Wednesday, January 16, 2008

Forecasts

My last post included an unexpected forecast. Which is to say I wasn't planning on forecasting anything, but when I sat down to review my notes and thought about what was on my mind - oops, out popped a prediction.

Forecasts and forecasting are everywhere. This is partly "the new year" phenomenon - as a culture we seem to like end-of-year and start-of-year lists. We also seem to like voting on issues. Take this sample:
  • "Should people get paid to donate their organs? Yes 42%, No 58%"
  • "Should government play a role in managing health insurance? Yes 57%, no 43%"
  • "Should public works be operated by private interests? Yes 32%, No 68%"
Where did those questions and answers come from? Some global forecasting organization? A major news magazine? A prediction market website? No, no, and no. They came from The Costco Connection, a monthly advertising supplement/magazine sent to the discount warehouse company's' 10 million+ members.

And there are forecasters on the radio and TV - not just getting the weather wrong, mind you. In this set of observations on the future from Paul Saffo, from the Institute for the Future, he notes that the Vatican is looking to train extra exorcists for the coming year - what do they know that we don't know?

What about philanthropic forecasts? Are there paths through these myriad predictions that may be of use to individual donors, nonprofit organizations, institutional aggregators, and/or large foundations? You can be sure that the endowment managers at The Harvard Management Company and the Vatican Bank (manager for Catholic Church, not including assets of Vatican City), which collectively invest and manage more than $40 billion in liquid assets are watching a certain set of trends (though perhaps not the one on exorcists).

What trends might matter to philanthropists beyond those in charge of managing endowments? What about program officers, evaluation experts, policy and advocacy leaders, and CEOs? Here are some trends I'd point these folks to - please chime in and add your own.
  1. Short-term predictions about the American economy now seem to fall into two camps, we are now in a recession or we will be in one by __ date.
  2. The collapse of the housing market, the increase in foreclosures (which hit working women of color harder than other populations), and the likely effects of this on family and community stability, children's educational prospects, health and health access, and crime.
  3. The unprecedented opportunity represented by the two leading Democratic Party political candidates to change an entrenched national discourse on racism and sexism. And the likelihood that they won't.
  4. The continuing costs in real lives and real dollars of the wars in Iraq and Afghanistan, including the social and more costs of caring for those who return from active duty.
  5. The shift, over the next 10 years, from leading edge Baby Boomer retirement to bulk-of-the-bubble Baby Boomer retirement.
  6. The mass migration of populations across hemispheres and cultures, accelerated by the effects of climate change.
  7. The shifting rates of growth in Islam and Christianity as the world's fastest growing religions, and the potential implications on national, regional and global economics and politics.
  8. Continued Internet-based innovation about information and giving
What are you watching? What matters to the way you think about your giving on a daily, monthly or annual basis? Is your foundation planning to act differently because of any of the trends noted above? For example, Harvard, Yale and others have announced expanded uses of their endowments to address the economic realities of their incoming student bodies - a market which recently peaked in size and demographers predict will begin dropping. Are Harvard and Yale's actions "noblesse largesse" or are they rational acts in the face of several trends coming together - smaller number of potential students (supply), huge amount of money, overwhelming student debt burdens, real belief in power of social class diversity, recognition of national wealth gaps, proactive move to deflect growth in anti-elitism....[add yours here]....

And what about your foundation - what is it doing in light of the trends above (or any others)? Is it making any strategic adjustments due to the external realities of its issues areas? Please let us know if there are trends that matter, how you are adjusting your own or your foundation's giving to those trends, and what else we might be on the look out for.


DISCLOSURE: I graduated from Yale, have taken courses at Harvard, shopped at Costco, been on panels with Paul Saffo and I've been to Vatican City. I was born during the baby boom, though I am no where near retirement.

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