[Note: This post was backlogged from December 20th, when it was initially written. Apologies for the delay in posting.]

This week, the incredible blow of the Madoff debacle has left many reeling with anger and sadness at the staggering losses within, primarily, the Jewish philanthropic and organizational world. The Forward has a chart on “Tallying the Jewish Communal Losses,” and there is no end to media coverage giving us up-to-the-minute details as institutions scramble, large foundations doors close, towns lose pension plans, and people lose their jobs. Disbelief, sadness and outrage rightfully cycle through commentaries and conversations.

I felt a particular kick to the gut Monday morning when I heard that the JEHT Foundation was closing its doors. Working at Demos, JEHT was a major funder of our work on the right to vote, a campaign to restore the right to vote for people with felony convictions.

JEHT was a wonderful foundation that gave sizable, large grants to organizations working in the fields of criminal justice, juvenile justice, fair elections and international law. As they said themselves in their press release:

The issues the Foundation addressed received very limited philanthropic support and the loss of the foundation’s funding and leadership will cause significant pain and disruption of the work for many dedicated people and organizations.

With the U.S. being the world’s leading nation in incarceration with 2.2 million people currently in the nation’s prisons or jails, the loss of the JEHT Foundation’s support reverberates, as organizations advance platforms to influence and work with Obama’s agenda on prison and drug reform.

That said, as the week continued, like Shalom Rav over at Jewschool, Jo Ellen Green Kaiser at Zeek, and Jim Besser at the Jewish Week, I started to think about what this will mean in terms of Jewish fundraising, and how this gutting of big donors, the “old boys network” as Besser calls it, will require a rethinking in funding and fundraising methods for Jewish institutions, whether organizations like it or not.

Besser rightfully contextualizes this loss:

It’s not just that Jewish organizations and donors lost uncounted millions and that their trust in a fellow Jew who happened to be a Wall Street icon was betrayed. It’s that the losses, still being totaled, came at precisely the moment the Jewish world was most vulnerable because of a raging recession that has cut into endowments, hurt big donors and sent the demand soaring for the services many Jewish philanthropies provide.

Just as Jewish institutions started turning to Jewish social justice groups for ideas when studies verified that young Jews rooted more of their Jewish identity in change work (in part from being turned off from these same institutions), I think this marks another point where Jewish institutions will turn to Jewish social justice organizations for ideas and models of fundraising rooted in membership models. That is, if they’re also willing to take steps to further democratize their institutions. As Green Kaiser writes:

The alternative to relying on foundation and federation funding is funding from individual donors. It’s the Obama campaign model, the grassroots model. Such a model does not preclude major donors and foundations. We still need their tzedakah. But the Jewish non-profit world would be so much healthier if our organizations could run as much (or more) on the biodiesel of the grassroots as on the richer petroleum diesel of major funder support.

If at least a quarter of our funding came from our customers / members, then we would be much more receptive to their needs and desires. We would be able to move more nimbly, reacting to changes in the zeitgeist quickly, using their money to move forward on grassroots-originated initiatives. Funders would benefit too, by being more connected to the groups they ultimately hope their charitable funds will reach.

I agree with Mark Charendoff, president of the Jewish Funders Network, when he says that, “If it was a wake-up call, it is an awfully painful one,” but we’re here, and growing pains like these have the potential to revitalize institutional aching bones that we hear about so often.

Growing pains that many Jewish social justice groups know all too intimately in having varied success in attaining foundation money, thus often times requiring a funding model reliant upon, and championing, large numbers of small, individual donations. (Granted, variance abounds across social justice groups (AJWS, PJA, JYCA, JOI, Avodah, JFREJ, JCUA, JUFJ, JFSJ, etc) in terms of how long they’ve been around, how successful they’ve been in raising money from foundations and individual donors overall, staff size and more (with JFSJ being a funder itself, thus somewhat different vis a vis the other orgs listed in that it also funds (or has in the past funded) some of these orgs).

Growing pains that, dare I say, require institutions to not only study and discuss generational shifts in Jewish life, but to focus on larger institutional changes that further democratizes who speaks and acts on behalf of Jewish communities. Grassroots fundraising places the emphasis on the breadth of the base of individuals, creating multiple giving levels for people to contribute at their income level, asking people to also fundraise for the organization, seeking new ways of reaching new audiences in order to solicit funds from a broader base of people, ultimately rooted in the value of “people power,” or wider swaths of communities, and not in concentrated hands of the exceedingly wealthy.

Small (and large) donations from a large number of people do not inherently translate into more genuine institutional response and changes in policies and greater transparency. This of course also requires an institutional ethos or value in not only hearing a wider spectrum of voices, but actively engaging and absorbing changes to reflect a wider and more varied understanding of Jewish life. In today’s age, particularly in thinking of the under 40 crowd who give when our voices and interests are taken into consideration; are turned off by mainstream institutions that many feel already don’t represent us; and use new media to hold organizations more accountable, I think the demand for not just discussions, but more action by institutions from Jewish communities will more likely be squarely placed on the table. That is, if they really want young Jews. And if young Jews want them. (Translation of young in the Jewish institutional world equating 40 and under.)

What will come from all of this, we’re all still unclear, but the question of whether this horrible loss opens a door to catalyze change in Jewish institutional life undoubtedly hangs in the air.

Lacking in resources to address fundraising models rooted in community building and engagement, we’re not.

One needs to look no further than social justice fundraising groups like the Grassroots Institute for Fundraising Training, which hosts conferences specifically looking at effective models of grassroots fundraising methods. Kim Klein and Stephanie Roth have been integral to GIFT (Klein was one of the founders of the Grassroots Fundraising Journal along with Lisa Honig). Both have extensive knowledge and expertise on fundraising and organizational development, rooted in grassroots models. Part of Klein’s book Fundraising for Social Change is available through googlebooks.