Editors’ note: This article, first published in print during February-2000, has been republished for Nonprofit Quarterly with minor updates.
The most important thing I have learned from 23 years of fundraising is to think big. “Imagination is more important than knowledge,” said Einstein. I think all of us who work for justice stay in this work not because of what we know, but because of what we can imagine. We know we are oppressed, but we imagine that we could not be. In fact, I think the driving philosophy of most of us who have worked for social justice for many years was succinctly expressed by Ché Guevara: “Be realistic. Do the impossible.”
In this speech, I am going to be realistic. I am going to look at what our society should look like, then I will present a little about the history of philanthropy and close by telling you what I think this has to do with you and me today.
When I am asked to help a group with their fundraising, I start by asking what they intend to do and how much it is going to cost. We start with a goal: “We need to raise $100,000 in six months in order to do our organizing campaign or continue our outreach program or staff our hotline or whatever.” We start with a goal, we specify a time frame, and we look at what fundraising strategies we are going to use, who our prospects are, and who is willing to help.
Likewise, I start here by reminding us of our overall goals. We are working for a particular kind of society. We have been so beleaguered since the election of Ronald Reagan in 1980 that we sometimes lose sight of what we are, what our goals are. I will be 46 next week. According to the actuarial tables, I am slated to live to be 92. I am going to describe the kind of society I want when I am 92. I would remind everyone that the society I outline exists in various ways in countries around the world, and some parts of it even existed in our country at one time.
It is a society in which the following things are universal, which means free and of high quality to anyone who wants them: health care; elementary, secondary, and college education; child care; public transportation, parks, swimming pools, libraries, and community centers. All of these are accessible to people with disabilities. When I am 92, clean air and clean water are the norm and the idea of polluting water is unthinkable. We have long since abandoned the notion that people are superior to animals and animals to plants, and instead we value wilderness and understand ourselves to be part of a larger ecosystem. We know from our past, but not our present, that the loss of any part of the ecosystem is a loss to the whole.
We have basic income levels: First, a guaranteed annual income to all adults, which is the minimum wage. The minimum wage is enough to keep people out of poverty, so the percentage of people living in poverty is zero. This is a vast improvement from the 25% of people who live in poverty now. Second, each community has figured out an amount called the living wage, and the living wage is the minimum that employers are required to pay to employees. Finally, there is a maximum wage, which is never more than 20 times what the lowest-paid person earns. This is the most dramatic change from today, where CEOs of large corporations earn, on average, 491 times as much as their workers. I am indebted to United For a Fair Economy for many of these ideas.
The book of Exodus in the Torah describes this society this way: “The person who had much did not have too much and the person who had little did not have too little.”
The society we work toward is characterized by a sincere affirmation that difference is good, and that one’s gender, sexual orientation or race is a source of pride, but not superiority. Children are safe and well-fed. We are measured and valued by how well we love each other and how kind we are to one another, not by how much money we earn or how much money we have raised or how many votes we can influence.
Our military is small. Largely it consists of the National Guard which is brought out during hurricanes and earthquakes. There is no market for weapons, and missiles are displayed in museums—the leftover products of a more primitive age.
There are many other components to this society—it respects age, people are involved in governing themselves, the nation as a whole tries to do what is best for each person and values each person as an individual. Every individual considers what they do in terms of what is good for the whole.
I spend time outlining this society because I believe that you must know where you are going in order to make plans to get there. If you don’t have goals, then all your plans, your organizing, your advocating, your litigating, your fundraising, have no real purpose.
Where Philanthropy Began
Now, I am going to step back from the society I want us to have by the time I am 92, and go back about 90 years to the period of 1900–1920. As is happening now at the turn of the 21st century, the turn of the 20th century saw vast amounts of wealth being accumulated by a few people. The number of millionaires in the United States increased from 100 in 1880 to 40,000 by 1916. I want to discuss three of these wealthy people: John D. Rockefeller, Andrew Carnegie and Henry Ford.
I find these men remarkable. I hope most of us are familiar enough with history to know that they were also remarkably ruthless. Many of their actions can only be described as evil. However, they were also complicated men and the institutions they endowed have had a profound influence on all of us. I think knowing a little more about what they had in mind when they set up their foundations and charities might help us in conceptualizing the future of foundation philanthropy.
Let’s start with John D. Rockefeller, Sr. In 1913, he was the wealthiest man in the world, with a personal fortune of some $900 million. He was a close friend of the man who has probably exerted the most influence on the structure of foundations of anyone—a man named Frederick Gates. Frederick Gates was a Baptist minister, a close friend of Rockefeller since 1889 when Rockefeller had committed$600,000 to the University of Chicago, which was founded as a Baptist College. Gates became Rockefeller’s personal giving adviser.
Rockefeller wanted a more planned method for giving away money, and Gates conceptualized what was called “scientific benevolence.” This marked a change for Rockefeller from giving to individuals who had needs to giving entirely to institutions, and over time to institutions that he created. The Rockefeller Foundation, the earliest of the private foundations, was created in part because, while touring some of the mining towns he owned, Rockefeller felt the degree of poverty the miners lived in was so extreme that it could lead to revolution. To avoid a full-scale revolt would require ameliorating poverty. To do so, Gates and Rockefeller began what would become the Rockefeller Foundation. The desire to avoid revolution subconsciously informs much philanthropy today.
Rockefeller’s contemporary, Andrew Carnegie, was also a self-made millionaire who held very different beliefs about wealth than did Rockefeller. (“Self made” as my friend Naomi Brussel points out, is a misleading term, since he made the money from his workers. What we mean by “self-made” is that he didn’t inherit money that someone else made off of the workers.) Carnegie believed that wealthy people should give away all their money before they die, and that a hefty estate tax was the wisest tax. He said, “By taxing estates heavily at death, the state marks its condemnation of the selfish millionaire’s unworthy life.” He further says in his famous essay, “The Gospel of Wealth,” “I would as soon leave my son a curse as the almighty dollar.”
Beginning in 1881 Carnegie provided funds to establish libraries; by 1907 he had contributed more than $40 million toward more than 1,600 of them. In 1902, he sold his steel enterprises to J.P. Morgan for $300 million and started a series of foundations, some of which still exist today.
Henry Ford, on the other hand, abhorred both charity and philanthropy. In 1914, he attempted to deal with his large wealth by creating an innovative profit-sharing plan for Ford Motor Vehicle Employees. He believed that everyone who worked for him should earn enough to be able to afford a Ford. Late in his life, he set up the Ford Foundation but didn’t specify what the money would be used for. When he was asked what he thought about the ability of private philanthropy to adequately address social problems, he said, “They may do some good. Of course they are not adequate. But my idea is justice, not charity. I have little use for charity or philanthropy as such.”
As you can see, these were complex individuals, but the most important thing to remember is that they reflected their time. They represented solid business thinking of their day.
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As these and other less wealthy people began establishing foundations, people started asking whether private individuals should have so much influence on the way social services were provided, in effect controlling the destiny of the poor. This controversy came to a head because of events at one of Rockefeller’s companies, the Colorado Fuel and Iron Company. The United Mine Workers’ efforts to unionize the workers there were met with violent confrontation, eventually resulting in the National Guard and federal troops being called out, the death of a number of strikers, and continued denouncement of Rockefeller by the UMW. Most of us know this struggle as the Ludlow Massacre of 1914.
In response to these new social situations, Congress created a citizens commission in 1915 called the Commission on Industrial Relations. Under the leadership of Congressman Frank Walsh, the commission took on the task of hearing testimony on the topic of “Centralization of Industrial Control and Operation of Philanthropic Foundations.” The name of the commission gives us an idea that Congress had questions about the relationship of the concentration of industrial power to the establishment of these new foundations. Many spoke in favor and many spoke against the creation of foundations. These hearings resulted in an eleven-volume, 11,000-page document. The majority view was that foundations were a problem, but there was little that could be done about them.
Barbara Howe, who has written widely about the early history of foundations, comments on the Walsh Commission, “Because of congressional ambivalence toward the millionaires’ foundation proposal—which on the one hand fit well into popular models of rational social planning, but on the other hand were seen as symbols of continued paternalism on the part of exploitative capitalists—the creators of the American philanthropic foundation were unable to gain either explicit credibility or open praise for their new institution.”
The outbreak of World War I overshadowed the public debate about the role of foundations and the problem they pose remains unaddressed to this day. Anyone who is interested can read about how foundations have shaped higher education, research, the direction of social movements, health care and so on. But it is important to note, as Robert Arnove says, “Foundations and their staff represent neither retrograde reactionaries nor subversive radicals. Rather they represent a sophisticated conservatism, supporting changes that help maintain and make more efficient an international system of power and privilege. Their watch-words are efficiency, control and planning.”
Where Progressive Philanthropy Fits
What is the role of progressive philanthropy in all this? Starting in the mid-1970s with the founding of the Bread and Roses Community Fund in Philadelphia, the now-defunct Youth Project in Washington, DC, and followed quickly through the late 1970s and early 1980s by the creation of the Funding Exchange and its member funds, and the Astraea Foundation, the Peace Development Fund, and so on, we found a group of people who agreed with the criticisms of traditional foundations and added many of their own. In addition, they asked a question of imagination: Can we do it differently?
These were people deeply troubled by our nation’s involvement in Vietnam and not about to recommend that the government be in charge of anything. The slogan of the Funding Exchange could really describe the whole movement—change, not charity. These were people who believed that foundations could address the root causes of social problems. They sought to democratize private philanthropy. Their gains are extraordinary.
Community control of grantmaking—the extremely radical and previously unthinkable idea that grantees and activists would control how money was distributed, has become completely acceptable. Site visits are now common. Published annual reports, grant guidelines, access to foundation staff and even to foundation donors are taken for granted. Some of us have forgotten to tell others of us who are too young to know, that these things are profound, extraordinary, cultural shifts in foundation philanthropy. The mid-1980s and the 1990s saw another major development in organized philanthropy, the creation of identity funds—women’s foundations and queer foundations. Many of these share a progressive world view with their leftist counterparts; others do not.
Progressive and queer philanthropy have proved that foundations can be vehicles for serious, lasting social change. Can they stay that way? I believe they can only through relentless and constant self-examination. By the constant application of imagination, asking, “What is the cutting edge of philanthropy now? What is the next innovation that will make philanthropy a vehicle for lasting social change?”
Creating the Future
I went through this lengthy history of foundations because most of us don’t know it, and because it is important to remind ourselves that foundations have always caused people uneasiness, and if they cease to make us uneasy—whether we are donors to them, as I am, recipients of grants from them, as I am, creators of them, staff for them as I have been—the minute we feel good and peaceful about our progressive foundations is the minute we lose that very edge that made us important in the first place. I encourage all of you to learn more about the history of giving and receiving, from the Bible, from the creation of our country, and from the excellent books written about it. Rooted in history, we may be able to create a new history and a new society.
When you look deeply into philanthropy, you see another hidden history in a story in the Christian testament. Jesus is standing in a synagogue and watching the people go in and out. Jesus watched rich people put large sums into the treasury. And then a poor widow came and put in two copper coins, the equivalent of a penny. Jesus commented on this, saying, “This widow put in more than all those who contributed because they contributed out of their abundance, but she, out of her poverty, put in everything she had.”
The backdrop to all philanthropy is the philanthropy of the middle class, working class and poor. Here in the United States, 82% of all the money given away comes from families with incomes of $60,000 and less. Seventy-one percent of taxpayers file a short form, meaning, among other things, that they receive no tax benefit for their giving. Yet seven out of ten adults give away money—in fact, more people give money than vote.
Who are these people? Some of them have public faces: Bill Gates, Ted Turner, the Packard Foundation. But the majority of them, contributing the majority of the money, are people who give because it is the right thing to do. They do not have disposable income. They give because they are asked. If their financial situation worsens and they must decrease their giving, as soon as their situation improves, they increase their giving.
It is for the sake of these people, the majority of givers, that I return to the society I wish to see in 40-some years. The world we desire to create cannot be brought about by private philanthropy alone. We, who believe in the possibility of progressive social change, must form an uneasy alliance with the government. For our own personal voluntary giving to have real impact, we must insist that our
mandatory giving—our taxes—be used properly, be collected fairly, and that the tax system itself be constructed progressively.
Warren Buffett, head of Berkshire Hathaway Company and certainly one of the most successful men of our time, says that he finds it absurd that capital gains taxes are lower than income tax. When he sells a share of stock, he says, he pays a smaller percent in tax on his profit from that sale than a social worker helping someone stay off drugs pays on his income from his job. Capital gains tax, estate tax and income tax are methods of redistribution of wealth. They are part of the solution to poverty. It is therefore ironic that few activists work for tax revision. Taxes offer an extraordinary organizing opportunity which we have largely ignored.
I want to suggest the following as necessary for moving from where we are to where we need to be:
- Look at the word philanthropist. Either reclaim it, so that everyone who gives away money thinks of themselves as a philanthropist, or abandon it and stop using it at all to describe anything progressive or queer.
- Focus on the subtext of my whole talk: All social justice requires an understanding of money—how it works, who has it, how it is taxed, how it is given away. Therefore, fundraising is central to program work, not ancillary, not supportive of, central to. Get rid of the barriers between program and fundraising.
- Whatever your work is—hospice, litigation, teaching, writing, giving money, raising money —be clear about the context. Why are you doing this work? What do you hope to accomplish? We must walk a fine line between Reinhold Neibuhr’s belief, “Nothing worth doing can be accomplished in our lifetime, therefore we must be saved by hope,” and Rabbi Hillel’s questions, “If not me, who? If not now, when?” GFJ
Robert Arnove, ed. Philanthropy and Cultural Imperialism. Indiana University Press, 1982.
Teresa Odendahl. Charity Begins at Home: Generosity and Self-Interest among the Philanthropic Elite. New York: Basic Books, 1990.