A debate that is becoming salient, over the past few years is if philanthropic foundations are becoming powerful by the day? A recent article in The Huffington Post points this out. The writer points out, correctly, that Jeff Bezos solicited ideas for his philanthropy, just a few days before the purchase of Whole Foods. PR stunt? Astute move to buy some social capital? Or perhaps a combination of both?
For some, this is a problem – arguing, as does the Huff Post writer, Matt Stoller. But for others, this is nothing but a transactional idea. A means of buying some legitimacy in a world where raising questions such as this is moot. The battle of ideas over the legitimate use of power is over, in this other world-view. The capitalists have won and rightfully decide what needs to happen in our world. Whether it is by monopoly or other means is irrelevant.
A friend recently pointed out Hypernomalization, a documentary that also makes this point. The thesis in this documentary, that giving away of democratic power to those with wealth is dangerous and has brought us to the current state of affairs – with a climate change denying President and a world where the state is increasingly being made irrelevant and the real power resides in the handful of oligarchs around us.
This is not just a political problem but also a social problem. And in that sense, a philanthropic problem as well. For those of us who study (and practice) philanthropy, this should be disconcerting – simply because of the ramifications of how the act of philanthropy is perceived. Whether it is a genuine act – aimed at bringing about social change or a PR stunt depends as much on one’s motivations and style of managing it. The current tilt towards hi-networth philanthropy makes it less egalitarian and ‘normal,’ it seems.
As I visited Indianapolis last week to attend the ARNOVA Young Leaders Forum, I met some of the people from Lilly School of Philanthropy, the world’s first school of philanthropy. While the two day meeting was meant as a professional development opportunity, it also served as a way for the young leaders – most of who are PhD students – to network and also listen to some of the leading researchers in the field of philanthropy about the ‘state of philanthropy’ in the U.S.
Incidentally, one of my colleagues also forwarded me a newly released report titled A Golden Age of Philanthropy Still Beckons: National Wealth Transfer and Potential for Philanthropy Technical Report released on May 28th by the Center on Wealth and Philanthropy at Boston College points to a new ‘ golden age’ of philanthropy, that could be ushered in, considering the inter-generational wealth transfer of about $59 trillion that is likely to occur in the duration between 2007-2061. I will discuss this briefly, in this blog post. This is the first of a series of blog posts and I will come back to discuss the issues in this post, in subsequent posts.
For the uninitiated, it may help to start off by pointing out that philanthropy is the most American value. As one speaker argued, it is more American than Apple pie – given that more Americans give to organizations than the number who vote or take part in any other social activity. Here are some key highlights about American philanthropy:
– The average giving by Americans has hovered around 2 % of GDP for the last four decades
– The total giving (estimated) in the U.S. was about $ 300 billion in 2013, according to Giving USA report
– Giving to religious institutions has declined over the decades from about half of all giving to only about one-third of all giving in 2013.
Consider a recent story about Detroit in the New York Times that showed that about $ 850 million are needed to rid the city of blight and deprecated buildings. Problems of urban poverty, homelessness are far too big and widespread to be addressed by philanthropy alone. While the figure of $ 300 billion may seem big, when one considers the scale of social problems facing the U.S., this figure is miniscule, compared to the total amount of money needed to ‘fix’ all the problems, provide the poor and vulnerable with services they need and also to invest in the future of the next generation. Philanthropy by itself cannot solve these problems.
How is this relevant ?
While the figure of $59 trillion may seem an impressive one and perhaps transformative, several questions remain unanswered too. Would those who get the bequests actually use this money towards philanthropy or would they hoard wealth? What about the newly wealthy, who may not be inclined to support causes that address social issues, but may in fact veer towards political advocacy or other parochial means of spending their wealth. As the press release for the ‘A Golden Age’ report says: “The study reveals a 12 % increase in this “give while you live” trend since the authors 199 study. Over 55 years, nearly $ 27 trillion are estimated to be given through lifetime giving and a further $ 6.3 trillion through estates and various estate planning approaches.” What is of interest to non-profit professionals in this is that the portfolio of transfers is shifting, according to the authors of the report. One of their conclusions is that the transfer portfolio will include nonprofit organizations, donor advised funds, family foundations as well. This diversification of portfolio is what the authors claim makes this trend in giving transformative.
This report and other similar ones point to one important sociological shift in America: Giving patterns are slowly shifting, though giving has somewhat remained at 2 % of GDP over the last forty years or so. This shift towards ‘giving while living,’ may potentially be a game changer, as the report indicates. And there is good reason to believe this claim. But the hype of philanthropy solving all major societal problems is a very big claim that is not substantiated by facts, as the example of Detroit above shows. While I believe in the power of philanthropy to have a transformative effect in certain niche areas, the claims being made in many cases are outright exaggerations.
Almost everyday, we read about a new report or another, comparing America’s poor education performance, as compared to the rest of the world. And almost always the comparisons bring up the usual suspects: poor infrastructure, lower education funding and lack of involvement from the parents in their children’s success. While all these are valid and important points, one crucial issue often gets overlooked – the stability of the family and its impact on young adults and their learning. I learnt this harsh reality, on a recent trip to a public school in Rialto, CA. While this is a ‘wicked problem’ that brings together issues of race, poverty, unemployment and housing segregation; I believe that with concerted education, greater sensitivity on part of the parents, these problems can be addressed.
As this recent Op-Ed in NY Times titled Sex is Not Our Problem points out, “about half (51 percent) of the 6.6 million pregnancies in the United States each year (3.4 million) are unintended” and “the U.S. unintended pregnancy rate is significantly higher than the rate in many other developed countries.” While the topic of this Op-Ed is about sex education and its role in forming healthier adults, the key arguments are relevant to the discussion here too that social issues need to be addressed and blaming one gender (in this case shaming of girls) won’t solve anything. With this, the writer is alluding to distracting tactics that are often deployed rather than focusing on the real issues at hand. I believe the same is occurring in the case of families and their role in educating children. Added to this, conflicts in welfare reform, education funding get in the way of actually addressing the issues at hand.
While I am not making the conservative argument that we need more families, and lesser single parents; though there is some wisdom in that argument – I am definitely calling for greater involvement on part of the parents. As someone who has had all his primary and part of his higher education in India, I can point out one insight that may be missing in all our policy debates: How to make parents more involved. For one, Indian parents, much like their Chinese and Korean counterparts are extremely engaged in their children’s education. Some going too far, I would argue. In a conversation with Mrs. Lara, an Assistant Principal, I learnt that many of the parents in this school district are either not too engaged, or just not present. This is the unfortunate consequence of some of them being deported back to Mexico, where many of them are from. “When the recession hit, you could see hundreds of abandoned homes, and when the parents left, many of the kids were left with foster parents. And one can only imagine the amount of attention these poor souls received from them.” She pointed out.
It is well known that higher educational achievement means better job prospects and greater productivity, as this Op-Ed points out: “From 1891 to 2007, real economic output per person grew at an average rate of 2 percent per year — enough to double every 35 years. The average American was twice as well off in 2007 as in 1972, four times as well off as in 1937, and eight times as well off as in 1902. It’s no coincidence that for eight decades, from 1890 to 1970, educational attainment grew swiftly. But since 1990, that improvement has slowed to a crawl.” The real economic gains and productivity have slowed down remarkably and with the recent recession, this has exacerbated the problem. As Mr.Gordon goes on to point out further that “the gains in income since the 2007-9 Great Recession have flowed overwhelmingly to those at the top, as has been widely noted. Real median family income was lower last year than in 1998.” Several factors have contributed to this including the retirement of Baby Boomers from the workforce, slowdown in innovation. The growing cost of education, reduced graduation rates from high school and those with bachelor’s degrees, all contribute to the problems that are outlined above.
Greater family involvement means lesser absenteeism, better grades and better changes of success, as this research paper points. While it may be stating commonly held beliefs that parents are crucial for the success of their children’s education – these factors are impeded in the U.S. by several factors, one of them being cultural and linguistic. Some parents may not feel comfortable or welcome in an environment where they cannot use their native language, which may not be English, in many cases. Cultural sensitivity on part of the school is key, in these cases, an insight that Mrs. Lara also shared.
While improving education standards and measurement techniques seems to be one of the ways to improve ‘quality of education’ as some organizations and policy institutes advocate; the real challenge may be more elementary and perhaps harder to fix, i.e., ensuring that the students have a stable and secure base from which to launch their careers as scholars. Families provide that in most cases and perhaps if we bring our attention back to where it matters, this insoluble problem won’t be so insoluble, after all.
Keeping up the tradition of recommending books to read in the upcoming New Year, here is my list of top twelve books for 2014– all focused on Charity and Philanthropy. For starters, the two words don’t mean the same. Hopefully, by the time you are done with the 12 books, you will know the difference. If you are slow reader, read a book a month; if you read fast, aim for one a week. The books are not ranked in any order, so feel free to pick up any title you choose. And yes, some of them are online (for free download) at Project Gutenberg or other sites. So, here goes:
Alexis De Tocqueville’s Democracy in America– Perhaps the most cited (and sometimes cited simply because they have to) this book is a classic. Written by a French Aristocrat, who spent a few years in the U.S. documenting the norms of civil society, Democracy in America is a must read for anyone wanting to understand how ‘civil association’ came to be so dominant in the U.S., its moral philosophy and political dimensions. Tocqueville does a great job of illustrating the development of legal systems, relationship of federal government with the states, among other things. But the genius of the book lies in finding how civil society came about in the U.S. and how it is unique in so many respects. If you don’t have this book, buy it. Today.
Bishop, M., and Green, M. Philanthrocapitalism: How the Rich can save the World –With the discourse of ‘business can save the world’ gaining traction by the day, it is important to be aware of this trend and analysis. While I completely do not agree with the arguments presented here, it is a book worth your time. With Bill Gates and Warren Buffet pledging almost half of their fortunes to philanthropy, will the sector be in a position to transform the lives of millions of poor? Will other HNW individuals follow suit? What are the prospects of this move for philanthropy generally? These are some of the questions Greene and Bishop have dealt with, in this book.
Robert Wuthnow. Saving America? Faith based services and the future of Civil Society – I am biased towards Wuthnow. He is my favorite Sociologist of Religion and also the most perceptive one. So, his book makes it among the most important ones to read. Infact, any book written by him is an eye opener (and there are quite a few to read). At last count, he had authored over 38 books (I counted that many, not sure if I missed a few). Nevertheless, Saving America offers an in-depth analysis of faith-based services and if they should be supported with tax dollars. Both incisive and perceptive, Wuthnow writes with compassion and a sense of duty towards those who are at the receiving end of the social services. He is a kind soul who is sympathetic with the benefits that these organizations provide to the recipients, but is also scholarly in his approach.
Kass Amy, ed.,Giving Well, Doing Good: Readings for Thoughtful Philanthropists. This brings together the best of essays from various cultures, thinkers and ideologies to reflect on charity and philanthropy. There is WEB Dubois, Pope Benedict, Tom Paine and Rabbi Maimonides, among others. Here is a sample of what is in this book: Eight levels of Giving by Rabbi Maimonides :
There are eight levels of giving:
1. Helping someone find employment or forming partnerships, so they don’t need your help again
2. Giving to the poor, knowing that no one gives to them
Below this, the giver knows to whom he gives and the poor person does not know from whom he takes
4. Below this, the poor person knows from whom he takes, and the giver does not know.
5. Below this, one puts into another’s hand before the latter asks
6. Below this one gives another after the latter asks
7. Below this, one gives another less than is appropriate, in a pleasant manner
8. Below this, one gives begrudgingly
Kass, Amy. ed., The Perfect Gift: The Philanthropic Imagination in Poetry and Prose – Another interesting book by Amy Kass. This brings together some interesting perspectives on philanthropy from various authors, poets and thinkers.
Peter Frumkin’s Strategic Giving – While many people are trying to leave a mark with their philanthropy, they don’t have a blue print of how to do this. Frumkin, who is at Upenn provides a concise, clear roadmap for those who want to do this. A very well written book, one that is indispensable for those who want to go beyond just writing checks.
William Jackson. The Wisdom of Generosity: A Reader in American Philanthropy – This is a quintessentially American philanthropy book. Using folklores, stories, parables drawn from America’s rich past, Jackson offers us an idea of what philanthropy looks and feels like in the U.S. A rich book, that will make you appreciate the richness of American traditions of giving. I realized that between me and the author, there is a small coincidence: that the author spent his youth in Bangalore, working with NGOs’ (my hometown) and I was sitting in Indianapolis at the Philanthropy Library, IUPUI, many years later and reading his book on philanthropy. Small world, indeed.
Warren Ilchman and Stanley Katz, Philanthropy in the World’s Traditions– This book looks for expressions of philanthropy across various traditions and religions around the world. This again, brings together various writers from varying backgrounds to offer us a rich compendium of ideas and perceptions.
Singer, Amy. Charity in Islamic Societies –This is perhaps the ONLY book length treatment of charity in Islamic societies. And perhaps the book that spurred me to decide on my dissertation topic. And yes, she writes well. I have a deep respect for historians who do their job well and she does a remarkable job of grounding the norms, aesthetic dimensions and values of zakat, sadaqa and Waqf in Ottoman Empire and brings back the narrative to current day. A great book that should be in your possession. A review of the book is here.
David Wagner. What’s Love got to do with it? A Critical Look at American Charity. – This one is for the critical theorists out there. Wagner is not entirely convinced that charity, as we practice it, makes an enormous difference in society. He offers a well argued, indepth analysis for why things are as they are. A good read.
Olivier Zunz. Philanthropy in America: A History. – This book is a historic look at the emergence of philanthropy and makes a case for its use in public good. Zunz is a historian and brings his skills to fore here. Starting with philanthropists such as Andrew Carnegie, Rockefeller and others, the book traces the history of philanthropy in the U.S., offering a great narrative of how public good has come to be associated with giving. A good read and I enjoyed this book.
Alright, if that hasn’t satisfied your curiosity, here are a few more (keeping in tune with what one of my favorite professors does – All his syllabus has three reading lists. Required, Recommended and Supplementary).
Robert Wuthnow’s Red State Nation
Barbara Ibrahim and Dina Sherif, From Charity to Social Change: Trends in Arab Philanthropy
David Hammack and Steven Heydemann eds., Globalization, Philanthropy and Civil Society
Helmut Anheier and David Hammack, eds, American Foundations; Roles and Contributions.
Arnove et al. Philanthropy and Cultural Imperialism
If you enjoyed this list, share it with others and if you find a book that you think I should read, please write to me! Happy holidays!
“ We did not hear the term “Abrahamic faiths,” until about ten years ago. This term is not only a great leap forward in terms of interfaith work, but also a radical shift in how people are looking at each other’s faith,” said William Enright, the Director of Lake Institute for Faith and Giving, Indianapolis. He said this when we were discussing the state of interfaith work in the U.S and the implications on philanthropy, a few weeks ago, when I was at the Lilly School of Philanthropy, IUPUI. While the interfaith movement has a long history in this country and has seen many ups and downs, I will briefly discuss how religious diversity in the U.S is impacting it. I will briefly look at the opportunities it presents in the field of philanthropy.
My first significant exposure to the interfaith movement in Washington D.C was when I attended a Jum’ah (Friday)prayer conducted in an Episcopal church in downtown D.C, about two years ago. Ever since, each time I visit the city on a Friday, this is where I attend Friday prayers. While the notion of praying in a church may seem anathema to many Muslims across the world, this seems like the most normal thing in the U.S, where space constraints and financial restrictions are forcing small Muslim congregations to creatively reach out to other faith based groups and create spaces where they can pray, conduct meetings etc. This is not the only instance where prayers are held in a Church. I personally know of two other venues in the greater D.C area where this is the norm. What this points out is also the growing recognition and accommodation of Muslims by Christian and Jewish groups, who see the need to accommodate Muslims and their needs. This is also a good illustration of the concept of “Abrahamic faiths,” that Mr.Enright pointed out. While not new radically new as a concept (the notion of Abrahamic faiths is centuries old) but its usage and acceptance is rather new.
In “America and the Challenges of Religious Diversity”, Robert Wuthnow, Princeton University professor of Religion takes a close, hard look at the changing religious landscape in the U.S, and analyzes its impact on the American population. Using in-depth interviews with religious leaders, lay-men and also people from the “new religions” in the American landscape i.e., Hindus, Muslims and Buddhists, the book provides a compelling argument for greater inter-faith dialogue and also a call for Christians to be more pro-active in learning and accommodating these religious groups. The key argument in the book is that the increasing religious diversity is presenting challenges to the American social fabric and we must pay close attention to this issue. There is a call for greater interaction and also work between religious groups, though a stronger focus has been put on Christian groups to do more, in terms of inter-faith work.
He calls for reflective pluralism, one in which there is adequate thinking and consideration given to what one believes in, and where one’s beliefs are coming from. He points out rightly, that for exclusivists to ignore all other religions and to continue to live in a bubble will be hard in the future, as the country becomes increasingly diverse.
Shoulder to Shoulder and Interfaith Youth Core
Two organizations that seem to be at the cutting edge of interfaith work in the U.S are Shoulder to Shoulder, an interfaith alliance of over 20 national organizations, across the country from Jewish, Muslim, Christian and other faithbased groups that have come together to defend each other’s rights. This is exemplified in their stance against Islamophobia, and other racially motivated campaigns by radical groups in the country. Their mission is: “Sharing ideas for starting community initiatives to address anti-Muslim sentiment by maintaining an archive of past events. Offering resources materials in a comprehensive online library that includes worship materials, educational curricula, videos, and more.”
Interfaith Youth Core is another group that is redefining how interfaith work is being carried out. It is reaching out to Millennials across college campuses to form a coalition of groups that educate each other and also organize along faith lines to transform the religious context of the country. Eboo Patel, the founder of the group exemplifies this struggle, and he illustrates that in his autobiographical book Acts of Faith.
Challenges: One exclusive path or many ways to reach truth?
Exceptionalism is one of the biggest challenges facing America in the realm of interfaith dialogue. While some denominations tend to be exclusive, others take a more ecumenical perspective when it comes to reaching ultimate reality, or religious truth. Wuthnow points this out by saying : ““ Among the thorniest questions that religious diversity poses for all the major religious traditions is whether or not they can sustain their historic claims to being uniquely true or at least better than other traditions in relating people to the sacred. Much of the reason for believers taking an active part in particular denominations or congregations has been the conviction that God could be found best in one theological location rather than in the other”.
What this calls for, then, is not only willingness to dialogue and to be open to ideas, but also to be secure enough in one’s faith that this first step becomes possible. Most often, insecurity and lack of initiative hampers most efforts. A theme that Wuthnow brings up more than once is that of the majority community accommodating the minorities. This is not only a pragmatic position, but one that resonates with the ethos of building a civil society. And if the interfaith projects mentioned above are any indication, this seems to be happening, as we speak.
There is reason to be positive, though more efforts need to be made in this direction, Wuthnow adds. One of the most eclectic experiences I have had in Washington D.C (when I lived there) was attending Jum’ah at a church in downtown, walking out a few blocks and eating Matzo Ball soup at a Jewish restaurant. It was my little pilgrimage to honor all three faiths, though arguably the Matzo Ball soup is only culturally a Jewish delicacy. The diehard fundamentalists may cringe at this thought, but this is the reality of Islam in the U.S and also reflects the pragmatism that followers of each religion demonstrate. This, I believe will define the future of interfaith work in the U.S.
I arrived in Indianapolis almost two weeks ago, for a research internship at the School of Philanthropy, Indiana University in Indianapolis ( IUPUI). Since my arrival, it has been an intense foray into the world of Philanthropy and almost every experience is directly or indirectly related to philanthropy. I am amazed at the depth, breadth and strength of the school (and in some ways the city) to embrace philanthropic studies, in such a comprehensive way. Walk into downtown and you will notice the “Cultural trail,” endowed by the Eugene Glick Foundation, one of the larger philanthropic institutions in the city. The School of Philanthropy itself is endowed by the Lilly family and hence the school is now called the Lilly School of Philanthropy.
This is the first in series of “conversations in philanthropy,” posts that I plan on writing, during my stay here, throwing light on some aspect of the field of Philanthropic studies. In this post, I will try to give a big picture overview of how philanthropic giving has changed from last year to this year, based on Giving USA 2013 report and some insights into religious giving in the U.S.
I have already had some deep, insightful conversations with many people here covering philanthropy in religion, fund-raising, and also individual philanthropy. The research team here takes a “big picture,” view of philanthropy and studies it comprehensively. Some of the most impressive projects that I have come across are in the realm of trying to understand philanthropy in the context of larger societal discourse and also individual changes in behavior. My colleague Daniel, for instance is studying whether the ‘U-curve theory’ of philanthropy is true. i.e., that poorer people give more in philanthropy as compared to the middle class, in proportion to how much they earn and this percentage drops, as one’s income level increases.
Giving USA 2013: The Giving USA Foundation and Lilly School of Philanthropy released Giving USA, the annual report, which takes stock of the field of Philanthropy in a “big-picture,” perspective. Here are some key findings of the survey, which uses data from Internal Revenue Service, other sources that publicly report giving and aggregates this information. This is the most trusted and comprehensive survey of giving in the country and has set a benchmark for reporting philanthropy. For more on methodology of how Giving USA compiles its data, look here. Here are some key findings for this year:
Giving USA 2013 found that charitable contributions from foundations, corporations, and individuals totaled slightly more than $316B in 2012, which represents an increase of 3.5% from 2011. While this is no small sum, the Chronicle of Philanthropy notes that this is a “far cry from the $344B raised in 2007, before the recession hit, and a sign that unless the economy heats up — and giving along with it — it will be 2018 before charities and foundations can expect a full recovery.” After adjusting for inflation, donations from individuals, corporations, and foundations are still 8.2% below their peak just before the recession started in 2007.
Giving by individuals, foundations, and corporations increased in 2012 (+3.9%, +4.4%, and +12.2% estimated, respectively). The sharp growth in corporate giving could be tied to record profits for companies in the second half of 2012.
Contributions to colleges, universities, and private schools rose by nearly 5%.
Billionaire donors giving at record levels: according to the Chronicle’s database that tracks donations of $1M or more, the number of gifts amounting to $100M or more to date in 2013 has already exceeded the number of gifts of this level made in both 2009 and 2010.
Nonprofits with the strongest fundraising projections for the coming years tend to be spending more on fundraising in this time when many are cutting back, and are making innovations in how they attract gifts and diversifying their sources of revenue.
The U.S is considered one of the most generous societies in the world, with very high levels of giving to civil society organizations. This goes back to the days of the founding of the country itself, given that there was suspicion of the government and also high levels of ‘self-reliance,’ among people to solve their own problems. This, has arguably continued and to this day, shapes the cultural landscape of giving in the country. The Charitable Choice provision of 1996 and subsequent neo-liberal policies that have sought to reduce the role of government has markedly increased the demand for social services and hence, there has been an increase in the number of nonprofits. The sheer expansion of foundations is staggering, considering there are over 75,000 foundations operating in the U.S today.
Individual giving is still very high in the U.S, as Giving USA 2013 points out. But the debates in the U.S today center on the role of the state versus individual action. This is not entirely settled, despite best efforts to find compromise, with the political parties espousing diametrically opposed views on issues such as Medicare and Medicaid, Social service provision etc. For more reading and in-depth analysis of who gives, to what and why, check out this paper by Schervish et al.
Religious giving: What does the future hold?
The U.S attracts an enormous amount of money towards is religious institutions and faith-based organizations. Giving to religion was virtually flat (a -0.02% decline) with contributions estimated to be $101.54 billion. Giving to religious organizations (mostly local houses of worship) represents the largest share of U.S. charitable giving at 32% in 2012. This is not surprising, given that congregations are disengaging with the church and there is reported drop in church attendance. This could also be a case where faith-based giving is on the rise (those not overtly religious, but inspired by humanitarian principles-which one could argue are rooted in faith). A classic case is Heifer International.
Given that religious institutions have witnessed a drop in giving (from about ½ of all giving a few decades ago to about 1/3 now) there are lessons for church and congregation leaders here, as well. The first could be to engage with the congregation more deeply, to utilize online fund-raising (Dr. Tim Seiler, the Director of Fund-raising school informed me that churches are considered to be lagging behind in technology adoption) and also focusing on the untold needs of the congregations. The biggest insight that I got into this segment is when he said that the pastors are perhaps not talking to the right people, and making appeals to those already giving – rather than reaching out to those who are free-loading.
Philanthropy is well and alive in the U.S and this is corroborated by the research in Giving USA 2013. It is undergoing a shift, albeit slowly and this is taking the shape of more partnerships, between foundations, private enterprises and faith-based and religious groups. Perhaps this is an indication of the changing needs of society and also how people are responding to these needs. Or perhaps, it is a reflection of desperately trying to fill in gaps that the state has left open – given the budget cuts and sequestration?