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BY 4.0 license Open Access Published by De Gruyter October 7, 2020

The Impact of Neoliberalism on Civil Society and Nonprofit Advocacy

Jennifer Alexander and Kandyce Fernandez ORCID logo
From the journal Nonprofit Policy Forum


The following manuscript employs critical inquiry to analyze the effects of neoliberalism on nonprofits in the U.S. and their capacity to engage in political advocacy and the production of meaning, a pivotal role for civil society institutions. Three false narratives of how nonprofits support democracy are presented followed by a discussion of how neoliberalism and the economization of the sector has delimited their capacity to fulfill their roles of engaging in emancipatory projects or social change. The manuscript concludes with a discussion of how nonprofits can reclaim civic space and empower citizens in a representative democracy.

1 Introduction

The capacity to advocate for their constituents and causes has been regarded as one of the most critical functions of the nonprofit sector (Almog-Bar and Schmid 2014; Salamon 2012). As mediating institutions situated between people and the state, nonprofits are credited with enhancing and sustaining the representative character of democracy in myriad ways. They have brought the voices of the marginalized into the policy dialogue (Almog-Bar 2017; Andrews and Edwards 2004; Clemens 1997; Jenkins 2006; Reid 1999), monitored government and corporate sector activities (Smith 1973; Van Til 2000), provided the locus and opportunity for active citizenship (Alexander and Nank 2009; Eikenberry and Kluver 2004), functioned as change agents (Frumkin 2002; Jenkins 2006), and provided the organizational structure to social movements that have transformed cultural norms and fostered regulations that protect citizens and the environment (McCarthy and Zald 1977). At first glance, nonprofits may appear to be a panacea for the shortcomings of republican democracy. From Tocqueville’s assertion that associations generated the civic dispositions necessary for democracy to the first commissioned study on the role of the third sector (Filer Report 1975), nonprofits have been more celebrated than scrutinized for their contributions to civil society (Salamon 2003).

Over the past 40 years, sea changes in the form of marketization, professionalization, and government regulation have progressively altered nonprofits’ capacities to engage their publics (Alexander, Nank, and Stivers 1999; Eikenberry and Kluver 2004; Hwang and Powel 2009; Nickel and Eikenberry 2009; Salamon 1999). These manifestations of neoliberalism have reconfigured the capacity of nonprofits to perform essential political roles as they required that organizations shift from community engagement to establishing organizational legitimacy with funders (Feldman 1997; Hall 2010; Lang 2013). Herein, we employ a critical analysis to interrogate key elements of the narrative of how nonprofits contribute to representative government. Our intention is to reveal how neoliberalism has eroded their political potential, specifically, their capacity to advocate on behalf of publics, and the ways in which nonprofits can salvage this role. Critical analysis is an effort

to dig beneath the surface of (often hidden) historically specific, special structures and processes – such as those related to politics, economics, culture, discourse, gender, and race- to illuminate how they lead to oppression and then to also reveal ways to change these structures (Sandberg, Eikenberry, and Mirabella 2019, p 2).

The argument that nonprofits have incorporated the logic of the market is well established. The contribution of this paper is the argument that neoliberalism, as an order of reason, has progressively diminished the capacity of nonprofits to fulfill their mission – to engage their publics, to empower and give voice, an assertion that has implications for representative government given their pivotal role in state-society relations. Nonprofit political capacity develops through sustained engagement with a public that generates meaning (Chambers and Kopstein 2001), mobilizes citizens (Kim, Jang, and Dicke 2017), and enables an organization to act with them by advocating their lived experience (Meyer and Hyde 2004). The ways in which neoliberalist logic has dissipated the political capacity of nonprofits has been documented in the international development literature (See Banks, Hulme, and Edwards 2015; Kamat 2004; Manji and O’Coill 2002) where the expressed purpose of nonprofits was often overtly intended to foster democracy working through the medium of civil society. Drawing on international studies as well as research within the U.S. we advance this argument in the context of the United States.

We begin by briefly introducing our application of key concepts including critical theory, neoliberalism, and civil society. We then define the type of nonprofit that pertains to this study, those that fit the description of community-based organizations (CBOs). Public advocacy, a form of advocacy intended to organize and activate publics, is then discussed as one of the central features of bottom-up democracy. We then turn to the argument that three intersecting dynamics have constrained the voice of nonprofits and altered their capacity to empower citizens, to challenge the market or the state, and represent the interests of their publics: (i) the quest for legitimacy through professionalization and managerialism, (ii) government laws and regulations that limit the voice of charitable organizations and concomitantly privilege the influence of elites over policy, and (iii) a civil society enervated by the loss of institutional support for citizen engagement and a decline in citizenship rights. We conclude with a review of how nonprofits can turn the tide and fulfill their potential as institutional beacons of civic engagement.

2 The Eye of the Storm: Neoliberalism, Democracy, and the Role of Civil Society Institutions

Critical theory is used to reveal why and how current structures and ideologies limit the political capacity of nonprofits. Critical analysis is a form of inquiry intended to expose how knowledge and meaning that appear neutral are social constructions that support asymmetrical systems of power and constrain human freedom (Sandberg, Eikenberry, and Mirabella 2019). While critical theorists comprise a diverse body of scholars, at the core they share a commitment to exploring questions that “make possible the reproduction and transformation of society, the meaning of culture, and the relation between the individual, society and nature” with the intention of allowing a form of politics to emerge that is neither authoritarian nor bureaucratic (Held 1980, p. 16).

Critical theorists regard civil society as an inherently political and conflictual space where “the general or public interest [can] be rationally and critically discussed (Habermas and Berg 1991; Howell and Pearce 2001). Herein, embedded power relationships and dominant values can be contested and citizens are able to check the power of the state and the market in the name of collective interests (Howell and Pearce 2001). Nonprofit organizations can be key actors in this process because they (i) institutionalize social mores within communities (Berger and Neuhaus 1977); and (ii) act as social change agents when they challenge established norms and foster agency among citizens (see Frumkin 2002). Critical theorists emphasize the importance of a civil society of protected rights in order to support “public debates that… go below the surface and ask hard questions, unmask interests and manipulation, [and] highlight hidden prejudices and bias” (Chambers 2002, p. 100). In short, through rational and critical public dialogues where people are free to “insert themselves in the political discourse on their own terms, bottom-up democratization becomes possible (Chandoke 2007, p. 610).

Neoliberalism is a term that holds multiple meanings. In this context, we reference what began as an economic policy that has mutated into an order of reason (Brown 2016). At its core, neoliberalism is political in that it “extends market metrics and practices to every dimension of human life” (Brown 2016, p. 5), thus generating the term “economization” to denote that an aspect of the state or civil society previously “governed by other orders of value” is now governed by economic rationality (Brown 2016). Most significant to this discussion is that neoliberalism conflates political and economic logic in several unsettling respects, specifically, by asserting that “individual freedoms are guaranteed by freedom of the market and trade” (Harvey 2005, p. 7). The assertion that individual freedom is secured through freedom of the market exemplifies what Gramsci called “the sense of the common,” which denotes widely held assumptions that can be “profoundly misleading, obfuscating or disguising real problems under cultural prejudices” (Harvey 2005, p. 39). He argued that dominant interest groups work with the state to impose direction to social life by promulgating a perspective that “incorporates some aspect of the aspirations, interests and ideology” of the subordinate classes (Gramsci 1971, p. 2). Thus, a state action, such as deregulation of labor, which is designed to secure the wealth of economic elites, is presented under the guise of securing individual freedoms, which then can convert to a cultural touchstone, or be taken as “common sense.”

Nonprofit or nongovernmental organizations (NGOs) are defined in a variety of ways but they are most easily identified by the characteristics they possess. They are private, voluntary, not-for-profit organizations dedicated to a public good. Nonprofits may be organized at the local, regional, national, or international level and they may serve broader (community/societal) or narrower (neighborhood/members) interests. For the purpose of this paper, our discussion pertains to both professionalized and community-based nonprofits that are tangible, institutional manifestations of civil society because they are engaged in ongoing interactions with a community (see Smith and Lipsky 1993). Such nonprofits hold identifiable characteristics: they are smaller, locally focused organizations accessible to citizens, where clients, volunteers, regular members, staff, and neighborhood residents are included in the governing body of the organization (Guo and Musso 2007). They perform a vast array of service and humanitarian functions that involve “generating normative claims about a common good and [acting] on these claims as a public expert in variously scaled civic spaces” (Lang 2013, p. 13). To this end, our analysis does not apply to nonprofits with an inward focus on serving only members or a targeted group to the exclusion of the interests of a broader community.

Advocacy is defined as “any attempt to influence the decisions of any institutional elite on behalf of a collective interest” (Jenkins 2006, p. 267). The most well-known form, known as institutional advocacy, consists of establishing strategic relationships or gaining “insider status in institutions or in organizations that initiate, prepare, legislate, or execute policy change” (Lang 2013, p. 22). Institutional advocacy, adapted from Pettigrew (1990) and Dechalert (1999), is inherently conservative in that the intention is to work with elites to influence policy from the inside. Management literature describes the prototypical process wherein a cadre of organizational leaders develop an advocacy strategy, enlist the support of relevant publics, and establish legitimacy based on expert knowledge important to a policy discussion (see Avner 2010; Worth 2019). In contrast, public or and grassroots advocacy is an effort to actively engage broader publics, fostering their engagement and empowerment in an effort to organize and mobilize citizens so that they may speak on their own behalf. Public and grassroots advocacy has been more confrontational and employed by social movements intent on challenging norms or regulations (Lang 2013; McCarthy and Zald 1977). To be sure, both forms are prototypes and are often actualized in tandem by consortia of organizations dedicated to a particular issue. However, institutional advocacy is most commonly associated with a professionalized organization and a management orientation whereas public advocacy is associated with community organizing, a tradition established in the early years of social work. The latter receives less academic attention except as an occasional component of community organizing in social work and sociology curricula.

It is essential to distinguish between the conceptions of civil society asserted in critical theory and liberal democratic theory at the start because the differences in meaning are determinative of the purpose and responsibilities of nonprofits. In liberal democratic theory, civil society is regarded as a coherent, homogeneous, and peaceful arena of “uncoerced human association” (Walzer 1995, p. 7) where citizens pursue individually satisfying interests and establish bonds of commonality. “There is a lack of attention to power and social differentiation” (Howell and Pearce 2001, p. 28). The essential task of civil society is to generate the moral formation necessary for people to govern themselves; to build the “competence and character in individuals, build social trust, and help children become good people and good citizens” (Elshtain 1999, p. 13). It is an arena where nonprofits are valued for their capacity to foster civic mindedness and social capital but it does not readily embrace citizen empowerment or politicization. By contrast, critical theory defines civil society as an inherently political domain of struggle where dominant interests maintain control by socializing people to ideologies that sustain their hegemony (Gramsci 1971). From this vantage point, nonprofits assume an inherently political role when they facilitate dialogue that transmits and/or challenges dominant values, a responsibility distinct from liberal political theory where their primary call is to sustain civic life. The civil society of critical theory differs from liberal political theory in its emphasis on the importance of (i) the common good over particular individual interests, (ii) the pursuit of human emancipation, (iii) attention to the power dynamics of “who gets to have voice and at whose expense” (Lang 2013, p. 49), and (iv) the criticality of state-society relations to fostering and sustaining democracy (Howell and Pearce 2001; Skocpol 1996; Young 2000).

In summary, a critical theory interrogation of nonprofit advocacy is a deep dive into the nexus of civil society, the role of nonprofits as political actors, and their capacity to engage and represent their publics. Nonprofits that are institutional representations of civil society sit at the heart of the project of emancipation. They foster public debate to construct meaning; they empower marginalized peoples, mobilize and synthesize public voices, and speak with citizens in the struggle for democracy. Herein we examine how the “market ethic” of neoliberalism has muffled this orientation, what nonprofits can do to help individuals challenge Gramsci’s (1971) “sense of the common,” and construct new knowledge and new visions for society. In the next three sections we take a central element of the promise of nonprofits’ contribution to representative democracy and outline the ways in which it has been impaired by neoliberal forces. Each section begins with a statement of the false narrative that disguises how nonprofits are constrained followed by a summary statement of our argument. In the conclusion we offer ideas as to how to bring about change.

2.1 Professionalization: A Form of Colonization

Conventional wisdom holds that professionalization has rendered nonprofits more effective. However, in doing so, organizational focus shifted away from the external relationships with publics and inward toward organizational demands. As nonprofits have diminished their connections to the communities they serve, they have foregone a critical source of their power and the capacity to challenge or defend their publics. Their capacity to steer civil society is debilitated (Della Porta 2017).

Nonprofits underwent a transition during the 1990s as governments and philanthropic donors enjoined them to adopt business-like models of service provision in the interest of greater efficiency, productivity, and accountability (Maier, Meyer, and Steinbereithner 2016; Salamon 1997; Weisbrod 1998). The rationalization of nonprofit organizations was an extension of a global movement, the New Public Management, which required that nonprofits formalize administrative structures and processes, develop performance measures, professionalize boards, generate commercial income to become self-sustaining, and focus on individual service delivery. Also known as organizational professionalism, “it is a discourse of control” exercised by managers from above that includes a form of rational-legal authority and the standardization of work procedures (Evett 2013, p. 787). Research indicates that this type of professionalization accorded nonprofit organizations greater legitimacy with donors (Guo 2006), strengthened ability to attract qualified staff (Dart 2004), fostered greater financial stability (Gras and Mendoza-Abarca 2014), and fostered autonomy for organizations that developed the capacity to generate income (Guo 2006; Khieng and Dahles 2015). This reform movement valued expertise and competence but accorded little value to civic and political roles (Frumkin 2002; Grønbjerg and Salamon 2012), “diminish[ing] the sector’s ability to internalize societal issues marginalized by the for profit sector” (Valentinov 2012, p. 362). While staff became better equipped to manage organizational demands, the reform effectively minimized the capacity of nonprofits to connect with their publics (Eikenberry and Kluver 2004; Hall 2010; LeRoux 2009). For example, financial goals came to override prosocial goals (James 2004; Suykens, de Rynck, and Verschuere 2019); reliance on commercial income resulted in a shift away from generating collective goods to provision of individual services, the commodification of clients, and fewer services available for those unable to pay (Baines et al. 2014; Eikenberry and Kluver 2004; Frumkin and Andre-Clark 2000; Gurewich, Prottas, and Leutz 2003; Hwang and Powell 2009; Khieng and Dahles 2015). Organizations became more risk averse when engaging clients (Valentinov 2012) and less innovative in their efforts to serve the public (Sandberg, Elliott, and Petchel 2020; Skocpol 2003).

What do studies indicate about the impact of rationalization and managerialism on advocacy, the most overtly political of all nonprofit activities? Results to date give few clear answers due to variation within existing studies of organizational activity, types of professionalism, funding sources, and meanings associated with the term advocacy (Feldman, Strier, and Koreh 2017; Lu 2018). When narrowing the scope to human service organizations, the field most likely to serve marginalized populations and receive government funding, results continue to be ambiguous. They indicate that advocacy may be reduced, increase, or shift in content, becoming more focused on organizational challenges rather than community defined issues (Eikenberry and Kluver 2004; Frumkin and Andre-Clark 2000; Hwang and Powell 2009; LeRoux 2009; Mosley 2012). Pertinent to the argument herein, Feldman, Strier, and Koreh (2017) attribute the inconclusive results to the complex response of organizations to neoliberalism and the way in which it has shifted the character of organizations toward marketization, precarity and commodification (Feldman, Strier, and Koreh 2017, p. 260).

We can assert that professionalization in the form of rationalization as described above has altered nonprofit ability to represent the interests of communities for three interrelated reasons. First, professionalization, “demands adaptation to institutional norms and structures as well as to a policy field’s language and terms of trade” (Lang 2013, p. 72). Central to this transition is the promotion of expert knowledge (a component of Weber’s definition of professionalization), which “signifies the authority of institutionalized expertise over the authority of other claims, be they coercive or moral in nature” (Lang 2013, p. 71). In effect, the shift toward expert knowledge as a source of organizational legitimacy signaled a change in organizational core competence, that which was integral to generating organizational products. No longer was the source of power and legitimacy drawn from connection to a public and their defined experience. Consider Gramsci’s (1971) assertion that knowledge is socially constructed to legitimate powerful interests. The obverse, democratic knowledge, is generated as “facts are converted to policy-relevant knowledge by a community as they come to understand a situation through interpretation, discussion and persuasion” (Dewey 1939/1998 in Stivers 2010, p. 253). In the rationalized organization, the unpolished, democratic knowledge that challenged social structures no longer had a place (Valentinov 2012; Chandoke 2003). In US cities, professionalization further segregated the sector, a dynamic that mirrored extant economic and ethnic divisions. The result in urban areas are largely white led, “high capacity” organizations with close ties to donors receiving funding, and grass roots organizations serving people of color that are locked out of sufficient resource flows necessary to effectively function (Danley and Blesset 2019; Harris 2016; Nickels and Clark 2019).

Second, with the shift toward professionalism advocacy becomes a depoliticized, managerial process designed and orchestrated by qualified organizational leadership (Chahim and Prakash 2014; Lu 2018; Sandfort 2014). Accordingly, the goals and values that drive the advocacy process prioritize the perspective of a professional class responsive to a field within an institutional environment over the people they serve (Pekkanen and Smith 2014). Institutional advocacy is further subject to the distortions resulting from a displacement of constituent needs for organizational concerns (Garrow and Hasenfeld 2014). The need to sustain funding streams and organizational survival has resulted in “soft advocacy” and a reluctance to be confrontational or insistent, particularly when engaging funders (AbouAssi 2013; Imig 2014; Lu 2015; Mosley 2012; Schmid, Bar, and Nirel 2008). A recent study conducted on the nonprofit sector in Camden, New Jersey revealed that

(T)he social, political, and economic capital of white-led nonprofits affords them the privilege to almost be guaranteed funding by white foundations without having community ties or expertise in local affairs to make their engagement and delivery of service impactful in the long-term. Professionalized white-led nonprofit organizations rarely address structural inequity, challenge the status quo, or devolve power and resources to the grassroots organizations that are in the trenches. (Danley and Blesset 2019, p. 29)

The dynamic of professionalized organizations controlling both the message and the resources directed to marginalized communities has a long history in the US (Lu 2015). It echoes the international development literature where NGOs were denounced as political interlopers, unaccountable to marginalized populations they purported to serve (Chahim and Prakash 2014; Chandoke 2003; Feldman 1997; Guo, Metelsky, and Bradshaw 2013). As an example, the Model Cities programs of the 1960s were intended to address the socioeconomic needs of the most impoverished neighborhoods with meaningful community participation dedicated to the planning process (Jackson 2008; Siegel 2019). While there were outcomes to celebrate, urban historians regard the programs as examples of experts defining problems, ambiguity within about the inclusion of citizens and actual barriers imposed upon grassroots neighborhood organizations that sought significant involvement (Jackson 2008; Siegel 2019). In order for citizens to have a voice and a capacity to shape their worlds, civil society organizations need to be grounded in a relationship with a people and their organization must be a place where the marginalized, “the tribals, the poor, the lower castes, and women [do not] have to struggle to enter the sphere” (Chandhoke 2003, p. 226).

In spite of an evident fissure between nonprofits and their publics, scholars, practitioners, donors, and public agencies routinely take nonprofits to be a proxy for the marginalized populations they serve. This disparity becomes readily discernible when examining how organizational accountability is assessed and whether downward accountability in the form of organizational outreach or community ties is included. Accountability and power are closely linked, such that accountability measures that respond to donor expectations around financial performance or transparency often prevail (Ebrahim 2005). Power “shapes what is considered knowledge or at least the right form of knowledge” (Raggo 2018, p 42). Thus, a concatenated sequence of power dynamics embedded in board governance, donor expectations, performance measures, trained staff, and resource networks shape “who is allowed access to governance, whose voices are at the table and whose perspectives are represented by others, and to what degree” (Guo, Metelsky, and Bradshaw 2013, p. 47). This dynamic creates a discrepancy between the public space of professionalized nonprofits and the world of under-resourced grassroots organizations that speak for the marginalized (Chahim and Prakash 2014; Chandoke 2007; Raggo 2018). Accordingly, the civic sphere has been progressively emptied of the participatory citizenship that regenerates democracy (Chandoke 2007; Dodge and Ospina 2016; Feldman 1997). Most significant to our argument is that a civil society celebrated for its capacity to represent the voices of the marginalized, is increasingly unlikely.

Third, in a neoliberal environment where nonprofits are regarded as primarily service providers, advocacy has ceased to be a valued organizational activity. The civic and political roles of nonprofits hold little salience in the now economized third sector (Bode 2014). Advocacy requires organizational resources that are increasingly in scarce supply.[1] Political advocacy is affected because it is not a program and thus requires investment in infrastructure such as human resources and communications to support engagement with and mobilization of various organizational constituencies (Lang 2013). The combined trends of marketization, precarity and commodification have progressively undermined the capacity of nonprofits to represent community interests (Feldman 1997; Feldman, Strier, and Koreh 2017).

Results of a national survey conducted by Salamon, Geller, and Spence (2008) indicated that while 90% of nonprofit leaders assert that advocacy is critical to mission accomplishment and that they should be more engaged, it has become a secondary activity. Advocacy involves less than two percent of the annual budgets for 85% of nonprofits in the US (Salamon, Geller, and Spence 2008). More recently, a 2017 study of nonprofits in the thirteen-county region surrounding San Antonio, Texas, revealed that the most frequently expressed challenge to mission fulfillment was the need for “community support and awareness.” Spanning all organizational sizes, respondents consistently noted that the desire for advocacy was compelling but the combination of resource constraints and organizational demands impeded their ability to follow through (Fernandez and Alexander 2017).

To summarize, the process of professionalization has disconnected nonprofits from their social and political roles and contributed to further marginalization of underserved populations. There is no pretense offered for political legitimacy or accountability to the publics they represent, nor is one required by funders who take nonprofits as bona fide representatives able to speak for the publics they serve. Like working parents too tired to sustain a routine of family meal time, nonprofit leaders speak of the importance of advocacy to their goals but they are often unable to follow through.

2.2 The Regulatory Environment and the Hegemony of Elite Interests

The logic of pluralism holds that a competition of interests will generate a policy outcome that represents a collective will. Nonprofits are celebrated for expanding the representative nature of democracy by bringing the voice of marginalized publics into the policy dialogue. In reality, the nonprofit sector is severely limited in its capacity to represent citizen interests by a host of factors, including the regulatory environment and resource constraints, while the economic elite exercise unfettered and disproportionate influence through a variety of state supported modalities. This dynamic occurs at all levels of government.

In the American experience, the idea that competition among interest groups would generate a policy product that represented a collective will can be traced to James Madison’s essay, Federalist 10. It captured the promise of democracy: that citizens were political equals who had the opportunity to participate in the institutions that govern their lives. The unfortunate reality is that the policy formation process in the U.S. is dominated by elite interests that have disproportionate influence. There is the additional problem that the market ethic of neoliberal ideology does not recognize or privilege a collective good. Self-interest is touted as the road to the betterment of all. Hence, it becomes difficult to distinguish between the interest-seeking behavior of a particular group enrichment claim and a collective good. For example, a nonprofit may promote community education regarding domestic violence, while a professional association, indistinguishable from a charitable nonprofit on its face, may advance the economic interests of members in the form of “clean coal.” In an economized policy dialogue, the two claims appear equivalent.

The capacities of charitable 501(c)3 nonprofits to advocate are circumscribed by conditions set down by the state which exercises definitional power over the activities to be considered in the public interest and supported through tax deductions. In the US, charitable organizations are deterred from political activity by the federal tax code, which is based on the concept of tax neutrality – that political activity should not be subsidized by government. What nonprofits are not supposed to do is to represent their clients’ specific interests before legislators. “Feed them, just don’t lobby for better anti-hunger programs. Heal them, just don’t try to lobby for changing the health care system. This is the essence of American law on nonprofits” (Berry and Arons 2003, p. 4).

Charitable nonprofits are permitted to engage in advocacy that takes the form of public education rather than endorsement of a particular policy or candidate but the line between issue advocacy and lobbying is so fine as to be unclear and the consequences of engaging in the latter are deleterious. Nonprofits in the US are further constrained by a federal tax code that is arcane and ambiguous. Consequently, organizations frequently underreport their activities (Bass et al. 2007) and the majority simply refrains from political activity out of fear of infringing on tax law (Pekkanen and Smith 2014). Moreover, the tax code has been revisited by Congress during times of social unrest with the intention of restricting civic speech. For example, Bremner (1988) noted that organizations promulgating “civil rights, welfare rights, environmental and anti-war groups and public interest law firms endured routine audits by the IRS during the 1960s” (p. 91). Questions of restricting civic voice of charitable nonprofits re-emerged during the Reagan administration in the 1980s and again during the early 1990s with the proposed Istook Amendment that attempted to limit civic speech by federally funded nonprofits. Although the legislation did not pass, it was an effort to “reframe the public’s understanding of what constituted acceptable charitable and nonprofit service in American civic life” (Cox and McCosky 1996, p. 284), echoing Berry and Arons (2003) lament that it is service delivery rather than promoting change.

Donor expectations that nonprofits should refrain from political activity drives the reticence and even disapproval that is often expressed toward overtly political actions. Ironically, institutional advocacy that is directed toward agencies or the courts is legally acceptable and increasingly commonplace. The result is that nonprofits are dissuaded from participating in the public sphere of policy making. They may be “on tap” as subject matter experts, but they are absent from the civic world and the legislative process (Lang 2013).

The government has controlled the discourse of civic space not only through administrative regulations, but also through the use of criminal law and state sanctioned violence. This dynamic is more pronounced in the international literature on nongovernmental organizations (NGOs) which reveals how governments have historically regulated and suppressed civic space by supporting those NGOs they deemed to be legitimate representatives of the people and silencing or criminalizing segments of civil society that challenged established norms (Buyse 2018; Della Porta 2017; Feldman 1997). Brazilian NGO scholar, Telles, coined the term “five star civil society” to describe “those NGOs whose agendas are considered acceptable and that don’t challenge political economic or social norms” (2001, p. 32). In the US, governments have criminalized civic voice during events of nonviolent civil disobedience and social movements of protest, resulting in a reduction of citizens’ civil rights, violations of human rights, and arrests (see Amnesty International 2020; Della Porta 2017). Consider the couple arrested for bringing books to detained children at the Baptist Child and Family Services in Oakland, California (Sanchez 2018). In another case, Arizona volunteers with the organization, No More Deaths, were arrested for providing food and water to undocumented immigrants (Silva 2018). Most recently, national protests for an end to state-sanctioned violence against people of color organized by Black Lives Matter resulted in an untold number of violent acts by police against citizens peacefully exercising their First Amendment rights (Amnesty International 2020). Just as the state has the capacity to manufacture civil society by treating nonprofits as proxies for publics, they have used coercive power of the state to criminalize behaviors of organized citizens who pose a challenge to the established social and economic order (Buyse 2018).

Which organizations are politically active? A study of organized interests registered in Washington, D.C. between 1981 and 2006 revealed that fewer than 5% of nonprofits were public interest groups. The majority represented either the business sector or professional associations, such as the American Medical Association, Association of American Realtors, or the Chamber of Commerce (Schlotzman 2010). According to federal disclosure records in 2014, 95 of the top 100 lobbyists in Washington, D.C. represented corporate interests, spending more than $2.6 billion in this year (Drutman 2015). Lobbying at the federal level is an expensive endeavor requiring a combination of skills, information, resources, media coverage and political connections. Hence, resource constraints are a formidable barrier to entry and determinative of who has the opportunity to participate in the policy formation process (Gilens and Page 2014; Schlotzman 2010). Public interest groups are further disadvantaged because their funding is less reliable, their interests are more divergent, and they have a higher organizational mortality rate (Walker 1983). Conversely, organizations with a more attenuated policy focus, such as trade associations and corporations, have the advantage of steady funding, and greater organizational longevity, in addition to offering government the benefits of their expertise in specialized areas (Walker 1983).

Who brings the voice of middle and lower-income citizens to the federal government? Schlotzman’s (2010) study was unable to identify representation among registered Washington organizations for the 90 million Americans who are employed in non-professional occupations, for those who are recipients of TANF, Medicaid, the Earned Income Tax Credit, or public housing. Lang (2013) notes that most private funding is directed to middle class causes and as a result, “those in poverty and on the margins of society have neither a strong voice, nor a strong lobby nor the resources to craft either (p. 133).”

Schattschneider (1960), one of the earliest scholars on interest groups, famously lamented “the flaw in the pluralist heaven is that the heavenly chorus sings with a strong upper-class accent” (p. 35). Nearly 60 years later, the choir has become deafening. Economic elites have expanded opportunities to influence policy formation through vehicles such as political action committees (PACs), think tanks, private philanthropy, and by changing legislation that previously limited their opportunities for influence. The landmark Supreme Court case of Citizen United (2010) determined that the “First Amendment prohibits government from restricting free speech in the form of independent political expenditures” for nonprofit associations, for-profit associations, labor unions, and other associations. Effectively, this decision established that corporations hold the same rights to constitutionally protected free speech as citizens. Nonprofit 501c4 and 501c6 organizations, already free to lobby without restriction, were now able to spend an unlimited amount of money with no requirement to disclose the source of funding. As a result, “the American political system is now awash in unlimited, untraceable cash” (Mayer 2016, p. 229). Justice Ruth Bader Ginsberg lamented that this ruling was the worst decision the current Supreme Court had rendered and that it had established a now unimpeded connection between money and influence on what laws were passed (Lapidos 2014, n.p.). In this neoliberal political environment, the one percent of the population that has amassed roughly 50% of the nation’s total wealth is now completely freed to influence policy and appropriate government for their own purposes. The charitable sector, responsible for both serving and giving voice to the most needy and marginalized populations is burdened with the constraints of the regulatory environment and funders who express little interest in their political role. In the environment where money is speech, their voices have all the force of pop guns in a nuclear blast.

Finally, the preferences and agendas of the wealthy, funded through foundations, are becoming a driving force for both public and nonprofit organizations. While private foundations appear at face value as “beneficent representations of wealthy individuals devoting their resources to public purposes and supporting institutions that enrich our lives,” there is another side to consider (Reich, Cordelli, and Bernholtz 2016, p. 65). Private foundations were initially regarded as a threat to democracy because they are “an institutionalized form of private wealth, tax subsidized, and established to serve a private sector interest in perpetuity accountable only to a handful of trustees” (Reich, Cordelli, and Bernholtz 2016, p. 65). Money directed to a private foundation is similar to tax expenditure in that it decreases the tax burden of the donor and reduces a revenue source of government. Foregone tax revenue from private foundations in 2000 was $24 billion, $36 billion by 2005 when it exceeded what the federal government expended on Temporary Assistance to Needy Families (Reich, Cordelli, and Bernholz 2016), and exceeded $50 billion in 2014.

In an era of unprecedented income inequality in the U.S., funding by private foundations has displaced democratic processes and established a means for the elite to appear beneficent while exercising undue influence over policy. Consider the following examples: Bill Gates has donated more than $3 billion to public education since 1999 and was referred to by the LA Times as “the nation’s superintendent of schools” because “never before has an individual or foundation had so much power to direct the course of education” (Ravitch 2006, para 1). Similarly, Mark Zuckerberg donated $100 million to New Jersey schools. Neither of these efforts has generated the expected results. While the public may appreciate their generosity, the preferences of economic elites supplanted the deliberative process of citizens and the expertise of educators. Moreover, studies indicate that the interests of the wealthy are more conservative than those of the general population (Reich, Cordelli, and Bernholtz 2016; Ghiridhadas 2018).

In this section, we have argued that nonprofit organizations that serve the needs of the poor and marginalized are discouraged from advocacy through the federal tax code, institutional norms of donors, the coercive power of the state, and barriers to entry in the form of resources and skills. The impact is a nonprofit culture of self-censorship, which has limited commitment to advocacy or willingness to engage the public in policy discussions (Berry and Arons 2003). We have also examined several ways in which economic elites have established a privileged position with the state that allows them to dominate the policy process. Economic elites have expanded their influence over policy through private foundations whose funding and agendas can displace the public process, and most notably, through legislation and the Supreme Court decision in Citizens United (2010) that now permits unlimited and untraceable funding to guide the policy dialogue, and shape election outcomes and legislation.

2.3 A Civil Society Cast Adrift and Citizens Marooned on Putnam’s Island

Conventional wisdom holds that democracy is in peril because citizens are disengaged from civic life. They are busy in their solitary worlds, distrustful of government, and “bowling alone” (Putnam 2000). A more thorough explanation would document the ways in which citizens have been abandoned by institutional forms that encouraged their participation in the project of democracy. Nonprofits seeking to engage their publics struggle to foster civic engagement in the wake of market domination and a state that is rolling back citizenship rights.

The third and perhaps, least elaborated dynamic that has limited nonprofits’ capacity to aggregate the voices of citizenry concerns the social isolation of citizens from one other, and the lack of institutional support for civic engagement that previously sustained their sense of membership in communities and the polity. Healthy democracy requires strong interpersonal social ties and civic engagement (Crenson and Ginsberg 2004; Nabatchi 2012; Putnam 2000; Skocpol 1999). It has also historically required active support of government and nonprofits. When connections among citizens are frayed, when there is less opportunity for deliberation, civil society is less able to activate citizenry or hold public and economic institutions accountable to a collective will. But how has this state of alienation come about? In this final segment, we unpack how government policies have shaped citizens’ conception of their belonging to the body politic and how the dearth of institutional supports previously extended by government and nonprofits have contributed to an incapacitated civil society.

A host of scholars have expounded on the decline in associational life that began in the 1960s. Research indicates that citizens ceased to join membership organizations, voting rates declined, and people expressed less trust in their fellow citizens and government (Durant 1995; Putnam 2000; Skocpol 1999; Wattenberg 2002). Reasons proffered include the rise in personal entertainment (Putnam 2000), a desire for material comforts, the demise of elite-generated federations (Skocpol 1999), demographic shifts in the population, and changes in the form and structure of advocacy (Skocpol 1999), among others. Most recently, citizen isolation has been exacerbated by a dramatic increase in economic inequality, rising economic insecurity, and meager government protection in the form of social welfare policy, further damaging trust between citizens and government.

Historically, government has played a pivotal role in shaping citizen engagement with both the state and the nonprofit sector (King and Stivers 1998; Nabatchi 2012; Skocpol 1996). In Downsizing Democracy, Crenson and Ginsberg (2004) argued that government engaged citizens in a variety of ways that no longer occur. Government relied on the voluntary compliance of citizens to pay federal taxes. With the introduction of automatic and involuntary payment through employers, government no longer depended “on the honesty, good will and foresight of individual taxpayers” (Crenson and Ginsberg 2004, p. 34). Similarly, they argue that the patronage system created a bond between government and citizens as “patronage employees helped to build support for the regime … by providing citizens with a host of particularized benefits ranging from social services to legal assistance and employment” (Crenson and Ginsberg 2004, p. 26). The need for an army created yet another link between citizenship rights and conscription. Women were extended suffrage during World War I in hopes that it would generate their support for the war. The Twenty-Sixth Amendment, which lowered the voting age to 18, was intended to foster support among young men being drafted to fight in the Vietnam War (Crenson and Ginsberg 2004). In short, ongoing interactive engagement with citizens ceased to be a necessary activity because “the administrative, financial, and military needs of government no longer required the political engagement of the general population” (Crenson and Ginsberg 2004, p. 46).

Similarly, the nonprofit sector has fostered citizen participation in ways that they do no longer (Della Porta 2017; Hall 1998; Skocpol 1996; Young 2000). While the organizations, themselves, were largely founded and directed by elites, nonprofits included institutional structures that drew a cross-section of Americans into civic life. The current structure of nonprofits with its emphasis on instrumental rationality, professionalization and bureaucratization obviates the need to engage constituencies as they once did[2] (Skocpol 1996). Nonetheless, donor requirements and government processes continue to exercise influence over citizen engagement. In a review of local governments in the US and Germany, Lang (2013) concludes that government has a powerful role in establishing the relationship with citizens and nonprofits, one that can either foster or diminish public voice (p. 160).

Policies, themselves, have consequences for citizen engagement. Skocpol (1992) introduced the idea of “policy feedback,” a dynamic that occurs as policies distribute the benefits and burdens of citizenship, thereby restructuring subsequent political processes. Second order, or interpretive effects of policy feedback reflect how people make meaning of their status in the body politic, their rights and obligations as citizens, and their trust in government based on policy impacts (Hacker, Mettler, and Pinderhughes 2005, p. 181–182). To provide context, Hacker, Mettler, and Pinderhughes (2005) contrast the relationship between public servants and recipients of Social Security disability benefits with the interactions between public servants and recipients of Aid for Dependent Children and how these government interactions shaped recipient identity and relationships with government. In their extensive review of New Deal policies that provided education, training and housing loans for World War II veterans and their families, the authors found that the impact of government generosity most profoundly affected individuals from lower and moderate economic backgrounds who felt more fully incorporated into the polity as first class citizens (Hacker, Mettler, and Pinderhughes 2005, p. 190). Most relevant to this argument is that New Deal policies “promoted unity within the polity, and prompted beneficiaries to have a greater sense of political efficacy and inclination to participate politically (Hacker, Mettler, and Pinderhughes 2005, p. 197).

The trend toward citizen isolation has intensified with a new threat. Since the 1980s, a growing body of citizens is caught in a dynamic of daily survival, detached from meaningful involvement in their communities, and with a lack of government protection in the form of social welfare policy. This long-term economic trend has been referred to as the “fragmentation of work and the breakdown of the standard employment relationship” (Castel 2003; Thelan 2019, p. 6). This cross-class section of workers, referenced as the precariat, may have college degrees or no higher education, but their work worlds afford them little or no job security, often chronic under employment, and an uncertain daily life given their unstable hours. Women and marginalized populations have been especially vulnerable. Standing notes that the precariat is the first generation to systematically lose rights of citizenship in the sense that they lack non-wage benefits: social insurance, health care, overtime rules, unemployment benefits, sick leave, or minimum wage (2016) and they have “minimal trust relationships with capital or the state” (Standing 2014, p. 9). This trend has swept across all industrialized economies but it is particularly pronounced in the US because European social welfare benefits and after tax income have a greater redistributive effect (Hacker, Mettler, and Pinderhughes 2005); they enjoy more government protection of job benefits and health care (Thelan 2019; Hacker, Mettler, and Pinderhughes 2005). By contrast, the US ranks 19th among 21 OECD nations for highest poverty rates among individuals living in households where at least one worker is employed (Thelan 2019, p. 17); the US has the largest low wage sector as a percentage of total workforce based on 2017 data, and the least amount of job benefits or protection for workers among OECD nations (Thelan 2019). Moreover, there has been a progressive and substantial decline in the real value of social welfare benefits in the US since the 1980s, including: student loans for lower income students (Pell Grants dropped from covering 80–40% of college expenses at a state institution between 1975 and 1999 [Hacker, Mettler, and Pinderhughes 2005, p. 174]). Bedrock social welfare programs such as unemployment insurance, food stamps, and Temporary Assistance for Needy Families (TANF) have all decreased in real value, as have workplace benefits for low wage employees (see Hacker et al. p. 199). For example, the minimum wage in 2014 was 47% less than its value in 1967 in constant dollars (Ellwell 2014).

In summation, more than a third of US workers (60 million) are now part of the “gig economy” and they are expected to be the majority by 2027 (Caminiti 2018). A vast majority of those citizens are caught in a dynamic of daily survival, detached from meaningful involvement in their communities. The institutional supports that once drew citizens into civic engagement are largely non-existent and the growing civic decline “threatens the very legitimacy and standing of the US political system” (Nabatchi 2010, p. 379). In the current state of affairs, civil society has limited ability to construct meaning in the name of citizens. It is too debilitated to fulfill its varied political purposes, or defend itself against the colonizing influences of the market.

3 Conclusion

The logic implicit to civil society and democracy holds fundamental preconditions, one of which is that “state power has to be monitored, engaged with and rendered accountable through intentional and engaged citizen action” (Chandoke 2007, p. 608). How then, might CBOs begin to recapture their political relevance and return civil society to a healthy state? How are they to foster the dialogic processes that give authenticity to their advocacy? Herein we have employed critical inquiry to interrogate three established narratives regarding the role of nonprofits in democracy to reveal debilitating constraints that diminish their civic capacity. The context for our argument has been community-based nonprofits in the US. While the effects of neoliberalism have not been symmetrical in every country, the relevance of these arguments extends beyond the US in several instances.

First, it is widely accepted that professionalism has made nonprofits more effective advocates for the publics they represent. However, scholarship indicates that professionalism has reduced their capacity to function as civil society actors, particularly where advocacy is not their sole mission. The organizational processes and structures that supported deliberative democracy and knowledge generation have been replaced with the values and accountability systems that correspond to donor identified needs. Evidence indicates that as local nonprofits lose connection with the public, they lose their capacity to generate community knowledge, to empower, and to counter the hegemonic forces of the market and state in civil society.

Nonprofits have an opportunity to reverse this trend. As the literature has established, nonprofits are created and constrained by power structures of their environments, which can be varied and conflictual (Pfeffer and Salancik 1987). They can engage in strategy to contest dominant norms to shape their environments, in this case, by focusing on organizational factors that foster community connections and participant engagement. These efforts include: establishing structures and processes that align organizational accountability with key publics; fostering deliberative democracy and knowledge generation through dialogic processes within the organization that allow for agenda setting through constituent involvement (Dodge and Ospina 2016; Fung 2006; Lu 2018), selecting board members and staff that are demographically representative of the public served (Guo and Musso 2007; LeRoux 2009) and who place connection with participants as an organizational priority; and tailoring organizational messages to transcend boundaries of gender, ethnicity and class to expand their footprint. The strategy of prioritizing community engagement and outreach may require forsaking resources, new opportunities for service programs and organizational growth. Whenever possible, nonprofits must educate funders, both philanthropic and government, about the negative effects of low overhead on organizational capacity and the value of advocacy/community.

Second, the US has demonstrated a deep attachment to the idea that nonprofits foster a more representative democracy by bringing the voices of the marginalized into the policy dialogue. We have argued that the charitable sector is severely limited in its capacity to represent citizen interests due to the regulatory environment, institutional pressure from donors that regard nonprofits as service vendors and place little value in their political roles, the resource constraints of entering into the high dollar game of federal lobbying, and the privilege accorded to people of extreme wealth to preempt democratic processes and assert their policy preferences through private foundations.

Nonprofits have an opportunity to strengthen their participants’ voices and counter these trends by focusing where they have the greatest potential impact – at the local level. Here, their organizational contributions are known and decision makers are most accessible. Through coalitions, nonprofits have an opportunity to influence policy outcomes by working to define collective impacts that include their publics’ knowledge and solution to problems. Most importantly, through advocacy collaboratives, nonprofits can pursue both institutional and activist strategies, expanding their impact, while reducing organizational risk and cost. Consider the example of “San Antonio Stands,” a collaborative of more than two dozen organizations committed to the protection, dignity and freedom of immigrants in Bexar County. Several local grassroots nonprofits and legal entities are joined by national and state organizations such as the ACLU, the Texas Organizing Project, and the AFL-CIO that bring resources and expertise. The result is a coordinated strategy to change laws and provide immediate support to people at risk. In an effort to expand their footprint and support, the collaboration extended its mission to include all people of color, citizens and immigrants, in need of assistance and protection when dealing with the criminal justice system.

Finally, we challenge a commonly accepted assumption that civil society has fallen into a state of dormancy because citizens became disengaged from civic life. A large percentage of citizens are civically unmoored because their lives are economically precarious. Institutional supports once extended by government and nonprofits have fallen away. Consistent with the neoliberal project, the social contract between citizens and the state has been progressively rolled back and citizens experience fewer social welfare supports. The result is a growing segment of population disengaged from social and political systems, caught in an ongoing struggle to survive, and more distrustful of government than past generations.

How might nonprofits renew their connection with their publics and facilitate their political engagement? Civil society activism has come to life in nearly every corner of the globe in response to the loss of government support for citizens’ rights and the precariousness of labor. Across Europe, the Middle East and even China there has been a surge of citizen activism in response to the de-legitimation of political institutions, the distortion of government purposes in support of elites, and labor market de-regulation (Della Porta 2017). In contrast to what many would fear when the disaffected take to the streets, these protests have been “massive, peaceful, innovative, and even successful” (Della Porta 2017, p. 292). In the US, a chorus of dissent is slowing gaining strength. The Occupy Wall Street movement that began nearly a decade ago and gained a foothold in several major cities across the nation marked a response to social and economic inequality. The Women’s March of 2017 and the size of the turnout indicated widespread support for legislation to address a host of issues. In the wake of the Trump presidency and growing awareness that legislation does not reflect the interests of the governed, activism is gaining traction. Grassroots and national organizations are drawing attention to issues of immigration, health care, and the need for racial equality, workers’ rights, LGTBQ rights, environmental protection, and reproductive rights.

Nonprofit leaders have an opportunity to seize this critical moment to enhance their role as catalysts for stronger publics. Civil society institutions need to work in collaboratives, and with local governments to articulate how they can draw citizens and their voices back into the policy dialogue. Democracy depends on it.

Corresponding author: Jennifer Alexander, Public Administration, University of Texas at San Antonio, 501 W. Cesar E Chavez Blvd, San Antonio, TX, 78249-1644, USA, E-mail:


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Received: 2020-03-18
Accepted: 2020-09-16
Published Online: 2020-10-07

© 2020 Jennifer Alexander and Kandyce Fernandez, published by De Gruyter, Berlin/Boston

This work is licensed under the Creative Commons Attribution 4.0 International License.