A Conversation with The American Prospect’s Robert Kuttner (Part 2 of 2)

Robert Kuttner co-founded The American Prospect, a flagship publication of the progressive left, almost 35 years ago. Currently a co-editor of the magazine, he is also a professor at Brandeis University’s Heller School for Social Policy and Management.

Kuttner was a longtime columnist for BusinessWeek and writes columns for The New York Times’ international edition. He also co-founded the Economic Policy Institute and serves on its board. He has authored 13 books, the most-recent one of which is 2022’s Going Big: FDR’s Legacy, Biden’s New Deal, and the Struggle to Save Democracy.

A forthright, insightful, and historically informed article about philanthropy that Kuttner wrote for the August American Prospect, “The Left’s Fragile Foundations,” caught our attention. Beginning the more than 5,600-word piece, he notes that “[t]he great social justice movements of the mid-20th century were all built on self-funding and direct organizing, often at heroic personal risk,” and he then describes some of those movements. “[T]oday’s progressive infrastructure is heavily dependent on foundations,” he writes, then also describes that infrastructure.

August 2024 Issue

“Progressive electoral machinery,” according to Kuttner’s description, “has become reliant on a model that uses two categories of tax-exempt nonprofits—501(c)(3) and closely connected 501(c)(4) groups—to target, register, and mobilize voters.” While advantageous, “using tax-exempt political organizations is also risky, because the IRS has never clarified just what (c)(3) and (c)(4) groups, which are supposed to be charities, may legally do in politics,” he continues. “That makes the model a potential sitting duck for a Trumpified, weaponized IRS, which in turn could intimidate foundation funding for progressive groups generally.

“The only effective defense is for progressive to go back to our roots,” Kuttner later writes in the article—citing Theda Skocpol’s 2013 Diminished Democracy: From Membership to Management in American Civic Life, which laments the professionalization of voluntarily arisen, usually nonprofit organizations in civil society. Consistent with Skocpol’s critique other progressives’ more-recent calls, he urges a return to genuinely participatory, grassroots-organizing, membership-based and -funded groups and movements.

Kuttner was kind enough to join the two of us for a recorded conversation earlier this month. During the first part of our discussion, which is here, we talk about his article; philanthropy and politics in general, including funding of voter-registration projects in particular; and liberal and conservative grantmaking, including in the wake of populism’s ascendance.

The just more than 15-and-a-half-minute video below is the second part, in which we discuss donor-advised funds (DAFs) and the challenges of, and prospects for, potential reform of the laws and regulations structuring the nonprofit sector more generally.

With DAFs and the money donated to them, “[a]s I understand it, you can find loopholes to avoid giving away a lot of it,” Kuttner tells us. “So that’s an area where it seems to me there ought to be a common concern among progressives, among conservatives, that this is not abused.” Another problem is that DAFs “are increasingly big business for Wall Street,” he adds. There “used to be a few freelancers who were good at advising wealthy people on where to put their money. Now, this has become a new profit center” for the big money-management firms.

Talking about the prospects for potential future charity reform of any type, according to Kuttner, “if you have well-meaning people who want to have fair ground rules, you got one sort of reform. If you have Trump weaponizing the IRS, then it’s just open season on liberal foundations, liberal think tanks. So, you know, there’s reform and then again, there’s reform.”

Overall, he concludes,

I think the pushback against donor-advised funds is a very good thing, and I think maybe we can get some convergence on that. And I think in principle, although the devil is in the details, it’s possible to get some convergence on what sort of voter registration is legitimately nonpartisan—but when you get into the weeds, it gets really tricky.

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This article first appeared in the Giving Review on October 16, 2024.

Source: https://capitalresearch.org/article/a-conversation-with-the-american-prospects-robert-kuttner-part-2-of-2/