Some organizations, says Stahl, are considering what it would mean to dissolve themselves and start up again as a limited liability company. In some ways, this would make moving money easier, especially for organizations that do international work. But it would also significantly reduce transparency around donations and how money is being spent. Moving an organization’s headquarters—and its bank accounts—to another country could theoretically protect its finances, but there’s no guarantee that it would be able to get money back into the US to continue work on the ground there. (Shortly before Trump’s inauguration, a Canadian law firm hosted a webinar for nonprofits considering relocating their headquarters to the country.)
Reich says that several organizations are already talking about what ways an attack by the administration could be challenged legally. “Nonprofits will probably win in court and that will be in a year or two,” he says. But by that point the administration will have had ample time to spread narratives like the one shared by Ngo—as well as, perhaps, to tie up their resources in defending themselves in court. “The point is destroying [nonprofits’] reputations,” says Reich, “and having the power to dictate how and where money gets spent.”
In the meantime, the uncertainty in the field means that foundations and funders are now looking to move money out more quickly—both to support organizations that may be feeling the pain of other donors pulling back and to ensure that the sector is ready for a more difficult operating environment than ever.
“We’re moving money to meet grantee needs and needs in communities,” says John Palfrey, president of the John D. and Catherine T. MacArthur Foundation, which is a member of Unite in Advance. Palfrey noted other government funding cuts, including to the US Agency for International Development and other federal grants, have meant that organizations like the MacArthur Foundation are already racing to disburse money to their grantees to help plug the gaps.
“We are telling the organizations we work with to be adamant with founders, that if they don’t fund us now there may not be a sector left,” says Ashleigh Subramanian-Montgomery, acting director of the Charity and Security Network, which works with nonprofits that operate in challenging conditions.
Subramanian-Montgomery says her organization has advised the nonprofits it works with that they shouldn’t comply in advance, but that some organizations are already “removing stuff from their website that could make them at higher risk.” She says she’s worried, however, that even the threats of defunding could cause people to “really start self-censoring, then changing programming completely,” she says. “Then there wouldn’t even be a civil society to push back on government policy.”
But what that civil society could look like is up in the air. “The Trump administration is going to set the sector on fire,” says Reich. “It’s going to need to be rebuilt.”
