"Power tends to corrupt, and absolute power corrupts absolutely." Lord Acton

Philanthropy Cannot Serve Two Masters

This week’s Acton commentary looks at the trend by many in the charitable sector to become increasingly reliant on government support. Sign up for the free, weekly Acton News & Commentary newsletter in the form here (right hand sidebar).
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The independence of American charities has steadily eroded in recent years as more philanthropic institutions have come to see their mission as one of partnership or collaboration with the government. That’s a nice way of saying, “seeking government dough.” Now, in the throes of a severe economic crisis and budget cutbacks at state and local levels, many charities are in a panic about reduced levels of funding. Anyone with eyes to see could have seen this coming.

A recent report in The Chronicle of Philanthropy spoke of a California budget crisis where “charities there are braced for steep cuts to social services and health care.” In Chicago, one manager of a children’s home said, “We’ve never seen the likes of this.”

The growing dependence of many charities on government support has been accelerated by the federal government’s funding, over several recent administrations, of charitable organizations for managing various social service programs. This funding, its supporters argue, gives private initiative the resources it needs to accomplish good works — with a little extra help from the government. But at what cost? (more…)

Greeks Bearing Gifts

In a Wall Street Journal article titled “The Great Philanthropy Takeover” Arkansas based writer David Sanders reports on a recent conference of the nationwide Council of Foundations in his home state. Sanders’ article aligns with Michael Miller’s blog of July 30 “Healthcare - Don’t Forget The Morality Of It” and deserves your attention because of the author’s conclusion that the Obama administration “is beginning to nationalize another sector of the American economy.”

How could that happen? Well it would happen because many of those folks who head up non-profit groups that rely on OPM — other people’s money — have a tough time identifying and convincing donors to give them some. Obama is offering an alternative: Bundled packages of tax payer’s money for “shovel ready” community help projects. If you’re a struggling non-profit with an iffy mission, it’s the greatest grant available.

And Obama knows about grants because when he was a community organizer in Chicago he and his associates, including William Ayres, were able to get over $120 million including matching funds from the Annenberg Foundation to spread around to their constituents. Eventually the Annenberg people cut off their funds because no good could be attributed to the use of all the money they’d supplied, but you get the picture.

Notwithstanding the deceitfulness of that Ayres-Obama Chicago enterprise, we generally should be wary of Greeks bearing gifts.

At the NCEA convention earlier this year I introduced and listened to a former lobbyist give advice to a room full of Catholic educators on how to get a piece of the stimulus money Obama had just announced would be available for schools. Just like Larry Arnn at Hillsdale College in Michigan and the American Council of Trustees and Alumni, I’m distrustful of the influence government has on curriculum and the mission of our schools and worry about the federal government’s intrusion into any enterprise. But at the NCEA event, the room was all ears to the application tricks being offered them.

That’s also what happened at the Foundation meeting in Arkansas, where as Sanders writes:

Carlos Monje, policy director of the White House’s Office of Social Innovation and Civic Participation, briefed the conference on how President Obama, who came up through the ranks of community organizing, wants to “change the ethic of service” for the country. Key to the administration achieving its desired results? Rewarding model nonprofits with federal dollars—seed capital—from the new $50 million “Social Innovation Fund.”

That phrase “ethic of service” calls to mind many things that hang on the tenets of faith to which Christians pay mind. But as we are consistently reminded by the scholars at Acton Institute, our charity is best left to the individual.

As Acton’s core principles state: “The government’s primary responsibility is to promote the common good, that is, to maintain the rule of law, and to preserve basic duties and rights. The government’s role is not to usurp free actions, but to minimize those conflicts that may arise when the free actions of persons and social institutions result in competing interests.” You might ask in this context who would declare a non-profit a proper “model” for funding or determine appropriate “social innovation?” If you said Mr. Monje you’re probably right.

Making the case to individuals for your “good deed” request is not an easy task, but it’s the only way we should be promoting the kind of Charity explicit in the ministry of Jesus Christ.

As I tell my friends in education, “Watch out for the serpent in your tent. Watch out for that Trojan Horse.”

Acton Experts on Giving, Finance

Zenit news service provides extensive coverage of two recent Acton-sponsored conferences in Rome. The first of half of Edward Pentin’s report focuses on Arthur Brooks‘ address at the “Philanthropy and Human Rights” gathering. A sample:

His friend had found that when people gave, they became happier, and when they were happier they became richer. Brooks was subsequently converted, and the discovery changed his life. Moreover, now he realizes that people have as much need to give as they have to receive, he believes those institutions that act as a conduit between the giver and the receiver, such as the Church, must be helped and encouraged.

The second half treats Carlos Hoevel’s presentation on Antonio Rosmini, part of a symposium on “Finance, Globalization, and Morality.” Pentin writes,

So what would be Rosimini’s solution to the current crisis? Hoevel said that, according to the philosopher’s vision, what we most need now is not so much “the endless injection of billions of dollars and euros” into the economy and heavy government interference, but “the urgent recovery of moral balance and moral content.”

Acton Rome conference on philanthropy

The Catholic News Service has published a report on “Philanthropy and Human Rights: Creating Space for Caritas in Civil Society,” a conference held Dec. 3 in Rome by the Acton Institute.

ROME (CNS) — Even at a time of global financial crisis, human beings need to give charity in order to be happy, said several speakers at a Rome conference on philanthropy and human rights.

Expecting a government to provide all social services and assistance robs those who are economically stable of the opportunity to help others and risks being inefficient, cold and even immoral, said the speakers at the Dec. 3 conference sponsored by the Michigan-based Acton Institute and the U.S. Embassy to the Holy See.

Father Robert A. Sirico, co-founder of the Acton Institute, said, “The market economy is not only the most efficient system to produce and distribute goods and services; it is also the system most respectful of our God-given creative freedom and which allows us to meet the basic needs of our brothers and sisters.”

Father Sirico was the only speaker at the conference — which included Catholic thinkers who have long praised the potential of the free-market economy — to speak directly about the current crisis.

Read the full story on the CNS site.

Doctoral Work on Religion and Philanthropy

I received this notice via H-Net last week:

THE LAKE INSTITUTE ON FAITH & GIVING THE CENTER ON PHILANTHROPY INDIANA UNIVERSITY

DOCTORAL DISSERTATION FELLOWSHIP

The Lake Institute on Faith and Giving at the Center on Philanthropy, Indiana University will offer a one year doctoral dissertation fellowship of $22,000 for the academic year 2009-2010. This doctoral dissertation fellowship will be given to a scholar whose primary research focus is in the area of religion and philanthropy or faith and giving. The fellowship is intended to support the final year of dissertation writing. The fellowship stipend will be paid in three installments: $10,000 at the beginning of the 2009-2010 academic year; $10,000 at the mid-point of the 2009-2010 academic year; $2,000 upon the successful completion of the dissertation.

More details here.

Sir John Marks Templeton (1912-2008)

Sir John Templeton, the great entrepreneur and philanthropist, passed away on July 8, 2008. Fr. Robert Sirico, president of the Acton Institute, marks his passing with this tribute:

It was with great sadness that I learned today of the passing from this life of one of the twentieth-century’s great stalwarts in the struggle for faith and liberty. Rising from a humble background in Tennessee, John Templeton graduated from Yale and Oxford universities, the latter of which he attended as a Rhodes Scholar. He went on to become one of the most-successful investors of his generation, creating wealth and generating employment for thousands of individuals. Today the very name “Templeton” remains a byword for entrepreneurship, prudent risk-taking, integrity, and innovation in the financial industry in America and around the world.

Read Rev. Robert Sirico’s tribute to Sir John Marks Templeton (1912-2008): A Great Entrepreneur and Philanthropist.

‘Call of the Philanthropist’

The new issue of Philanthropy Magazine features a cover story on Frank Hanna, vice chairman of the Acton Institute board of directors, and winner of the 2007 William E. Simon Prize for Philanthropic Leadership. The story is titled “Call of the Philanthropist,” a play on Acton’s Call of the Entrepreneur documentary, which features Hanna prominently.

The lengthy profile by Christopher Levenick offers insights into Hanna’s philanthropic activities and his philosophy of giving. Rev. Robert Sirico is quoted extensively, as are executives of other nonprofits that Hanna supports. For those who are interested in how philanthropy can be thoughtfully applied — and effective — the article is well worth reading.

Here’s Hanna on “indispensable causes:”

According to Hanna, donors should direct their funds only to causes they deem truly essential. “I believe,” he writes, “that the charities to which we give significant help should themselves be indispensable. In other words, their success should bring to mankind physical, intellectual, moral, or spiritual benefits of the most important kind, benefits without which mankind (or particular individuals) would be fundamentally diminished.”

Once philanthropists have identified the indispensable causes, they should restrict their donations to charities for which their support is truly indispensable. A small contribution to a massive organization will have marginal influence, at best. A series of marginal contributions is hardly better. Funds are always best spent where they will be put to the most effective use. If the organization can succeed without this donation, the money would be better spent on an organization that absolutely needs the funds to attain its objectives.

The Principle of Indispensability is designed to help maximize the leverage of charitable contributions. “Archimedes is credited with discovering how to use a lever to get seemingly disproportionate results,” says Hanna. “But Archimedes didn’t just stick his lever anywhere. He had to find the point of maximal leverage.” So too with philanthropy: Charitable donations achieve seemingly disproportionate results when they are directed to the point of maximal leverage.

Americans Giving at Record Numbers

Charitable giving in America has risen for the third consecutive year. The picture behind this recent report is rather interesting. Due to the absence of natural disasters, both nationally and internationally, large giving to major relief projects declined. Giving to human services also fell. The giving of corporate America rose only 1.5%. But in a shift from previous years giving to the arts and to cultural and humanities organizations grew rather significantly. The lion’s share of giving is still done by individuals, not by foundations, bequests and corporations. In fact, individual giving was about four times the amount given by all of these other sources combined, demonstrating once again that when individuals have the freedom to gain wealth they are enabled to share. But, as always, the largest percentage of giving was not among the rich. (This comment is not one meant to oppose affluence since there are several reasons why this remains true, and not all of these reasons suggest that the rich are universally uncharitable in the least. There is not a simple pattern here to explain this fact.)

(Continue reading the rest of the article at the John H. Armstrong blog…)

John H. Armstrong is founder and director of ACT 3, a ministry aimed at "encouraging the church, through its leadership, to pursue doctrinal and ethical reformation and to foster spiritual awakening."

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How to do Good Well

Posted by Jordan J. Ballor
on Monday, January 29, 2007

The business of philanthropy education, teaching people how to give their money away, is a growth industry, according to Business Week (HT: The Wealth Report).

It seems that wealthy kids often have trouble realizing and meeting their moral duties to be good stewards of their inheritance. “With my inheritance, I felt a sense of guilt and responsibility,” says Jos Thalheimer, 24, whose great-grandfather founded the American Oil Co. (Amoco) in 1910.

John Stossel’s recent “Cheap in America” program examined this phenomenon, contrasting the attitudes of Fabian Basabe, the “male Paris Hilton,” with Ben Goldhirsh, son of a publishing mogul.

Basabe, it seems, is unwilling and uninterested in doing good: “I’m going to live forever, by the way, so I’m going to have a lot of time to work and get involved.”

Goldhirsh, by contrast, “used the inheritance to start his own magazine, ‘Good,’ and donates subscription fees to charity. His father taught him that work, and charity — not money — is the route to happiness.”

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Never a Countdown on Effective Compassion

Posted by Karen Woods
on Thursday, December 28, 2006

The “10 years after welfare reform” articles of this past summer are old news, of course. Not surprisingly, indications were that, like any public policy, reform hadn’t been the all-time poverty solution, but that policies had, in fact, helped a significant number of people to move themselves to self-sufficiency. A recent Wall Street Journal series highlighted the broad range of issues related to moving out of poverty. A companion piece to the December 28 entry, “Economists Are Putting Theories to Scientific Test” notes that MIT has set up a center called the Abdul Latif Jameeel Poverty Action Lab focused exclusively on using experiments to study poverty.

Revisiting public policy and referenceing research can be insightful, especially as we attempt to make responsible end-of-the-year financial contribution decisions. What did pundits and experts alike argue is effective compassion, and how far on or off the mark are they in comparison to our own giving standards?

There is an abundance of good how-to-give-responsibly material from varied sources. With the Buffet donation and the Clinton philanthropy meeting in Little Rock, even recent international stories, Big Donors are making their legacy marks. Few of us have such resources, however. Does that mean that very limited, perhaps virtually unnoticed giving is any less valuable?

Less self-focus and more other-focus is a good thing, approached differently but consistently across the world’s faith doctrines. A New Testament Gospel parable underscores the relative value of giving…..not relative to world impact but relative to the personal sacrifice required of the giver.

The story of the Widow’s Mite is worth revisiting. Interestingly, Wikipedia reports: “This tale is held by most modern Christians to mean that a gift should to be judged not by its absolute value, but by how it compares relatively; that it is not the impressiveness or purchasing power which matters, but what it means.” There is theological debate about the ‘true meaning’ of the parable. I’ll leave such to the theologians and consider a ‘face value’ interpretation. There is a quality about sacrificial giving that facilitates my being a better person. To give sacrificially rather than from abundance means that I probably considered my own needs (wants, most likely), weighed them against neighbors’ need, and determined to put the others before myself.

It appears that ready sacrifice isn’t so especially American these days. Unlike the American culture that marveled Tocqueville, twenty first century America is ruefully referred to as the “me” culture–me first, me now, more for me, is there any other consideration except me? Brokaw referred to Americans of World War II era as “the greatest generation.” Sacrifice was a way of life–literally of life, of resources, of simple sacrifices such as sugar and gasoline. But just as our growing abundance has empowered Big Donors to make a Big Impact, has personal sacrifice for others been eclipsed? Arthur Brooks certifies that Americans remain the most generous, and more interestingly, those with less give more

But I’m not just musing over personal sacrifice in the amount given. Am I deferring to personal comfort and ease, i.e., online giving, vs. my having to make a more concerted effort to determine both program and financial effectiveness of a charity helping needy neighbors?

I questioned a Generation Y colleague, who of course is technically astute. Was I reflecting my age, working from an assumption that personal connection was of higher value, that deferring to click (Internet) donation was a contender to Subsidiarity? He offered some insights about the ease of accessing global information about need, that my “needy neighbors” now could reasonably include global neighbors vs. only those in my own community. And I’m not pushing facilitators of online giving in to a questionable position. Many of the charities that we know well now have the capacity to accept online donations.

So this is the recommended benchmark: Give sacrificially. Make the personal effort to discern your need from want and then compare to your neighbor’s need……next door or across the globe. If possible, use the Internet to investigate how well your charity of choice invests resources that you give them. Investigate just how much an Internet “giving intermediary” takes for processing. Don’t ever discount the needs of your own community, those perhaps with no Website, not in high profile charity registries, but helpful to your neighbors with food and health needs, challenged teens, people who simply need a friend.

Those personal expenditures are the epitome of personal sacrifice……and worthy of being categorized with the widow who gave her mite.

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