Uncharitable: How Restraints on Nonprofits Undermine Their Potential

by Dan Pallotta

Overview

Uncharitable goes where no other book on the nonprofit sector has dared to tread. Author Dan Pallotta argues that society's nonprofit ethic acts as a strict regulatory mechanism on the natural economic law and creates an economic apartheid that denies the nonprofit sector critical tools and permissions that the for-profit sector is allowed to use without restraint. In this provocative, timely, and accessible book Pallotta declares our independence from these obsolete ideas, so we can dramatically accelerate progress on the most urgent social issues of our time.

Product Details

ISBN-13:	9781584659556
Publisher:	University Press of New England
Publication date:	07/13/2010
Series:	Civil Society: Historical and Contemporary Perspectives Series
Edition description:	New Edition
Pages:	336
Product dimensions:	6.00(w) x 8.90(h) x 0.90(d)

About the Author

Dan Pallotta founded Pallotta Team-Works, the company that invented the AIDS Rides and Breast Cancer Three-Day events, which raised over half a billion dollars and netted $305 million in nine years--more money, raised more quickly, for these causes than any known private event operation in history. The company had more than three hundred and fifty full-time employees in sixteen US offices, was the subject of a Harvard Business School case study, and fundamentally reinvented the paradigm for special event fundraising in America.

Table of Contents

Introduction xi

Chapter 1 The Morality of Outcomes 1

Nonprofit Ideology 3

A Model of Christian Charity 16

Conclusion 32

Chapter 2 The Foundations of Our Misconstruction 35

Economic Apartheid 35

The First Error-Constraints on Compensation: Charity and Self-Deprivation Are Not the Same Thing 47

The Second Error-Prohibition on Risk: Punishing Courage, Rewarding Timidity 78

The Third Error-Discouragement of Long-Term Vision: The Need for Immediate Gratification Institutionalizes Suffering 90

The Fourth Error-Discouragement of Paid Advertising: If You Don't Advertise Here, Your Competition Will 96

The Fifth Error-Prohibition on Investment Return: The Limits of No Return, and a Stock Market for Charity 116

Conclusion 125

Chapter 3 Stop Asking This Question 128

Efficiency Measures-The Puritan Guard 128

Efficiency Measures Miss the Point 138

Efficiency Measures Don't Measure Efficiency 142

Efficiency Measures Are Unjust 149

Overhead Is a Fiction 162

Summary 168

New Questions and a Very Large Assessment Apparatus 170

Chapter 4 Courage 177

A Cold World? 178

Strategic Plan 181

Reclaiming Our Dreams 183

Acknowledgments 187

Case Study-Pallotta Team Works 189

Methods and Controversy 197

Collapse of the Company 216

Impact on Organizations' AIDS and Breast Cancer Fundraising 221

Notes 229

Bibliography 271

Index 305

What People are Saying About This

Derek Bok

“Dan Pallotta has written the clearest and most articulate critique I have read of the system of values that our charities and other nonprofit organizations are supposed to follow. He explains in graphic detail how these values undercut what charities are trying to do and prevent them from accomplishing all that they might. Not everyone may agree with his position, but the nonprofit world will surely benefit from a vigorous discussion of his arguments.”

Dr. David Ho

"What scales would our nonprofit organizations have to achieve to eradicate the great social problems that confront us, and how do our traditions and beliefs about charity stand in their way? Dan Pallotta has elevated the questions we need to be asking. His book provocatively challenges traditional views of how charities should operate and provides a thought-provoking alternative."
— Dr. David Ho, Time Magazine Man of the Year, 1996, Director, Aaron Diamond AIDS Research Center

Editorial Reviews

"Pallotta has written the clearest and most articulate critique I have read of the system of values that our charities and other nonprofit organizations are supposed to follow. He explains in graphic detail how these values undercut what charities are trying to do and prevent them from accomplishing all that they might. Not everyone may agree with his position, but the nonprofit world will surely benefit from a vigorous discussion of his arguments." --Derek Bok, former president of Harvard University

"Pallotta produces quite a lot of both data and logic. If you do not first analyze a fundraiser's results, how is it possible to judge whether what it spent was justified? He also makes a convincing case for charities to spend far more on advertising, perhaps even selling shares to pay for it. If this makes you queasy, read Mr. Pallotta's book. As he says, 'To mount a campaign to convert 6 billion people to love--which is essentially the role of charity--takes a lot of money. . . . . Raise the capital to promote the idea by offering a return on investment, hire the best people to manage the effort, and run the advertising to spread the word. You beat capitalism at its own game.'"-- "The Economist"

"Pallotta turns on its head the assumption that charity and capitalism should be forever divided. Don't charitable causes deserve the same kind of competitive forces that work to get results in the for-profit sector? Wouldn't social causes be better served if charitable organizations were headed by the kind of bright, aggressive executives that work in the for-profit sector? Pallotta traces the history of nonprofit organizations to Puritan notions of charity and self-denial. He also offers a detailed case study of TeamWorks and other trends in the nonprofit sector that only tweak around the edges of a system that is sorely in need of change if it is to deliver on its mission to improve social inequities or cure diseases. A passionate, thought-provoking look at the nonprofit sector."-- "Booklist"

"Philanthropists and charity execs should read [Uncharitable] to ponder, if judiciously, its lessons."-- "Boston Globe"

"This tome is big-time out-of-the-box thinking that will cause ripples. Yet if you care about charity, it is a must read. While I don't want to lose the volunteer passion and compassion in charitable work, it's high time we confront the fact that, for the most part, this is no longer a bake sale."-- "In Los Angeles Magazine"

"What scales would our nonprofit organizations have to achieve to eradicate the great social problems that confront us, and how do our traditions and beliefs about charity stand in their way? Pallotta has elevated the questions we need to be asking. His book provocatively challenges traditional views of how charities should operate and provides a thought-provoking alternative."--Dr. David Ho, Time magazine's 1996 Man of the Year and director of the Aaron Diamond AIDS Research Center

"Everyone who cares about nonprofit organizations and their potential accomplishments--from journalists to sophisticated donors to foundation officials--should read this book. They'll surely be convinced that fundraising ratios and program expense ratios are a silly, useless, and even fraudulent way to compare "efficiency" across nonprofit organizations."

-- "Stanford Social Innovation Review"

From the Publisher

Pallotta turns on its head the assumption that charity and capitalism should be forever divided. Don't charitable causes deserve the same kind of competitive forces that work to get results in the for-profit sector? Wouldn't social causes be better served if charitable organizations were headed by the kind of bright, aggressive executives that work in the for-profit sector? Pallotta traces the history of nonprofit organizations to Puritan notions of charity and self-denial. He also offers a detailed case study of TeamWorks and other trends in the nonprofit sector that only tweak around the edges of a system that is sorely in need of change if it is to deliver on its mission to improve social inequities or cure diseases. A passionate, thought-provoking look at the nonprofit sector.

Booklist

Philanthropists and charity execs should read [Uncharitable] to ponder, if judiciously, its lessons.

Boston Globe

What scales would our nonprofit organizations have to achieve to eradicate the great social problems that confront us, and how do our traditions and beliefs about charity stand in their way? Pallotta has elevated the questions we need to be asking. His book provocatively challenges traditional views of how charities should operate and provides a thought-provoking alternative.

Dr. David Ho

Pallotta has written the clearest and most articulate critique I have read of the system of values that our charities and other nonprofit organizations are supposed to follow. He explains in graphic detail how these values undercut what charities are trying to do and prevent them from accomplishing all that they might. Not everyone may agree with his position, but the nonprofit world will surely benefit from a vigorous discussion of his arguments.” 

Derek Bok

This tome is big-time out-of-the-box thinking that will cause ripples. Yet if you care about charity, it is a must read. While I don’t want to lose the volunteer passion and compassion in charitable work, it’s high time we confront the fact that, for the most part, this is no longer a bake sale.

In Los Angeles Magazine

Everyone who cares about nonprofit organizations and their potential accomplishments—from journalists to sophisticated donors to foundation officials—should read this book. They’ll surely be convinced that fundraising ratios and program expense ratios are a silly, useless, and even fraudulent way to compare “efficiency” across nonprofit organizations.”

Stanford Social Innovation Review

Pallotta produces quite a lot of both data and logic. If you do not first analyze a fundraiser’s results, how is it possible to judge whether what it spent was justified? He also makes a convincing case for charities to spend far more on advertising, perhaps even selling shares to pay for it. If this makes you queasy, read Mr. Pallotta’s book. As he says, ‘To mount a campaign to convert 6 billion people to love—which is essentially the role of charity—takes a lot of money. . . . . Raise the capital to promote the idea by offering a return on investment, hire the best people to manage the effort, and run the advertising to spread the word. You beat capitalism at its own game.’

The Economist