Propelled by America's economic expansion and fattened by an
unprecedented transfer of wealth into their hands, the nation's
charitable foundations are giving more than ever before.
Schools, symphonies, and soup kitchens are all benefiting from
the open wallets of individuals like Bill Gates and institutions
like the Ford and Rockefeller foundations.
Yet America's philanthropic institutions are, on the whole,
unjustifiably stingy, according to an increasingly vocal set of
critics, who are waging an aggressive campaign to shame givers into
On the surface, the argument is about whether private foundations
should give more than the minimum - law requires them to give at
least 5 percent of their asset base annually.
But the issue cuts more deeply, touching on what obligation the
wealthy, and often clubby world of private foundations, have to
society as a whole, given their privileged tax status.
"The debate comes down to what's right, and the question of whose
money is this anyway," says Mark Dowie, who is writing a book about
American philanthropy and social responsibility.
Mr. Dowie and others say the tax breaks that private foundations
enjoy justify greater accountability for how much money they plow
back into society.
Pushing for 6 percent
The National Network of Grantmakers and the National Committee
for Responsive Philanthropy are launching a campaign next week to
push foundations to give at least 6 percent of their assets yearly.
Such a change may seem small. But given the total size of the
nation's foundations, that slight bump in giving would send an
additional $4 billion flowing into nonprofits.
The issue will be debated next week at the annual meeting in Los
Angeles of the Council on Foundations, the largest regular gathering
of the philanthropic world.
The gathering comes at a time of unprecedented prosperity for the
nation's foundations. According to the New York-based Foundation
Center, large-foundation giving jumped 22 percent in 1998, the
latest full year of data.
Yet as the stock market pumps up foundations' assets, and gifts
to new and existing endowments increase, that giving looks puny to
All the more so, say critics, when contrasted to the need.
Citing the growing gap between rich and poor in the US, the
rising number of homeless, and the high rate of child poverty, Rob
McKay of the McKay Foundation says foundations "are not exactly
stepping up to the plate." The McKay Foundation gave out about 20
percent of its assets last year. …