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Reviews / Comptes Rendus
| Christopher Gunn, Third-Sector Development: Making Up for the Market (Ithaca and London: ILR Press/Cornell University Press 2004)
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| ACADEMIC INTEREST in the role of third-sector economic development has been growing since the 1980s. This book is an up-to-date survey of the sector in the US and a critical analysis of the issues facing its future development. The book is a broad study of American social entrepreneurship carried on by community groups, labour unions, co-operatives, and religious organizations as they seek to create economic activity to meet needs that neither the private nor public sectors are willing or able to do. Currently 65 per cent of the US economy is under the private or first sector, 25 per cent is in the second or public sector, and only 10 per cent is in the social/nonprofit or third sector. (31) |
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The author, Christopher Gunn, is a professor of economics at Hobart and William Smith Colleges and the author of Workers' Self-Management in the United States. Gunn acknowledges that the third sector is relatively unknown to the American public because of the promotion and glorification of the private sector and capitalist globalization that has dominated that country's media since the Reagan era. While various beneficial theories of capitalist development are mouthed constantly in public discourse, the role of the third sector in economic development is not discussed. But Gunn points out that "many a community is not being served well by the global economy."(8) In fact individual Americans and their communities are victims of globalization. While the loss of manufacturing plants and jobs to developing countries is well-known, the new arena for outsourcing jobs offshore is the white-collar service sector. A recent estimate is that 3 million American white-collar positions will move overseas between 2005 and 2015. This scenario would indicate that the demand for third sector intervention would only increase. |
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The sector has grown substantially because of the loss of manufacturing jobs and the offloading of social services by the public sector. Health, education, and culture are the three main areas of nonprofit activity. Even with only 10 per cent of the American economy, the sector is substantial. Private foundations, which are a source of funding, have over $300 billion in assets. (28) "The sector's historic mission," Gunn writes, "has been to fill the cracks and repair the damage." (44) It looks like there is a lot more damage to come as large numbers of white collar jobs are moved offshore. |
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Gunn describes the American economy as one of "uneven development" in which income distribution is becoming increasingly unequal and class divisions have grown. (47) While the third sector tries to address these imbalances, it does so sporadically. The 25 case studies which he provides reflect the extraordinary diversity of the sector — all sorts of enterprises from the highly successful Dakota Growers Pasta Company to the Corporation for Public Broadcasting. He measures each case against five criteria: creation and retention of surpluses, provision of jobs with living wages, environmental sustainability, linkages and spin-offs, and the meeting of basic needs. As "alternative institutions of accumulation" he views third-sector enterprises as engines of economic growth that could do more to democratize and revitalize beleaguered parts of the economy and disadvantaged regions and cities. What he regrets most is that the sector has not developed "larger-scale applications," which would allow development at "a meaningful level." (183) |
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The obstacles to a more prominent role for the sector are numerous. First, most of these projects are locally-based. There is little driving them to create national solutions. He considers co-operatives as having the most potential for growth, but he is right to say that only a change in American political discourse can create a climate for third sector development on a scale that would matter. The American emphasis on the private sector, the limited nature of the American public sector (primarily civil service and military-oriented), and the lack of internal linkages within the social sector itself indicate that moving to a new level of influence would probably require a major economic crisis. |
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This book is a valuable survey filled with useful information and informed analysis with critical insights. But it speaks almost completely to a national American audience. It is written for Americans and deals specifically with their situation. Because of Gunn's belief in the third sector as an important economic engine, non-American readers need access to comparative material so they can understand the importance of the third sector in their countries and how that environment relates to Gunn's America. In Canada, for example, the social sector is also a distant third in terms of economic impact, though Canada's co-operative sector is well-developed in certain regions of the country. Canada's public sector plays a greater role in health and education than the public sector does in the US, where military spending and private health care give it a different profile. Canadian community economic development also has strong links to the Canadian state, as do the First Nations territories, whose economic needs are significant. If the third sector is to play a fundamental rather than a marginal role nationally in Canada or even the US, then it must be part of a global economic movement that creates a change of consciousness about economic development. Only a crisis in global capitalism could put something so different on the historical agenda and then only with significant government and public input. |
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At the end of his book Gunn suggests that the power of the anti-globalization, anti-capitalist movements of the past decade may be the seedbed of a renewed interest in the third sector and its role. But there is a debate between those who support a strengthening of the public sector as an answer to privatization and those, like Gunn, who prefer the social sector. What we need to realize is that the social sector has been part of developed economies for some time. Like the other two sectors, it competes for resources and status, but it operates at its best when the two large sectors leave it more or less to its own devices. Whenever the private or the public sector want to move in on the social sector there is little to stop them. Ideologically, financially, and politically they have much deeper pockets than does the social sector. As long as the sector remains marginalized in the economy it will be allowed to continue its role. Should it ever rise to challenge the other sectors, we will be witnessing a social, economic, and political revolution. Gunn's study of the sector in the US describes a situation that is non-revolutionary. |
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George Melnyk
University of Calgary |
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