Where’s the beef?: Big projects swallow up all the money

Hey, Nonprofiteer, here’s my beef:

I read (Crain’s Chicago Business, March 16, registration required) that the Chicago Olympics 2016 committee has a corporate sponsorship goal of $1.8 billion.  Isn’t that going to cut into corporate responses to nonprofit funding requests?  Is that going to make things worse for nonprofits than they already are?  I remember hearing a nonprofit Executive Director grousing about how much money was diverted from regular charitable donations to go to [naming opportunities in the city’s new downtown] Millennium Park, and the Tribune recently mentioned the same possibility in connection with the Olympics.

Should I worry about who will pay if the Olympics go over budget?

(This guy sounds a little worried:

http://behindthebid.blogspot.com/2007/03/crains-olympic-challenge.html)

Signed, Bean Counter

Hey, Bean–

You’re asking two separate questions.  Second one first: you shouldn’t worry about who will pay for inevitable Olympic cost overruns, because it’s all settled: you’ll pay, if you’re a Chicago taxpayer.

I think the Olympics are a bad idea on about six different dimensions, but the first one you raise is discussed least often: the tendency of big projects like the Olympics (or, before it, Millennium Park) to sop up huge volumes of corporate and foundation funding, leaving less for ordinary operating nonprofits.  But of course it’s impossible to determine what those funders would have spent on education or health care or social services had a sexier alternative not been available.

Fundraisers for high-profile projects always advance the argument that, as George W. Bush would have it, we “make the pie higher”–that donations to the Olympics constitute additional private money being put at the service of public purposes.  The notion is that glamor projects magically produce the fresh generosity necessary to sustain them.

But if Great Depression II teaches us anything, it’s that private firms actually don’t have limitless sums of money, and that if they put it in one pot (say, credit-default swaps) it’s not available for inclusion in another (say, mortgages).  By the same token, if they put the money into naming the Ronald McDonald Memorial Olympic Village it’s going to be mysteriously missing when the local food pantry comes to call.  And it stands to reason that given the option corporations (and even foundations) will choose to invest in shiny things on which they can engrave their names.

At least in Chicago, the ordinary lack of transparency in philanthropies (“It’s our money; why should we tell you what we’re doing with it?”) is complemented by an equal lack of transparency in government (“It’s your money; why should we tell you what we’re doing with it?”).  So we can only speculate that money spent on circuses will not then be forthcoming for bread.

*******************

Readers: What’s your beef?  What drives you craziest about trying to manage your agency or serve on its Board?  Is it the bully who won’t let anyone else speak?  The budgeting that features revenue everyone knows you won’t get?  E-mail your problems to the Nonprofiteer, subject line “Where’s the beef?” and she’ll solve them for all the world to see.

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4 Responses to “Where’s the beef?: Big projects swallow up all the money”

  1. Yana Davis Says:

    That Chicago attitude, mirrored in some other places in the US, by the way, can be characterized as the difference between Neanderthals and Homo sapiens.

    The Neanderthals come off better, by the way, because scientists now believe that Neanderthals hunted cooperatively while Homo sapiens – with more flexible arm motion and better weapons – tended to hunt in pairs or alone.

    Bottom line, Neanderthals probably would have been better – and more transparent – philanthropists than we’ve turned out to be. Who knew?

  2. Jim Simpson Says:

    Money for people in need shouldn’t be the focus of subjective discussion by athletic event holders. Until the revenue stream for people focused non-profits has a predictable mid point that covers the basic overhead which is not dependent upon the successful chase of gifts and grants, and un-predictable corporate, government and investment vagaries, taking care of people won’t be the legitimate claim of people focused non-profits.

    • Nonprofiteer Says:

      I’m not sure how we create a predictable revenue stream for nonprofits without making them entirely dependent on client payments; but you’re correct that funding for human services shouldn’t be dependent on whether there’s cash left over from athletic contests. Money from the government is not often predictable, but if all of us in the nonprofit sector devote efforts to making sure stimulus-package money flows through our hands, we’ll help ourselves, our clients and the general economy.

  3. Newstips v2.0 » Blog Archive » Olympic giving Says:

    […] Nonprofiteer has a full discussion. […]

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