On Feb. 12, the Philanthropy Roundtable and the John William Pope Foundation co-hosted an event in Raleigh titled “How and Why Free-Market Public-Policy Donors Give to Charities That Help the Poor.” The transcript below is of a speech given by Alicia Manning, Director of New Citizen Programs at the Lynde and Harry Bradley Foundation The Roundtable has so eloquently set the stage for this discussion by reinforcing, through the very existence of its Economic Opportunity program, the idea that humans thrive where liberty and personal responsibility coexist. I’m not sure whether former Professor Riggs would agree that what I’m about to suggest can be properly considered economic theory, but I will posit an idea nonetheless: a society that is both free and humane is a duality that requires both a supply of free people and a demand for freedom. Philanthropy can work on both sides of this equation. The extent to which American citizens are currently free is obviously open to debate, but to the extent that there is still a supply of free citizens to assemble, speak and associate freely, it is safeguarded through the efforts of those assembled here as well as others who work to mitigate the effects of an ever‐expanding government and evermore powerful quasi‐governmental entities that adopt a statist approach to dealing with citizens’ problems. To counterbalance all that freedom, however, a robust society also requires private civic institutions, or mediating structures, as some in academia refer to them, where the demand for freedom is fomented. A vigorous civil society doesn’t only help the poor; it enables all of us to live lives of mutual support and concern, religious expression, and cultural richness. It gives each of us a visceral experience of connectedness and meaning that elucidates all that we stand to lose by surrendering authority over our daily lives. The Bradley Foundation is engaged in nurturing both sides of this equation, but I am going to talk almost exclusively about how grantmakers can participate in the development of a more robust civil society, improve their communities, and transform lives in the process. I should first describe our mission, which is straightforward. The Foundation is concerned with strengthening American democratic capitalism; supporting limited, competent government; supporting a dynamic marketplace for economic, intellectual, and cultural activity; defending at home and abroad American ideas and institutions; and recognizing that responsible self‐government depends on enlightened citizens. The Bradley Foundation was established in 1985, and early on, its national and international policy programs were well‐developed. Local grantmaking in our home city of Milwaukee, however, was less sophisticated, consisting mainly of grants to large, mainstream charities and causes that benefitted from high visibility or at least friends in high places. By the early 1990s, through our increasing involvement in welfare reform and the then‐burgeoning school choice movement, we had begun to realize that a properly conceived local program could be deployed strategically in service of our broader programmatic goals by furnishing practical examples that reinforce our policy objectives. For reasons that are fairly evident, establishing a community‐based grant‐making program modeled after those of the large, mostly progressive foundations that support the “poverty industrial complex” was not going to work. Rather than mimic the programs of those foundations by dividing our programs into issue‐based categories, hiring subject‐matter experts, and simply slapping on a conservative veneer, our board of directors decided to do something different. For nearly two decades, now, the Foundation has chosen to identify and support grassroots and faith‐based groups run by visionary leaders who are close to the problems they aim to address. We sought out the expertise of the esteemed Robert Woodson of the Center for Neighborhood Enterprise, who taught us how to root out the hustlers from the real deals. Now, we award such groups general support, trusting that they are in a better position than we to determine how to prioritize the allocation of their funds. Often, we support them over a long period time, and the ongoing exchange of information that is a necessary part of the process of grant‐making takes place against the backdrop of an established relationship. This approach has been more compatible with the Foundation’s broader interests in increasing local control and portraying citizens, even poor ones, as dignified human beings who are capable of the fullest measure of participation in a vigorous civil society. It has also been very effective at solving community problems. Presently, our local grant‐making covers an array of issues, but as it pertains to helping people help themselves, there are eight criteria we seek to identify in organizations we support: They promote personal responsibility and self‐help over victimhood and dependence. They capitalize on the private initiative of citizens to govern themselves. They have important leaders who serve as moral authorities and who are personally invested insolving community programs. They conduct work that is transformative, focusing on personal relationships and character development, often in the context of religious faith, as opposed to transactional, focusing on service delivery. They foment movements within fields or organizations that drive a wedge between those who promote ineffective solutions and those who promote effective solutions to community problems. They have a significant economic effect on the city either by directly improving neighborhoodsor by rendering residents more capable of being economic contributors. They are programmatically interconnected so as to form an interdependent community. They serve as important neighborhood anchors that have a stabilizing effect. Too often, in our work, we encounter other donors who are interested in these ideas, but make mistakes in the application of them. These are donors who have built, from the ground up, the businesses that have supplied their wealth, or they are only one degree removed from their forebears and have a personal stake in the stewardship of their institution’s funds. They often contribute generously to causes that bolster the supply of free people through policy reforms, but lack confidence in their ability to identify the entrepreneurs who possess the local wisdom to solve problems others deem intractable and whose work ultimately results in the cultivation of citizens who want to be freer. Because they have been told that philanthropy is the purview of experts, they sometimes adopt over‐complicated, jargon-laden grant‐making strategies that turn helping people into a science that requires a level of precision and scrutiny usually reserved for nuclear fusion. They fail to recognize that the wisdom they have acquired through both the navigation of countless relationships and the resolution of countless issues in their professions and daily lives is exactly what struggling people in struggling neighborhoods need. They need social capital, and they need to understand how to develop it. I am going to point to three areas in which I think donors get bogged down, preventing them from finding and supporting organizations that effectively help the poor. First, they mistake management for leadership. Everyone appreciates good management. Sometimes, however, the most well‐managed operations are also the most inconsequential. Conversely, I could tell you a dozen aggravating stories of organizations with extraordinary, life‐changing programs whose bad management has threatened to derail them or has shut them down entirely. Management is important. Leadership is more important. People in poor neighborhoods desperately need visionary leaders. They need someone in their lives that they don’t want to disappoint. The people in the Lindsay Heights neighborhood on Milwaukee’s near‐north side need Sharon Adams, whose career took her to New York City for several decades before she returned there to live in her childhood home. Crushed by the crime and decay she saw, and angry that longtime residents were too frightened to sit on their front porches, she gently but deliberately led her neighbors down a path of self‐determination and neighborhood renewal. Less than a decade later, North 17th Street has a peach orchard, hoop houses for winter gardening, and bees. Vegetables and flowers grow on every spare foot of property. Sharon’s organization, Walnut Way Conservation Corporation, has incubated several small businesses owned by neighborhood residents, including painting, landscaping, and catering companies and a juice bar. A neighborhood kitchen has become a gathering place for honey processing, canning classes, and family celebrations. The lives of longtime residents were documented through an oral history project. Walnut Way has created and is currently implementing a neighborhood plan revolving around wellness that involves major capital improvements and the willing, voluntary participation of dozens of other nonprofits who have also been inspired by Sharon. Residents made these changes themselves, and none of it would have happened without Sharon’s strong faith, her strong will, her gentle wisdom, and her positive aura. Leaders are assets in which to invest. Management can come later. Second, free‐market donors often mistake language for ideas. There are groups of people who say they are helping troubled kids avoid gangs, excel in school, and learn life skills – and they actually are. There are groups of people who say they are helping troubled kids avoid gangs, excel in school, and learn life skills – and they are actually just shuffling them around a building, perhaps keeping them safe but not much more. The problem lies in the fact that these two groups often look quite similar on paper. Grant‐seekers, especially the larger ones with dedicated development staff, know how to use evocative language. They also know how to co‐opt terms that were once meaningful to free‐market adherents, populists, and believers. The only way to know the difference is to visit and ask the right questions. Many donors apply a political or philosophical purity test to grant‐seekers, screening out those who use certain buzz words that make them uncomfortable. Conservatives cringe when they hear the words social justice or advocacy or, my favorite term du jour, collective efficacy. Grassroots leaders often don’t have the luxury of ensuring that all their communications adhere to a tidy ideological framework. They sometimes use words that float around in the nonprofit lexicon without realizing, or caring, that they are loaded terms to different groups of people. Sometimes they intend to convey the same meaning as that of a political movement that uses a very specific definition of a particular term. Sometimes they don’t. It’s up to us to figure it out. Other organizations are blatant about their support for causes or public figures that instantly alienate conservative donors, as often evidenced by the posters that can be found on the walls of their headquarters. I am urging donors to overlook this. If an organization possesses many or most of the criteria I listed earlier, and if a funder’s investigation leads him to believe that it is programmatically effective and not actively working to undo the policy goals he is trying to advance in other areas of his grant‐making – let it go. Grassroots leaders who are both charismatic and competent are fairly rare; we need all of them to save our struggling communities. And, if we’re being honest with ourselves, conservatives have not successfully created a narrative that compels those in the trenches to join our cause. Donors need to trust that the people who have been helped by effective grassroots groups, and particularly their children, are one step closer to understanding how a free society affords them more opportunities. Lastly, donors mistake transactions for transformation. The ability to precisely measure outcomes is not a harbinger of an organization’s effectiveness. The evidence‐based outcomes craze is overblown. David Bosworth is a professor of creative writing at the University of Washington who writes about culture in his spare time, including the subject of philanthropy. He has coined a new term that accurately describes the current, ubiquitous obsession with enumerating every meal ever eaten, every meeting ever attended, and each human encounter that has ever taken place. He calls it quantiphilia. Quantiphilia plays on the insecurities of educated people in a time of uncertainty. It implies that whatever framework existed for considering effectiveness in this arena before was inadequate or at least not based on evidence that would hold up in a case worthy of publishing in a scholarly journal. Before I get into too much trouble, let me clarify that I am not trying to suggest there is no value in measuring anything. Certain, basic information is critical to a donor’s ability to judge a group’s effectiveness. Fiscal responsibility is essential. Similarly, organizations that proclaim the significance of outcomes that are somehow not in proportion to their budget size raise a red flag and can lead donors down a path of inquiry that can be constructive for both grantor and grantee. For example, I recently learned about a six‐week academic program that served roughly 120 kids and had a budget of roughly $200,000. At that price tag, a private tutor could have been hired for each participant, but without both the numerator and denominator, it would be impossible for a donor to make the judgment that the program is not likely to be an effective use of his scarce resources. And aside from their intrinsic value as empirical data points, outcomes can serve as important indicators of an organization’s inclination toward transparency, its ability to communicate effectively, and its health in general. We track all kinds of outcomes at the Bradley Foundation for all of these reasons. However, if one is looking to revitalize civil society, one is, in essence, looking to incite a movement. It should be the hope of every donor that the local initiatives in which he invests will gain momentum beyond the scope or effect of the resources he has invested. If this is the case, how could the donor’s individual impact possibly be isolated and analyzed? In this context, a fixation on the precise measurement of narrow sets of program outcomes is to miss the forest for the trees. This brings us to the heart of the quandary presented by quantiphilia: a preoccupation with measurement invariably leads to the funding of what can be measured. If a funder’s objective is to support service delivery, perhaps that’s appropriate. But if a funder’s objective is to support the engines of community that generate a demand for freedom – the little creators of good culture in the context of which services are sometimes delivered – it must consider an organization’s Lasagna Factor. All of us need to belong to naturally diverse, interdependent communities of mutual support, but this is particularly true of poor, vulnerable people. For example, people returning to the community from prison need more than a job and an apartment. They need a credible role model; a friend who has walked in their shoes and can help them avoid the landmines of old groups of friends and disapproving family members. They need someone to help them deal with the emotional insecurity of having to make hundreds of small decisions throughout their suddenly unstructured days. People who form organizations to do this kind of work do so because it is a calling for them. They don’t limit the scope of their efforts to what they get paid to do. If a member of a community of ex‐prisoners needs to move, someone brings their pick‐up truck, if something breaks, they bring a toolbox, and if someone dies, they bring lasagna. They don’t have a lasagna program, and heaven knows they don’t have a lasagna budget, but lasagna appears. Personal transformation only occurs in the presence of relationships built on trust, respect, and love. Donors who care about self‐government must support organic communities that promote self‐help, and they must find alternative ways to assign value to their work. They must consider the long‐term sustainability and the incredible leveraging of volunteer resources of organizations that have a high Lasagna Factor. I will close simply by saying that donors who wish to alleviate poverty in ways that don’t impede economic growth or personal liberty must adjust their thinking about popular trends in philanthropy. Certainly, they should let the Roundtable be their guide for reasonable, detailed information about effective grantmaking in this arena. But they should also trust their own instincts, which can only be honed by getting personally acquainted with those special organizations that play a part in protecting and restoring American culture.
Category: Public Policy
On Feb. 12, the Philanthropy Roundtable and the John William Pope Foundation co-hosted an event in Raleigh titled "How and Why Free-Market Public-Policy Donors Give to Charities That Help the Poor." The transcript below is of a speech given by David Riggs, Executive Vice President of the Pope Foundation, during the conference. Thanks to all of you for coming here on this wintery day to learn a little more about an important project of the Philanthropy Roundtable, “How and Why Free-Market Public Policy Donors Give to Charities that Help the Poor.” The Pope Foundation has been a supporter of the Philanthropy Roundtable for many years and we hope that you will find their activities and expertise to be of interest, too. My goal here is to set the stage about why free market public policy donors give to charities that help the poor. I’d like to begin by briefly describing some of the Pope Foundation’s history. The Foundation has a long history of giving to public policy nonprofits. The purpose of that philanthropy, generally speaking, has always been to advance economic liberty for all people. The Foundation has been a significant donor to many NC-based public policy nonprofits like the John Locke Foundation, the Civitas Institute, the Pope Center for Higher Education, and the NC Institute for Constitutional Law. The Foundation has also made significant investments in national public policy nonprofits like Americans for Prosperity, the Heritage Foundation, and the Cato Institute. The Foundation has supported all of these groups because we share the principles of individual freedom, limited government, and personal responsibility, and these groups have proven to be effective at advancing a wide array of policy issues. In addition to the Foundation’s support of public policy nonprofits, it also makes significant investments in charities that help the poor, supporting community philanthropy – or nonprofits that engage in some form of humanitarian aid within the geographic area of Raleigh. There is a genuine ideal of helping your neighbor that motivates the Pope Foundation board in the area of community philanthropy. Giving to community philanthropy is simply the right thing to do. But, additionally, the Pope Foundation gives to charities that help the poor because it fully complements our public policy investments. I would like to offer three general reasons for why free market public policy donors should consider giving a portion of their donor dollars to charities that help the poor. [First], investing in charities that help the poor provides a fuller, free-market vision; one that truly advances opportunity for all people to live more fulfilling lives. Partnering public policy investments with humanitarian aid is one way to reinforce the free society desire to help all of society, not just the wealthy as many political opponents like to claim. And so, in a strategic marketing sense, we are more likely to have free market public policy success when we expressly show how the policies we seek to advance helps our neighbors and the least fortunate within our society. The second reason for supporting charities that help the poor relates to their ability to bolster cultural norms and practices that are key to a free society – for example, work and industriousness. The data shows that American society is changing and perhaps not for the better. The unemployment rate in the United States dipped to 6.7% in December, its lowest level since October 2008. That should be cause for celebration because the figure suggests that about 2 to 3 percent of the working population is truly unemployed, since about 4 to 5 percent of the unemployment rate is statistically full employment (under traditional economic analysis). But, of course, anyone who has been following the news about employment closely over the past few years knows that the American economy is no where near full employment. The drop in the unemployment rate from its high of 11 percent in 2008 to its low today is mostly because the long-term unemployed have given up searching for work. The true unemployment rate tends to be pegged around 15%. In fact, one Wall Street advisor has claimed that the real unemployment rate is as high as 37.2%. The unemployment rate is significant, but an equally significant problem for economic growth is the declining labor force. This isn’t a cause of the Great Recession exclusively, although the economic downturn has exacerbated it. Rather, it’s a problem that has been worsening for at least the last 50 years — and it’s one that free-market donors should take an acute interest in. Some of the most recent data shows that just 63 percent of the 16-and-over demographic is working or looking for work. That workforce participation rate is at a 36-year low. Some of that is due to an influx of Baby Boomers retiring, but the trend line is in a negative direction, suggesting that more and more Americans are accepting of perpetual unemployment and reliance on the social welfare safety net. This indicates a broader trend in American culture, one of a loss of the virtue of industriousness – or, as libertarian sociologist Charles Murray says, that basic American assumption that life is to be spent getting ahead through hard work and thereby making a better life for oneself and one’s children. The founder of the Pope Foundation, John William Pope, recognized the importance of industriousness when he said, “the responsibility for success lie on the shoulders of the individual.” Murray discusses the loss of the virtue of industriousness in his book "Coming Apart." He focuses on white males between the ages of 30 and 49. In 1960, 81 percent of these males worked 40-hour work-weeks compared to just 64 percent in 2008. For men who are employed, they tend to work fewer hours per week than their counterparts two generations ago. Is the drop in labor force participation due to a decline in good-paying blue collar jobs? In other words, low-skill workers wanted to find work, but couldn’t. Murray addresses that question, too. "Put yourself in the place of a [man] who is at the bottom of the labor market, qualified only for low-skill jobs," he writes. "You may wish you could make as much as your grandfather made working on a General Motors assembly line in the 1970s. You may be depressed because you’ve been trying to find a job and failed. But if a job driving a delivery truck, or being a carpenter’s helper, or working on a cleaning crew for an office building opens up, why would a bad labor market for blue-collar jobs keep you from taking it? … Why would you not work if a job opening landed in your lap? Why would you not work a full forty hours if the hours were available? The answer, Murray writes, is because of a declining emphasis on industriousness. So, what to do about the problem? As free-market donors, our focus is often on public policy reforms: Lowering taxes and reducing regulation will lead to more job creation. As important as these steps are, they are only part of the puzzle. It’s also necessary to work for change at the level of civil society — to encourage industriousness in the lives of individuals and families right now. Free-market philanthropy can play a critically important role in this by supporting local nonprofits that encourage individuals — particularly those of low income — to practice the virtue of industriousness, and to teach them how to do so effectively. The third, and final, reason for why public policy donors give to charities that help the poor is because it complements and leverages investments in public policy nonprofits. Investments in public policy nonprofits are designed to create economic opportunity. When we support charities that help the poor, we help people take advantage of the economic opportunities generated by sound public policy investments. Of course there is an assumption in that last statement which is that we know how to help the poor. In a recent article in Commentary magazine, Arthur Brooks, President of the American Enterprise Institute, addressed this question of how to help the poor: "What, then, do poor people say they truly need to lead prosperous and satisfying lives? The real answer is both simple and profound. They need transformation, relief, and opportunity — in that order. On these three pillars, conservatives and advocates for free enterprise can build the basics of the social-justice agenda that America deserves." I’m delighted to say that the discussions we are slated to have for the remainder of the day will address what the poor say they need: transformation, relief, and opportunity. In North Carolina, two prime examples of local nonprofits fulfilling this mandate are StepUp Ministries and Jobs for Life. The mission of both organizations is to help individuals help themselves. An opportunity society has two basic building blocks: a universal education to create a base of human capital and an economic system that rewards industriousness. So, free market philanthropy must passionately advance education reform while it also defends and advances a system of free enterprise.
Unemployment, minimum wage, and the collapse of work are big topics in the news right now. Personal responsibility and accountability are notably absent from much of the conversation. At the John William Pope Foundation, we understand the importance of helping the poor, particularly with an eye towards helping them become active parts of the free-enterprise economy. Along those lines, we encourage you to attend an upcoming event sponsored by the Philanthropy Roundtable titled "Getting America Back to Work," which will be held April 9 in Houston, Texas. During the event, they will explore philanthropic strategies to help economically marginalized individuals become employable, find work, and build economic stability: As concerns about poverty and economic mobility mount, one thing stands clear: Work provides the earned income that alleviates a host of poverty-related problems. Yet the unemployment numbers and welfare statistics suggest that it's not always simple to join the workforce. What holds people back from working, and how can private philanthropy bridge those barriers? What strategies effectively help people become employable and secure? Can social entrepreneurship strategies create jobs for the most difficult to employ? What organizations inspire donors to support them? Join us for an exploration of philanthropic strategies that promote the culture and practice of work. Register here.
The Manhattan Institute's James Piereson uses his Wall Street Journal column today to dispel a few myths surrounding the wealthiest 1 percent in the United States. To judge by media reports, most Americans would assume that the wealthiest 1 percent are found mainly in the financial sector and reap most of their income from capital gains. But Piereson writes that "1 percenters" consist "primarily of salaried executives at nonfinancial businesses (30%) and secondarily of doctors (14%), people working in finance (13%) and lawyers (8%). Among the 'super rich' in the top 0.1% (about 110,000 households), the distribution still favors business executives (41%) over people in finance (18%)." These wealthiest Americans depend heavily on salaries, not capital gains: In 2010 the top 1% earned 36% of their incomes from salaries and wages (what the CBO calls labor income), 22% from businesses, farms and partnerships, and just 19% from capital gains. The majority of their income would thus be taxed today either at the corporate or the highest marginal rate rather than at the lower capital-gains rate of 23.8%. Emanuel Saez of the University of California (Berkeley) has shown in a series of papers that, as he writes, "The top income earners today are not 'rentiers' deriving their incomes from past wealth but rather are the 'working rich,' highly paid employees or new entrepreneurs who have not yet accumulated fortunes comparable to those accumulated during the Gilded Age." The typical "rich" person today is someone who works for a salary and accumulates stocks and bonds through savings, retirement plans and (for business executives) stock options. Piereson concludes that portraying the 1 percent as scapegoats for all ills in the United States is a distraction: At a time of slow economic growth, mounting government debt, a stalemated politics and the impending retirement of the "baby boomers," the attacks on the "one percent" look more and more like a diversion from the nation's real problems.
The Fund for American Studies (TFAS) is accepting applications for its summer 2014 academic internship programs held in Washington, D.C. Since 1967, TFAS has been putting students on the path to leadership and influence through its summer and semester "Live. Learn. Intern." programs. TFAS summer institutes include a guaranteed internship placement, courses for credit at George Mason University taught by outstanding faculty, housing in furnished apartments in Washington, D.C. just blocks from the White House, guest lectures, site briefings, professional development activities, and social events. Programs are offered in the following areas of study: Public Policy & Economics International Affairs & Economics Business & Government Affairs Journalism, Communications & Public Relations Community Service & Nonprofit Sector Generous scholarship awards are available to residents of North Carolina through the support of the John William Pope Foundation. Further program details and an online application may be found at here. Applicants are encouraged to apply today to receive priority scholarship consideration. The final deadline is March 18. Questions may be directed to Mary Stankus at email@example.com or 202-986-0384.
Our new Grantee Profile focuses on the Property and Environment Research Center: Can the free market solve environmental problems in the United States? Ask the average American on the street, and their answer would be no: Government regulation is needed to ensure that natural resources are preserved. They might even add that a free market and a healthy environment can’t co-exist. But what if freedom, not government, really were the best path to environmental protection? The nonprofit Property and Environment Research Center, known as PERC and based out of Bozeman, Montana, has been making that case for over three decades. In so doing, they’ve shifted the way we talk about markets and the environment in America. PERC’s mission is simple: Show that private property rights, far from being antithetical to the environment, actually are the best way to preserve nature and natural resources for future generations. The nonprofit primarily deals with water use, ocean fisheries, wildlife, and land conservation. Read more Grantee Profiles here.
"Conservatives need a social justice agenda of their own." So writes Arthur Brooks, president of the Washington D.C.-based American Enterprise Institute, in a new article for Commentary magazine. Brooks main question is this: How can conservatives overcome the widespread perception that they care little for the poor, while progressives care significantly? The transformation begins, Brooks writes, by articulating a conservative social-justice agenda: Conservative leaders owe it to their followers and the vulnerable to articulate a positive social-justice agenda for the right. It must be tangible, practical, and effective. And it must start with the following question: What do the most vulnerable members of society need? This means asking the poor themselves. Brooks builds his case on three pillars: Moral transformation: Fostering the values of faith, family, community, and work. Material relief: Encouraging individual charity and building a social safety net that discourages dependence. Opportunity: Advocating for education reform and the virtuousness of the free market. Writes Brooks: Our nation has a great deal of need that goes unmet, and it is only exacerbated by years of misguided statist policies and a materialistic culture. The social-justice agenda outlined above can reorient us toward our best selves and toward our obligation to help the vulnerable. It is an agenda that seeks transformation, relief, and opportunity. It means defending a culture of faith, family, community, and work; increasing our charity and protecting the safety net for the truly needy; and fighting for education reform and free enterprise as profound moral imperatives. This agenda will do the most good for the most people—and revive the conservative movement. For too long, conservatives have identified themselves as fighting against things, perpetually making war on the left’s mistaken priorities. They fight against punitive taxes, creeping overregulation, wasteful spending, licentious culture, and ruinous national debt. There is no reason to repudiate the ideology behind these fights. But these second-order policy fights are not intrinsic to a better nation; they are merely instrumental. The central, motivating purpose of conservative philosophy is not fighting against things. It is fighting for people.