and mortality rates of some individual cancers have declined. The death rate for breast cancer, for example, has fallen since 1990 while the actual number of women diagnosed with the disease continues to rise. Improved treatments will keep most of them alive for longer.
The original idea was that 25 percent of all funds raised would be allocated to research. Today, the share allotted to research is about 15 percent.
JJS: Whether it’s your voluntary contributions or your levied tax payments, both of your funds easily get wasted. As noted above, the nonprofit recipient of your money — whether a big charity or big government — does not need to be accountable to you. The bigs often get their way, whether it benefits you or not.
One privilege that governments give charities is tax-exemption. But should they? What if, instead of favoring big entrenched entities government favored everybody equally? It could quit taxing our earnings, enterprises, and edifices (buildings), and instead use taxes or fees or dues or leases to recover the common wealth.
What’s our common wealth? Mostly it’s all our spending for the earth we use, our spending for land (in mortgages), for resources (in the price of gasoline and electricity and indeed everything), for EM spectrum (in the price of advertised goods and services), and for the degradation of the environment (in the price of medical care). All those various spendings could be redirected from the current recipient, into the public treasury.
Presently, you can’t go anywhere and find any place doing all these “geonomic” recoveries of the socially-generated value of nature. But some places do some; they levy land by shifting their property tax off buildings, onto locations. Those places motivate owners to use their lots productively, which requires labor and capital, so those places prosper — and prosperous people can afford to make donations without the distortion of a tax exemption.
And if any place were to recover all those “rents” we spend, then that’d leave no more free money on the table for insider investors to pluck by speculating in land and resources. Having to pay over these rents, both producers and consumers would strive to conserve. They’d waste less and leave behind less waste. The environment would become far less polluted. That means nearly no carcinogens for living beings to eat, drink, and breathe, and nearly zero cancer. So, how much would we need even a well-meaning charity if we had economic justice?
Thoreau Was Right