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Foundation monopoly

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By Todd Cohen

Foundations are restraining charitable trade.

Masquerading as change-agents, many foundations slow social progress by practicing philanthropic redlining.

They tout their commitment to boosting openness, innovation and collaboration.

But they screen out nonprofits that do not conform to their inbred, narrow and philanthropically correct doctrines about the right way to fix what is wrong.

They also preach about the need to strengthen nonprofit capacity, but will not provide the operating funds nonprofits actually need.

Smitten by the wealth they control, foundations act as if they also control the market on wisdom.

They fail to see that nonprofits working and competing in the marketplace can be the best source of creative ideas and social change.

Tackling the crushing problems in our society depends on freeing nonprofits to make choices and take risks to operate more effectively, deliver better services and push for policy change.

More productive nonprofit enterprise will flow from a charitable marketplace that encourages open and even-handed competition for funds, know-how and volunteers.

Foundations can foster that competition by providing more operating support, and rewarding nonprofits that offer the best ideas for improving and measuring their operations, programs and advocacy.

By letting the marketplace work, foundations can unleash change.


Todd Cohen is the Editor and Publisher of the Philanthropy Journal.

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