With Election Day 2006 now history and the future fraught with possibility, it's time for nonprofits and foundations to consider their position with respect to the nexus of free speech, public policy, and tax-exempt status.
Already, there is a trade-off between an organization's tax-exempt status and how much lobbying and advocacy that organization can do. Charities can lose their exemption if advocacy comprises a substantial portion of their activities. But nonprofits and philanthropies have a legitimate role as educators on issues and causes of interest to them. They should engage with the public on these issues. Our participation in policy conversations not only is acceptable, but vitally important to a vibrant, functioning democracy.
To better clarify the limits of nonprofit speech and to avoid the risk of having stricter regulations imposed on us if we over-reach we must consider other imperatives. The first is the value of discourse. Democracy requires both a voluntary exchange of information and a citizenry that develops and acts on informed opinions. The latter absolutely depends on real, vigorous debate involving legitimate points of view. When we take steps to chill that debate by withholding funding because we disagree with the views presented, for example, or by using our resources and networks to muffle or drown out the voices of those with whom we disagree we shirk our responsibility to democracy.
But what do we mean by a legitimate point of view? Simply put, ensuring real, vigorous debate sometimes means erring on the side of including perspectives that others might consider "illegitimate." At the same time, we must be careful to respect peoples' right to "vote with their feet" as well as their wallets. One would hope that those on opposing sides of an issue as well as funders would choose debate over confrontation or, worse, no debate at all. But all of us have the right to leave the room or stop our financial support of an organization.
As a recent case in point, Harvard's John F. Kennedy School of Government invited the former president of Iran, Mohammad Khatami, to speak one day before the fifth anniversary of 9/11. As the press subsequently reported, Kennedy School officials were roundly criticized for the decision. While the school had held previous events representing a range of perspectives on the region, by inviting Khatami to speak it demonstrated its firm belief in the value of real and vigorous debate and erred on the side of including a voice that many critics considered illegitimate. Similarly, nonprofits and community groups that helped organize protests also acted consistent with their ideas and beliefs, as did funders who may have chosen to vote with their wallets. On the other hand, those who condemned the Kennedy School for considering the event or tried to stop the event entirely were sending a message that there is such a thing as too much discourse. The implications of that view for democracy are troubling.
The second imperative is the need to draw clear lines between engaging in policy and engaging in politics. Regulations already address how much advocacy nonprofits can do. But we need to do a better job, if only for ourselves, of addressing what kind of advocacy we do. The proper role of faith-based organizations in politics is a good example. In 2006, liberal and conservative congregations from California to Kansas came under fire for allegedly violating the conditions of their tax-exempt status by supporting specific candidates or ballot propositions. Entire faiths have come under scrutiny as well Mormons, for example, who have been discussing how they might support former Massachusetts governor Mitt Romney as he prepares a 2008 presidential bid.
At the 2006 Independent Sector conference in October, four preacher/activists, representing both conservative and liberal evangelical perspectives, participated in a panel called "Politics and the Moral Imperative." All four celebrated the role of clergy in endorsing and educating congregations about policy issues. They drew a bright line, however, at endorsing specific candidates. That bright line is appropriate and necessary. It helps keep the community in the discussion while avoiding conflicts of interest and threats to faith-based organizations' legal status.
The third imperative is upholding the rule of law. By that I simply mean that if we are going to stand firmly behind our beliefs, we must be willing to pay the consequences. If, for example, a church decides that it absolutely must work on behalf of a particular candidate, it also should be willing to forgo its tax-exempt status.
The nonprofit community not only has a right but also a role in policy discourse. But in this period of heightened scrutiny of the sector, we need to be clear about where we draw the lines.
Tiziana Dearing is the executive director of the Hauser Center for Nonprofit Organizations at Harvard's John F. Kennedy School of Government.