Participatory Funding as Philanthropic Model
Description
Ownership Matters:
"To do the most good, you’ll have to give up control.
Partly inspired by the example of the Boston Ujima Project, Ben Wrobel (Village Capital) and Meg Massey explain that the key term here is participatory funding (or PF) — the idea that the best way for donors and funders to impact the lives of a community or a neighborhood is to turn over financial decision-making power to the people who live there.
The authors believe we need to do two things at the same time: reform philanthropy and rebuild democracy. One of the tools which is somewhat interchangeable between these two goals is that of participatory budgeting, a civic mechanism invented in Porto Alegre, Brazil, in the 1980s and utilized today in more than 7,000 municipalities today (including New York City and Chicago).
Some key points:
- Philanthropy plays such a large role in public affairs because public institutions around the world today are failing to meet basic needs.
- The style of philanthropy most commonly found today is "market-based," whereby foundations are run on principles of commercial business. (A popular variation: "moneyball philanthropy" (borrowing from the book about winning baseball teams) that claims donations should go to the organizations with the best-looking empirical data.
- The vast majority of impact funds (in an impact investing market soon approaching $1 trillion) have operating models that closely mimic those of traditional investment firms, which are notoriously insular, secretive, and unaccountable to anyone besides shareholders.
- The slogan of the disability rights movement — "nothing about us without us" — has become a rallying cry for greater participation everywhere."
(OM #17)
Characteristics
Ownership Matters:
- "PF shifts decision-making power to people with lived experience of the problem at hand. . . . The funder gives a voice to people who don’t usually get a say in the decision, voluntarily letting go of power in the process.
- The inside argument for PF: shifting decision-making power will result in better decisions, tapping into lived experience and perspectives beyond the ivory tower. (In other words, an argument for efficacy.)
- The outside argument for PF: the moral and ethical obligations that come with a commitment to justice dictate this kind of approach. (In other words, an argument for equity.)"
(OM #17)