The survival instinct of non-profit organizations

Last night I read Cycle of Failure: HOW MICHIGAN KEEPS “THROWING THE FIGHT” FOR CHILDREN – AND HOW TO MAKE THE STATE A CONTENDER AGAIN, a report written by the National Coalition for Child Protection Reform (NCCPR) about the foster care system in Michigan.

The report is one of many attempts to address the problems with the foster care system in Michigan, following the deaths of Ricky Holland, James Earl Bradley, Allison Newman, Johnny Dragomir, Isaac Lethbridge, Joshua Causey and Rufus Young, all children in the Michigan foster care system, or adopted from that system.

As in previous work of the NCCPR, they make the case that the basic problems in the foster care system are the result of too many removals, which harm children, overload case workers and suck up all funds available for the protection of children. It also sheds a light on an issue not mentioned in any of the other reports about Michigan, coined with the phrase "foster care-industrial complex".

Richard Wexler, author of the report, writes the following:

Addicted to per diems

But every time anyone in Michigan has tried to face up to these challenges and fundamentally reform the system, that foster care-industrial complex has stood in the way. Michigan’s private agencies are paid for every day they hold a child in foster care. If they do what they are supposed to do and work to  reunite a family or, when that’s truly not possible, try for adoption, the payment stops.

As James Beougher, former director of child and family services for Michigan DHS, has written: “When you pay for foster care on a per diem basis – you get lots of days in foster care.” Beougher’s attempts to change that never got past the pilot stage in Michigan – but he’s now hailed as a hero in Maine, for transforming one of the worst systems in the country into a national leader.

So it’s no wonder that the National Commission on Children, one of the most distinguished groups ever to study child welfare, found that children often are removed from their families "prematurely or unnecessarily" because federal aid formulas give states "a strong financial incentive" to do so rather than provide services to keep families together. Of course the agencies will tell you they don’t even think about such things – they claim they care only about “the best interests of the child.” After all, they say, they’re non-profits. But the will to survive can induce in non-profits a form of greed that is as corrosive of common decency as the worst corporate behavior.

This can be seen in one telling statistic: In Michigan cases where the state maintains direct supervision of a child after the child is placed in foster care, only 40 percent of children return home within a year. That’s certainly bad enough. But when children are handed over to private agencies, paid for each day they hold the child in foster care, the proportion returned home within a year falls to 30 percent. And for technical reasons, this actually understates the
gap in performance.

The biggest addiction problem in child welfare is not substance-abusing parents, though that problem is serious and real. The biggest addiction problem in child welfare is powerful, well-connected private child welfare agencies that are addicted to their per-diem payments. And they are putting their addiction ahead of the children.

So try to divert more money to safe, proven alternatives and the foster care-industrial complex will stand in the way. Try to curb institutional care and the foster care-industrial complex will do everything it can to stop it. Try to place more children with extended families and in their own neighborhoods, and the private agencies will march up to Lansing to urge that it stop – even if that may mean the state has to violate federal law.

Most of the time, the agencies won’t actually say they oppose the idea – not out loud, not directly, not overtly. Instead, they’ll say how much they favor prevention – but… They’ll talk about how they, too, wish children didn’t have to be institutionalized, but… That’s how it’s done in child welfare: Never say no to a good idea, just “Yes, but…” it to death.

Nothing changed in Illinois until things got so bad that the elected government had to stand up to the permanent government. Finally, they took on the foster care-industrial complex.

Instead of simply handing out per diem payments and rubber-stamping license renewals, Illinois forced its private agencies to compete for business, and prove they were helping children. Agencies that couldn’t return enough children safely to their own homes or get them adopted wouldget no more referrals. Some of those agencies closed.

And lo and behold: Suddenly the “intractable” became tractable. The “dys-functional” became functional, and, as noted at the start of this report, the foster care population plummeted from 50,000 to under 16,000. The providers also had to show the children were safe in their new placements – and independent court-appointed monitors confirmed it. Under the new arrangement, child safety has improved.

So it can be done. We know what works, there is enough money, and there are plenty of good, capable people in Michigan child welfare. All that is missing is the will to do it – the will to stop embracing all that is worst in American child welfare, start seeking out all that is best, and stand up to the foster care-industrial complex. Michigan can be a contender again.

It just needs to learn the lessons from its own past.

I especially liked the phrase the will to survive can induce in non-profits a form of greed that is as corrosive of common decency as the worst corporate behavior. This corrosiveness can go as far as diverting funds to pay off Las Vegas gambling debts, call psychic hotlines and pay for jewelry, parties, lottery tickets, alcohol, vacations, antiques, artwork and even a cremation, as an audit of private foster care agencies in Los Angeles County revealed. (See: Private agencies diverting millions).

That is the system at its worst. Federally funded personal greed made possible through local cronyism, but it doesn't have to get as corrupt as the worst cases illustrate, to result in an unworkable system.

Each organization that is founded to do something about a certain problem is confronted with a paradox. The sole reason for such an organization to exist lies in the existence of a problem. So the survival of the organization depends on the perpetuation of the problem the organization tries to solve.

Each organizations is a bit of an autonomous beast. It doesn't always matter who make up the board or the staff, it doesn't always matter who the CEO is. People will be replaced by other people if that is in the interest of the organization. That is as much true for profit making organizations as it is for non-profit organizations. If the CEO of Exxon all of a sudden becomes an environmentalist, he will immediately be fired, as much as it could be in the interest of the rest of the world, it would not be in the interest of Exxon. If the CEO of Wolverine Human Services all of sudden became a family-preservationalist, the vested interest of the organization in residential care would lead to the booting of their highest executive. In that sense organizations have a built-in survival instinct that feeds upon the problem.

I even recognize it in myself and the work I do for this website. When for days on end, I don't get notification of a recent case, it's starting to irk. I should be happy, no abused or dead child, no trafficking, no adoptee facing deportation. Instead I get edgy. So when even I experience something like that, while not making any money through this website, how much bigger does the paradox grow when investments are being made and pay roll obligations exist?