Productive Justice

Posted on by Ed Whitfield

The need for productive justice is largely the result of inequitable systems of distribution and unfair structures of ownership that allow a shrinking group of the élite to accumulate socially produced and socially needed production resources in their hands.

  • Productive justice is having equitable access to productive opportunities.
  • Productive justice means not having to beg someone for a job.
  • Productive justice means not having to beg for land to grow food on.
  • Productive justice means being able to provide for yourself and your loved ones—the very young, the old, the infirmed, and the caretakers—with your labor which produces for all.
  • Productive justice means enjoying the dignity that comes from being a productive and needed part of society.
  • Productive justice means being a role model and teacher to the young who follow.
  • Productive justice means being an independent political thinker and actor, unfettered by fear of displeasing elites on whom you might otherwise depend upon.

Productive justice is needed because the current system means that the control of who is or is not allowed to be productive is in the hands of a small group of people.

This small group has enormous power that derives from this control.

This power is literally power over the life and death of others.

This power robs other people not only of their produce but also of their dignity.

By determining who has access to opportunities, spaces and resources needed to be productive, these owning elite control the actions, direction and rules of the whole community.

They use this power to increase their power and wealth.

This system of the few controlling the many has gotten worse, despite all the talk about democracy.

With the elites controlling even what are the choices put before us, it matters little how we chose.

We need to work in the cracks and fissures of the existing structure to expand and broadly/openly distribute productive opportunities while still looking for ways to undo the historical patterns of power and distribution that have resulted in current inequities.

Engaging the public in budget-making processes

Posted on by Fund for Democratic Committes
Participatory Budgeting Project
Participatory Budgeting Project
Participatory Budgeting Project

In over 1,200 cities, towns and municipalities around the world the public is actively engaged in local budget-making processes. Under the banner of “participatory budgeting”, citizens from South America to the United Kingdom and Toronto to Chicago are creating new methods for financial decision-making in their communities.

These efforts are producing amazing results! Chicago’s Ward 49 is in its second participatory budgeting cycle. Last year’s effort was so successful more Chicago city council members and candidates are planning to launch similar projects in their districts. Politicians from across the political spectrum are finding common ground through the fairly old fashioned notion that the people ought to exercise more direct control over the decisions of their government.

The Fund for Democratic Communities is excited to bring two people who are deeply involved in developing participatory budgeting to Greensboro. Josh Lerner is Co-Director of The Participatory Budget Project, a nonprofit offering support, resources, and guidance to local groups and elected officials organizing participatory budgeting efforts in their communities. Maria Hadden is a resident of Chicago’s 49th Ward and a member of its Participatory Budgeting Leadership Committee.

On May 4th they will present a history of participatory budgeting around the world with an emphasis on the United States. Then, on May 5th, they will lead a discussion for people involved with local nonprofits and grassroots community groups on how to integrate participatory budgeting into their funding cycles. See below for the full event announcements.

We expect these will be exciting, educational presentations and discussions and we hope you will consider coming to one or both of these events. No RSVP is necessary, but if you would like to connect with other folks in Greensboro interested in this, check out the Facebook events page for both events (linked below). Feel free to invite your Facebook friends who may be interested too!

For more information, contact me at pbproject [at] f4dc.org.

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Our Money, Our City: Presentation and Discussion on Participatory Budgeting

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Wednesday, May 4 · 5:30pm – 7:30pm
Nussbaum Room, Central Library
219 North Church Street, Greensboro, NC (map)

Cities across the United States face tighter funding environments and deeper budget cuts, and Greensboro is no different. In over 1,000 cities around the world, residents are trying a different way to manage public money. Through “participatory budgeting” they are directly deciding how to spend public budget funds. Chicago’s Ward 49 recently launched the first participatory budgeting process in the US, for its $1.3 million ward budget. Other US cities are beginning to incorporate similar efforts into their budgeting processes.

Josh Lerner is Co-Director of The Participatory Budget Project, a nonprofit offering support, resources, and guidance to local groups and elected officials organizing participatory budgeting efforts in their communities. Maria Hadden is a resident of Chicago’s 49th Ward and a member of its Participatory Budgeting Leadership Committee. They will present a history of participatory budgeting and discuss how Greensboro residents might initiate a similar project here.

This event is free and open to the public. Light refreshments will be served.

Co-Sponsored by: The Fund for Democratic Communities and the Greensboro Public Library

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Using Participatory Budgeting to Engage More People in the Success of your Organization

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Thursday, May 5 · 4:00pm – 6:00pm
Gateway Center Conference Room (Third Floor)
620 S. Elm Street, Greensboro, NC (map)

The economic reality faced by the nonprofit sector today may be the most difficult in decades. As funding sources erode, nonprofit directors and fund developers need to build stronger relationships with existing donors and the communities they work within. A new tool called “participatory budgeting” could help. In over 1,000 cities around the world, organizations have used it to attract more resources and support for their activities. Participatory budgeting engages community members in directly deciding how to spend budget money in cities, schools, housing authorities, and organizations. Residents of Chicago’s 49th Ward recently launched the first participatory budget process in the United States.

Josh Lerner is Co-Director of The Participatory Budget Project, a nonprofit offering support, resources, and guidance to local groups and elected officials organizing participatory budgeting efforts in their communities. Maria Hadden is a resident of Chicago’s 49th Ward and a member of its Participatory Budgeting Leadership Committee. They will discuss ways to use participatory budgeting to build community trust in your organization, stabilize your funding, and engage more people in your mission.

This event is free and open to anyone with a stake in a local nonprofit.

Southern Grassroots Economies Project

Posted on by Ed Whitfield

The first meeting of the Southern Grassroots Economies Project took place this weekend, March 18-20,  at the historic Highlander Research and Education Center and it was a great success. There will be much more information posted here in the coming weeks, but for now we want to say how good we feel about the 30+ representatives from organizations from across much of the South from Texas to Georgia and as far north as Kentucky who came together to consider the importance of developing cooperative economics as a part of their social justice work. A temporary steering committee has been formed and will have its first conference call in a week to begin to plan for additional activities to strengthen this part of the movement in the South. As Niqua, a youth member of a worker owned co-operative lawn care business in Atlanta organized by Project South, said on the last of day of the meeting, “I feel like we are a part of history now.”

BlueGreen Conference Report

Posted on by Ed Whitfield

Good Jobs are Green Jobs

The recent Blue-Green Alliance Conference drew nearly 2,000 people to Washington, DC February 8-10 to hear a number of panels and participate in workshops on the growing relationship between organized labor and the environmental movement. In an effort to undo the friction that had been felt between these two movements—each feeling that the other was not concerned about its core values— labor leaders, rank and file union members, environmentalists and other community members met together for two days before turning their attention on the third day to lobbying congressional lawmakers to push forward an agenda that upholds both creating good jobs and promoting a clean environment. The BlueGreen Alliance was formed five years ago when leaders of the United Steel Worker’s Union and the Sierra Club got together to find ways of furthering both their interests. Since that time, the Alliance has grown to include “more than 14 million members and supporters in pursuit of good jobs, a clean environment and a green economy.”

The conference had many more workshops than anyone could attend. I was interested in learning more about the state of development of businesses dealing with manufacturing for wind power development, where things stand with worker involvement in management, and issues concerning education and communities that are typically excluded from economic development, so I focused my time in those areas. In this and subsequent blog posts, I’ll cover each of these topics. First: Wind power.

Wind Turbines

I learned at the conference that there are 12 manufacturers in North Carolina actively engaged in manufacturing parts used in wind turbines. They specifically make some of the hundreds of parts used in the nacelle (the hub, generator and control portion) of high-powered wind power turbine installations. Large, precision-machined castings (similar to those used in the production of heavy transportation, shipbuilding or mining equipment) are used in the structures, where the relatively slow but powerful rotation of wind turbine blades is converted to the higher speed rotation needed for electricity production. Companies experienced in large-scale precision metalworking have opportunities for new markets in wind turbine production as part of the supply chain providing parts and equipment from local sources for the sometimes international companies that are the world leaders of wind turbine production.

Off Shore Wind

There are plans being developed to install a series of wind turbines just off shore along the east coast, to catch the stronger and more consistent winds that blow near the coastline. North Carolina does not otherwise have much potential for electric production from wind, since the average wind levels on land in this state would not support the use of wind power. This has not prevented a few North Carolina firms from being involved in manufacturing for other areas of the country, such as the Midwest, where there are much higher sustained winds. Given the extent of the transportation means that are available, large equipment made here can reasonably be transported by road or rail to the other states. North Carolina’s proximity to the Tidewater area of Virginia is also providential in terms of future economic development here. The shipbuilding industry in southern Virginia, not far from the North Carolina border, is well suited for some of the large-scale production that will be needed.

 

Developing our socially responsible investment policy

Posted on by Fund for Democratic Committes
Wise Investments (Design: PJ)
Wise Investments (Design: PJ Chmiel)
Design: PJ Chmiel

From a social justice “purist” standpoint, there is only one stance toward investing in stocks and bonds and other capitalist instruments: don’t do it. That approach might appeal to folks who like to claim that they haven’t sullied themselves with capitalism, though I don’t think it’s an honest claim. It’s just not possible to live in the United States and stand free of the economic system in which we all live. Have a job? Buy food? Pay rent or a mortgage? Sell stuff to make your living? These activities are not intrinsically capitalist, but the ways these activities work here and now in the United States tie them into the larger capitalist economic system. That’s one of the features of capitalism—it’s constantly growing and to feed itself, it sucks in ever more of what used to be held by individuals or families or held in the commons. So good luck standing clear of it.

Don’t get me wrong, I’m an anti-capitalist, and F4DC operates from an anti-capitalist stance. We think humans can—and must, for our very survival—do better than capitalism. That’s why we’re part of a growing movement focused on developing a new kind of economy to replace capitalism: one where people and planet come before profits. Where the rewards of productivity go to the people who do the work. Where communities are enriched, not stripped, by businesses that are rooted in place. An economy built on the principles of cooperation, sustainability and solidarity, not competition, short-term gains and exploitation. We’d like to see this new economy become real in our lifetimes, so we’re devoting a good deal of time and other resources to various economic development efforts.

One part of this work is to recognize the importance of solidarity, so even if it were possible for some of us to stand completely clear of capitalism, I wouldn’t generally want to be the first to opt out—unless, working with others, I found something that was inspiring, scalable and replicable. Some kind of economic base that was available to significant numbers of people, across all kinds of communities. This is in contrast to a more individualistic effort to personally avoid being tainted by capitalism’s ugly features. That individual approach just doesn’t have much effect on many people’s lives in a system as big and durable as this one.

The other thing that’s relevant here is our history: F4DC came into being through a loving bequest from my dad (see that story here). Our financial resources originate in a wide range of investments Hayden Thompson made in companies and ventures, all of which were thoroughly situated in capitalism. So we’re in it up to our eyeballs anyway.

F4DC wouldn’t exist if it weren’t for this history and this money. Without it, Ed and I would have figured out some other way to work on grassroots democracy, ending capitalism, and all the other projects that are inspired by our mission. But right now, we have the daily dilemma of what to do with this money. Everyday we wonder, “Is it possible to use money to build grassroots democracy that makes communities better places to live?” We think we’re figuring out some ways to do that. That means we are very serious about stewarding this money so that it makes all the difference it can make.

All this is to say that we plan to strategically invest F4DC’s financial resources into the stock market and other garden-variety capitalist investment instruments. That means investments in corporations for the most part. We’re doing it because we’re looking for some kind of return that allows us to extend our financial reach with grants and support for social and economic justice organizing.

Since we’re investing in this dicey capitalist enterprise, we have to develop some kind of relationship to it. And that’s why we have an investment policy. We’re not delusional—we don’t think that any investment policy can protect us from the embarrassments and horrors of capitalism. Let’s face it: corporate capitalism invents new embarrassments and horrors all the time, in its pursuit of profit over people and the planet. But we can stand next to our investment decisions with more integrity if we try to be honest about what our bottom line is.

This is our first crack at an investment policy; we expect it to evolve over time. But here it is as of March 14, 2011, on the eve of making our first foray into the world of investing.

  • We’re not purists, but try to avoid the most embarrassing investments:
    • No to companies that are primarily identified with tobacco, defense industries, liquor.
    • Areas to be careful in: mega-banks and financial hocus pocus firms (e.g., most hedge funds).
  • We’re interested in exploring the use of our resources for shareholder activism in support of progressive causes.
  • We should support cool stuff whenever we can. We’re especially interested in:
    • Green energy generation and conservation;
    • More participatory forms of financial services
  • We should take the time to personally review the initial list of proposed investments, to ensure that at least at the start, we aren’t investing in something that is the target of social justice action that we are actively supporting. For example, we are active supporters of the Farm Labor Organizing Committee’s efforts to get Reynolds America to negotiate with farmworkers about working conditions. Chase Manhattan Bank is also being targeted as part of that action (see supportfloc.org/default.aspx). So we wouldn’t want to invest in either Reynolds or Chase.

Grants: Helping local nonprofits strengthen grassroots fundraising

Posted on by Fund for Democratic Committes

In July we announced our new matching grants program, which provides one-to-one matching for dollars raised through grassroots fundraising. The program was slow to catch on at first, but now things are getting interesting. By the end of the year, we expect to make matching grants to nine North Carolina groups, totaling roughly $40,000. Groups from Raleigh, Durham, Asheville, and Greensboro have taken us up on our challenge to build their sustainability and relevance by consciously expanding their fundraising among a broader base of people in the communities in which they work.

Along the way, we’ve learned that the art and science of grassroots fundraising has in many ways been lost, and needs to be redeveloped. To that end, we’ve been holding occasional mini-courses on grassroots fundraising and doing lots of one-on-one consulting.

The Interactive Resource Center (the IRC) and Faith Action International House are two local groups we’re proud to support in this way. The IRC assists people who are homeless, recently homeless, or facing homelessness reconnect with their own lives and with the community at large. Faith Action is all about building a united community of many cultures – engaging native-born Americans, immigrants, and refugees in learning, service, and advocacy for human rights, justice, and equality. What’s interesting about both these groups is the growing role played by the people they serve in getting the work of the organization done and in planning next steps.

Faith Action and the IRC are each working to raise as much money as they can before the year is out. And for each group, we’ve promised to match up to $10,000 of their smaller donations. With the incentive of our matching grants, we’re hoping lots of new supporters surface.

After this batch of grassroots dollars gets raised, the next challenge to Faith Action and the IRC will be to figure out meaningful ways to connect their new-found supporters into the larger missions of their organizations. That’s how you build an organization that’s here for the long haul.

Marnie’s Remarks at the North Carolina Center for Nonprofits Annual Conference

Posted on by Fund for Democratic Committes

The 2010 Annual Conference of the North Carolina Center for Nonprofits was recently held in Raleigh. I was asked to serve on a panel called Foundations and Operating Nonprofits Working Together in a New Reality, to contribute information about F4DC’s approach to various aspects of our grantmaking, given the current economic crisis. Below are the remarks I made in response to two questions I was provided in advance of the event. (Believe me, I don’t speak this coherently off-the-cuff!) I tried to fit in as much as I could within the five minutes I was allotted.

How does our work with nonprofits differ from more mainstream foundations?

Ed and I sort of stumbled into starting a foundation because of the opportunity and responsibility that came from my family circumstances. I don’t think if you’d asked us five years ago what we’d be doing in 2010, either of us would have said, “leading a foundation.” We, and the people we work with most closely, are primarily anchored in the world of social justice activism, not philanthropy. To tell you the truth, we’re kind of suspicious about philanthropy as a social change mechanism, and we wonder a lot about the utility of money in transforming society. So one way I think we’re different is that we bring into all our relationships with nonprofits a whole bunch of questions about our role, as well as their roles.

Have we changed any of our grantmaking strategies because of the economic crisis?

Yes, the economic crisis has led us to change our approach to grantmaking in significant ways.

First, the primary source of F4DC’s funds is my father’s estate. The economic downturn has slowed down the liquidation of that estate, and that’s hurt our cash flow. Like all nonprofits, we’ve confronted some hard decisions. We ultimately decided that in the face of economic hardship, our greatest obligation was to move as much money as we could into the community, in the form of grants. To accomplish that, we cut our overhead drastically. We laid off our staff and experimented with being an all-volunteer organization. After eight months, we realized that wasn’t a sustainable way to operate, so now we’re operating with two part-timers. We’ve dropped from three full-time-equivalents to one full-time equivalent. We also closed our office and now work out of our homes, coffee shops, and the public library (a bastion of grassroots democracy!). These changes have allowed us to move up our grantmaking from $50 to $60,000/year to $100,000 this year. We hope to give away closer to $200,000 next year.

Second, we launched a matching grants program that is intended to do two things: 1) leverage every dollar we grant for greater impact, and 2) encourage grassroots groups to build their capacity for self-support. Basically, for projects and organizations that align with our mission, we’ll match dollars raised through grassroots fundraising. Were emphasizing a style of fundraising that was prevalent in the Civil Rights Movement, before there was foundation or major donor money available to that movement. The idea is to focus fundraising right in the communities most affected, because these are the folks that have the greatest stake and know-how in solving their own problems. We’re talking pass-the-hat and spaghetti dinners. Phone ten allies and ask them to each commit ten dollars. Never hold an event or a gathering where you don’t make “the ask,” and make sure that ask is compelling.  These approaches consciously build a group’s base of support and strengthen stakeholders’ level of commitment, building an insurance policy against the day that foundation monies are no longer available.

Third, we see this economic downturn as just one of several deeply disruptive, linked changes that may well portend a level of environmental, economic, and social collapse that will radically alter how we live in the not-too-distant future. Whether we want to change or not, big changes are coming—some of them are here already—due to the intersection of global climate change, peak oil, and the non-sustainable nature of a global, corporate capitalism that has driven the world toward the greatest wealth inequality ever experienced by humanity. This combo sounds scary, because it is. Almost too scary to handle. So what to do?

F4DC’s response to this scary scenario is two-fold. First, we’re more committed than ever to our mission of nurturing grassroots democracy. We’re convening folks to think about what it means to be a citizen in a society that aspires to democracy—surely it is more than voting and paying taxes! And we’re helping the groups we work with to think through what democratic dialogue, decision-making, and action looks like. Being intentional about democracy at the grassroots level prepares communities for collective problem-solving, which is needed as rapid changes descend upon us.

We humans have the capacity to react to scary changes with fear and greed-based responses. We also have the capacity to react with cooperative, reasoned responses. Democracy feeds the latter.

The other thing we’re doing in the face of possible social collapse is exploring ways to nurture sustainable economic development based on cooperative economic models, like those used so successfully in the Basque region of Spain. There, worker-owned coops constitute fully 60% of the employment and have weathered the Spanish economic crisis far better than traditional corporate models.

Closer to home, one of our recent grantees, the North Carolina Housing Coalition, is launching a program of cooperative land ownership for families living in mobile home communities. We’re also partnering with Project South in Atlanta and Highlander Research and Education Center in New Market, Tennessee on an effort we call the Southern Grassroots Economies Project.

We’re looking for ways to nurture what some have called the “Solidarity Economy,” all across the Southeast. Through education, networking, and policy changes, we’re hoping to expand cooperative ventures in housing, manufacturing, farming, and health care. Our emphasis is on the producer side, not so much on the consumer side, because as the old economy collapses and jobs get scarce, people are often denied ways to be productive. Think of all the hardworking students who graduate, and then are unable to find jobs. Think of all the people my age who are experiencing years of unemployment despite looking daily for work. Think of the growing number of prisons, where we warehouse more people every year, particularly men and people of color, locked away from any chance of being useful to themselves, their families, or communities.

People long to be productive, to be useful—it seems to be part of our human makeup. So let’s start to build a new economy where that urge to create, to make, to be part of the solution, is taken as the premise. That’s what the Southern Grassroots Economies Project is all about.

Fundraising as community building

Posted on by Fund for Democratic Committes

Like many people involved in work with nonprofits, community groups, and other grassroots organizing efforts, I do not look forward to fundraising efforts. Asking people for money – even when I believe passionately in the cause – is often times a painful exercise that leaves me feeling like part of the “problem” I am seeking to solve.

The Fund for Democratic Communities asked me to attend the annual Money for Our Movements conference organized by the Grassroots Institute for Fundraising Training (GIFT) in Oakland, California. Over 500 organizers from around the country gathered at Mills College to discuss funding strategies, trade experience, and learn new skills through a number of excellent workshops.

In one of the sessions I attended, a presenter made the statement that fundraising should be seen as an opportunity not simply to collect money, but as a part of community building. One of the GIFT staff members offered that it is not up to us as organizers to decide who can and cannot contribute to our causes. Our job is to build sustainable movements by creating a community that interacts with and supports our efforts.

This philosophy of fundraising as community building stands in sharp contrast to the traditional process of fund development, a process that I am increasingly involved in through a number of organizations with which I work. The traditional process of developing a donor list of mailing and email addresses, sending out appeals to segments of that list defined by economic status, and planing a couple of annual events has the ability to raise large amounts of money. It is not, however, a sustainable model. The targeted donors generally do not become involved with the organization beyond activity on the board or the standard “Friends of…” committee. In the case of a human services organization, it is highly unlikely that donors (especially major donors) will ever come into contact with the people the organization serves. In this way, the traditional fundraising process buttresses the current social structure that promotes social and economic stratification and segregation.

A grassroots fundraising effort can do exactly the opposite. It can include both small donors and large donors in a way that is not demeaning or exclusionary to either. By creating a community invested in a project in ways other than financial, it becomes natural for people to contribute money to the effort because, while they may not be accessing the services or projects directly, they feel some measure of substantive involvement.

This differentiation was discussed in a session focusing on the difficult funding environment nonprofits and grassroots organizations are facing now. DataCenter and the National Organizers Alliance presented the findings of their joint study of how organizations are funding themselves during this economic downturn. While funding is becoming more and more difficult to find, organizations are developing creative ways to survive and in some cases may offer models for growth.

What is clear is that the traditional process for fundraising is becoming less reliable than in the past. Organizers must begin to reorient (if they haven’t already done so) themselves to a grassroots, bottom-up funding structure to survive and thrive in the emerging economic condition. Further, these kinds of funding strategies could serve as a method for promoting wide-spread social and economic re-conceptualizing, something in which the Fund for Democratic Communities is also currently engaged.

Visiting the Federation of Southern Cooperatives

Posted on by Ed Whitfield

A trip into Epes, Alabama takes you down some curvy, bumpy roads. But given their history and connections, visiting the training center for the Federation of Southern Cooperatives is a necessary part of looking into grass roots economies in the South. After a phone call where I asked for a few minutes time on their busy schedules to introduce myself and the F4DC project, I was finally able to get permission to come by briefly back in May. It seems that they were in the middle of filing some important reports and submitting proposals to make sure their work could continue. They were also preparing for a training program on the advantages of developing cooperatives and a summer youth sustainable agriculture program. Once I got there, however, the distance and impatience that I had felt on the telephone disappeared and I was warmly received and not rushed through the discussion. Face to face contact remains the most effective way of introducing people and ideas.

The Federation of Southern Cooperatives has been around since 1967. It is a product of the Civil Rights movement and has most recently been involved in struggles for black land retention and against the patterns of racism and discrimination that has up until recently characterized the US Department of Agriculture’s relation to black farmers. The victory in 1999 in the Pigford suite reflects years of effort to redress the grievances of black farmers in the south who were systematically denied loans and other support that white American farmers could take for granted. Unfortunately, the multi-billion dollar settlement has not been fully funded and is tied up in Washington bureaucratic red tape and budgetary complications.

The two people I got to talk to were Pamela Madzima, Forestry Program Assistant and Osagie Idehen, Cooperative Specialist. They told me about the Federations current work with Tuskegee Institute and Alabama A&M University on forestry and goat husbandry as well as work with the Alabama Association of Cooperatives on coop development. They were both excited about F4DC’s planned efforts to look at ways to strengthen grassroots economies in the south. In particular, they felt that if we could together identify sources of conflict on the one hand and the unmet needs of the many economic groups on the other, we could be instrumental in helping southern grassroots economies move forward. We talked specifically of finding overlaps that created intensified competition for scarce resources, as well as gaps in the economic chain that prevented the full development of the synergies needed to push the new economic ventures forward over the declining economies that are causing so much suffering in our communities.

Before I left, I got to go on a brief tour of the Rural Training and Research Center facilities. In addition to the offices, I got to see the dormitory space, classroom space, meeting rooms and the dining facilities. We then went outside to see the garden area and the goats that are to be used in a combination forestry – goat husbandry research to figure out the optimum number of goats that can be raised in wooded timber areas.

I am looking forward to going to Birmingham for the Federation’s award banquet August 19 and then back to Epes for the federation’s annual meeting August 20 and 21.

Mid-Year Update on F4DC’s Finances

Posted on by Fund for Democratic Committes

Like the rest of the world, F4DC has been affected by the global recession—we just don’t have as much cash coming through as we used to, and we’re not able to predict very well what our cash flow is going to be like from this year to next.

“Why’s that?” you may ask. It’s because our financial resources come from the estate of my father (who died in January 2007), and the recession is making it very hard for the estate to “settle.” As I said in an earlier blog post:

It’s because of the kinds of investments that my Dad made, which were mostly not in the stock market or other publicly traded instruments. He mostly invested in privately arranged loans to commercial real estate developers, start-ups of companies making medical devices, that kind of thing. We can’t get the money in these kinds of investments “on command.” We have to wait till the loan agreements become “liquid,” or pay off in the form of cash. And then we have to wait a little while longer while the estate settles this aspect of its business and pays off its various beneficiaries, of which F4DC is one.

One effect of the global recession is to slow that whole liquidation process down even more. So, we’re getting by on smaller and somewhat unpredictable distributions from the estate.

With the downturn and uncertainty—in fact because of the downturn and uncertainty—we’ve made efforts to cut way back on our overhead so that we can put more of our available resources into the community, through grants (see the news about our new Matching Grants Program) and special projects. (See Ed’s blog posts about the Southern Grassroots Economy Project, which has the potential to build a healthier, sustainable economy over the long run.)

You can see how some of these changes are playing out in two financial documents you can download: Our June 30, 2010 Balance Sheet (pdf) and January – June 2010 Income and Expense report (pdf). The balance sheet shows that we have about $375,000 in the bank: not quite where we thought we’d be three years out from the founding of F4DC, but enough to make a difference in reaching our mission.

In the Income and Expense report, you can see that we’ve had about $145,000 in income in 2010. We’ve been advised that this is basically it for the year, unless one or more of the private equity investments makes a surprise move toward liquidity.

Our biggest expense category so far this year is personnel, but this isn’t going to be ongoing. This big number was incurred at the start of the year and reflects the severance payouts we made to our staff as we bid them farewell.

Now, I’m pleased to say that our biggest ongoing expense category is grants and awards—and it’s about to take off substantially with the new Matching Grants Program. And the work we’re doing to contribute to the development of the Solidarity Economy in the Southeast is going to be showing up in our travel and meeting expenses. Keep following Ed’s blog posts to see how this evolves: we’ll be meeting, convening, and spreading the learning of folks who are actively building productive, collaborative, democratic, community-based enterprises.