Originally published on Inside Philanthropy on January 21, 2021.

Shocking? Unbelievable? Outrageous? Sad? It’s hard to find the words to capture the feeling we all had watching the Capitol building of the United States of America breached for the first time since the War of 1812. 

For those monitoring the impact of extremism, hate and political polarization on societies around the world, the United States is now just another case study in conflict and fragility. 

So let’s ask honestly and squarely: Who pays for polarization? In both senses, that is. First, who actually footed the bill for Wednesday’s events? For an event of any kind in Washington, D.C., there are permits, logistics, hotels, banners, flags, food—it is not a cheap endeavor. Who and what is behind the actual funding of this powerful and relentless current in our politics today? And second, who suffers for it? What is the actual human cost? 

While the question of who bankrolls these efforts remains largely opaque, we do have clarity regarding the mechanisms being used to finance hate groups. For years, advocacy groups, professional research organizations and investigative journalists have pointed out the loopholes that exist for extremist and hate groups to exploit to receive funding. The most glaring gap is that there is no legal designation for “hate speech.” In other words, unlike most places in the world that recognize the long-term societal harms and imminent dangers of hate speech, the United States is curiously permissive of toxicity. So without a legal designation for prohibiting their behavior, many hate groups simply incorporate as nonprofit organizations and operate as such. This means our tax structure rewards a hate group with the same financial and legal benefits as a soup kitchen. 

That’s right: In the United States, you get the same tax benefit for donating to a children’s hospital as you do for donating to a group that calls for the execution of gay couples. So with a charitable status, a hate group and its affiliates, sponsors or hosts can employ a myriad of tools to receive funding. The first and most common method is simply to receive a tax-free donation from an individual. A more popular and preferred method now is for donors to funnel such money through a donor-advised fund administered by a large foundation. As a series of reports and investigations have shown, that’s how Schwab, Fidelity and Vanguard end up as leading contributors to white supremacist groups and other fringe elements in our society. 

A close cousin to the charity route is through the use of online funding platforms and other digital financial service providers—operations like Amazon Smile and Paypal. Here, too, experts have counted the dollars and mapped out the way forward. Following the insurrection at the Capitol, advocacy group Color of Change launched a public call for Stripe and JPMorgan Chase to halt payments to the Proud Boys through their platforms. 

Critical questions remain regarding how we define hate speech, and where free speech stops and hate speech starts. Defining the government’s role in regulating this question and in regulating the work of charitable entities will require our collective and tireless effort. So the answer may be simple, but it’s not easy. 

While these questions are thorny, complexity should not be a barrier to action. Every foundation has an obligation and, in fact, discretion under the law to determine standards based on its own values. In 2019, Amalgamated Foundation led an effort dubbed Hate Is Not Charitable joined by over 100 other charitable entities, representing billions of dollars in assets, pledging to implement policies and screens within our own institutions to ensure none of our charitable dollars would flow to hate groups. In light of recent events, this effort to “self-regulate” should gain momentum across the philanthropic sector. 

So to the other question: Who “pays” for polarization? What is the cost of our democratic system turning into a puppet show for those with the most radical views? The consequences of polarization are deeply felt by individuals, like us, who are members of communities—Jewish and Muslim—often targeted by extremists. While polarization most directly and acutely threatens those who are “other”—Jewish, Black, brown, Indigenous, immigrant, LGBTQI—polarization has a universal impact, tearing at the entire fabric of civil society, including our democratic institutions and even the concept of truth. 

Despite this, or perhaps now more than ever, it is incumbent upon us to invest in this country to build institutions that are truly able to guarantee justice, equity and stability. As our democratic processes and promises come under attack through the exploitation of free press and free speech, we need to develop systems and structures that can build trust at the same pace it is being broken. That is why we, the CEO of a charitable foundation and the director of a research-dialogue forum, are working together systematically to help stakeholders in philanthropy and adjacent sectors work to address the problem of hate funding in its various forms.  

As we think about the high cost hate creates for our society, let’s ensure that at the very least, it is not being subsidized by tax-free dollars that are meant to serve a charitable purpose for the public good. Let’s recommit to rebuilding our democracy and our institutions, to ensure that it is not our children, our communities and our democracy, but ultimately, it is those violators and instigators who pay the price. 

Abbas Barzegar, Ph.D., Director of the Horizon Forum, a “think-do” tank tackling the impact of extremism and polarization on philanthropy and adjacent sectors.

Anna Fink, Executive Director of the Amalgamated Foundation, the intermediary helping power the movement for racial, economic, and social justice.