October 2007 Archives
Medical experiments on the poor and disenfranchised have contributed to science at the cost of untold pain.
Giving them experimental tech is a bit less ethically dubious.
Except for the bit where the article mentions that Microsoft tests its developmental products on the poor. Somewhere there are people scarred for life after their experience with the Vista alpha build.
FUNKY EXPERIMENT EXTRA:
The following is a must-see video of an early LSD experiment -- with kids! The kid who talks is wild, but check out the hair on his guy next to him!
I mentioned to my students last week that while I'd like to do cool screencasts (such as the one below) for every last thing I teach in my classes, but the production time is a serious hurdle, especially for me working alone.
Here's a blog post that raises this issue and offers some tips for improving production efficiency. For much more, here's a detailed how-to.
Google Adwords dominates web marketing. Salesforce: Customer Relationship Management.
Here's a screencast from Beth Kanter on how to integrate the two to maximize return:
| Add Beth's Blog: Screencasts to your page |
Another thing I'm up to tonight: a brief overview of donor-advised funds. Particularly after the 2006--cough, choke--reforms, the law in this area offers yet another sterling example of how difficult it's becoming do good without the government getting medieval on your @$$.
What Congress fails to grasp in its ongoing effort to extirpate private interest in charitable giving is that charity is, like any medium, an extension of the self. Rigging up ever more draconian and arcane laws will not only fail to bring about an end to private influence on public action; they'll actually push people to find ways of making their influence stronger.
Google.org is a perfect example--despite the dot-org extension, G.o is not a nonprofit or a charity. It operates within Google's for-profit network. The logic: a little tax is a worthy price to pay for freedom.
Anyway, here are few links worth reading re donor-advised funds. There are a lot of others, of course, but it's late and I'm sleepy.
Council on Foundations post-2006 link roundup
Council on Foundations comments on donor-advised funds reform
NY Times on for-profit charity funds
Tides Foundation donor-advised funds
My top secret plan for tonight's nonprofit organization's law class is to use the Princeton case to provide an overview of prudent (and imprudent) management practices.
The case is a classic example of why you want a lawyer who can sift out the losing claims. The lawsuit reflects a number of legitimate concerns arising from lack of attention to donor intent, but damn, the plaintiffs' lawyers make so many crappy arguments that my neck got worn out from how hard I was shaking my head. They would have done much better to laser in on the strong points (I mean, a 71 page complaint?!?), because the obvious longshots seriously diminish the overall credibility of their clients' case.
The family's lawyers would have also strengthened their case by seeking a less extreme remedy--say, an injunction ordering Princeton to avoid certain practices and to engage in others--instead of the attention-getting but most likely futile bid to get a judge to hand over an 800-million-dollar Ivy League academic center to the original donors' kids.
If you want to read more, check out the opposing websites run by the Robertson family and Princeton.
Want to know all the juicy details in the Oral Roberts University lawsuit?
Illegal campaign activity!
Sexual harassment!
Designer dresses in Oklahoma?
Excessive use of ALL CAPS!
This case has it all!
Click the link below for the University's Scandal Vulnerability Assessment and the full complaint filed in court.
But that's not why he's in the news. Here's why:
According to Bild Zeitung on Thursday, the 77-year-old Eden has filed suit against a 19-year-old Berlin woman for the following reason: Despite a night on the town with Eden, which ended back at his place, she refused to have sex with him, saying he was too old for her.
"That was shattering. No woman has ever said that to me before," Eden told the tabloid. "I was crushed." He has filed charges with the prosecutors' office, he said. "After all, there are laws against discrimination."
Perhaps she should have just said he smells funny? I don't think there's a law against that.
Anyway, it's just another example of how clever SOBs use good laws for bad ends.
Arg.
DISCRIMINATION TRIVIA EXTRA:
Here's another study in unintended consequences, albeit one that has a much better outcome.
Among folks who study civil rights law in the U.S., the story is often told about the real reason the Civil Rights Act includes a prohibition against discrimination on the basis of sex. Back when the Act was just a bill, its primary aim was to ban racial discrimination. Some Congress critters opposed that, but their efforts to defeat the bill weren't having much success.
So one of them came up with a sure-fire strategy: amend the bill to include a ban on discrimination against women--a notion so preposterous, so outlandish, so downright absurd that it would be impossible for Congress to vote the bill into law.
Instead . . .
We tend to have short memories when it comes to revolutionary technology. The telegraph, radio, black-and-white TV--these may not seem revolutionary now, but back in their day they were arguably more revolutionary than the internet or web.
Why?
Because folks had never seen the like before.
Below, an old magazine ad that presages Marshall McLuhan's observation that the electronic era ushered in an age of all-at-onceness:
Below: key excerpts from an article on his work in today's WWD Green supplement.
Being socially responsible was equally important to the designer. "After Argentina's economic crisis, there were many workshops with skilled craftsmen that had no work," he said. Carga, which is now carried by eight U.S. retailers, including Takashimaya in New York, and the Edition stores in Japan, has been able to help sustain a family-run workshop in Buenos Aires that might have otherwise shut down.
"I don't believe in thinking about 'green' as an added value," said Bianucci, who is currently working on two all-leather Carga designs. "A few years back, everybody was talking about ergonomics in design. But now, there's no need to talk about an 'ergonomic chair,' because it's a given. It would be great if in a few years we didn't have to talk about 'green,' because it would be the default."
Case in point: the scandal now erupting in Europe over a charity purportedly working to rescue orphaned child refugees from Darfur. The government of Chad has arrested nine French charity workers amid accusations of paedophilia and human trafficking. The charity, L'Arche de Zoe ("Zoe's Ark"), defends its personnel as true humanitarians caught up in political maneuvering.
What's really going on here? My own sense is that this isn't a paedophile ring. Rather, it reflects a deep resentment toward some in Chad would view as neocolonial appropriation of its children. Even without the deep-rooted historical tensions, this kind of response is not unique. For example, in Russia, American charity workers have been branded as spies, while nationalist resentment of Americans adopting Russian children recently led the Russian government to ban foreign adoptions.
Below: a classic poster from 1937 that brings together plumbing and electricity, two industries often associated with social enterprise in disadvantaged regions and private enterprise in more developed areas.
I was plunking around the web for the latest on the Yankees' manager search when I came across the following message board thread:
Don't you hate it when you go to a drive-thru and they ask if you want to donate a dollar to some cause in exchange for a coupon book?
I hate it. Here's why. I like to choose the charities I give to. I don't need some restaurant drive-thru deciding for me. Also, they really put people on the spot. They know that they are putting you on the spot in public. They know that people will feel cheap and selfish by the time they pull around to the second window.
Today I finally felt the need to explain..I pulled up to the second window [why does that first one exist? All it ever has is a stack of buns in it] I said look i'm really not a jerk, I give to charity, I just like to choose which ones I give to.
One of these days I'm gonna pull up to the second window and ask if they'd like to donate to the drive-thru relief fund and pay for my meal.
You've probably encountered similar donation requests at a drive-thru or grocery store checkout. From the grocery store's perspective, they win by associating themselves with charity and touting their charitable contributions without having to donate a penny themselves. The charities win because they get money.
But the customers? The feeling of coercion is real, and it can alter their perception of charity itself . . .
it's a shakedown operation bro. I have no problem telling these people no fuggin way, they always want toadd a couple dollars on my charge card at the check out or assualt me when I am leaving the store. I give because I want to give, not due to coercion.
Skinny girl: We should volunteer at an eating disorder clinic.Sigh.
Friend: Yeah, that would be fun. And we'd be, like, helping people.
Skinny girl: But wait -- if we volunteer there, what if we get influenced and change our beliefs about food and think that not being skinny is sexy?
Friend: No, that wouldn't happen... It would be motivation, because you would think, 'Wow, she's skinner than me.'
Springwise has a feature on the kidpreneur movement. Its focus: a New Delhi bank run by street kids, co-sponsored by HSBC and Comic Relief.
Like any other bank, CDB pays interest on the deposits that New Delhi’s street children make. That interest can be a vital incentive to kids who might otherwise spend their daily earnings on cigarettes, candy or other items—or worse, have their meager profits stolen. Money for the interest comes from the repayment of micro loans made to kids 15 years and older. But interest on income is only part of the picture. While adults stand at the ready to help, CDB is managed by children, helping them gain valuable work skills.
No question this is doing good for the kids running the bank--hooray for them. But let's take a closer look.
The bank rewards savings by paying interest, yes. But the interest comes from microloans, which are increasingly coming under fire for being offered at less than optimal terms: exorbitant interest over a short period of time, with a principal too small to facilitate a sustainable business.
While the microloan movement garnered last year's Nobel Peace, it's long-term viability may not be so great. Witness Natalie Portman's recent plea for microcredit loan forgiveness and the trickle of research papers questioning the loans' low success rate.
Kid bank co-sponsor HSBC is already under fire over the collapse of its subprime-mortgage loans and high-interest credit-card business. At what point will microcredit go from being seen as the future of philanthropy to a gateway drug for exploitive lending?
Look carefully at the ways people do to feel good about themselves and to make others feel good about them, and you'll see a few things again and again.
Perhaps the most prominent: children.
Protecting kids is hardwired in our genes. They're vulnerable little critters, and their cute soft burbling li'l selves trigger self-sacrificing protective behaviors that go way, way back, apparently from before we were human.
Dogs picked up on this long ago, which is one big reason they evolved from nasty bitey S(andD)OBs into adorable puppies whose lives are little more than a prolonged pre-adolesence. To see the benefit of this, we need only look back to the Ellen dog adoption dust-up from earlier this week, which highlights how we have come to equate dogs with kids.
Like dogs, people have evolved their own adaptive strategies leveraging children for their own personal advantage. The charitable strippers controversy is a Russian nesting doll in this regard: puppeteers cast themselves as a children's charity and hold their annual fundraiser at a middle school, and a strip club tries to rehabilitate its own image by sending its employees to serve as volunteers. We see a similar dynamic in the viral spread of blogger support for DonorsChoose, a charity that connects donors to unmet needs in schools.
And here's another one. The BitTorrent community has come under a lot of fire for turning a blind eye to illegal file sharing. A popular counter-strategy has been to highlight the instances in which copyright enforcers file suit against children, but now, as the ever informative TorrentFreak reports, the community is raising the stakes:
Together with p2pnet, TorrentFreak adopted 29 little children who are in desperate need for food, clothing and a decent place to sleep. The Child Orphanage is for kids in Nepal whose parents were killed by Maoists demanding the abolition of the country’s monarchy.
Banning torrents hurts orphans. Now that's a powerful argument!
For more info, check out p2pkids.org.
Student journalist Carla Babb's videos didn't get much attention . . . until presidential candidate John Edwards tried to get her to take one down. Here it is:
In my web design class this week I talked about what social enterprise can learn by examining the traits of videos that go viral on Youtube. A few things we discussed: time play, coordinated action, DIY, mashups, instructables and parody.
I'll leave the ponderous yet oh-so-astute academic commentary for another day. For now, enjoy the videos!
Microsoft logos and sounds
Crank dat Soulja Boy
Soulja Boy instructable
Soulja Boy Spongebob & Barney
Soulja Boy lyrics (a literary parody)
The history of dance
LonelyGirl15
(Students in my nonprofit law class will definitely want to read this, since we'll be talking about it on Wednesday.)
For example, here's a blog post from Counterfeit Chic about Major League Baseball's practice of sending fake goods seized here to charity overseas, particularly in Africa. If piracy is truly evil, is it right for charities to be one of the continent's leading importers of counterfeit clothes?
Sorry, beg to differ.
While the social enterprise establishment has been celebrating American Apparel for its commitment to the public good, folks in business and advertising--you know, the soulless corporate drones that nonprofiteers want to save--have for years highlighted American Apparel's reckless and blatant degradation of women.
Most notoriously, in the name of a maintaining a libertarian workplace culture American Apparel's infamous founder, Dov Charney, flouts his penchant for sleeping with American Apparel's female employees and models. The result has been a play-to-get-paid workplace culture that belies Charney's assertion that it's OK because the women consent. As I emphasize in my law classes, rewarding a woman for consenting to sex is as much a violation of sexual harassment law as firing her for refusing. Both scenarios create an environment in which employment is contingent on sex. From the Business Week article linked above:
But BusinessWeek spoke with seven former workers who say they were offended by what they called a highly sexual atmosphere at American Apparel. They told stories of senior managers who pursued sexual relationships with less senior colleagues and rewarded their favorites with promotions, company cars, and apartments. "It was a company built on lechery," says a former stock person. "I thought it was a male contemporary perspective on feminism, but it turns out to be just a gimmick," says another ex-employee. And another: "I made sure to stay away from the store when I knew [Charney] was coming into town. It's not one person -- he's aiming for all women."Does American Apparel get sued for sexual harassment? Sure, by the women courageous enough to risk their careers to file. But prosecuting a lawsuit is painful and expensive, and American Apparel has the money to shut down the cases with settlement payouts.
As for the ads, click here for how one New York hipster neighborhood--which American Apparel portends to represent--is responding to the company's signature imagery of women as playthings.
Why do I harp on this subject? One reason is to call attention to how good actions can blind us to behavior we would otherwise condemn. You might think that nonprofits and social enterprise are less likely to indulge bad behavior. Perhaps, sometimes. But all too often the reverse is true. We conflate the virtue of the mission with the individuals who further it, to the point where we can't see their flaws. Or worse, we strategically calculate that we must protect the mission's reputation at all costs, even if it means some people must suffer in silence.
Another reason is rooted in social enterprise itself. The turn to the market has naturally led the movement to gravitate toward promotional practices that maximize immediate return on investment, and explicit references to sex are an easy way to get attention fast. Bit by bit our culture is changing--sexually charged ads, indulgence of high-impact executives, hiring on the basis of flirtatious sex-appeal.
The longer we pretend it's not a problem, the more likely we'll become what we set out to stop.
From People Online:
Paris HIlton's first major post-jail philanthropic effort – her planned trip to Rwanda – has been postponed by the foundation that organized it.
"Due to the restructuring of the Playing for Good Foundation, the philanthropic trip to Rwanda that the foundation had previously planned with Paris Hilton has been postponed," the organization said Thursday in a statement. . . .
After being released from jail in June after serving 23 days for violating probation in a DUI case, Hilton said she wanted to change her image – and make charity work a focal point of that effort.
In September, she announced her plan to visit Rwanda, the scene of genocide in 1994.
"There's so much need in that area, and I feel like if I go, it will bring more attention to what people can do to help," she told E! Online at the time.
One of the problems with current notions of social enterprise is that they perpetuate the split between mundane business and business with a social value. The division is untenable. Mainstream business is shot through with social value, and social enterprise is riddled with the mundane--what we are witnessing now is a collapse into one.
The video below is from the season finale of Mad Men. While it may seem off point, watch carefully--it illustrates how the best consumer marketing flows from the sublime.
I've been spending a bit of time this semester thinking about web video and why charity videos . . . um, how to put this politely . . . aren't exactly compelling. As an experiment (and trying not to tip my hand too much) I asked a couple students in my nonprofit web design class to give their assessment of Youtube's new nonprofit program.
They were . . . polite, but also refreshingly honest--which I know can be a risky thing for students, especially in a Lake Wobegon field such as social enterprise where Every Venture Is Above Average. Their main points: it seems to work OK as an archive, but why would anyone watch these things? And the donation button is nice and all, but what's there to motivate people to give?
Excellent questions, methinks. As my students noticed, except for spikes during PR moments (e.g., Clinton Initiative press conferences; Oprah), charity vids tend to wither on the vine. Same thing with educational videos, another thing I've been tinkering with a bit over the past few months. Occasionally there's a breakout hit, but they're the exceptions that proves the rule. For example, the KSU web 2.0 vids are nifty to look at and provide a basic introduction to what folks are saying about the social networks . . .
but when it comes to adding new insight, well, they're more self-congratulatory rah-rah than analysis with any value-added [not unlike most nonprofit scholarship!]. Then there's the tongue-in-cheek web philologist Hot for Words . . .
HfW is actually more Web 2.0 than the KSU vids--note how her videos incorporate questions from previous commenters--but I'm pretty sure that subjecting students to videos of me in revealing underwear would violate international law.
So what's a charity-minded educator to do?
Not sure yet, actually. I've been playing with podcasts and vids of my own that basically put my lectures in web form, but following the reciprocity principle--do unto others--I can't bring myself to require students to listen to or watch things that I personally don't find engaging. A classroom is not the web, and vice versa--they are radically different media environments, as evidenced by reports that online courses are flatlining once again.
What I want to do is stuff like String Ducky . . .
but here's the thing, the tragic choice: time is a scarce resource. In the time it would take me (or most professors) to prep a stylish and contentful 2-5 minute vid, I could prep and deliver 2-5 real-world lectures stuffed with playful yakkity-yak and whiteboarding. (Yes, I've tried online whiteboard voiceover, but unfortunately I haven't gotten skilled enough with my Graphire to produce more than rudimentary scrawl. Sigh.)
Over the next week or so I hope to start posting my own experiments with audio and video, but I have no illusions that they'll be as cool as Wallstrip.
Someday when I have a production team and quality video equipment . . .
A Park Slope middle school has cancelled a fundraising event after strippers from Scores volunteered to man staff do something non-double-entendre-y at a candy (!) booth. And it's hardly the first group to have trouble with a donation because of qualms about the source.
NTen, one of the world's leading organizations specializing in social enterprise, has added its voice to the outcry against Comcast's now confirmed practice of throttling BitTorrent seeders. NTen comes down on the side of the Net Neutrality movement, which is citing Comcast's actions as a sign of things to come should broadband providers be allowed to discriminate in favor (and against) various nodes on the web.
The movement faces substantial (and well-moneyed) opposition, but that's not the only challenge it has to overcome. The elephant in the room is the nature of the practices that the movement seeks to protect. The calls for action focus on blogging and benign torrenting, such as open-source software distributions. In fact, the Comcast torrent controversy hit the mainstream news when reporters testing rumors of the Comcast throttling tried to torrent the King James Bible, which in the U.S. (but not in England!) is in public domain.
Sounds inspirational, but are telecom companies truly hunkering down to squelch bloggers and Linux distros? Or are they more concerned with the massive bandwidth consumed by the illegal sharing of music, movies, software and porn?
Pretending that the latter isn't an issue renders the arguments made in favor of net neutrality far less compelling than they seem within the movement. Case in point: the question raised at the end of the NTen post:
While it's most likely that Comcast has instituted the measures as a means of controlling traffic and server load, it raises a fine point: Why are movie downloads from iTunes ok, but not file sharing via BitTorrent?
You don't have to be a Yale-trained lawyer to guess that the answer lies somewhere in the fact the iTunes downloads are legal and can factor bandwidth costs into the price.
Would the Net Neutrality movement be more credible if it also called for file-sharing communities--many of which are nonprofit in practice if not formally under the law--to crack down on illegal file-sharing--including bootleg Bibles in Britain?
Both the state and federal government like to regulate charitable fundraising. Of course, there's one rule they'll never institute, but should: a ban on workplace fundraising. Penelope Trunk makes the argument here.
Two high-profile charity news stories from the past couple weeks:
- Bill Clinton's book, Giving, and
- The charity auction of the Senate letter condemning Rush Limbaugh
may benefit some good causes, but they also echo the kind of actions that, in the 1960s, gave rise to today's complex rules governing private foundations and public charities.
Back then, a number of politicians were upset by how certain wealthy charities supported causes and politicians they (the politicians) didn't like. It was a rather motley alliance of constituencies that saw themselves as disenfranchised: white southerners opposed to the civil rights movement (which major foundations were funding), Western politicians who saw the major foundations giving grants to power brokers from the Northeast and industrial states; Christians upset that money was going to fund charities supported by candidates who were . . . can you believe it, I mean, here in All-American New York City? . . . Jewish!!!
While the complaints and political alignments may seem odd today, the laws they produced live on, and there's a real possibility that high-profile politicized charity could prompt another round of so-called reforms. Imagine--
Conservatives upset by Bill Clinton using charity to build support for his wife . . .
Liberals upset that a family charity could pay 2.1 million dollars in an eBay auction that also serves to promote the Rush Limbaugh show . . .
Who knows what could happen if these wacky kids get together?
Stranger things have happened in charity law--just another reason why it's said that politics makes strange bedfellows.
The video above is a promo for Pangaea Day in May 2008. The hook: Can Your Film Change the World? The event: Make a world-changing video, and bazillions of people will watch it on that day, and the world will be a better place.
Uh, sure.
Now I know I'm supposed to buy into all of this. I mean, that's the thing about being a professor of nonprofits or social enterprise or sustainability or whatever. You meet a professor who studies the history of human sacrifice and you don't automatically hide the knives, because you know it's possible for someone to study ancient societies without agreeing with everything they did. But when I go to a shindig the assumption is that I endorse every damn fool thing done in the name of what I study.
Which is part of much bigger problem. Social enterprise is looping back into the same mistake that it ostensibly set out to correct: assuming that something is good because it tries to do good.
Not me, bucko. Pangaea Day? C'mon, Pangaea Day????? Have the melting polar ice caps opened up a timeslip back to 1968?
And the #$%&?! sombre violins. It's like the music in previews for pretentious indie films about people who wake up to realize that they are morally pure while the rest of society is corrupt and filled with secrets. I know that as a Serious Person with degrees from Yale and Duke I'm supposed to chill my chardonnay in anticipation of the first showing at Film Forum, but shoot, what I'm really thinking is that I wish my Junior Mints were cyanide capsules.
Yes, there is tragedy in the world. There is evil and injustice and someone needs to fix it. But uploading a cartload of short fill-ums rife with portentious and precious observations about what everyone else is doing wrong won't "catalyze" a frackin' "revolution." All it serves to do is assure the videomakers and their viewers of their own superior virtue.
Which, when you get right down to it, is the root of most of the problems that we're trying to solve.
In my law classes I like to talk about different kinds of law: the law enacted by governments, organizational rules and social norms. Above we got a passel of the latter two.
The scene: Ellen DeGeneres crying because a nonprofit adoption agency re-claimed the dog she had adopted after she gave it to her stylist.
Although such a publicized dispute between rescue groups and adoptive animal owners is rare, it reveals something that pet lovers have known for years: Private rescue groups are legendary for their stringent requirements and hurdles for prospective adopters.
Long applications, home visits and strict diet regimens are the hallmarks of some rescue groups' adoption processes. To some, it can rival the complexity of adopting or fostering a child.
The organization's name, "Mutts and Moms," points to what is going on here.
In nature, the relationship between dogs and pet owners is an example of symbiotic mutualism--in short, they exhibit traits we like, and we give 'em stuff.
However, for various reasons some people frame this relationship in terms of the metaphor of parenthood. From this perspective, they don't own dogs; the dogs are their children, and they are dog's mom or dad.
This way of seeing can give rise to its own set of norms, rules and even laws grounded in the image of the dog as a human child.
Ellen treated the dog as something of a hybrid, which is not unusual--child and friend in some spheres, animal and property in another. The key sphere in which it was animal property: transfer of ownership. Ellen saw giving the dog to her friend as a responsible extension of her care; the animal "adoption agency"--again, note the metaphor--viewed it as abandonment.
Whatever side you're on in this incident, the key thing to remember from an organizational management standpoint is to maintain the ability to look beyond your own group's perspective. It's easy to be a cyclops--dogs are kids and that's that, tough luck for you. But life is a complex phenomenon, and sometimes a wiser principle is one that combines elements from various parts.
Salisbury University's president removed her Facebook profile after being questioned about apparently unprofessional captions posted alongside photos on the Web page.Janet Dudley-Eshbach, president of Salisbury University, had a photo on her profile showing her pointing a stick toward her daughter and a Hispanic man with a caption saying she had to ''beat off Mexicans because they were constantly flirting with my daughter.''
A caption accompanying a photo of a tapir referred to the large size of the piglike animal's genitalia.
Dudley-Eshbach removed her profile from the social networking Web site hours after reporters asked her about the captions Monday. She did not immediately return a call seeking comment by The Associated Press on Wednesday.
In a statement, Dudley-Eshbach said the photos were taken during a family vacation to Mexico and that she wrongly thought the public couldn't see them.
In my nonprofit law class tonight we're going to talk about puppies, unicorns, flowers . . . and, oh yeah, the support tests for distinguishing public charities from private foundations.
Also known as the seventh circle of charity hell, the support tests are Congress's way of taking your idealistic enthusiasm for changing the world and bludgeoning it out of existence. Ever want to know what it feels like to be a seal pup in hunting season? Well, the support tests are your hakapik.
That said, here's a blog post that can help make this experience a bit less painful.
This is a graphic designed to illustrate the process of creating nonprofit technology.
But as with any metaphor, ya gotta be careful.
Is the middle of a sandwich just a by-product of the bread?
When making a sandwich for a family member, guest or customer, do you consider only what you want?
Does spending a lot of time on something mean that you're getting a proportional increase in value?
Fun picture, but is it truly "a model for ongoing success?"
Section 501(c)(3) of the tax code recognizes "literary" purposes as grounds for tax exemption.
But c'mon, how often are you going to see literary purposes in real life?
How about every day at the bookstore?
Literary Classics of the United States, Inc. is the 501(c)(3) organization that publishes The Library of America, a collection of this country's "best writing." If you want to support their work, you can either buy the books or make a tax-deductible donation!
Media Capital of the World extra: The Library's HQ is on 14 E. 60th St., NY, NY. And the stuffed animal in the picture is New York's own Bully, the nation's (if not the world's) most book-savvy bull!
Bernadette Price tips us off to a trenchant analysis of the Wall Street Journal's recent write-up of the Armand Hammer Museum's attempt to use trademark law against a museum that actually displays hammers. The author highlights the importance of reputation--here, the ill will that could be generated against the larger Armand Hammer Museum for trying to squelch a smaller, remote entity which arguably has a stronger claim to "The Hammer Museum" name.
Intellectual property is an issue of increasing importance to social entrepreneurs--if you hear any other good news stories, send 'em in!
In my web design class tomorrow we are going to be discussing basic principles of web design for social enterprise sites, from the basics of graphic design and web coding to the various factors that shape what we create.
One such factor: search engine optimization (SEO), or the strategies used to foster a high ranking in online search results.
The big kahuna here is, of course, Google, whose likely algorithm is described in broad outline here.
But what if Google had to design its user interface to suit Google search?
Fortunately for you, Carl Alviani over at Coroflot's CreativeSeeds has done a bang-up job on the subject in his recent post on (1st year job) = (last year school). His recommendations are excellent, and not just for young graphic designers. Be sure to read the whole post; here are a few of my thoughts on some of the key points
- "Be humble"--this is important especially if you know, just know that you're better than everyone in the joint. Humility doesn't just open you up to learning new things; it also generates trust, which makes people more open to accepting your brilliant ideas.
- "Make friends with people who know how to do things you don't." Again not just for knowledge, but for connections. People love to feel smart, needed, helpful, appreciated for being who they are--you can leverage this to build a network of patrons committed to your success.
- Learn the business/technical side: The more you know these pesky details, the more you can make them work for you.
- Go to events, with business cards: And not just conferences and business meetings. New York is full of parties. Clueless people think they're a place to get drunk and score. (Helpful hint: don't be Aquagirl.) But the tao of parties is that people create a zone outside of business so they can connect in an environment beyond mere exchange . . . which in turn builds the trust and connections from which business opportunities emerge.
- "Understand that you'll probably be working somewhere else in five years." Back in the 1960s, Marshall McLuhan wrote that in the electric age the permanent job is dead; people will change jobs five times in their lifetime. He was right and wrong--jobs are fluid, but often more like five times a decade. That's OK--it's the new normal. Focus on having roles to play, and you'll naturally flow through any number of different opportunities.
This blog is supposed by educational and all that, but it's also a way for me to ramble on about day-to-day life. And today was one of those work days [update: project now done--hooray!] that brings to mind the following classic movie scene:
Which reminds me of another related video that also happens to help explain why I love the integration of verbal and visual in contemporary culture. As I explained to the adults who interviewed me for research papers back when I was a precocious little tyke, the first word I ever recognized is in this sequence, at 0:12.
You never know what's making a difference to kids. We'd like to think the educational stuff is what opens their eyes, but sometimes it's just a fun coincidence of word, image and song:
What does a woman in a tomato suit have to do with social enterprise? Check out Beth's Blog for the answer.
A long time ago in a blog post far far away, a commenter inquired about the difference between a trust and private foundation. In class I explained that a trust is property held for the benefit of a third party--in the case of a charitable trust, the "indefinite class" (as opposed to specific individuals) benefited by the trust's charitable purpose.
The term private foundation, however, has a somewhat more slippery legal definition. It arose as a way to describe--and condemn--charitable organizations funded by a small number of individuals, who presumably veered more toward their own interests as opposed those of the general public.
Quick aside: I'll be talking about that a bit more on this site, but suffice it to say that while the term "private foundation" still retains the connotation of private interests vs. public good, defining what constitutes a private foundation turned out to be a task too tough for the legislators determined to regulate 'em--which is why the tax code classifies all charities as private foundations unless they meet one of the rather complicated tests for public charity status. But that is a tale for another day . . .
Occasionally a news story bubbles up to remind us why U.S. law came to distinguish between private foundations and public charities. Here is one such story.
In Tuscaloosa, Alabama, a college has come under fire for certain transactions in which state funds ended up going to a related private charity. Frankly, the sort of things described in the article could--and probably do--occur in any number of charities without anyone being too upset, but here ya go--the state Department of Examiners of Public Accounts is laying the smacketh down on good ol' Shelton State Community College because "contractual agreements are being utilized to divert public funds to foundations."
Now you might be saying, hey, what's the big deal--aren't private foundations charities too?
And you'd have a point. But there's something else going on here that says a lot about the values embedded in law and how they shift and evolve. Is this small Southern skirmish a sign of a swing back toward the government as the hub of social benefit?
From Devo as a dadaist art student performance to Evo/Devo as a scientific theory to Deproduction, a Colorado nonprofit video facility--the not creates the is.
So I was walking down Park Avenue on my way home from the office when a tourist comes up to me and asks, "How do you get to Carnegie Hall?"
And I said, "Practice Marry the chairman's daughter!"
Ba-dum-bump. I'm here all week, and remember to tip your server.
Why the stupid joke? Check out the deets of this news story--
Carnegie Hall's chairman and current major donor is Sanford Weill, who used to head Citigroup.
The architect chosen for the Hall's 150 million dollar renovation? His son-in-law, chosen ostensibly because of his previous work for another charity . . .
. . . led by Sandy Weill's wife.
The lawyers offering their opinion in this NY Times article distinguish between law and reputation, and it's a principle every nonprofiteer needs to remember: just because it's legal doesn't mean it's right. In this instance, I would imagine that the Carnegie Hall board followed the "disclose and abstain" procedures common in standard conflict-of-interest policies, and they probably also set a market-rate compensation supported by analysis of comparable practices in similar situations (more on that soon!).
Still, it looks skeezy, doesn't it?
Note Sandy Weill's defense against accusations of nepotism. One argument is clever, the other, not so much.
- The not-good-because-it-only-reinforces-the-criticism argument: “I’m proud of what he does. I think there’s nothing wrong with being proud of a son-in-law.â€
- The clever (if transparent) anti-discrimination argument: “You can’t actually disqualify someone because they’re somebody’s son-in-law.â€
Key paragraphs after the jump:
Can a social enterprise be sued just for putting up a website?
You betcha.
Check out this announcement of the latest court ruling in the case of National Federation for the Blind v. Target. The claim: the NFB is seeking an injunction and monetary damages arising from Target's alleged failure to make its website accessible to the blind. The case is far from over, but the judge is allowing the case to proceed.
How can a website be made accessible to the blind? And does the law require organizations to design their sites so the blind can read them? The NFP states its position here.
Target will most likely settle out with a bit of (expensive) tinkering with its site. But will smaller organizations--especially businesses and noncommercial nonprofits--have the resources to make their sites conform to Web Accessability standards, not just for the blind but all people with usability challenges rooted in a disability?
The discussion at Slashdot has some helpful advice (look for comments rated 4 or 5 for good ones). Note especially the following advice, which I'm going to remember going forward:
Where the text is on the page is irrelevant, as long as the page has good structure: headings, lists, blockquotes, em tags, strong tags etc. a screen reader will be able to read it perfectly well. The Web is for communicating information, text is the best way of achieving that in most cases and where images are used all that's needed are the trivial additions of alt tags to provide a quick description of what the image contains.
Don't know what an alt tag is? I'll be covering that soon in both my classes, given the legal issue; for a brief explanation, click here.
Noblis: tech consulting in the public interest.
Usually when I'm at work I use the University ethernet connection instead of wireless--it's a little faster, doesn't cut out and I don't have to log in. But this morning after an outage I decided to test the office wireless and noticed the following:
Pace Wireless Network--a tongue-in-cheek easter egg from the IT department, or a happy coincidence?
ACRONYM DESIGN EXTRA:
Organizations luuurrrrrvvvvve acronyms, especially when the abbreviation creates a catchphrase or is at least easily pronounceable. For example, my nonprofit web design course is part of the Colloquium Assistance Program, which is supposed be (ta da!) a CAPstone of the student experience.
Hey, don't blame me--I didn't make it up.
Which leads me to my advice about acronyms. If you absolutely must create acronyms for your organization, here are 3 traps to watch out for:
Alphabet soup: "Today at 3 there's a meeting of the MNZ with the PGY to talk about the GTH/WUM retreat . . . "--in short, a cluster%$#! of acronyms can make your group seem like a sterile over-corporatized bureaucracy.
A day at The Office: Cutesy acronyms like CAP (sorry folks!) or HUG ("Human resources Users Group") tend to give the impression of a place that's trying just a bit too hard to sound friendly and with-it. See also: team-building activities and motivational posters (well, except for these).
Double trouble: Make sure your acronym doesn't have an unfortunate connotation in English or another language likely to be used by you or your clients. For example, until recently every student at a certain university had to deal with Student Accounts and Registrar Services, a name designed to produce the catchy & ubiquitous acronym SARS.
Which also turned out to be catchy in a not particularly nice way . . .
YouTube recently featured the following charity appeal video. The real action, though, is in the comments thread, which pours on the snark:
Today's visit: the office of SocialMarkets.org to chat with founders Allan Benamer and Jeff Tuller. (I met Allen at another event I'd write about if Allen hadn't already provided such a good write-up himself.)
What's SocialMarkets? The website offers this tantalizing blurb--
socialmarkets is a stock exchange for the non-profit sector: because in any context, better information makes for better investment decisions.Intriguing, no? You'll get to see what this means soon enough, when they go live with what I was fortunate enough to scope out today. If you'd like an early peek, register to be notified for the alpha release.
and you'd like to add more functionality . . .
but you don't know how to write the code.
Any options?
Plenty.
Here's one: Google gadgets.
Click the "add" button to customize the gadget you like, then copy the code to your clipboard.
How do you add it to your site, you ask?
Check back later next week--I'm covering that in class on Wednesday.
The image of social enterprise you usually see is young, hip, cutting-edge and oozing with virtue. The website below, the creation of a person with a degree in nonprofit management, shows how it often plays out in real life.
What it is: an audience-participation murder mystery dinner theater.
The good: The founder of this dinner theater found a fun way to blend her nonprofit management background with commercial entertainment.
An interesting way to leverage ethical ambiguity: Not only does a portion of the ticket price go to nonprofits, but audience members get clues by bribing the actors--and the bribes get donated to nonprofits.
What not to emulate: Although this site is relatively new, it looks like a site from 1997. Note particularly two traps you should not let your organization fall into:
- the use of frames, a classic example of the maxim that just because you can do it does not mean that you should, and
- a lack of updates to dates and events, which leaves the impression of a ghost site.
Here's the link to the wiki prepared for the web design class discussion last Wednesday. I'll let you know when I add something!
In my nonprofit law class we've had an overview of state nonprofit law and a brief introduction to federal tax exemption. Traditionally you could distinguish between state and federal law governing nonprofits as two substantially different spheres, with states regulating organizations' formation and governance and the federal government determining which organizations qualify for exemption and deductible gifts.
But the times they are a changin', with federal tax law playing an increasingly more prominent role in standardizing principles of corporate formation and governance.
One example we've already seen: the recommended--as in necessary--standardized language that the IRS advises charities to include in their articles of incorporation in order to qualify for exemption under Section 501(c)(3).
And here's another example: the IRS draft "Good Governance Practices for 501(c)(3) Organizations."
Yes, state law still requires directors of for-profit and nonprofit social enterprises to be mindful of their fiduciary duties, such as the duty of care and the duty of loyalty. But while state law fiduciary standards can be--to use a high falutin' technical term--squishy--the IRS has been hard at work to spell out the principles of good governance in detail. The draft brings together a number of recommended management practices, such as
- preparing a clear mission statement
- adopting a code of ethics and whistle-blower policy
- exercising due diligence consistent with the duty of care
- fulfilling the duty of loyalty, including the adoption of a recommended conflict of interest policy
- making information about mission, activities and finances available to the public (i.e., "transparency")
- adhering to state and federal rules as to fundraising
- preparing accurate financial statements and obtaining an independent audit of accounts
- paying officers and staff no more than reasonable compensation
- adopting a clear policy for retaining and destroying documents
As you can see, serving on a board of directors involves a lot of hard work!
Top 12 nonprofit Facebook apps
Beginner's guide to Facebook
pbwiki.com
lifehacker.com
O'Reilly on Web 2.0
Case in point: here's a news item about nonprofit intellectual property, a subject we'll be covering in class in a couple weeks. A New York nonprofit theater is sending cease and desist letters to a Seattle nonprofit theater with the same initials.
Is this the right thing to do, or is the NY theater all WET?
If things seemed slow around here the past week, that's because I've pretty much been asleep outside of the moments that led to the few posts you got. Thought about putting up the first few nonprofit law podcasts with me sneezing and rambling in a benedryl-induced haze, but I'd really hate to see the class memorize that for the exam.
I had my suspicions on Wednesday but knew without a doubt that I was gone on Thursday morning, when I wanted nothing to do with my computer. I live on my computer.
In social enterprise circles, one of the movement's signal successes has been the sale of mosquito nets to prevent malaria in Africa.
Recently, Dr. Arata Kochi, the blunt new director of the World Health Organization’s malaria program, declared that as far as he was concerned, “the debate is at an end.†Virtually the only way to get the nets to poor people, he said, is to hand out millions free.
In doing so, Dr. Kochi turned his back on an alternative long favored by the Clinton and Bush administrations — distribution by so-called social marketing, in which mosquito nets are sold through local shops at low, subsidized prices — $1 or so for an insecticide-impregnated net that costs $5 to $7 from the maker — with donors underwriting the losses and paying consultants to come up with brand names and advertise the nets.
“The time for social marketing of bed nets in a big way is over,†Dr. Kochi said in an interview. “It can become a supplemental strategy for urban areas and middle-income countries.â€
Two years ago, social marketing was at the heart of a scandal when it was revealed that the United States Agency for International Development, or USAid, which distributes foreign aid, was spending 95 percent of its malaria budget on consultants and 5 percent on goods like nets, drugs and insecticide. Under attack from several senators championing the fight against malaria, the agency later announced that it would spend at least half its budget on goods.
Senator Tom Coburn, Republican of Oklahoma, called the new W.H.O. policy “a great move,†adding, “We knew social marketing doesn’t work.â€
Ever feel like things just don't fit? Feel bad that you're just . . . wandering?
You're not alone.
Today's column by David Brooks taps into the growing scholarship calling attention to how today's emerging adults are trying to make sense of world far different from that of their parents. Here are the key final paragraphs:
The odyssey years are not about slacking off. There are intense competitive pressures as a result of the vast numbers of people chasing relatively few opportunities. Moreover, surveys show that people living through these years have highly traditional aspirations (they rate parenthood more highly than their own parents did) even as they lead improvising lives.
Rather, what we’re seeing is the creation of a new life phase, just as adolescence came into being a century ago. It’s a phase in which some social institutions flourish — knitting circles, Teach for America — while others — churches, political parties — have trouble establishing ties.
But there is every reason to think this phase will grow more pronounced in the coming years. European nations are traveling this route ahead of us, Galston notes. Europeans delay marriage even longer than we do and spend even more years shifting between the job market and higher education.
And as the new generational structure solidifies, social and economic entrepreneurs will create new rites and institutions. Someday people will look back and wonder at the vast social changes wrought by the emerging social group that saw their situations first captured by “Friends†and later by “Knocked Up.â€
Of course, Marshall McLuhan predicted all this years ago!
In our tech class last week we talked briefly about how to set up a blog using online services such as Wordpress.com, blogger.com and typepad.com. For this upcoming Wednesday, I asked a few of you to talk about Facebook and wikis (in particular, pbwiki.com).
All this stuff is nifty to know, but is it of any practical use for social enterprise?
Good places to start to answer that question:
Minneapolis is abuzz with news of a most unusual gift to its local Catholic homeless mission: handmade Italian shoes donated by the Pope.
As we discussed in class on Wednesday, tax-exempt status under 501(c)(3) means that an organization does not have to pay federal income tax on accessions to wealth . . . including designer shoes from the Pope.
If this were a for-profit corporation, this transaction would raise some interesting tax questions. Back when I was a tax lawyer, for example, I worked on complex transfer pricing issues raised by the transfer of goods from the overseas division of a sneaker company to one in the U.S.*
But the Pope's donation is a different matter entirely, no? Yes, a related subsidiary of a global corporation received items from an overseas branch, but the recipient organization transferred these items to the poor. At a fundamental level something seems not quite right about the government taking a cut of items that would otherwise go to charity--and pretty soon we'll be talking a bit more about why.
While we're at it, let's explore a somewhat different scenario. What if, instead of giving the shoes to the homeless, the charity had sold the shoes in a charitable thrift shop? As I mentioned briefly in class, the unrelated business income tax (UBIT) applies to an exempt organization's regularly carried on commercial activity that is not substantially related to furthering the organization's exempt purposes. It's not enough for the proceeds to go to charity--the revenue is still taxed, because the trade or business is itself unrelated. However, there are a few key exceptions that would most likely keep this sale from being taxed.
- UBIT does not apply if substantially all of the items sold were donated.
This exception is what enables groups such as the Salvation Army, Good Will, the City Opera, the National Council of Jewish Woman and the Society of St. Vincent de Paul to operate thrift shops without having to pay tax on their profits. Also,
- UBIT does not apply if substantially all of the work is performed for the organization by volunteers.
Staff your store with volunteers, et voila--even if you buy a bunch of things to sell (e.g., a church gift shop), the profits are still not taxed.
Selling things without having to pay tax?
It's a miracle!
*Note to nonprofit law class students: no, you don't have know anything about transfer pricing for the exam!)
But does this sort of thing actually help--or is it just slacktivism?
Now it seems obvious: free-and-easy subprime mortgages were a bad idea. Countless repossessions, a lifetime of pain.
Just a few months ago, however, the subprime boom was turning banks into little social enterprises.
The ad pictured above is a snapshot I took back in July a few steps from New York's City Hall. The image is one all too common from the time before the fall: happy families living the dream.
The loans were legal. Everything was done in keeping with the lenders' internal rules, at least as amended during the boom. The emerging social norm of ownership for all was passing from ideal to reality.
But was it wise?
Probably not, as the industry lost sight of the inevitability of a market correction and the pain that would result. Yes, the repossessions are themselves within state law and contractual rules, but images of people being tossed to the street violate deeper principles not formalized in law . . .
Yet. We have already begun to see the system adapt, with promises of government support to certain people facing steep loss.
It's a cycle we see time and again throughout society, including nonprofit law: we do what is allowed, and a foreseeable negative reaction prompts corrective law. Sometimes the law is good; other times--and we'll see a lot of this--the new law creates problems worse than those it set out to correct.
The lesson for a manager of a social enterprise, whether for-profit or non-: Look beyond the now. Think about what might happen, how it will look and how people who don't think like you might respond. When your organization depends on the goodwill of others--whether for donations, purchases, tax-exemption or investment--failing to do so could turn your short-term success into longer-term frustration.
Yesterday we featured a Special K's cause marketing partnership with . . . well, if you look carefully, you'll notice that it doesn't name the cause or the charity. The reason: it's breast cancer. Presumably they feel that no one would buy cereal with cancer on the box.
The cartoon above took a much bigger risk. It's today's Funky Winkerbean strip, the culmination of a storyline in which lead character Lisa Moore dies due to breast cancer. This strip also has a significant social enterprise component: the cartoonist, Tom Batiuk, has been working in partnership wiith Cleveland's Ireland Cancer Center to establish and finance Lisa's Legacy Fund for Cancer Research and Education. In fact, the Fund will receive 100% of the proceeds from the book collecting the strips in the storyline.
But not everyone thinks this is a good thing. Check out the heated comments on TheCancerBlog, particularly from one angry grandmother:
I think you are on an ego trip and feeling that you are doing something good. Well it is not good and you need to fix it. Consider your public and remember, children are reading your work. Young mothers with breast cancer are reading your work.You are hurting people who already have more hurt in their lives than you can possibly imagine. As a mother and a grandmother I beg you to stop hurting and begin to give some hope to those who must face each day with the knowledge that hope is all they really have.
Which got me thinking about the family and social responsibility. Should society be obligated to shelter children from the dark side of life? Must public life paint the picture of a Secret world in which every outcome is positive?
Contrast the American criticism of Lisa's death with the popular acclaim afforded the new Doctor Who series in the U.K., in which "everything dies" is the pervasive recurring theme. Doctor Who is unapologetically marketed as a children's program, and even the happy endings have a tragic core.
My own take: death, pain, loss--these are part of life, the ultimate natural law. Without them there is no growth, no change; pretend they don't exist and you risk being unprepared to face them down. In this regard the family can play an invaluable role as a social enterprise, teaching kids how to respond to the negative in ways that make life better for us all.
I'll get straight to the point: Most Powerpoint presentations suck.
Hard.
Unreadable paragraphs. Lame bullet points (guilty!). Chart junk. It's no surprise, really, that a Powerpoint slide was responsible for NASA's failure to prevent the explosion of the space shuttle Columbia.
So what's a do-gooder to do?
One of my own resolutions going forward: more pics + shorter descriptions. Which is why I find this so intriguing.
Don't store your presentation on the same flash drive where you keep your porn. Especially if you're speaking to school kids.
BONUS LESSON:
And if you're a politician or a pastor, don't even bother giving this excuse:
"I have no idea where these came from," the Democrat said.
No one will believe you.
Yesterday the U.S government accidentally deleted the state of California.
At least they say it was an accident . . .
1% For the Planet is a modern variant on the Judeo-Christian tithe (zakat in Islamic charity). In 1 for the P, businesses donate 1/100 of the their revenues to approved environmental charities. 1FTP annually certifies participation in the program, and the biz can advertise its commitment to sustainability.
The ad above, though? The use of sex as an attention grabber is an old, um, trick, and it has become so pervasive that it's practically a visual cliche'. While this design strategy may attract short-term attention (especially among men), does it truly engender long-term support?
This song has been playing in infinite spin in the Wilson Cave (actually, it's more of an aerie). The video has a few images that some might disturbing, but the core is drawn from nature: in particular, the life of a honeybee.
Hive life has long been a model for all forms of all forms of corporate identity. If I don't explain why soon, please shoot me. For now, I'll just highlight a poem that played an important role in emergence of the good ol' USA: Bernard Mandeville's Fable of the Bees, which argues that social virtue is a product of human vice. Selections from that poem after the vid.
A SPACIOUS Hive well stock'd with Bees,
That lived in Luxury and Ease;
And yet as fam'd for Laws and Arms,
As yielding large and early Swarms;
Was counted the great Nursery [5]
Of Sciences and Industry.
No Bees had better Government,
More Fickleness, or less Content.
They were not Slaves to Tyranny,
Nor ruled by wild Democracy; [10]
But Kings, that could not wrong, because
Their Power was circumscrib'd by Laws.
These Insects lived like Men, and all
Our Actions they perform'd in small:
They did whatever's done in Town, [15]
And what belongs to Sword, or Gown:
. . .
As Sharpers, Parasites, Pimps, Players,
Pick-Pockets, Coiners, Quacks, Sooth-Sayers, [50]
And all those, that, in Enmity
With down-right Working, cunningly
Convert to their own Use the Labour
Of their good-natur'd heedless Neighbour:
These were called Knaves; but, bar the Name, [55]
The grave Industrious were the Same.
All Trades and Places knew some Cheat,
No Calling was without Deceit.
. . .
Thus Vice nursed Ingenuity,
Which join'd with Time; and Industry
Had carry'd Life's Conveniencies,
It's real Pleasures, Comforts, Ease, [200]
To such a Height, the very Poor
Lived better than the Rich before;
And nothing could be added more:
. . .
The MORAL.
THEN leave Complaints: Fools only strive
To make a Great an honest Hive. [410]
T'enjoy the World's Conveniencies,
Be famed in War, yet live in Ease
Without great Vices, is a vain
Eutopia seated in the Brain.
Today was a long teaching day, with a between-class dash from City Hall to Grand Central for class #2 in White Plains. (Basically the place where I teach is structured like the old MX missile array--we shuttle from silo to silo thoughout the New York area to evade attack by rival universities.) On my way to Metro-North a crowd caught my eye . . .
a crowd around a car . . .
could it be . . .
Yes! Another Grand Central charity raffle!
Today's bait: a blue Maserati.
The cause: The Scholarship Fund of the Columbus Citizens Foundation.
The odds: Pretty good, since the number of tickets is limited to 500.
At one thousand dollars apiece.
You can buy an entry online here with the click of a nifty web button.
No ticket for me, but I did get to see a guy try to get the phone number of the PR woman by the car.
SMALL PRINT HERE'S-THE-CATCH BONUS:
OK, so you think to yourself, that raffle ticket ain't such a bad deal. After all, if you win, you get a $110,000 for less than 1/100th of the price, and you have a decent shot of winning.
Except . . . well, read this from the full solicitation:
Winner is responsible for all applicable Federal and State Taxes. Prior to delivery, the Columbus Citizens Foundation will collect the withholding tax from the prizewinner.
That's right, buckaroos. The government makes you pay taxes on windfalls, including that spiffy Masariti you just won in a charity auction. You'll get kicked up a tax bracket or three, and you won't get to claim the car until you pay up.
In sum, if you lose you're completely out of the price of the ticket--you can't deduct the value of the raffle ticket, since technically it's not a donation--you bought a chance to get something of value. On the other hand if you win, you're essentially buying the car for the amount you'll have to pay in taxes. Add in the exorbitant cost of insuring a Maserati in New York and the precipitious plunge of a Maserati's value after purchase . . .
I guess it's a better deal than if you'd bought the car new off the showroom floor, but if you're on a budget, you'll probably end up having to sell the car to pay the taxes, and even then you might not do much better than break even.
Sigh.
It costs 2 UPCs and a $5 donation, at least according to this Special K cause marketing effort touting a "free" anti-cancer key chain.
What Kellogg's is leveraging: our tendency to dissociate charity from commerce. One model for the phenomenon at work here is that of cognitive frames. As Berkeley linguist George Lakoff describes below, words change thought:
The first thing to know about language is that it expresses ideas and thoughts. Every word is defined with respect to what cognitive scientists call a frame. A frame is a conceptual structure of a certain form. Let me give you an example. Suppose I say the word "relief." The word "relief" has a conceptual frame associated with it. Here’s the frame: In order to give someone relief, there has to be an affliction and an afflicted party -- somebody who’s harmed by this affliction -- and a reliever, somebody who gives relief to the afflicted party or takes away the harm or pain. That reliever is a hero. And if someone tries to stop the person giving relief from doing so, they’re a bad guy. They’re a villain. They want to keep the affliction ongoing. So when you use only one word, "relief," all of that information is called up. That is a simple conceptual frame.
Why do I call this The Social Enterprise Pirate Blog? Aye, matey, 'ere there be a tale!
"Pirate" here isn't a reference to folks like our friend Chris the Ninja Pirate. Rather, this is a pirate blog in the sense of pirate radio and pirate tv.
On one level, the title grows out of the history of the blog itself. Technically, this blog shouldn't even exist--it isn't officially recognized or sanctioned by the university where I serve as a professor of social enterprise. Nor is it likely to be for the foreseeable future, so if The Good Ship SEPB should happen to disappear, that probably means your humble Cap'n has been ordered to walk the plank. Again.
But this is also a pirate blog in a broader sense. Part of my aim here is to engage in a bit of culture jamming directed toward social enterprise itself. Most writing done in the name of social entrepreneurship--or sustainability or civil society or nonprofits or whatever else happens to be en vogue in the profession do-gooding community--tends to fuse analysis with advocacy. Such an approach has its place, but over time it also has a tendency to blind us to our own weaknesses. Instead, let's hack the law, question authorities and have a bit of fun!
Google has announced that its Checkout for Nonprofits will be free through 2008.
Why would Google do this?
Obviously Google gets some good publicity, which is a common reason why companies engage in cause marketing. The real story, though, is more strategic--Google's trying to strengthen its presence in the market for similar services from companies such as Amazon and Paypal. Some nonprofits will make the switch; others will sign up because the service is now available for free. In fact, if basic human psychology is any guide, a number of people will also use Google in their online businesses because Google makes donation checkout free--and will keep using it even after Google starts charging in 2009.
Below: the Twin Towers ad for Defi pour la Terre, an environmental NGO, which echoes a hunger-awareness ad pulled by MTV after one airing:
The next ad is NSFW, so I'll just link to it. In sum, let's just say that putting a bare bottom on a nonprofit job fair is not exactly doing wonders for the organization's reputation for respecting gender equality.
Speaking of which, there's another ad that has yet to garner much attention in the U.S that illustrates the need to think carefully about designing your corporate identity. It's equally NSFW and concerns not a nonprofit, but Hewlett-Packard, a scandal-plagued company whose American division is using cause marketing to rehabilitate its reputation. In the States, HP is advertising its commitment to corporate social responsibility. In Europe, HP is selling laserjets for their ability to print color pictures of undressed teen girls.
Really, the two ad divisions should work better to coordinate their message.
Starting a social enterprise involves a series of choices. For the record, here are a few that we've started to cover in class or in our reading:
- Choice of entity:
- Corporation (Advantages: Limited liability; familiarity; ease of contracting)
- Trust ("Property with a purpose"; can be more difficult to change)
- Unincorporated association (Advantages: flexibility, ease of formation; disadvantage: greater potential for personal liability; might not be able to open bank account)
- Choice of purpose:
- For-profit: Distribute profits to shareholders; typified by commercial activity
- Nonprofit: Devote profits to mission; serve nonprofit purposes (which might include business activity)
- Charity: serve the public benefit; no private inurement
- Mutual benefit: serve the benefit of member
- Can a for-profit organization be a social enterprise? Answer: yes, and in several ways.
- An organization might choose to give a substantial portion--or even all--of its profits to charity.
- It could promote corporate social responsibility as part of its organizational culture
- It could serve a purpose defined primarily by its public benefit
What does this have to do with social enterprise? Plenty. Because charitable organizations view themselves through the lens of public benefit, they can actually be more resistant to acknowledging problems in their midst than pure for-profit business.
Here are three important lessons from the Isiah Thomas case that every manager should keep in mind:
- Don't fire the accuser. The MSG exec who boasted on the stand that he fired the accuser because she was bad for the organization--uhhhhh, no. Not a good move. This is textbook retaliation, and it's illegal.
- Don't promote people as an incentive for changing their testimony. Yes, MSG won a short-term victory by promoting the intern who had sex with Stephon Marbury. She changed her story soon afterwards, much to the delight of the defense. However, providing a positive job benefit in such circumstances can be as much a violation of sexual harassment law as firing an accuser. Should she so choose, the intern herself could file suit for being promoted as a quid-pro-quo. And she'd have a strong case.
- Don't view any executive as too important for the organization to punish. They're not. For example, the nonprofit that produces the Grammys indulged their highly paid prez for years despite widely circulated complaints regarding his behavior, to the detriment of the group's reputation in the industry and, yes, their fundraising. He eventually got fired, with high-dollar settlements for both him and two accusers. The whole debacle could have been avoided if the organization had disposed of him much earlier.
An industry ad scanned at FrozenToy.com.
From Ads of the World, a reminder of Marshall McLuhan's assertion that "The television war has meant the end of the dichotomy between civilian and military. The public is now participant in every phase of the war, and the main actions of the war are now being fought in the American home itself." (War and Peace in the Global Village, 134)
By enmeshing us into the global web, is television itself a social enterprise?
Sounds impressive, no?
Except that's not quite right. Unless I've missed something, the Hero Initiative is not the "first-ever federally chartered not-for-profit corporation" etc. etc.
Scandal? Nope. Just a lack of clarity about nonprofit and charity law.
Here's the deal. A federally chartered not-for-profit corporation is one that is, essentially, incorporated through U.S. law as opposed to the corporate law of a state. The American Red Cross, for example, was incorporated by an act of Congress, as described here.
The Hero Initiative was not incorporated by or through the federal government. However, the IRS did recognize it as an organization exempt from income taxes under Section 501(c)(3) of the Internal Revenue Code--in other words, it's a 501(c)(3) organization, like a gazillion or so other charities.
Tax and corporate law can be quite confusing, and of all the ways one could get confused the one described above is pretty minor. Still, state and federal regulators can get pretty picky about how a charity promotes itself, so it's best to be as accurate as you can.
