A discussion paper for the Colloquium on Critical Issues in Philanthropy

 ARNOVA, Atlanta, November 2007

A REVIEW ESSAY:  SEARCHING FOR CRITICAL ISSUES IN PHILANTHROPY

by JON VAN TIL*

Foundations and Public Policy: The Mask of Pluralism, by Joan Roelofs. Albany: State University of New York Press, 2003.

Who Really Cares: America’s Charity Divide—Who Gives, Who Doesn’t, and Why It Matters, by Arthur C. Brooks.  New York: Basic Books, 2006. 

The Foundation: A Great American Secret, by Joel Fleishman.  New York: Public Affairs, 2007.

The Billionaire Who Wasn't: How Chuck Feeney Secretly Made and Gave Away A Fortune, by Conor O'Clery. Public Affairs.

 

Four new books on American philanthropy suggest that the liberal perspective may be sorely lacking when it comes to the resolution of issues of third sector policy and practice.  The first, by political scientist Arthur C. Brooks of Syracuse University,  is entitled Who Really Cares, and makes the argument that survey research consistently shows that persons on the right engage more often and deeply in charitable giving and behavior than persons to the left.  Brooks writes:

The conventional wisdom runs like this:  Liberals are charitable because they advocate government distribution of money in the name of social justice; conservatives are uncharitable because they oppose these policies.  But note the sleight of hand:  Government spending, according to this logic is a form of charity.  

Let us be clear:  Government spending is not charity.  It is not a voluntary sacrifice by individuals(p. 20).Brooks goes on to find four factors that explain why conservatives behave charitably:  1)  They are more likely to be religious; 2) They are unlikely to believe that government should equalize income; 3) If they are ‘working poor,’ they are very generous, more so than those of higher income and those on the welfare dole; and 4) They are  likely to reside in an intact family unit.  Therefore, claims Brooks, ‘The net effect of these four facts is that conservatives generally behave more charitably than liberals, especially with

* Professor of Urban Studies and Community Development, Department of Public Policy and Administration,Rutgers University at Camden, New Jersey 08102
vantil@camden.rutgers.edu    856-225-6223  web page:  www.crab.rutgers.edu/~vantil

respect to money donations (p. 178)’[1].  After all, conservatives attend church more frequently, are dubious about governmental redistribution of income, and are less likely to divorce.

Brooks’ findings support  the ‘U-curve’ theory of giving, which holds that the poor give a higher portion of income than the middle class because they are more active religiously.  That hypothesis has  been  questioned by James and Sharpe (2007) in recent article in this journal, and while Brooks did not have a chance to respond to that article, it would be interesting to see how he would proceed, especially in light of his statement: ‘I consider it my job to examine the data, interpret results, read statistics critically and accurately, never to substitute anecdotes for evidence, and to tell you a true story’ (p. 10).”

 The second book under review is also authored by a political scientist, Joan Roelofs, and is titled Foundations and Public Policy.  Roelofs examines nearly every form of third-sector activity that foundations have funded—ideology and information, governmental reform, arts and culture, economic development, legal reform, social change, and international intervention—and considers their ideological implications.  Not only does she present a more lively view of what foundations actually do fund than one finds in the recent book by Joel Fleishman (2007, in the third book here featured) , but she interprets each of these grants in light of a particular hypothesis.  Foundations tend to fund activities that liberals tend to support, but the impact of these programs is to discourage vital and effective progressive (or radical) social change.  Roelofs contends that foundations serve as ‘masks of pluralism’—providing ways for corporate money to fund middle-of-the-road intellectuals to contain and limit the prospects of real social change.

The philanthropic establishment has given Fleishman, one of their own, a quite reverential treatment, but Fleishman does not return the compliment to Roelofs.  He writes curtly of her work:

(T)here is a small body of Marxist-oriented scholarship about foundations, much of it politically marginal and factually shaky.  A recent example of work in this category is Joan Roelof’s (sic) Foundations and Public Policy, which claims that foundations have been largely responsible for the worldwide triumph of capitalism through their shaping of academic life…And of course the foundations have done this because they were created by capitalists to advance and protect the interests of the ‘ruling class’.  When one finishes discounting for the conspiracy theories that underlie and explain such criticisms, there is little on which one feels comfortable relying (p. 159).

           Fleishman  provides a vigorous defense for the provision of tax benefits to ‘all kinds of nonprofit organizations’ (p. 23) and presents a number of case studies (and more on line) of ‘high impact initiatives’, from the Flexner Report on Medical Education of 1906 to the China Sustainable Energy Program of 1999.  But the book is, on whole, primarily a declaration of passionate faith, belief, and enthusiasm of the power of organized philanthropy.   Here’s how it concludes, in a last chapter titled ‘A Prophetic Epilogue’:  ‘I am convinced that Warren Buffett has inspired a whole new explosion in the world of philanthropy…(He) may well succeed over the long run in benefiting many more human beings than those whose lives will be improved by his own billions. And that would indeed be a consummation devoutly to be wished’ (p. 280, emphasis Fleishman’s).”

Fleishman played an important role in the greatest secret venture in philanthropic history—the distribution of wealth accumulated from a string of duty-free stores owned by  Charles Feeney.  In the fourth volume here under review,  the Dublin-based journalist  Conor O’Clery probes a “great American secret”—to use Fleishman’s subtitle—that Fleishman does not choose to examine in his own study. 

The massive giving of Feeney, identified by O’Clery as The Billionaire Who Wasn’t, is that secret philanthropic venture.   This activity, which eventually received public notice under the name of ‘Atlantic Philanthropies’, was, as Fleishman recognizes (p. xxiii) ‘for most of its history…all done under conditions of strict anonymity.’

Feeney was the man one couldn’t call; his people would call on you.  The man who disbursed millions throughout the third sector, but held his donees to a strict promise never to speak his name.  The man they loved in ARNOVA and INDEPENDENT SECTOR and ISTR and the National Center for Responsible Philanthropy when he funded their programs, but whom politicos scorned for his support of  Sinn Fein and Castro and studies of how business controlled politics.  The man who showed that offshore philanthropy could advance an idiosyncratic agenda in a dazzling variety of public spaces.

The case of Charles Feeney and the instruments of his giving deserve the most careful examination of voluntary action and nonprofit organization scholars.  But to this point, this case stands as a “no-go zone” in philanthropic studies. 

A policy shift in 2002 at  Atlantic Philanthropies brought its funding of American nonprofit sector-serving organization to an end, but it also brought a number of long-hidden issues to the surface.  In its early years, the (apparently) stated policy of the anonymous donor (who everyone knew was Feeney) that mention could not be made of his gifts created an Aesopian set of open secrets usually communicated by means of facial expression.   For recipient organizations like INDEPENDENT SECTOR, ARNOVA, ISTR and The National Committee on Responsive Philanthropy, taking secret money challenged, one might have surmised, the public commitments of these nonprofit organizations  to transparency and openness in philanthropic giving.

For other sector-serving organizations, a set of issues presented themselves regarding self-dealing.  Several heads of major university-based organizations were intimately involved with Feeney as advisors, board members, and members of staff.  The story remains to be told of how they sought to protect themselves and their universities from conflicts of personal and institutional interest.

A third set of issues surround the ways in which individual scholars, often members of ARNOVA, handled issues involved in performing “secret research” funded by Feeney.  Of particular interest may be the papers presented in at a Feeney-funded Conference on Anonymous Giving held at the Indiana University Center on Philanthropy in February 1991.  At least one paper presented there has been published (Schervish, 2004), while other scholars protect to this day their vows to keep the papers they presented there from the light of day.

The move from anonymity to the semi-visibility of today’s Atlantic Philanthropies brought a bit more light to Feeney’s endeavors, but the organization to this day remains stingy in the information it provides the public on its work.  The whole episode deserves  careful review within the literature of philanthropic studies as a case in very private  giving.  At the very least, scholarship might provide the next donor who comes along seeking to play a vigorous role of anonymous activism an understanding of the gains and costs involved in the Feeney initiative.

The work of Brooks and Roelofs shed intellectual light on the Feeney case from their divergent perspectives.  From Brooks’ perspective, Feeney may be seen as the classic case of a charitable donor.  When all is considered, Feeney made his money through private business and then gave it away voluntarily.  That he employed an offshore organizational vehicle that enabled him to escape the scrutiny and regulation to which American foundations are subject  probably makes little difference from Brooks’ erspective.  What counts is that the money was private and not public, and was given with a desire to assist in the resolution of some sort of social problem.

To Roelofs, on the other hand, the Feeney case may appear to be a case of private wealth run amok.  She may well applaud his support for a variety of left-wing causes, such as the Cuban health care system or the move toward political power by  semi-socialist paramilitary organizations in Northern Ireland.  But, however acceptable these forays into radical politics may appear, the leftist would also be expected to concern herself with the perceived injustice of an economic system that permits one man to accumulate the billions that flowed to Feeney by dint of his cleverness, persistence, and luck in the sale of perfume and alcoholic beverages.

Perhaps the lesson to be learned from these books from left and right is that though they fancy themselves so different, in many respects they are saying the same thing: that liberals solutions are not helpful in modern society.   And, to use Roelofs’ phrase, they mask their agreements quite cleverly.

Feeney, after all, rejected the traditions and structures of American philanthropy in structuring his private giving.  He moved his offices offshore, which allowed him to operate independently from governmental review and taxation.  When it suited his purposes, he gave directly to political forces, like Sinn Fein, who would not have been eligible for philanthropic giving.  And he vigorously, with NYU Law Professor and nonprofit center director Harvey Dale as his enforcer, imposed an iron law of secrecy upon the operations of his group and the behavior of his recipients, regardless of their commitments to the liberal tradition in modern philanthropic process, with its values of  transparency and accountability.

Roelofs (p. 143), for her part, quotes Scott Nearing’s assessment of a particular philanthropic intervention:  “What the grants did was make the (recipients) permanent beggars from the… foundations.”   And Brooks (p. 162) makes nearly the same point for governmental grants:  “Welfare payments suppress giving tendencies.  And subsidies to nonprofit organizations ‘crowd out’ private giving by changing the incentives of givers.” Giving, these authors agree, can be a dangerous act.

Brooks, appearing to support only those forms of giving that do not make the giver poorer and the recipient richer, concludes his volume as follows:

This book has shown that one of the greatest political hypocrisies of our time is the pious sloganeering about liberals in America being more compassionate than conservatives.  This stereotype is false, and it is a disservice to our country…

The idea that income inequality is terrible per se is anachronistic and bad for charity…Income inequality—when it comes at the cost of freedom and economic opportunity—is not a mainstream American value…

What  I am calling for, then, is not a wholesale rejection of core progressive values—liberals should still be liberals—but rather a selective rejection of the forces that weaken personal generosity.  I am asking liberals to stand up for charity (pp. 177, 179, and 182).

 

And Roelofs writes, in her conclusion:

I wrote this book primarily to reveal the power that has been largely obscured both in popular accounts of our society and in the more specialized political science literature.  The liberal foundations try to hide their hands and do not encourage critical research…(They) themselves are buffer institutions, serving the corporate interests of their origins, their trustees, and their investments.

They further obscure themselves and their subsidiaries through ideological mystification, for example, the concept of the sectors: government, business, and the independent one.  This masks power, as crucial decisions are made in institutional and informal settings where elites from government, business, foundations, think tanks, academia, and the media interact (p. 198).

           One might reasonably conclude from a reading of these books that we have a case of what can reasonably be called ‘academic isomorphism’.  Whether the ideologue approaches the question from the left or the right, the enemy is found in the middle—in the form of liberalism and associated traditions of a mixed economy, accountable foundation structure and practice, and a commitment to at least a modest redistribution of wealth and income. 

 

REFERENCES

Russell N. James III and Deanna L. Sharpe, “The Nature and Causes of the U-Shaped Charitable Giving Profile.”  Nonprofit and Voluntary Sector Quarterly, Vol. 36, Number 2, June 2007: 218-238.

 

Schervish, Paul G. "The Sound of One Hand Clapping: The Case For and Against Anonymous Giving.”   Voluntas, vol. 5 (April 1994): p. 1-26.

 

 

 

 

 

 

JON VAN TIL is Professor of Urban Studies at Rutgers University in Camden.  His latest book, Breaching Derry’s Walls: The Quest for a Lasting Peace in Northern Ireland, will be published this winter by University Press of America.

 


 

 



[1] To be fully fair to Brooks, he does spend several pages (63-66) discussing, and dismissing, the value of the thinking of what he calls the “hard left.”  Here’s a sample:  “Marxist philosophy has few open adherents in contemporary American political life, but it still thrives in the hothouses of academia, and is surprisingly common among artists, journalists, and intellectuals outside the United States” (p. 65).