What Would George Washington Do?

When we read about Bill Gates’ new foundation, made possible by his extraordinary gift of $30 billion dollars and the $32 billion added to this Foundation by Warren Buffett – a Foundation to help eradicate poverty, disease, illiteracy, and to advance education and medical research – and then read of an additional 70,000 Foundations in this country, most of which are also involved in trying to make the world a better place – we rejoice in the extraordinary generosity of the American people and the unique role that philanthropy has played in this country.

Oddly enough, I do not think George Washington would be as enthusiastic as we are.  In his farewell address to Congress in 1797, he warned against “associations” formed by small groups of people -- “an enterprising minority… of ambitious men” that “subvert the Power of the People and usurp for themselves the Reigns of Government.”  He and other political philosophers of his day were concerned with reconciling the idea of political equality and egalitarianism with the right of people, usually wealthy and influential people, to come together to promote their ideas and their areas of special interest.  He worried about the dangers that this provoked for the rest of the population who did not have the same access to the government that wealth provides.

In a brilliant essay, Peter Dobkin Hall states:  “Popular intermediary bodies presented a dilemma of which 18th century political theorists were well aware.  Formed around special interests… they not only diminished the sovereignty of the state by representing themselves rather than government as legitimate forums for the expression of the popular will, they also favored propertied minorities with the resources to devote to their establishment and perpetuation…  The founding fathers having overthrown the greatest military power on earth using voluntary associations such as the Sons of Liberty knew all too well the dangers posed by non-governmental popular assemblies and regardless of their other differences united in denouncing them.”

It was this dilemma that troubled George Washington and continues to trouble anyone who tries to resolve classical democratic theory with the reality of the unequal influence of wealth.  Clearly, George Washington would worry about the huge and financially powerful foundations that exist today – not elected by anyone – adopting programs and projects for the country and which, in his words, are “usurping the power of government.”  For example, he might worry when he reads that the Gates Foundation will spend millions of dollars to support charter schools which might weaken, and in some cases destroy, our public school system.  He might ask: “Who elected them?”

On the other hand, George Washington was astute enough to recognize that because these Foundations are beholden to no one, “no one elected them,” they can take risks, experiment and venture into areas that elected officials cannot go.  Such are the paradoxes involved in privately controlled powerful foundations functioning in a democratic state.

George Washington might also be concerned, as the editor of the Nonprofit Quarterly wrote in a recent article that the non-profit sector “may be one of the most class driven components of this society.”

Today more than one third of our foundations and non-profit organizations are created to help alleviate social problems, many involving the poor, marginalized voices.  At the same time these organizations are run by boards that represent the affluent members of society.  Again, a paradox.  This is a country that was founded by men and women who in one way or another were running away from the entrenched power and wealth of the old world.  “A core public ideology of the United States is that the nation was founded to be classless and caste free, with equality and opportunity for all.  Our national rhetoric is fiercely democratic and egalitarian.  But the facts are at odds with this ideal and the United States now holds the distinction of having the largest wealth gap among the world’s advanced industrial countries,” according to Edward Wolff of New York University.  “Where the top one percent of this country owns 38% of all wealth, in Great Britain, our closest rival in terms of inequality, it is more likely 22-23%.  This has worsened considerably over the past 25-30 years in this country, even while inequality has lessened in many other major countries.”  And this one percent of the country plays key roles on the boards of many major foundations and non-profit organizations.

Translated, this means that the rich are speaking for the poor and major changes in our economic, social and tax structure that created this vast gap will not be truly addressed.  Instead, the non-profit world tries to make life easier and more bearable for the poor, a noble goal in itself, but one that will not change the forces that created it.

Fundraisers like myself continue to exacerbate that situation.  We urge in our fundraising discussions that non-profit organizations try to put on their board people who can financially support them.  A board member must “give” money, “get” money, or get off the board.  That is the lesson I preach.  And, I point out that the records show that organizations that cannot find such members usually will go out of business.  And thus by the very nature of what we fundraisers are doing, we are adding to this problem.  Again, another paradox.

But in spite of these factors, the good that foundations and non-profits do – the enormous contributions they have made to this society, and the importance of the diversity of ideas that they have brought - clearly mitigates any negatives that flow from the paradoxes related above.  Our country would not be what it is today without them.  They have made us the envy of the world and country after country, in our globalized community, is looking to us – to our foundations and non-profits – to help them grapple with their own contemporary problems.

But the paradoxes discussed in this article put a special burden on our foundations and non-profits to function with more transparency, more disclosure, more accountability and openness, and more accepting of better and increased effective government oversight.  In this fashion, the foundations and the non-profit organizations would help reconcile George Washington’s concerns about their special power with democratic principles and the reality and complexity of the world in which we live.

Comments

[Josh Moore]

Amazing article! However, it is difficult to say if nonprofits and foundations are undercutting government, or simply providing the services that our government and the “people” who support it are unable, or more likely, unwilling, to provide.

[Maria Nardell]

This article brings up such an interesting and important issue. In addition to roles of the U.S. government and nonprofits in the U.S., it is also worth considering how the relationship between nonprofits and governments takes on another dimension with NGOs that work abroad. Not only are the voices of Americans at stake, as Naomi points out, but so are the voices of the people in the countries served. Surely individuals and communities appreciate the support they receive, but to what extent such aid works through or around local governments has enormous implications for people's views of the legitimacy and effectiveness of those goverments, program sustainability, economic development, and many other issues.

[Irving P.]

The paradoxes are real - the solutions less so. We're a country of the rich: the rest of us just live here and do the heavy lifting (fundraisers included). Any solutions?

[Kristin]

Like Martin Luther King said, "Philanthropy is commendable, but it must not cause the philanthropists to overlook the cirucmstances of economic injustice that make philanthropy necessary."

Simone P Joyaux used this quote in a recent Third Sector conference we hosted here in Bermuda.

More of us in the nonprofit sector need to look at social-change philanthropy, social entrepreneurship etc... Rather than simply as the article stated 'making life more bearable for the poor', we need to really look at the foundations of our society that create the poor.