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This Week in Global Development
The potential exodus of NGOs from the US, and the rise of authoritarianism
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This week, we reported that U.S.-based international nonprofits are looking into https://www.devex.com/news/us-nonprofits-seek-refuge-abroad-111200 as they face an increasingly unpredictable political environment at home. Law firms in Canada and the...
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Foreign.
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My name is Rumbi Chakamba and you're listening to this Week in Global Development hosted by myself, Abba Saldinger and David Ainsworth. I'm joined by Anna and Elisa who you all should know by now on the podcast. And this week we're going to dig into why US Nonprofits want out of the US So this is quite an interesting story, Anna. US Nonprofits are now looking into setting up offices outside the U.S. i hear that our colleague Jess Abraham spoke to a lawyer in Canada who says he's received inquiries that are like 10 times over what he normally receives about setting up offices in Canada. So why is it that US Nonprofits want out?
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C
Yeah, it's a pretty difficult to say the least environment for US Based nonprofits as well as philanthropic foundations pretty much because US President Donald Trump, his critics say he's targeting groups that are perceived as progressive and left leaning with various threats and allegations. These allegations range from ties to terrorism to tax evasion. So very serious accusations that in and of themselves could sink an organization's reputation even if no formal charges are ever brought to bear. Trump's even reportedly talked about taking away the right of U S based charities to send money abroad. So obviously that would be a huge blow and this is all pretty unprecedented for a US President to go after charities and non nonprofits and, and foundations like this. So the most high profile example that I think people would be aware of is the Open Society Foundations which is founded by George Soros who happens to be a major Democratic donor. Trump has accused OSF of racketeering, of fomenting political violence and so forth. So and reportedly OSF is kind of preparing for a legal battle if charges are filed. But there's been a lot going on in the sector beyond osf and that's where it gets to your question. Like you said, Jess reported on how a lot of US based nonprofits are looking at establishing sister organization overseas entities. There's huge interest with Canada and uk some of the charity lawyers that she spoke to, it's been a surge of interest and you know, this is, this makes sense given the funding environment and the kind of hostile environment. I think it's important to note a big caveat is that it's not that easy to just set up an overseas entity. There's a lot of regulatory and tax implications. So not everyone is going that route. There's certainly a lot of interest in it. But another contributing reporter of ours, Rebecca Root, has also written about how a lot of the response has been open letters Signatures, petitions and so forth. There's one open letter that garnered, I think, like, 3,700 signatures calling, condemning the Trump administration essentially for an illegal and unjust campaign to silence these groups via executive order. So that's really more of the reaction among everyday nonprofits that you're seeing. And I think to the last point, this gets to the big question that everyone's asking is, is this legal? Is what Trump is, is threatening legal? And it's kind of a gray area. Legally, you cannot kind of sick IRS and the Treasury Department on groups for purely partisan political reasons. But as we've seen, President Trump has been able to bend the justice system to his will. And as I said earlier, sometimes it's just the threat of the allegations that will cause, you know, reputations to be harmed that will divert resources, money, attention from the causes that these nonprofits and foundations are trying to fund and focus on. So, so basically, the establishing sister organizations is kind of one element of this larger story of this very miserable environment that a lot of organizations are finding themselves in.
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Do you know, like, at the beginning of the Trump administration, that was one question I would constantly ask, is this legal? Can they do this? And I think we've probably come to a point where we've stopped asking that and are just in a phase where anything is possible. But one of the reasons as well is the environment is definitely harsh, but then it's also really hard to operate at one point in time. I know, Alyssa, you are looking into how charities could possibly lose their tech status under the Trump administration. That didn't happen, but that's also still questionable. And we still, we also had a story about the Children's Investment Fund foundation that has actually stopped giving out grants to US Based organization because they're not sure how they're actually supposed to be operating. Can you tell us a little bit about the operating environment, Alyssa?
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D
Yeah. So I think that an example that kind of paints everything that you've just said. Ruby and Anna, what you've just said is that in the past week, two people at, like, various international organizations that are pretty high up have told me that they are considering changing the flags and are looking into the ways in which one was looking at Canada and one was looking at the UK So this is definitely happening. And this is just kind of the last week out and about here in D.C. that this has just, like, happened to come up. So I think this is, there's definitely, as there has been for the last year, a level of fear in the air about what nonprofits can and can't do what foundations can and can't do and what people feel comfortable with. Like you said, Rimby, this isn't necessarily new. We, we reported on the big beautiful bill a couple of months earlier and there were various provisions that were kind of like placed in, ended up being stripped out. And there was also kind of talk earlier in the year and has been going on for several years before President Trump returned to office about something that was often termed the nonprofit killer clause, which is basically a clause that was being placed into bills, taken out of bills back forth, back forth to essentially make it easier for the US treasury head to declare an organization as a terrorist supporting organization, which as Anna said at the top of the podcast, even kind of like the claim of that can sink an agency. I think that the really important thing here is that folks were worried one, because of the like, unilateral nature of that, but two, because of the, the ways in which a lot of organizations operate in really tough environments. And it can, you know, I think it gets really complicated really quickly when you're working in places like Afghanistan and in Yemen. And not to say that money does go to those groups, but that it's, it can be difficult to operate in these environments. And there's cause for confusion there, those two clauses, because I think this is, these are just examples of things that have come up throughout this past year, have been taken down and come back. So that's how unstable the environment typically feels these days here in D.C. and then I think it's just, you know, a matter of reshuffling, continued reshuffling. We had the USAID fallout earlier this year, and now we're continuing to see smaller scale reshuffling, but reshuffling nonetheless. Right. So this Children's Investment Fund story that you were just mentioning really, really big shook a lot of organizations in our sector. And I think people are still trying to figure out like, okay, what does this mean? So we're still in that process, in that phase right now, here, at least in Washington.
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You know, I was actually thinking about this before we jumped onto this poll, because one thing I realized, I was wondering, one of the questions that I have is, are organizations now pushing back and is enough being done to sort of protect the sector or sort of protect nonprofits? And I also realized that the Trump administration moves really, really fast, which must make it really difficult for you to react because, like, if you look at what happened at usaid, it happened at such an unprecedented speed. It would be so difficult for you to mount a response before anything is while they're doing this, because by the time you're now ready to mount a.
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Response, it is done.
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So are we seeing pushback and is does it seem like enough is being done to protect nonprofits?
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I will just quickly say that a lot of people on that note, Ruby, say that that's part of President Trump's strategy is to like put this onslaught every day of new news and making these fast developments that people can't keep up with. And it really kind of curtails the power of like Congress and the press and everyone to keep up. And so it's an interesting strategy. But in terms of nonprofits, what I saw in the beginning of the year is everyone was kind of not everyone, but a lot were trying to remain under the radar, like hope that this passes and the dust will settle. And I think after it's almost similar to usaid, you know, you see that after a while, this isn't a situation that's going to go away. So there is much more, you know, like I said, you know, writing, lobbying, like council on, on foundations and other like various coalition group. But it's still just kind of like open letters and things like that. I don't know how much influence and power that actually has down, you know, down the road. Certainly what we're seeing with osf and why bring them up is because they're probably the most prominent of like denying these charges, fighting back, calling it an authoritarian kind of move to be silencing NGOs and foundations. But you know, OSF has also a lot of resources to be doing this. So I don't know that you will see a tremendous amount of nonprofits and foundations fighting back very hard unless some charges are filed against them. And at that point, it's a different ballgame.
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You know, I was actually thinking, I'm interested that you mentioned that it's a strategy. Because I was thinking to myself that if this is a strategy and this is actually well thought out, it's low key, brilliant. It's not good for the sector, but it's low key, brilliant. But then like you're saying, Anna, we're beginning to see a lot of people like writing letters, etc. But I don't think anyone has actually cracked how to mount a resistance. Right. No one has actually cracked the formula for this. What do you think about that, Alyssa?
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D
I couldn't agree more. I think that I open letters are great. I mean, it's showing solidarity. But I don't think anyone at the state Department is reading an open letter. I mean, correct me if I'm wrong, State Department listeners let me know. But I think that there continues to be this level of like, okay, some folks are speaking up, most are still not. You know, I feel like I just heard someone the other day tell me we're just still trying to keep our heads down. And I was like, still, you know, all the programs have been canceled. So I think there's still this layer, like I spoke earlier, of fear of uncertainty, of people not wanting to ruffle feathers and be noticed. And I think that it kind of blends itself into more of this, like, tumult of action that's happening against the sector. And no one is seems really putting up like a large front to counter it. Rumby, you mentioned earlier about, like, the legal case for many of these things that I do think that's really important to, to just touch on a little bit more. We at Devex have tracked dozens of legal cases that have gone through, especially the D.C. courts over the past year. I was trying to kind of sum it up for someone the other day, and I said, you know, it's mostly, it's mostly non wins for the organizations that are suing. There's some smaller wins. I think, like the Inter American foundation saw a massive win with getting, you know, once they were kind of dismantled earlier this year. The President has since reclaimed her seat, et cetera, et cetera, that the Supreme Court recently sided with President Trump on the biggest case that we were watching, which is whether or not the administration needs to pay back organizations for foreign aid money. So I think that the question of, is this legal? Is being answered day by day as we speak. And it's kind of a fluid moment in this time of legality in the United States. It seems, at least from where I sit, where the rules are being kind of created down the road, as more kind of questions are being thrust to the Supreme Court level, especially.
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Anna, did you want to chime in?
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I think Alyssa really covered it well. I mean, I think it's still a tepid response among the nonprofit sectors. And again, not a lot of some of these smaller nonprofits have the resources. So if charges are ever filed, it's going to be a very difficult battle for them. I mean, perhaps they will form a coalition, as we've seen some plaintiffs do. But, you know, for the most part, I think that I kind of go back, it's a very hostile environment, and that's very dangerous. And it does make sense why there is this surge of interest in overseas entities. Because like you said, SIF has halted funding to US Based nonprofits and it was a significant funder. If other foreign funders follow suit. That's a very, again, again, very dangerous territory for a lot of US Based nonprofits.
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One trend that I'll definitely, that I'm definitely interested in watching, which I don't think we have the answer to, is are we going to see more organizations setting up sister organizations in the Global South? Because that could also help with like the localization drive that we're talking about before everything went away.
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If you're listening to this podcast, you're probably, probably already working in global development, or maybe you're thinking about carving out a new path in the social impact space. Regardless, we all need a little help sometimes in our pursuit of a happy, fulfilling and impactful work life. Whether you're actively searching for a new role or looking for some pointers on how to strike a healthier work life balance. I'm Justin Sablich, devex's Careers Editor and each Friday in the Career Hub newsletter I'll bring you inside the minds of leaders, leading career coaches and recruiters to help you navigate the next step of your professional journey. You'll also have access to the latest hiring and salary trends and a weekly dose of the best leads from Global Development's largest job board. Visit devex.comcareerhub to subscribe.
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But I wanna jump to a story from our colleague David Ainsworth. David was at the Trust conference in London last week and they talked about how authoritarianism is now on the rise and they actually brought up the US an example. And a lot of people were saying that they are seeing tactics that were used in many low and middle income countries now being used in the US and they're seeing the civic space shrinking in the US as well and sort of advice on how to counter that. And they were also talking about the space for journalists and how that is shrinking as well. And wondering, because I feel like these discussions are happening on the international forum that they're seeing as sinking as shrinking civic space in the US And I'm wondering if that affects the administration at all, how it, if it affects the way that the administration works at all.
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D
Yeah, so I can jump in here. Dave wrote a really interesting story. I think if folks haven't seen it, I would encourage you to check it out about this conference. And I think the, you know, kind of main bulk is what Remi has said there is authoritarianism is on the rise. There are plenty of examples happening in the US and people are taking notes. So that's kind of the main thrust of Dave's story here. I think something important to just put things into context is it's not like this is all happening this year. You know, I think the kind of the trigger of a. What Dave refers to as the Democratic recession started in kind of like the late 2000. So right after the global financial crisis, or, sorry, late 2000, before the 2010. So what I'm referring to is 2008. And it had been, I think there was a report that Dave mentioned that the world freedoms had declined for 19 years in a row up until 2024. So this is a trend that's been ongoing. I remember last year writing about Georgia's foreign agents law. So Georgia, the. Georgia, the state. You know, this is. This has been kind of chipped away for a while. As journalists, we have a particular interest in this, given that so much of it targets journalism. And we're seeing again, a lot of that in the US if you follow domestic news about reporting at the Pentagon and things of that nature. But to, to keep it to Dave's story, you know, it was really kind of a several days of folks from the global south sharing their experiences of working and living in authoritarian contexts and kind of nudges of we might be able to help here, which I think is pretty, pretty interesting. Someone that I want to bring up that Dave heard speak was a journalist named Asu Kurmasheva, and she was with Radio Free Europe, Radio Liberty, and she had previously provided news in a region of Russia. Dave had mentioned that she left her posting, came back, or rather she was reporting abroad, and then came back to Russia to visit her, her ailing mother. And at that point she was imprisoned. And she told the crowd that authoritarianism doesn't come in a day, it comes after 10 years. Now, we're talking about rapid pace with the last year, but we're also talking about 19 years of declining democracy globally. Right. So I think there's something interesting to be said here about the gradual pace of authoritarianism with protest, et cetera. Here in the US you often see Handmaid's Tales dressed up on the street and things like that, but it doesn't. I think the point of the conference was it doesn't happen like this. It happens from the erosion of small freedoms, especially as they have to do with civil society, journalism, free pressure, etc. So, yeah, some things that Dave also talked about was again, those foreign agents laws. So we've seen them in Georgia, we've Seen them in Russia essentially saying, you know, if you are a organization that receives defense in the country, a particular percentage of your funding from abroad, you have to register as a foreign agent. So there's a lot of just fear here with like, okay, well, my name goes on a registry. Am I really a foreign agent? If I get funding, you know, 10% or 30% or frankly even 80% of funding from another donor outside of the country, what does that mean? And that was, again, just something that was pretty interesting to call out in terms of whether we're seeing that here in the United States. I'll stop there.
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I find that part really interesting that it doesn't happen overnight because little known fact about me is I'm originally from Zimbabwe and I think I actually lived through, you know, that actually happening and you moving to an authoritarian regime. And so many things end up being normalized because of like tiny little changes that happen over a period of time. By the time something shocking happens, it seems normal. And it's not something that you question anymore, which is very interesting. But another thing that I found interesting in Dave's story is they spoke about how important it is for UN agencies and international organizations to stay within these countries to document what's happening. So I just found that little piece of nugget interesting and I wanted to check if you wanted to chime in on this.
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C
Yeah, no, I think kind of related to Alyssa's point and looking at the broader picture in terms of this is, you know, something that's years in the making. I think it's important to remember that conservatives in the US Republicans have, have for years been very wary of democracy promotion programs. You know, you have the Iraq war, so there is that dichotomy there of regime change and you know, that Republicans most did vote for, but they've always been very skeptical of USAID's kind of democracy promotion program. So this isn't something new. I think it's simply taken to the next level with President Trump. You know, you've had skepticism about Voice of America by Republicans in the past, but Donald Trump has completely or attempted to liquidate Voice of America. So again, this is an escalation of that skepticism and long running skepticism. And then like Alyssa pointed out, you know, you have people look at us around the world as a model. They still do. And if you're seeing that, you know, the President is demanding certain things of universities, of law firms, of major corporations, of the press, of nonprofits, of philanthropic foundations, this sets an example very much so, that, well, if the US can do it. We can do it as well. And, you know, it kind of simplifies the argument, but there is credence in the fact that other countries, especially more that lean authoritarian like you've got Hungary, Viktor Orban is a very good example where he's saying, well, President Trump is doing this, it's doing well for the country. This is exactly what I've been promoting. The press has gone overboard and so forth. So you see a lot of parallels. And I think that you will continue to see certain nations saying, well, this is definitely something that's done in the US at the moment and maybe it's for the best.
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D
I will also just kind of add to that, I think. Absolutely. There's a really interesting concept which is it sounds really obvious, but we live in such a global world that the world watches each other. And I think that kind of gets to what you're saying, Anna. Right. It's like, okay, if what's happening in the US Is okay, then perhaps we try it too, or vice versa. Okay, Georgia did that Foreign agents law. That works. Right. So it's kind of there's this, this back and forth. But what I saw actually last week that was pretty interesting is that we at DEVEX typically talk on an international level. Right. Global and up here. I happened to be in Indiana last week giving a talk about kind of my experience reporting on the downfall of usaid. And while I was there, I basically came to, to this university, Vienna University, and people told me, wow, it's a really interesting time to be here as a journalist. And I didn't really know what they were talking about. And I googled it and found out that that day there had been a big spread on the New York Times about how the university was basically stripping its student newspaper and had base had gone on a front about we're not going to be supporting it because of particular coverage. And apparently this newspaper is very well regarded in the student newspaper space. And so there was this back and forth currently happening. So that was a really interesting example too of kind of going a little bit outside my bubble in D.C. into the Midwest and seeing how now from our international standpoint, these things are trickling down to the local standpoint. And I think we often hear an international development, global is local and local is global, vice versa. And that was a really interesting example of the ways in which the wave of kind of movements against repress, et cetera, trickles down.
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C
Yeah. Now, I was going to use your visit to Indiana as a segue to my D.C. kind of World Bank, IMF annual meetings. I know we've talked about them a lot, but for me it was really an eye opening experience talking about debt, which, you know, kind of brings us back to the international level though. There's a lot to say about us accumulating debt as well because of recent legislation. But you know, I think I got some really interesting perspectives about debt which is really hammering countries in the global south, especially in Africa. And you know, I thought that maybe it would be good to kind of take a step back and explain a little bit what you've done in some of your articles on the situation in terms of attempting to provide some debt relief to countries. There's. So in terms of the debt, the main effort to address it has been the G20 Common Framework, which has its pros and cons. A lot of economists, it's more cons than pros, but you know, it has been praised for bringing in a larger group of creditors. So not just this kind of so called Paris club of wealthy nations, but also China, also private lenders such as commercial banks. So it has earned some praise on that front. But on the flip side, it's received a lot of criticisms for being too creditor friendly, too slow, and not doing enough to kind of chip away at this mountain of debt that is forcing governments to divert investment from development priorities such as education and healthcare. So you mentioned in one of your articles, Alyssa Zambia is a prime example of this. It took over two years for their debt restructuring arrangement to be worked out. And a lot of economists say it's just a fraction of what's actually needed. So that's why, you know, a lot of the economists and experts I spoke to say the multilateral system needs to do a lot more to prevent countries that are currently in a liquidity crisis where they can't meet their short term obligations from spiraling into a full blown crisis, which I learned is when they can't meet their long term financial obligations. And this is a much more serious, serious situation. So I talked to Brian Kogoro of Open Society Foundations and he really gave an interesting perspective on the inequities that are kind of baked into the system, if you will, and what a vicious cycle it can be because, you know, these debt repayments are taking money away from not just development priorities, but countries industrializing and improving their economies, which in turn is limiting their ability to pay these debts, hence the vicious cycle. There's also this perception of risk which is a huge issue in the global south, which many economists say has put Africa at an inherent disadvantage. And the parallel or the analogy that I heard that really stayed with me is Greece, for example, in terms of interest rates, will not be punished by the war in Ukraine, but Ghana perhaps will be punished with high interest rates because of the war in Sudan. And that's a situation that you see unfold, and you can kind of think about that and think about the inequities of that. So. And, you know, the higher the borrowing rates, the more you're repaying for the same amounts of money that other countries are borrowing. So I think it was really interesting just seeing how the debt situation is embedded into this entire system. And it's not to say that, you know, countries that have borrowed do not bear some responsibility for. For paying back that debt, but it is a very skewed system. And I think it's good that there's been so much talk about it, but there's been frustration that so far all it's been is talk. You know, at the IMF, World Bank, IMF meetings, you had the G20 recently come out with the Declaration on Debt, which some were frustrated that it didn't have a lot of details. It was pretty scarce on details. Alyssa, I know you're going to the G20 summit, and a lot of people expressed to me during the World bank meetings this concern that it's just going to be another global gathering with a lot of talk that's not a lot of action and details.
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B
One thing I found super interesting about your chat with him is he saying that he's actually quite hopeful because he sees more. He's actually seeing signs that there will actually be action to address this, which will be good and something to look out for in the G20 to see if there's more movement. But, Alyssa, you're also going to the Social Summit in Doha. So I had never heard of the Social Summit. So you need to fill me in. What is the Social Summit and what can we expect from there?
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D
So there's a reason you've never heard of. It hasn't happened in 30 years. Wow. Yes, I. I'm learning about it as we speak. The Social. This. This is called the World Summit for Social Development, and it's called the Second World Summit for Social Development because the first one was 1995 in Copenhagen. Now, I think this has been kind of, at least like on UN documents, et cetera. It's like the first time that global leaders are getting together in 30 years. We all know that global leaders get together quite a bit, but I think in terms of this framing this world summit, it will be the first time that they will be doing it under this kind of auspice of social development since 1995. Main kind of thrust of what this summit is is it will be first of all in Doha. I was just looking up the, the conference venue yesterday and it's under the Qatar, you know, main conference venue, which is like this glossy, beautiful. It seems to have kind of been created out of the tree of Qatar. So there are like these big white tree pillars going in. So I'm excited to see what, what it kind of feels and looks like to be there in person. But the, the point is really to kind of renew and reinvigorate what delegates agreed to in 1995 in Copenhagen, which was these essentially like three pillars of what they termed were important social development aspects. So the first is eradicating poverty, the second is expanding employment, and the third is building more inclusive societies. So they're still kind of revolving again around those three pillars. There was a declaration that was, as most UN meetings go, it's already been drafted, it's already been agreed to. And actually they did that in early September. And now they will come together at Doha to kind of sign it, endorse it and formalize it, and then wrapped in with that endorsement. And these various plenary sessions are so many side events. So they're side events on truly everything that you can think of in terms of global development. I saw things on debt, on gender, on climate, on aging population. So like, truly pick your preference of global development options. A couple of things that I'm curious to check out is of course, kind of looking to which folks are in the room, how kind of the, the feeling is when people sign that plenary or at that plenary session, signing that declaration. I will say it's super pro Sustainable Development Goals. It's renewing and recommitting to the Sustainable Development Goals. We know and our readers know, especially through our colleague columns reporting with the UNGA and just various kind of UN US relationship coverage, that that's not actually a given anymore, especially on the US State. There's been a lot of pushback on the Sustainable Development Goals. I think during the fourth Financing for Development conference that was in Spain, there was actually pushback to swap sustainable with responsible. So there's, there's actually like quite a lot in here and that. So anyway, I'm curious to see what the room will feel. But then there's also a number of different pieces that they've pushed forward as, as really important. So there's going to be something that I'm looking forward to is there's going to be a UNDP push about prosperity floors. So again, this is kind of like raising the I think there's a couple folks Namibia will be talking about how it's experience raising its minimum wage. There's also different kind of side events about what to do, how to link, you know, prosperity and safety with peace and security. And then there's also just, again, like I said, kind of everything else that you could imagine. So stay tuned for my coverage. I'll let you know what I get up to and what I find and what the, the feeling in that really glossy big conference venue is like next week.
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B
I'm definitely looking forward to that. And if you don't, I advise you to follow Alyssa on social media because she actually really takes you into the room. She's really good about that. So she really takes you into a room. If you're in Doha, say hi. If you're not, follow her on social media because you'll feel like you are there. And Ana, anything that we should be looking forward to too, like in terms of defects, coverage? Anna is the boss.
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C
Oh, I mean, there's so much, I think especially in November, we've got the Doha Summit, which I think is interesting because the Last one was 30 years ago. I mean, that's a lot, a long time. A lot has changed in 30 years. Of course we've got COP, the UN climate conference that's going to take up the bulk of November. And we've got our reporters, Jesse and Ayanot and some other folks from our team that are going to be in Brazil for the COP conference. And we're going to have a lot of wall to wall coverage. And then of course the G20 summit at the end of the month, which overlaps with the end of cop. And I think what's interesting about all of these events is that one possible thread that we could see is something that we've a lot of people have been talking about in terms of the coalition of the willing. So we know that the US has really stepped back, especially on the climate front. I don't know who's going in terms of the US delegation, if anyone is going, but we know how the Trump administration feels about climate change. So there is this sense of at these gatherings that the countries that are willing to move forward with these issues are simply moving forward. They have accepted that the US Is not going to be at the moment really part of a lot of multilateral efforts, but that doesn't put a stop to things. And I think that we will see that theme in a lot of the events coming up in November. I do think these gatherings, even though it's a lot of rhetoric, I do think that they're important because we're in this evolution phase of development, and so people do need to talk about it. But of course, question is whether it'll be followed by action.
- [31:28]
B
So much to look forward to. And if you are not signed up, sign up for devex Newswire, where you can get little glimpses of all our reporting and access to everything that we have on offer. Thank you so much for joining me, both of you. It's always so great to have you on the podcast. Thank you.
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D
Thanks, everybody.