We are fortunate to live in a country where many of our citizenry are willing to donate their time and money to help fight the incredible social problems we face. Indeed, our willingness as a people to contribute of our time and money has become a fundamental part of our national character, and it has contributed to the rise of a robust third or nonprofit sector in the United States.
In my interactions with government and nonprofit leaders from around the globe, I have come to realize that our belief that the average person can make a difference is not unique. However, I do believe the degree to which we believe it far exceeds our international counterparts. It reminds of something that the former U.S. Ambassador to the Russian Federation Alexander Vershbow articulated while trying to explain why our nonprofit sector is so strong during a speech in Moscow. He said:
Americans believe very strongly that individuals can change society through their own efforts. And they understand that individuals working together to further a common goal can make even bigger changes than by working alone. These beliefs, born perhaps of our unique historical experiences, are not of recent advent. The nineteenth century Frenchman Alexis de Tocqueville, who visited and reported on American society, wrote “Americans of all ages, all stations of life and all types of dispositions are forever forming associations. In democratic countries, knowledge of how to combine is the mother of all other forms of knowledge; on its progress depends that of all the others.”
The United States support of charitable organizations remains unsurpassed. In 2008, Americans collectively gave more than $307 billion to charities representing the equivalent of 2.2% of the gross domestic product. This percent of gross domestic product more than doubles the next two highest nations in terms of charitable giving, the United Kingdom and Canada, which gave only 0.73% and 0.72% respectively.
Americans are donating their time as well. In 2008, more than 26% of adult Americans volunteered in their local communities. As the Independent Sector notes:
The power of the charitable community grows from its ability to bring together people who share a commitment to improving lives. They select the charitable community to make those changes because it offers the freedom to experiment with new ideas, to respond to needs without delay,…and to encourage all efforts, both large and small, that will improve the quality of life for people across the country….
The ability to utilize volunteers is an incredible asset to the nonprofit sector. It serves to reduce operational costs and provides opportunities for nonprofits to leverage relationships in their communities.
All of these factors have contributed to the unprecedented expansion of the nonprofit sector itself. Annually, the number of 501(c)3 organizations grows by 1% to 5% resulting in more than 1 million nonprofits currently registered in the U.S. today. It is estimated that an additional 300,000 or more operating charities have not registered. The vast majority of these nonprofits are locally based. Though many of us can easily name national charities such as the American Red Cross, Salvation Army, or United Way, according to the Idependent Sector only “four percent of all charitable organizations have annual budgets of more than $10 million. Most are small, with nearly three quarters operating with budgets of less than $500,000.”
Regardless of their size or budget, these small charities are making a fiscal impact. Not too long ago, the World Bank examined the return on investment local charities were providing in the Washington, DC metropolitan area. They found that organizations like the Manna Food Center in Montgomery County could leverage every dollar it received in cash donations into $5 worth of food through food donations and distribution. Another organization, Stop Child Abuse Now in Northern Virginia, recruited volunteers to serve as court appointed special advocates for nearly 200 children annually, saving the state government more than $400,000 in attorney’s fees. Additionally, each year the Independent Sector designates a monetary rate for a volunteer’s time. While clearly the value of a volunteer exceeds any dollar figure that can be assigned, the 2008 dollar per hour rate is $20.25. If a volunteer were to spend two hours each week mentoring a child or working in a soup kitchen through one of these local organizations, the dollar value of that one volunteer’s time over the course of a year is more than $2,100. These same types of savings can be found in almost every community in the United States.
Community-based organizations are able to utilize voluntary initiative and community donations to tackle problems that the government is unable to adequately address on its own and do it for less money. So as you look to donate or voluteer, don’t count out the little guys.