The Third Sector (Foundations) as a Protective Layer for Capitalism

Those who wish to promote change should look closely at what sustains the present system....Some may see a galaxy of organizations doing good works -- a million points of light -- but the nonprofit world is also a system of power which is exercised in the interest of the corporate world.

In what way does this sector serve as a protective layer?

First of all, non-profits play an important role in the concentration and distribution of capital for the profit-making sector....Second, nonprofits provide goods and services that the market cannot...Yet another protective function is employment for sons and daughters of the rich who might otherwise be unemployed and disaffected, along with those of any class who are dissident and troublesome...The nongovernmental and nonpartisan status of these organizations generates a halo of altruism and independence... They contribute to amusement, to placation of artists, to biochemical research, and to routine charity, but perhaps their most interesting endeavors are in directing social reform....John D. Rockefeller decided "to establish one great foundation...which would finance any and all of the other benevolent organizations, and thus necessarily subject them to its general supervision."

http://www.namebase.org/roelofs.html

me how this applies to the small non-profit that provides day activity services to my developmentally disabled daughter. Is this article referring to large nps or to all nps. For profit services for her would be very expensive.

is the actual answer.

A real society of people working together, not charity from the captains of industry who steal from the working classes and give us back 10% of what was stolen in the form of charity.

The "free market" doesn't provide healthcare for all, let alone dd services. They're not "profitable" unless the gov't taxes everyone to pay providers (which they do, to a certain extent).

Thus, non-profits cover the market failure in the guise of "charity". But since they're run with private dollars, they're less accountable than gov't.

That doesn't mean some don't do good, needed work. It just means the system as a whole works to damp down market failure, fog accountability, & support the status quo.

The fortunes that go into the Gates fund, or any of these funds started by successful robber barons in the latter part of their careers, are not actually "given away." That's how the press covers it, every time, but it's untrue. They are investment vehicles like a hedge fund, but without the bad reputation. The Happy Family Charitable Foundation is free to have its endowment invested in the Halliburton Killcorp. The idea is for the endowment to grow from year to year. Whatever is then "given away" (in the fashion you describe: as a way of controlling reform movements and social policy) is supposed to be regenerated from the growth of the endowment. And by capitalist ethics it's downright irresponsible not to always go for the highest return!

In reality, these are vehicles of diversification, often of off-shoring. The money that goes into them is rescued from estate taxes (which were only recently repealed and probably will be brought back one day to quell populist upheavals, with the support of the Gates and Buffett families). The fortune remains under the family's control, albeit as a "non-profit" with certain restrictions -- and relative freedom from scrutiny or criticism.

I have been told by a member of one particularly famous robber baron family that the family patriarch doesn't even own his own suit - the foundation owns the suit. But the family controls the foundation.

This is a great unexplored area to academics and the press. You can throw in the holdings of churches and the endowments of the big universities.

ideology...

it free of government supervision since it contracts with gov. to provide the services. I missed the "foundation" part of all this. Here in Minnesota almost all services like this are not run by the government because it is a conflict of interest for government to play the role of provider and overseer. Also we cannot not have government as guardians in order to comply with the same issue of conflict. The government sets the standards, inspects the projects, determines the pay grade but they do not provide the services. I do realize that when a need is covered like this the capitalists can say that it "is working" so we do not have to change anything. Edited to add that it was a bunch of old 60-70s activists that started this center and are still running it today.

For instance my daughter gets her funding mostly through Medicaid programs. She goes there 5 days a week for 6 hours a day. She also gets government funded busing from another non-profit transportation system which was started years ago by the CAP programs with government funding. Much of this is to provide community based care instead of more costly institutional care. The government encouraged the development as an alternative to institutional care. There are also for profit programs that serve this population but they to are inspected and regulated as to cost by the government.

that makes it a gov't program in my book.

http://www.grassrootspeace.org/edrussell/

go to the link, scroll down til you find her name, two mp3's of @ 18 minutes each.