NONPROFITS HAVE GROWN STEADILY since the early 1960s, when politicians looked to dramatically expand the role of public-private partnerships in urban governance, particularly in distressed areas. Today, they comprise the third largest sector of the U.S. economy: well over 1.5 million nonprofits employ roughly 12.5 million people as of 2017, the latest year for which comprehensive data is available, according to the Johns Hopkins Center for Civil Society Studies. This growth has coincided with decades of yawning inequality, prompting social movements and scholars alike to look askance at the so-called “nonprofit industrial complex”—the dense networks that connect community activists with professional social workers and managers, public administrators, and philanthropists.
Historian Claire Dunning examines the rise of this complicated web of governance in her illuminating new book, Nonprofit Neighborhoods: An Urban History of Inequality and the American State. A professor of public policy at the University of Maryland, Dunning shows, using a case study of Boston from the late 1950s through the early 2000s, how marginalized communities navigated shifts in municipal and federal engagement with urban poverty and development. They answered the Johnson administration’s call for “maximum feasible participation” in urban renewal by forming organizations to win grants for daycare and after-school programs, job training and translation assistance, affordable housing, community health clinics, and other social services.
This vibrant mobilization produced a vital infrastructure of service provisions that the postwar welfare state had failed to ensure. Yet, in filling the vacuum left by the private sector and more assertive forms of state-led development, Dunning argues, nonprofit neighborhoods ultimately buttressed the transition to neoliberal policymaking at all levels of government.
Once a central financial and industrial hub of the Northeastern United States, Boston faced severe economic pressures as the Cold War progressed. Between 1950 and 1960, the city’s population declined by over 100,000 residents from a peak of just above 800,000. The distribution of defense spending in Massachusetts was beginning the fuel the rise of Route 128’s suburban tech corridors, which compounded Boston’s struggle to attract investment and maintain municipal services for a shrinking (and poorer) tax base. In the late 1950s, Dunning writes, federal and philanthropic grantmaking augured a solution to the city’s fiscal strain that appealed to political elites and local activists. While suburban homeownership boomed, declining city revenues had exacerbated the racial and economic stratification that marred postwar prosperity in the urban North. Grantmaking thus proved attractive by meshing a few solutions: it provided a fiscal stopgap that avoided further tax increases or bonds, offered immediate resources to communities troubled by crime and disinvestment that created jobs, and alleviated the public discontent that aggressive, top-down episodes of urban renewal had provoked.