Non-profits, which depend on both the private economy and the public sector, suffer greatly in economic downturns such as we are experiencing at present.
Take healthcare, for example. Consider what happened when the tech-fueled boom of the 1980s – known here as the Massachusetts Miracle – ended. Hospitals were hit hard by a slowdown in Medicaid payments when state tax revenues fell, and a large number of them closed, particularly community hospitals and those that served the inner-city.
In some cases, institutions that failed were sitting on cash they couldn’t access. Like Coleridge’s Ancient Mariner – surrounded by water, water everywhere, but not a drop to drink – many non-profits had liquid assets they couldn’t use to meet payroll because of donor and legal restrictions.
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