The ‘Cycle of Poverty’ for small non-profits

Linda Tirado’s account of poverty, called “Why I Make Terrible Decisions, or, poverty thoughts” recently went viral. It’s honest and captivating, and describes some of the instances in which people living in poverty have to choose between two imperfect options. It also describes cycles of poverty that emerge- the patterns that keep people poor (to paraphrase: if you don’t’ have enough money to buy fancy work clothes, you can’t get a job that will give you the money to buy fancy work clothes) that keep people from being able to establish a financial base. Without a strong financial base life is minute-to-minute and decisions are immediate. Mothers have to spend almost all of their time working and have almost no time to spend with their children. There’s no time to think strategically about how to change course and there’s no time to plan.

In the past year I’ve worked with a number of small non-profit organizations that are struggling to gain financial footing. Some have always been struggling to make ends meet and others have only recently entered their “lean years”. But in every case, once the organization falls below a certain financial threshold, it loses the cushion of time that it needs to be able to plan, to build relationships, to write grant proposals and to be strategic in its choices. With limited staff and limited time, all hours go to the pressing concerns of running programs, responding to clients. My husband calls the day-to-day problem solving “fighting fires”, and it takes staff away from writing and planning.

And to make matters worse, many foundations want to see a stable, well-funded organization. They don’t want to contribute to a flailing initiative that might not be successful. But like the plight of the many people who live without a financial cushion in their own lives, these organizations need a step up to be able to stabilize and build a stable financial base.

But how can a small non-profit break out of the cycle of poverty? Perhaps by having a friend in high places. Perhaps by having a staff member who works well beyond his or her paid hours to do the planning, networking, schmoozing and grant writing that doesn’t fit within the work day. Perhaps by merging or downsizing the organization. But too often the cycle doesn’t end. Struggling organizations continue to struggle. They continue to exist on the cusp of bankruptcy, with staff who are exhausted and hopeless, with board members who toss and turn at night trying to think of ways to keep the organization afloat. And every day staff have to choose between failing their clients in the short term by spending their time on long-term planning or failing their clients in the long term by not planning for the organization to be around for the long term.