Moyers & Company: Capitalism’s Favorite Television Program

The undercover act only goes so far — CEOs may go to the ground floor, but they, and the Undercover Boss producers, have no desire to expose what goes on in the basement. Most of the companies are retail-based; rarely do we get a look deeper down the supply chain. While the CEO of Fatburger is willing to see what life is like on the grill, how about life picking the tomatoes that garnish his patties? While Modell is floored by Angel’s struggle, does he explore the source of the sneakers she slings on the sales floor? To do so would be to find working conditions too squalid for network television. Unwittingly, the show reflects the narrow lens through which American capitalism considers labor.

Teach a Man to Fish

Recently, I came across two critiques of a common saying: “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.”

One of those critiques was in the video below (hat tip to James McGrath and Ross McKenzie)

The other was in a post by Vu Le at Nonprofit With Balls that I linked to earlier:

The teach-a-man-to-fish paternalism. This philosophy, so ingrained in our culture, is patronizing and often ineffective, sometimes harmful. It assumes one person is a fount of knowledge while the other is an ignorant, empty vessel to be filled with wisdom. It ignores systems and environmental variables. We can teach someone to fish, but if they have no transportation to get to the pond, or if the pond is polluted, or if better-equipped corporations have been destroying aquaculture through over-fishing, then they’re still screwed while we feel good about ourselves. We see the same dynamics in funding via this belief that nonprofits can be self-sustaining if we just teach them to earn their revenues instead of constantly asking for free fish in the form of grants and donations.

Perhaps I’ll share my own thoughts on this later; there’s a lot that I could say about teach-a-man-to-fish colonialism. For now, I just want to share this video and this quote along with a quick comment.

The idea of teaching a man to fish often ends up looking like this: we who have the fish teaching the people from whom we took the fish how to work the systems that we designed to distribute the fish and ensure that we get to keep most of the fish. That’s deeply problematic. That’s an idea that we need to interrogate.

People I Read: Joan Garry

In the early-ish days of blogging, it was normal to have a blogroll: a list of links to other (often more popular) blogs that the author was interested in. The blogroll would sit calmly in the sidebar and let readers browse their way to other blogs and other authors, discovering fresh ideas and insights. Now, nobody maintains a blogroll. The best hope you have of finding someone else is to follow a link in the body of a post or in a comment or in a link dump. Around here, they also show up in link posts that I share fairly frequently.

But the fact is that I kind of miss the blogroll, and I think that it’s worthwhile to share some of the blogs I read and a note one why I read them. I’ll try to put up one example every couple of weeks.

This post’s person I read is Joan Garry.

Joan Garry is the former executive director of GLAAD and is now a nonprofit consultant specializing in crisis management, executive coaching, and management. Her blog focuses on helping executive directors, improving board performance, and fundraising, with a smattering of other topics. Anyone who is managing a nonprofit, regardless of their specific role, would do well to add Joan to their regular reading list (and listen to her podcast).

Vu Le: We Need to Stop Treating Nonprofits the Way Society Treats Poor People

First of all, I am vegan, so I NEVER expect cake and ice cream ANYWHERE. My usual dessert at fundraising events is a blueberry garnish. Second of all, none of us are expecting the work to be easy, but spending 15 hours trying to figure out how much of $1,864 in office supplies and printing the XYZ Foundation paid for last fiscal year is probably not what any of us should be putting our energy into.

Two Observations on the Salary Question

Joan Garry recently wrote about a big question in nonprofit circles: what to do with executive salaries? Or, as she phrases it: Is it inappropriate for nonprofit leaders to be well paid?

This is a question that comes up a lot. On the one hand, donors and nonprofit employees are trying to solve big problems, and there’s a risk that paying the executive director a large salary will pull money from other critical areas. On the other hand, nonprofits are competing for talent and a large salary can help attract the kind of executive who will increase the amount of money available to solve the problem. It’s a dilemma, and one that’s hard to find a solution to.

I’m not going to try to solve it here. I’m just going to offer two observations.

First, this question is almost always phrased in terms of executive salaries. Of course, it’s usually also being answered by nonprofit executives. But if nonprofit executives are concerned about the larger issue of pay equity – and not just trying to justify their own salaries – then this question needs to be expanded. The conversation about pay needs to include development staff, program staff, technology staff, administrative staff, custodial staff, and everyone else.

Second, the answers to this question always compare nonprofit salaries to for-profit salaries on the basis that the for-profit salary is normative. We tend to think that the for-profit leader making a $400,000 a year in total compensation is the benchmark, and that nonprofits need to be able to compete with that in order to attract the talent we need. We don’t question whether it’s reasonable for that for-profit executive to be making about eight times the median household income in the United States. This is a conversation that should include earners (and non-earners) throughout the for-profit, nonprofit, and public sectors.

Neither of these observations are meant to imply that Joan’s post isn’t a very good one. They’re just to say that the conversation about pay equity needs to be much, much bigger than a conversation about nonprofit executive pay. And it needs to reflect the values that the nonprofit sector embodies.

Three Myths About Low Income Finances

The fine folks over at ideas42 recently did a three-part series called Three Myths About the Underbanked and connected to a recent white paper called Reimagining Financial Inclusion. I highly recommend that you head over there and read part one, part two, and part three.

Because there are so many misperceptions of how finances work for low income households, and because this issue is so important to how we think about poverty and addressing poverty, I’m going to offer a single summary post of their findings.

Myth #1: Low Income Households Don’t Want to Save

Read the original article at ideas42.

In Bridges Out of Poverty, Ruby Payne reiterates a common myth about poverty:

One of the hidden rules of poverty is that any extra money is shared. Middle class puts a great deal of emphasis on being self-sufficient. In poverty, the clear understanding is that one will never get ahead, so when extra money is available, it is either shared or quickly spent.1Ruby Payne, Phillip DeVol, and Terie Dreussi-Smith, Bridges Out of Poverty: Strategies for Professionals and Communities, Kindle Edition (Highlands: Aha! Process Inc, 2009), Kindle Locations 387-388

Payne and her coauthors are deeply concerned with ‘poverty culture’. The implication isn’t simply that low income families fail to save, but that low income households lack the desire for save (even if it’s for good reasons, like the lived experience of “never get[ting] ahead.”

But the problem isn’t that low income households don’t want to save. As the folks at ideas42 point out, “83% of Americans worry about their savings, suggesting a large majority of consumers do want to save even if they aren’t able to at the moment.” Moreover, low income households ‘save for sooner’, meaning that they expect to use their savings in less than a year (and often less than six months).

None of this indicates that low income households don’t want to save. In fact, those households are saving, if only for the short term. Instead, it indicates that low income households lack the resources to build substantial savings over the long term.

Myth #2: Low Income Households Are Bad at Managing Their Finances

Read the original article at ideas42.

One of the first proposals to addressing poverty is often to address financial literacy. We often assume that low income households live in poverty, in part, because they don’t know how to manage their money. But in fact, people who are low income tend to be more knowledgeable about what things cost and where their money is going. They even use creative strategies – like freezing a credit card in a glass of water or using envelope budgeting – to manage their finances.

Among the highlights:

Low income households are more likely to know the cost of goods than their high income peers. Whether it’s the starting taxi fare in their city or the price of a beer, low income people are more likely to know the price. They’re also more likely to change their willingness to buy the product based on where they encounter it.

Low income households are more likely to know where their money goes than their high income peers. In part because a higher percentage of income is spent on certain things – rent can eat up a lot of a low income household’s budget, for example – low income people tend to know where every dollar goes. They don’t wonder where their money went… they know.

Myth #3: Low Income Households Don’t Pay For Financial Services

Read the original article at ideas42.

We often think that only wealthy households pay for financial services: portfolio managers, financial advisors, and so on. But low income households pay an astonishing amount of money for financial services each year. In 2014, they paid an aggregate $34 billion in fees and interest. Much of that was for using services that other people access for free and as a penalty for having unsteady income.

Low income households pay for basic services. This includes services that many people can access for free, like check cashing and money transfers. While these fees aren’t necessarily high – Walmart charges $3 for checks up to and including $1,000 – the point remains that low income households have to pay in order to access basic services.

Low income households pay penalties for unsteady income. Many low income households have volatile and unpredictable income streams, must juggle bill payments, and have little or no access to credit. This means that low income households are more likely to pay overdraft fees, NSF fees, late fees, and other penalties simply for not having enough money at a given point in time.

The folks at ideas42 estimate that low income households pay an average of $1,100 a year on basic financial services. For a family of four living at the Federal Poverty Level (an income of $24,300), that’s about 4.5% of their income!

Conclusion

How we imagine problems affects how we choose to solve them. If we believe that low income households don’t want to save, we’ll work to educate them on the importance of saving and instill that desire. If we believe that they don’t understand finances, we’ll encourage them to take financial literacy classes. If we believe that they aren’t using – or paying for – financial services, we’ll encourage them to use those services.

The problem, of course, is that if we don’t understand the problems, we’ll apply the wrong solutions. And one of the biggest challenges facing us when we try to address poverty is that we tend to base our approaches on myths rather than facts.

The question facing us is not ‘how do we change the attitudes of low income households (e.g. how do we teach them the importance of saving)?’ It’s ‘how do we create financial products that serve low income households effectively?’ In other words: how do we help people who want to save, actually save? How do we help people use their financial knowledge and reduce financial burdens? How do we provide access to affordable credit and restructure fees to account for unsteady income? And so on.

But the first step to addressing poverty is overcoming the myths that we cling to and getting our facts straight.

Footnotes   [ + ]

People I Read: The ideas42 Blog

In the early-ish days of blogging, it was normal to have a blogroll: a list of links to other (often more popular) blogs that the author was interested in. The blogroll would sit calmly in the sidebar and let readers browse their way to other blogs and other authors, discovering fresh ideas and insights. Now, nobody maintains a blogroll. The best hope you have of finding someone else is to follow a link in the body of a post or in a comment or in a link dump. Around here, they also show up in link posts that I share fairly frequently.

But the fact is that I kind of miss the blogroll, and I think that it’s worthwhile to share some of the blogs I read and a note one why I read them. I’ll try to put up one example every couple of weeks.

This post’s person I read is everyone at the ideas42 blog.

ideas42 is a consulting group started by Sendhil Mullainathan and Eldar Shafir (the authors of Scarcity: Why Having Too Little Means So Much) and including an impressive roster of researchers. They perform research in behavioral sciences and develop ways to apply their findings to social problems. Their work ranges from redesigning violation and misdemeanor tickets in New York to improve compliance to redesigning Alliant’s credit services so that they can serve low income consumers. The most important work that they do is bring empirical research in behavior science to addressing poverty. In a field where policy is often determined by ‘common sense’, actual data is a welcome disruptor. Their blog is a great source for cutting edge research in behavioral science.

The New York Review of Books: The Undermining of American Charity

We now write because we are alarmed about a major new force that has entered the field of charitable giving. It has so far been hardly noticed by the general public. But now it is threatening to undermine the American system for funding charity. This force is the commercial “donor-advised fund,” the fastest-growing, but still largely unknown, charitable vehicle. Donor-advised funds (or DAFs) give donors all of the tax benefits of charitable giving while imposing no obligation that the money be put to active charitable use.

Four Steps to Choosing Your Next Donor Database

Every day, some huge number of nonprofit organizations is looking for a new donor database solution. I know this because they come to forums I frequent and ask, “What donor management system should my organization buy?”

It’s an impossible question to answer. Every organization is different and has different needs. And there are a lot of donor management systems out there. Playing matchmaker – without knowing a lot of organizational details – isn’t an option (and wouldn’t be ethical).

But there are steps that every organization can take to separate the wheat from the chaff and make the right decision for themselves. I’ve been through a donor database change at every organization I’ve worked for, so let me show you my four steps to choosing a donor database.

Make Your List

Yes, there are some things that every database is going to do, and there are some things that every organization needs. But once you’re past the basics, what does your organization need? Do you need to track pledges? Manage events? Compose and send mass emails? Generate segmented mailing lists? Track online peer-to-peer fundraisers?

Every organization has different needs, and you need to know yours.

The first step in choosing a new donor database is making a list of the features you want and need, as well as features you have no use for. I recommend ranking those features as well. A simple four point scale works well:

  • Features that we need
  • Features that are important but not necessary
  • Features that are desired but not important
  • Features that you don’t have any use for

The point, of course, is to know what you’re looking for before you start looking at flashy demos and listening to salespeople. You don’t want to discover that you’re missing a vital feature – or that you’re paying for features you’re not going to use – after you’ve signed a contract.

Schedule a Live Demo

Almost nothing beats a live demo when it comes to understanding a database. When I say ‘live demo’, I don’t just mean a demo where you’re seeing someone show you the software. I mean one where you can have a conversation about the software; one where you can ask questions and get answers.

This is where your list really comes to life. If you have a feature you need (or even want), ask to see that feature demonstrated. If you need to track grants for your organization, ask the demonstrator to input and report on a grant. If you need an event registration form on your website, ask the demonstrator to show you how the software will handle that.

If you’ve ever taken a creative writing class, the same basic rule applies: show, don’t tell.

Also be sure to ask about pricing, support, training, conversion costs, and the roadmap for the future of the software. More companies are moving to a software as a service model, and you’re signing up for a relationship, not just a product.

Play in the Sandbox

The only thing that beats a live demo is the chance to use the software. A sandbox is a live version of the database with actual data – usually dummy data – already in it. Ask if there’s a sandbox that you can access and, if there is, play in it!

This is your chance to try to do all of those things you need to do. Be sure to try everything. If you’re going to have to enter a hundred new constituents from your annual event, make sure that you can do that. If there’s a report you have to generate – even if it’s just once a year – try to create it. If you need to send an email based on whether the constituent has opened a previous email or made a gift in the last three month, make sure that’s possible.

And if you’re not the only person who will be using the database, share it! The people who will be entering information or generating reports need to be comfortable with the system, and may have insight that you lack.

Talk to Other Users

The greatest advocate – and the greatest critic – is the end user. Every company should be willing to give you a list of organizations that use their software (and maybe even some who recently left). Talk to people on that list!

Ask people who actually use the software on a day-to-day basis about their experience. What’s been the best thing? What’s been the worst? What workarounds have they needed? What hasn’t worked as expected? How’s the support? Listen to their answers and try to get a variety of perspectives.

Conclusion

There’s no such thing as the perfect database that will do everything you want exactly the way you want it. But there are, more than likely, a handful that will be close. These steps won’t guarantee that you’ll know exactly which product to buy. But they will help you narrow it down to the best.

And isn’t the best what your organization deserves?