Rhetorical turbulence--Is Social Enterprise Sustainable?--II.A

Social enterprise did not arise in a vacuum.  It emerged out of a peculiar array of historical circumstances increasingly distant from the world of today.

The roots of the term extend at least as far back as the late 1970s, when fiscal crises buttressed support for cutbacks in government grants in the West and the Solidarity movement gave global prominence to the idea of what the Polish reformers called “social enterprise”—self-governed, self-sustaining and the fundamental source of social benefit.  The sustained economic boom of the past fifteen years did not only give rise to a new generation of entrepreneurs applying their expertise to philanthropy; it also fostered an association between entrepreneurship and such adaptive values as success, insight, growth and the future. 

In this environment the rhetoric of social enterprise spread far beyond the confines of organizations engaged in identifiable hybrid activity; it also became a standardized mode of self-description among otherwise non-entrepreneurial nonprofits.  We see a similar phenomenon at work in the dissemination of such descriptors as green, organic and, of course, sustainability, which have emerged as normative as much through imitation as ideology.  This is what I referred to earlier as the fourth less acknowledged expression of hybrid values:  mimetic replication of entrepreneurial and public benefit language, with minimal to no impact on organizational behavior.  

While it is indeed possible for social enterprise to be a revolutionary new standard that will forever change our ways of doing good, it is also possible that social enterprise may turn out to be an organizational equivalent to the hula hoop.  Just as each new summer brings forth a new song that captures the ear of everyone between age two and twenty-five, evolving political and economic circumstances give rise to new ways of talking about coordinated action.  In the for-profit business world this is all too familiar; just as “atomic” businesses flourished after WWII and the invention of the transistor fueled a “tronics” boom, over the past decade we have seen dot-com rhetoric morphing into Web 2.0 as well as the painful rise and fall of shared modes of description for hedge funds and subprime mortgages.

Above: the dancing alien meme from the subprime mortgage boom


That social enterprise could prove merely to be a semantic bubble is not as outrageous as it might seem.  All the talk of world-changing revolution distracts us from a more unpleasant historical fact: that social enterprise is far from the first charitable revolution witnessed in recent years.  Merely a decade ago, many of the same experts now espousing social enterprise were proclaiming a “global associational revolution” that was poised to change the world forever. However, this revolution in doing good did not champion hybrid social ventures but nonprofit NGOs, or “civil society,” which were said to constitute a distinct “third sector” apart from state and market.  It was a paradigm well suited to an environment that now seems like the ancient past—the breakdown of the welfare state, waves of recession, the collapse of the Soviet Union and the Eastern Bloc and the imminence of a new millennium in the standard Gregorian calendar.

But even this was not the first social revolution.  Go back a few more years and you’ll find another way of describing nonprofits and charity.  As opposed to a third sector, nonprofits were “partners in public service” with government in administering “the welfare state.” Commercial business was a sector spoken of primarily in terms of market failure, a trope that does not seem surprising when you consider that this was a time marked by rampant inflation, a dormant stock market and the implosion of industrial manufacturing in the U.S.

In fact, the very terms we use now to describe doing good reflect the linguistic dynamics of earlier times.  Consider, for instance, the word “philanthropy.”  The use of this word to describe charitable giving reached a critical mass around the turn of the twentieth century, with the rise of charitable giving by wealthy industrialists.  That philanthropy is a word derived from Greek roots—philia, “brotherly love”, and anthropos, “human”—is not a coincidence; it reflects a strategic linkage of the industrial nouveau riche with the classical language then associated with the establishment elite.  

Similarly, the word “social” used in the charitable context is not an isolated novelty.  It is a word that came to prominence in the charitable world with the early development of social systems theory in the nineteenth century.  Whereas then-traditional charity viewed poverty as the result of personal flaws, social reformers—including the first generation of academic sociologists—argued instead for seeing society’s problems in terms of systemic social dysfunction. Even the analytical language is familiar, with analogies drawn from membranes and networks found in the society, the human body and such radically new media as the telegraph and railroad.

Akin to turbulent disruptions within the economy (Mandelbrot, 2004), the language of charity exhibits a tendency to evolve through waves of exploding bubbles, with some collapsing into nothingness, others leaving signal traces and a few systemically reshaping how we think and act.

A variety of factors influence how these patterns emerge,  perhaps the most prominent being strategic symbiotic mimesis, in which groups seeking an infusion of capital adapt to the perceived interests of potential patrons.  At present, this is the rhetoric of entrepreneurship, with particular instantiations of reflecting, inter alia, the extent of adaptive change each actor deems necessary to satisfy the expectations of targeted potential patrons.  Other factors that influence the spread of particular metaphor include the emergence of new media, shifts in status markers, the recognition of scientific progress, the vicissitudes of politics and the perceived stability of the broader economy.  

Here is where the analogy to Web 2.0 becomes particularly salient.  Akin to the initial mania for the so-called dot-com revolution, Web 2.0 has from the beginning been criticized as vague and questionably novel concept.  However, with the market downturn, Web 2.0’s semantic flexibility is less of an adaptive advantage than another piece of evidence for viewing the idea as just an echo of 1990s dot-com hype.  The exponential escalation of Web 2.0 can just as quickly become an exponential implosion, as negative associations with web-based social networking cascade into a market collapse.

Like its online counterpart, the sustainability of social enterprise is entangled with that of its underlying metaphor.  The more society tends to associate entrepreneurial values with positive feedback, the greater the potential for social enterprise to amplify  in ways that reinforce the perception that the movement is a permanent revolution.  Yet as business may lose its appeal, there is also the probability that a cascade transforms into a collapse.  In the latter scenario the question facing social entrepreneurs will go beyond merely defining what they are.  They will encounter increased resistance to the very notion of blending charity with entrepreneurship, a scenario in which the linkage of charity and entrepreneurship may become opaque at best.

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