Or at least one of the things, but I think it can easily be argued that this one of the problems that causes the other problems. Take a look:
In summary: those who are in poverty are more likely to be illiterate. So are criminals. This is not for lack of brainpower, but more a failure of school system and (to get a bit radical) a system of oppression that feeds off people's lack of resources. Without literacy, one can't expect to go far. With that, the ruling class has a supply of brainless workers to help them get even richer (I studied Marxism in school! Can you tell?)
Writers should also take note: our jobs and our art are on the line!
Some nonprofits to invest in because they do good work by encouraging youngsters to read and bring books into young people's hands:
Books for America: This organization doesn't focus on just children's education, which might many start in the fight against illiteracy. They donate books to not only schools, but shelters, prisons, adult education centers, hospitals, rural areas--areas that need books, but are sometimes neglected. They also have an awesome bookstore in DC!
Burning Through Pages: A Denver-based nonprofit that buys books, give them away, and take the time to talk about them. Instead of encouraging kids to read classics, they seek books that are more relatable to kids in order to inspire a love of reading in today's youth. They also have viral graphics.
First Book: A national organization which donates new books to schools and programs to low-income children. Over the years, they have donated over 90 million books. I still vaguely remember receiving a bag with the First Book logo and books and goodies inside.
The Make It Safe Project: The Make It Safe Project donates books about sexual orientation and gender expression to schools and youth homeless shelters that lack the resources to keep their teens safe by donating books and supporting the develop of gay-straight alliances. The goal is to give queer kids books that they can relate to, give them stories that speaks to them.
My Story Book Club (of LLF): A program of the Lambda Literary Foundation, this project has similar aims as The Make It Safe Project--to bring LGBT literature into schools. Like Make It Safe, it exposes kids to diversity. Taking it a step further, it provides an online space for discussion: making books interactive, including chats with the authors.
I made this list quickly, so if I'm missing anything, let me know. I'm thinking of making a page for all of this info. Literacy has always been something I've been passionate about as a writer and social activist.