More Than Money
Issue #13

Provocative Dialogues

Table of Contents

“Dialogue #5: Giving: Community, Strategy, and Dignity”

Facilitator: Aaron Edison
Participants: Geoff, Claude, Ellen

Don't Fuel the Wars

"When I was a consultant to the Rockefeller foundation, I said to them, 'For every dollar you give to a liberal cause, a conservative foundation is funding a conservative counterpart. At best these dollars cancel each other out--at worst, they fuel community-based cold wars. You say your work is about building community, but you are often just arming adversaries. Could you fund a better way?'"

"Even if funders agree with one side of a war of ideas, it makes sense for them to use precious philanthropic dollars to build bridges between parties rather than to fund one side of a cultural war. They are more likely to come up with a durable lasting impact, and to promote community revitalization and self-governance."

--Mark Gerzon, director, The Common Enterprise

Geoff : I'm 27 and the Executive Director of my family foundation. I enjoy the world of philanthropy and plan to make it a lifelong priority. About Mark Gerzon's paragraph: I've noticed that in the foundation world, organizations of grant-makers tend to carry with them rather obvious political biases: e.g., the Council on Foundations is liberal; the Philanthropy Roundtable is conservative. In fact, the latter was formed specifically by a small group of funders to be the antithesis of the former.

On one hand, I find that the tension between opposing viewpoints creates a diverse "marketplace" so to speak, for philanthropic ideas, a competitive atmosphere where we hope the best solutions will come to light. On the other hand, I agree we all need to move beyond partisanship to get things done.

Claude : I am a 68 year old San Franciscan, the founder of RCM Capital Management which now manages over $25 billion in securities for institutions and high net worth families. I wrote four books on investing, and two years ago published a book on philanthropy now in its eighth printing (Wealthy and Wise: How You and America Can Get the Most Out of Your Giving . Little, Brown & Co.) My wife and I are entrenched philanthropists who believe that we should do as much as possible while we are living to make our communities safer, better educated, happier, etc.

I think it makes good sense to bring people with diverse views together to shape proposals. Our experience is that not enough interaction and collaboration occurs in the philanthropic communities. Too many organizations are duplicating the services of others, without communicating as to what is working well and what is failing, and why. My major criticism about Gerzon's approach is the fear that "too many cooks spoil the broth," hence that too many voices from multiple constituencies probably will lead to mediocrity.

Ellen : I live in Vermont and am a consultant in the field of philanthropy. I grew up middle class, and while I have inherited some money, this does not change my class position. I am interested in these issues for personal as well as professional reasons. I struggle with how much money to give away, how to communicate about inheritance with my kids, and all that.

Responding to Ger-zon, I would hate for people with liberal or progressive views to think, "for every dollar I might give to progressive causes there's one going to conservative causes, so they cancel each other out..." Let's be real. The Right, whether religious or not, has access to many, many more times the funding than progressive organizations do. In Social Change Philanthropy in America, researcher Alan Rabinowitz estimates about 1/10th of 1% of the total giving in this country funds progressive social change. I want funders to think, "In such a small pool, every dollar I give really counts, so I want to give it the very most effective way."

Sure, in some circumstances dialogues such as Common Enterprise will be the most effective strategy for change, but in other circumstances lobbying might be the best strategy, or grassroots organizing, or public education. Those of us who care about social, economic and environmental justice in this country find all kinds of reasons why progressive organizing is not more successful: lack of collaboration, factionalism... These may be true, but lack of funding is also a major factor. I don't think money is the only, or even the most important resource needed, but it is certainly a critical one.

Be Strategic

"If I could wave my magic wand, people would let go of needing to pick exactly which groups get their money. Instead, they would decide how much to give overall and to what issues, and then give through intermediary foundations who have done the thorough research needed to strategically leverage a lot of change with small amounts of money. Or they could hire their own staff to do this kind of legwork."

--Teresa Odendahl, director, National Network of Grantmakers

Geoff : Regarding Teresa Odendahl's views in "Be Strategic," I think she misses the point. Sure, people should trust other organizations to research effective causes; but more importantly, I think that others should respect people's right to do with their money as they see fit. We can cajole, suggest or even implore others to consider the avenues of charity we think are best, but ultimately, it is up to the grant maker to give funds where he or she thinks is best.

Ellen : We could open a discussion about to what degree there should be individual, private ownership of massive resources--I happen to think there should be greater limits--but that seems a whole other question. Teresa is in no way denying that we live in a country where people have the right to build unlimited wealth and do what they want with it. She's saying that if funders care about the results of their giving then making their decisions in an isolated way undermines that intention. Unless you're devoting your life to analyzing a certain social problem, it is very hard to make informed and strategic individual decisions about what will really make a difference.

I agree with her that most giving is done in a whimsical, "whatever moves me at the moment" kind of way. Very few donors or even foundations have a clear analysis of the issues they fund, or the key points for high impact intervention. It takes enormous work to figure this out. That is why it is critical either to do this analysis yourself or give through an intermediary. Is anything changing because of the work you fund? People with wealth have a responsibility to give in such a way that they can evaluate the impact.

Geoff : From my foundation experience I'm always shocked when I examine closely the financial statements of organizations that "sound" like they're doing a lot of good for the world. But when you see the excessive salaries, excessive overhead and the massive sources of other revenues, your realize that some charities try to obscure the facts about themselves.

Claude : I encourage donors to look at their contributions as they look at investments. They should expect good value in exchange for their efforts, and there are many obstacles out there--serious, self-centered, clinging obstacles--that need to be "pushed and pushed hard." Too many donors have been too polite; it may require some tough bargaining to reach compromises, much less constructive changes that will produce successful results.

Dignity and Honor

"Holding onto excess wealth may be a deep and old human pattern, but it's a false and selfish way to live your life. Sure, keep whatever millions you think you need for security-but then, give yourself and your family the pleasure, dignity, and honor to give away the rest. Don't wait until your deathbed."

--Waldemar Nielsen, contributor, Chronicle of Philanthropy

Geoff : I think that being a philanthropist causes many wealthy people to get a "I MUST SAVE THE WORLD" mindset. Not only is that impossible, but it undermines people's feelings of effectiveness in the local causes they support. For example, in Philadelphia where I live, the homeless and poverty and graffiti problems are so pronounced, it makes me wonder if any help could ever make any difference whatsoever. Then I realize that long-standing, complex problems require long-standing, complex solutions which need many more times the time or resources than I could ever devote. That's why instead of criticizing the priorities of current philanthropists, I'd rather proselytize to the masses of people who are either too unenlightened, selfish, or unknowing of how to give money at all. Wally Nielsen's paragraph speaks for me, here.

Claude : Boy, do I agree with Wally's paragraph. (I'm biased here, because I know that anything he writes amounts to unusual common sense and honesty.) In Wealthy and Wise I prove with new, conservative, and quantitative definitions of financial wherewithal that it is in everyone's interest for wealthy people to give substantially. People of means must understand that if conditions in America stagnate and deteriorate, they (people of means) will no doubt be singled out and penalized. Higher income taxation and/or higher attachment of inheritances may become new orders of the day. Indeed, people of means should develop the attitude that solid philanthropy is one of their wisest, even most self-interested, investments.

Ellen : I agree. It is totally in our own interest to use our resources to make a more just world. I am profoundly disturbed to see this country moving increasingly towards what used to exist only in countries like South Africa: rich people living in walled compounds with guards at the gate, unable to feel secure anywhere without protection. If nothing else but for the nourishment of own humanity and spiritual well-being, we can't cut ourselves off from the rest of society. .

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