Philanthropy Spring 2014

LENFEST REFLECTS • CHARTER SCHOOL BOOM • COULD YOU GIVE AWAY YOUR COMPANY? A PUBLICATION OF THE

S P R I N G

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PHILANTHROPY SAVE JOURNALISM?

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Government cannot solve the intractable problems diminishing the American dream for so many of our fellow citizens. Our social fabric is fraying, upward mobility is in decline, and national optimism is waning. Made possible through a robust and vibrant private sector economy, strategic and forward-thinking philanthropy can offer new perspectives and hope to the neediest among us.

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Library of Philanthropy The Philanthropy Roundtable now offers an online collection of the essential books, articles, and essays on giving—from definitive recent works to the classics, all sorted for ease of browsing and accompanied by helpful extracts, introductions, and background, plus easy links for more detail.

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Biographies of Great Donors Strategies for Giving Case Studies from Philanthropic History Philanthropy and the American Character Pursuing Philanthropy Like a Business Moral Issues in Charitable Success

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Charity in Literature The Power of Grassroots Civil Society Corporate Philanthropy Respecting the Intentions of Donors In Defense of Private Giving

To browse this treasure chest, please visit Librar yofPhilanthropy.com

table of contents

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features

departments

12 T he Future of Journalism

4 Briefly Noted

14 Profit and the Free Press An ink-stained veteran doubts that philanthropy can solve today’s crisis in journalism. By Seth Lipsky

18 I nvestigative Philanthropy?

Local news and research journalism as charity causes.

20 Nonprofit, Gold-plated, Reporting

By Biz Carson

22 Digging Deep into the Heart of Texas

By Ari N. Schulman

23 Watchdogs, Pro and Amateur

By Jonathan V. Last

25 A $250 Million Experiment

By David Donadio

26 Serving Locals the News They Crave

By Maria Servold

27 Drilling from the Right

By Kate Havard

28 B uilding Religion IQ in Reporters

A donor-funded conference educates the media on faith. By Andrea Scott

34 N ew Balance

Training the next generation of conservative journalists. By Justin Torres

38 Charity TV

A California philanthropy and a TV station stimulate giving. By Chris Weinkopf

42 G iving It All

The Barnhart brothers gave away their $250 million company. By Liz Essley Whyte

Schools need better teaching, not more

money: Bill Gates. Celebrity philanthropy fizz. Bureaucracy-ridden sluggards. Media fortunes offer media aid.

7 Nonprofit Spotlight Street Sense gives the homeless a job.

8 Interview Gerry Lenfest reflects on $1.2 billion of personal giving.

48 Ideas

From Promising to Proven

The charter school boom ahead.

By Karl Zinsmeister

100 Years of Experts Armed

with Money…

Community foundations at a milestone.

By William Schambra

56 Books Faithful Giving Happiness accrues to both donor and recipient in Jewish and Christian teaching.

By Scott Walter

Wielding the Profit Motive Against Poverty Treating the poor as customers.

By Ashley May

Books in Brief

Reflections of a Rockefeller. Failing one’s way to success.

61 Face to Face

Photos from the Summit for Leaders, staged by the Alliance for Charitable Reform.

A P U B L I CATI O N O F THE

Adam Meyerson PRE SI D E NT

Karl Zinsmeister

VI C E PRE S ID E N T , P U BL ICA T IO N S

Caitrin Nicol Keiper E X E C U TI VE E D IT O R

Liz Essley Whyte

MA NAG I NG E D IT O R

Andrea Scott

A SSI STA NT E D IT O R

Taryn Wolf

A RT D I RE CT O R

Kara Runsten I NTE RN

Arthur Brooks John Steele Gordon Christopher Levenick Bruno Manno John Miller Tom Riley Naomi Schaefer Riley William Schambra Evan Sparks Justin Torres Scott Walter

C O NTRI B U T IN G E D IT O R S Philanthropy is published quarterly by The Philanthropy Roundtable. The mission of the Roundtable, a 501(c)(3) tax-exempt educational organization, is to foster excellence in philanthropy, to protect philanthropic freedom, to assist donors in achieving their philanthropic intent, and to help donors advance liberty, opportunity, and personal responsibility in America and abroad.

For editorial or subscription inquiries, please contact: The Philanthropy Roundtable 1730 M Street NW, Suite 601 Washington, DC 20036 Phone: (202) 822-8333 Letters to the editor: letters@PhilanthropyRoundtable.org Advertising inquiries: advertise@PhilanthropyRoundtable.org Reprints: reprints@PhilanthropyRoundtable.org Subscription inquiries: subscribe@PhilanthropyRoundtable.org Copyright © 2014 The Philanthropy Roundtable.

All rights reserved.

Cover: © rudall30 / shutterstock.com, © hohl / istockphoto.com

SPRING 2014

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Education reform can be trickier than curing disease, Bill Gates says.

He did it his way Robert Wilson, who passed away at the end of last year, was spectacularly generous, and a free thinker in more ways than one. He gave away $700 million of the $800 million he earned on Wall Street to causes like conservation and Catholic schools— whose efficacy he admired, though he was an atheist.

(See our profile in the Spring 2010 issue of Philanthropy.) But when Wilson was asked to sign the Giving Pledge, his scrappy side emerged in a blunt exchange with Bill Gates. “Your ‘Giving Pledge’ has a loophole that renders it practically worthless, namely permitting pledgees to simply name charities in their wills,” Wilson wrote in e-mails later published by online outlet Buzzfeed. “I have found that most billionaires or near billionaires hate giving large sums of money away while alive and instead set

Alignment of the stars Celebrity philanthropy, even if well-meaning, can be rich with pratfalls and posturing. In 2007, actor Brad Pitt founded the charity Make It Right to 4

PHILANTHROPY

Ryan Scheer, John S. and James L. Knight Foundation

Politics and education reform When Bill Gates spoke at the American Enterprise Institute in March, he noted that early in their philanthropic years he and his wife Melinda zeroed in on two causes. One they considered the root of the greatest inequity worldwide: health.

The other was the largest cause of inequity here at home: education. In his remarks, though, the billionaire marveled at how money alone cannot fix education woes, citing Washington, D.C.’s lavish school funding (currently approaching $20,000 per student) in the midst of floundering schools.

“There is no correlation between the amount spent and the excellence that comes out,” said Gates.

Having realized this, the Gates Foundation spent three years looking closely at the mechanics of teaching. “Teachers get almost no feedback. They get almost no sense of, ‘OK, I’m good at this and I should share that with other people.’ Or ‘I’m not very good at this, and therefore I should learn from other people,’” explained the founder. “We took 20,000 hours of video and looked at various measures” of successful instruction. At the end of this massive project the foundation encouraged school districts to apply scientific evaluations to teachers every year, rewarding those whose students succeed, while offering warnings and training to those whose students lag. Now the hard-won findings need to be made a reality in schools. Compared to the Gates Foundation work on international health, the technical and economic obstacles are comparatively small. Yet politics makes progress difficult. “It’s tough,” stated Gates, “because when we invented the malaria vaccine, no school board gets to vote to uninvent it.”

build eco-friendly houses for low-income residents of New Orleans who lost their homes in Hurricane Katrina. Ecologically trendy turned out to be economically troubled, however, with the average cost per home soaring beyond $400,000. That in turn made it impossible for the nonprofit to stick to its goal of selling the dwellings only to residents who had lived in the poor Ninth Ward before the storm. Recently the organization learned that the glass-infused wood used to build stairs and decks on the houses without the usual decay-preventing chemicals has already started to rot, long before its promised 40-year lifespan. Planet-friendly Make It Right is thus in a bind, illustrating the classic aphorism that good intentions aren’t enough to solve problems.

Elsewhere in the celebrity sphere, actress Scarlett Johansson found that, after eight years as an ambassador for Oxfam, the international hunger charity had declared her persona non grata.

Her crime? An alliance with SodaStream, the soft-drink company that has a factory in the West Bank, where Israeli-run enterprises are boycotted by Oxfam. Rather than quitting the company, Johansson declared she was quitting the charity.

The factory might actually be “a model for some sort of movement forward in a seemingly impossible situation,” she suggested to the U.K.’s Observer.

As SodaStream’s CEO told the BBC, “We’re giving livelihood to 500 Palestinians who feed 5,000 people, who will have no other jobs. Throwing them into unemployment is not what’s going to bring peace to this area.”

© Masaru Kamikura / CC 2.0

briefly noted

up family-controlled foundations to do it for them after death. And these foundations become, more often than not, bureaucracy-ridden sluggards.… I’m going to stay far away from your effort.” Gates tried again, saying he agreed with Wilson in many ways, and that indeed, people should think about giving while young. More politically incorrect heterodoxy ensued from Wilson: “When I talk to young people who seem destined for great success, I tell them to forget about charities and giving. Concentrate on your family and getting rich—which I found very hard work. I personally and the world at large are very glad you were more interested in computer software than the underprivileged when you were young. And don’t forget that those who don’t make money never become philanthropists. When rich people reach 50 and are beginning to slow down is the time to begin engaging them in philanthropy.”

Cycle of hope When filmmakers came to Texas health care executive Jon Halbert to pitch a documentary about an unlikely cycling team in genocide-riven Rwanda, he and his wife Linda were hooked. “It’s become our passion, really,” Linda told Philanthropy. “Best million dollars I’ve ever spent,” Jon told the Dallas

Adrien Niyonshuti is Rwanda’s cycling star.

Morning News. The film, Rising from Ashes, follows the birth of the team, coached by haunted cycling legend Jonathan “Jock” Boyer, and its standout star, Adrien Niyonshuti, who lost more than 60 members of his family to the 1994 massacre.

The team members hail from both parties to the conflict—“all sides, all faiths, Hutu and Tutsi, Muslim and Christian, from all walks of life,” Linda says, noting that their united front sends the message to others, “If they can do this, so can we.”

Now the Halberts hope the movie will be equally powerful. After racking up awards on the festival circuit, the documentary attracted audiences across the U.S. who wanted to do more than just watch.

“We all looked at each other and said, ‘It’s not over,’” says producer Greg Kwedar. With $250,000 in seed money from the Halberts, the filmmakers established the Rising from Ashes Foundation to hold more screenings, support the athletes, bankroll cyclists in other African countries, create the first all-African team to take on the Tour de France, and fund Niyonshuti’s Cycling Academy to get Rwandan kids involved in the sport. “We found an opportunity to rebrand a country by doing a film,” Jon says. “To leverage that amount of money to help 13 million people…. To us it was a no-brainer.”

Ryan Scheer, John S. and James L. Knight Foundation

© Masaru Kamikura / CC 2.0

MEDIA FORTUNES OFFER MEDIA AID In this issue of Philanthropy, you’ll read stories about how donors are seeking many ways to bolster news reporting today—at a moment in history when managers of the industry are finding it hard to make ends meet. But in decades past journalism bestowed many a fortune on newspapermen and publishers, and today some of those fortunes are being recycled back into efforts to strengthen journalism and improve its craft.

Three examples follow. Other press-derived charitable endowments funneling money into the media include the Robert R. McCormick, Donald W. Reynolds, Patterson, Park, and Triad foundations.

Digital Knights to the rescue John and James Knight were not only brothers but also highly compatible business partners. “My uncle was the consummate editor, and my father was the nuts and bolts man,” says Marjorie Knight Crane, James’s daughter. The two men transformed the Ohio newspaper they inherited from their father in 1933 into a multimillion-dollar media empire known as

The Knight brothers experimented with electronic newspapers as early as 1947.

SPRING 2014

Knight Ridder. They cared deeply about the field that made them wealthy.

“The Knight newspapers strive to meet the highest standards of journalism,” John told a group of businessmen in 1969. “We try to keep our news columns factual and unbiased, reserving our opinions for the editorial pages, where they belong.”

The brothers’ fortunes—and respect for the power of the press—today undergird the John S. and James L. Knight Foundation, which has become a leader in philanthropic giving to journalism. The foundation has so far invested more than half a billion dollars in the field, funding everything from scholarships for aspiring reporters, to mid-career training, to nonprofit startups in new media. Its current focus is helping the struggling news industry find equilibrium in the digital era.

The Knight News Challenge, started in 2006, grants millions to innovators using electronic tools to make news sharing easier, as a way to improve government openness and public understanding. Past winners 5

briefly noted include the Oyez Project, which provides audio recordings of court arguments, transcripts, and summaries of complicated decisions, to make legal rulings more accessible to reporters and citizens.

The foundation’s support for innovation in journalism is something president Alberto Ibargüen thinks the Knight brothers would rally behind. “They believed so strongly in new technology that there is no doubt in my mind they would be at the forefront of experiments with digital media today,” he says.

The brothers tried sending electronic facsimiles of newspapers to the homes of subscribers as early as 1947, and poured hefty sums into early versions of online news delivery in the early 1980s. “They were simply not afraid of change or of the future.”

and the journalism program at Patrick Henry College.

He thinks journalism and newspapers are growing even more ripe for philanthropic backing. “Higher education is not a business. There’s an element of philanthropy in it. I think journalism may go in that direction too, similar to a symphony.”

Giving across generations At age six, in turn-of-the-century Kansas, Eugene Collins Pulliam sold his first newspaper. Later, as a budding reporter, he nabbed one of his first scoops by sneaking onto an unlocked railroad car to interview William K. Vanderbilt.

Pulliam eventually purchased and ran more than 50 newspapers, including his flagships, the Indianapolis Star and the Arizona Republic. The magnate died in 1975, but that was not the end of family contributions to journalism. His son, Eugene Smith Pulliam, became publisher of the Indianapolis Star and the Indianapolis News. His granddaughter Myrta Pulliam won a Pulitzer Prize in 1975 with a team of other reporters for a series on police corruption. Another granddaughter edited a local newspaper in Maine. His grandson writes a weekly column for the Star. Even some of his great-grandchildren now work in reporting (Sarah Pulliam Bailey, a correspondent for Religion News Service, appears on page 33).

In addition to continuing to work in journalism, family members have used philanthropy to enhance the field that made their patriarch so successful. In this they follow Eugene Collins himself, who set up a journalism scholarship at Ball State University, and paid for young foreign reporters to visit the United States.

Pulliam’s grandchildren gave $5 million to support journalism studies at DePauw University, $5 million to the Newseum, and additional gifts to Butler University, Ball State University, and the Society of Professional Journalists (which their grandfather co-founded).

Granddaughter Myrta also helped start Investigative Reporters and Editors, a nonprofit aimed at improving the quality of watchdog reporting. Grandson Russ has given to the World Journalism Institute 6

The elder and younger Eugene Pulliams bracket a young Russ.

Siblings Judith and Punch Sulzberger grew up listening to countless dinner conversations about the Gray Lady.

PHILANTHROPY

Arthur Ochs “Punch” Sulzberger believed in the power of a free press. And he believed that the press had to make money in order to keep producing democracy-aiding journalism. So in his three decades as publisher of the New York Times, he expanded the paper’s advertising, diversified the company’s assets, and added new moneymaking feature sections to the Gray Lady.

It was this entrepreneurial spirit that his sisters, Marian, Ruth, and Judith, hoped to highlight when in 2005 they donated $8 million to journalistic projects to honor Arthur. Half of that went to create something entirely new and unique: a training program at Columbia University to give editors and media executives the business acumen they need to keep journalism profitable.

The Punch Sulzberger Program, as it is now called, offers selected fellows four weeks of intensive management classes at Columbia, followed by a year’s worth of one-on-one coaching from business experts. Fellows choose a “challenge” at their media company—a project requiring at least a year’s worth of work, but with attainable and measurable goals— and tackle it with the support of the program.

So far more than 130 leaders at news organizations from the Boston Globe to ABC News to the Associated Press have jumped at the chance to participate. Eight editors and executives at the Christian Science Monitor came to the program starting in 2008, with their newspaper losing money and surviving on subsidies from the Christian Science Church.

Their publication set a daring goal: to become the first national newspaper to cut its daily printed product and become a “web-first” publication. In its latest fiscal year, the Monitor posted its best financial performance in more than half a century.

The Sulzberger program is “sort of like a mini MBA,” says Monitor editor Marshall Ingwerson. “It really made me jump in with both feet, and focus on…asking this journalistic enterprise to work as a business.” The paper is now on track to cut off church subsidies by 2017, he says, and the website has more than quintupled its traffic since the beginning of the program.

The Pulliam Family, Vic DeLucia / New York Times

Relinking press and profit

nonprofit spotlight Donald Brown has been selling Street Sense since October 2013. “It’s humbled me and makes me be more nice.

I make honest money,” he says.

Liz Essley Whyte

STREET SENSE It’s a rainy spring day in the nation’s capital.

Inside a toasty old back office, James Davis, the self-dubbed “CEO of 17th and L Street,” is holding forth on what it takes to be a successful street newspaper vendor. He should know: In ten years working on his favorite corner, he has sold 100,000 copies.

Street Sense, a biweekly paper sold by D.C.’s homeless, offers flexible employment and practical life lessons where both are scarce. Beyond a training session and adherence to the code of conduct, there is no barrier to entry; all comers are accepted regardless of work history or criminal record.

It calls on entrepreneurial skills and habits of discipline many vendors never knew they had, but old pros like Davis help them develop. Remember, he tells his audience, you are your own boss, and this is your own business; you will get out of it as much as you put in. It helps to have a catchphrase, such as his signature, “Help the homeless help themselves by supporting Street Sense!”

Founded in 2003 by banking reporter Laura Thompson Osuri and shelter volunteer Ted Henson, Street Sense has counterparts in more than 100 major cities in the U.S. and abroad. Vendors purchase papers wholesale and resell them retail, pocketing

the profits. In D.C., they invest 50 cents per paper and collect $2 or more per sale; many customers are happy to contribute extra, especially to vendors they’ve established a rapport with. Davis says an active vendor can earn $100 a day. Paper sales account for a quarter of the nonprofit’s operating expenses; grants and donations provide the rest of the $250,000 annual budget.

In D.C., about 130 vendors distribute more than 30,000 copies of the paper every month. The gumption and stamina required to do this is impressive. Vendors often face rejection or rudeness from pedestrians, who may not distinguish them from the gaggle of petition-gatherers, evangelists, hawkers, panhandlers, and others vying for attention on the sidewalk. Davis stresses the importance of staying professional and positive.

Who knows, he tells himself—that person walking by may have already donated, or may just not have any cash on hand.

The paper’s content revolves around homelessness and poverty. Vendors write about half of each edition themselves, while interns, staff, and volunteers produce the rest. The range of subject matter reflects the lively personalities involved.

Autodidact Jeffrey McNeil pens a column usually devoted to sharp criticism of the welfare state. Amateur ecologist Cynthia Mewborn writes on scientific topics, often SPRING 2013

everything that you could want to know about a given kind of bug. Katrina survivor Gerald Williams has an ongoing series on his family’s escape from the storm.

Experienced journalists lead weekly writing workshops for the paper, giving contributors a chance to come together, toss around ideas, and hone their craft.

This week at the office, with the radiator rattling away, a dozen regulars assemble.

Angie Whitehurst, working on a piece about insurance options, gets feedback on the additional data she needs to research.

Chon Gotti shares the series of job losses that put him on the street. He got by for a while ferrying cigarettes across state borders, but gave up this gray-market gig to join Street Sense, where, he says, he makes less money but finds the work more satisfying. Charles Davis tells how surprised he is that he’s met so many friendly people— most of all, the blind man who approached him to buy, of all things, a paper.

When customers and vendors get to know each other, “it makes their lives bigger and richer,” says editor-in-chief Mary Otto, in a video promo. A big part of Street Sense is the relationships it builds. In addition to the writing circle, Street Sense vendors bond via support groups and workshops. Even those just entering the business find purpose and autonomy in their ability to sell. Many vendors report that becoming involved with Street Sense has helped them out of addiction or debt.

This is thanks not just to the material benefits, but to the humanizing effects of having a voice and a vocation. “In homelessness, you lose so much of yourself; you can really forget who you are, and the world kind of forgets who you are, too,” says Otto in the video. Reflecting on a decade of experience with Street Sense, James Davis has spoken of its power to restore that loss: “I’ve seen people get their self-esteem back and feel like they are part of society.”

—Caitrin Nicol Keiper 7

GERRY LENFEST

When H. F. “Gerry” Lenfest made a fortune from the sale of his cable company to AT&T in 1999, he determined to give it all away as quickly and intelligently as he could. The result has been $1.2 billion of giving, with more to come. The foundation he and his wife Marguerite established is due to close no later than ten years after their deaths.

Lenfest went to work on the high seas right out of high school, serving three years on oil tankers. When he returned, his father enrolled him in Washington and Lee University. After college, Lenfest served in the Navy, and then completed law school at Columbia University. Following a stint on Wall Street, he went to work for Walter Annenberg’s Triangle Publications, where he spotted an opportunity when Triangle decided to sell its cable TV business. Lenfest scraped together $2.3 million to buy a system with 7,600 subscribers. Year after year he grew his enterprise, concentrating his efforts around Philadelphia and San Francisco. When he sold, it had 1.3 million customers.

Now celebrated as one of the contemporary founding fathers of Philadelphia, the 83-year-old Lenfest has bolstered the city’s cultural institutions with hundreds of millions in support for education, art, music, and museums. He has given generously to colleges.

Philanthropy has previously documented his $5.8 million gift to save the SS United States (Fall 2010), his $20 million gift to the tuition-free, vocational Williamson Free School (Spring 2011), and his aid in settling the art of the Barnes Collection in downtown Philadelphia (Summer 2011).

Lenfest recently spoke with Philanthropy about his giving and one of his more recent investments—the city’s flagship newspaper, the Philadelphia Inquirer, which he owns with five others. He’s now in the midst of litigation against one of the other owners in an effort to defend, as he said in a letter to newspaper employees, the “independent journalism” that is “at the heart and soul of a free press.”

8

Philanthropy: You’ve given away more than $1 billion personally and through your foundation. What do you consider your greatest philanthropic achievement?

Lenfest: That’s hard to pin down, but the one I think I’m most proud of is the Lenfest College Scholarship Program, which we started when we sold the company. It was the first real philanthropic venture that we went into. We picked scholarships for rural students as opposed to inner-city, because there seemed to be such emphasis on inner-city and we felt the rural was neglected. We started with Franklin County, Pennsylvania, which had the lowest percentage of high school graduates going to college of any county in the state, with the exception of Philadelphia proper. It has blossomed into a wonderful program. We award scholarships to 24 students each year. Roger Lehecka, the former dean of students at Columbia, has assembled a group of deans from colleges like Swarthmore and Cornell and Princeton and other excellent schools to go out in the hinterlands and interview these students. And of course the deans of admission at the schools where they apply are impressed that they’ve been selected for the scholarship by this august group. It’s not the amount of money that we give; it’s the qualifications they get from the selection process. These rural students go to colleges and universities that they’d often never heard of, and now some of them are going on to Ph.D.s. They have also formed a very close-knit alumni group called the Lenfest Scholars. So that’s what I’m most proud of.

Philanthropy: Why did you decide to spend down?

Lenfest: I read a book that discussed the history of foundations, Inside American Philanthropy: The Dramas of Donorship,

by Waldemar Nielsen. Many foundations were started by people who gathered their cronies and their children around them. Most of these didn’t last beyond two generations. The banks are filled PHILANTHROPY

with skeletons of old private foundations. The book also said: “What’s the use of doing something in perpetuity?

You can’t see beyond your life what the needs will be, and circumstances change.”

So I have two principles: One is that I don’t want to die with a lot of wealth, and second, that my kids are taken care of. I don’t believe in wealth going on in perpetuity. There are occasions when it’s turned out to be well done, but they are few in my opinion.

Philanthropy: What made you want to focus the foundation’s remaining efforts on disadvantaged Philadelphia youth?

Lenfest: The Philadelphia school district is in deep trouble. We can’t, in our foundation, really cure that problem, but we can nip at some of the areas where we feel we can help. I turned over the chairmanship of the foundation to Keith Leaphart because I felt he was better equipped with his background to help with education in the city. I first met Keith when he emptied my wastepaper basket at my company. I talked to him and said: “Who are you and what are you doing?” He said, “Well, I’m getting my master’s in business and my medical degree at the same time, and this janitorial business is how I pay my way through school.” I’ve followed Keith and his career and greatly respect him. He knows the city. He grew up in one of the poorer sections. He got out of the situation he was in and through his education became a great success.

Philanthropy: I understand that you were once building a new, larger house but decided instead to give the land to a nature preserve. Can you tell me more about that?

Lenfest: We bought the last of the King Ranch property in Chester County, Pennsylvania. The huge King Ranch had 800,000 or so acres in Texas, and it had about 10,000 acres in the Philadelphia area. They used to bring in cattle by railroad car and fatten them up for the eastern market. The head of King Ranch passed away, and they sold their property

The Museum of the American Revolution

interview

Gerry and Marguerite Lenfest have given away $1.2 billion, with much of it going to support arts and culture organizations, including the

The Museum of the American Revolution

French-American Cultural Foundation. Here Gerry accepts the insignia of the Legion of Honor, as presented by the French ambassador to the U.S.

in pieces. I was fortunate to buy the last 500 acres.

I had the design of this house, and I went out to see it. The hole was dug and rebar was being put in. I looked down in this hole and asked the architect, “How big is that house?” And he said: “16,000 square feet.” I thought for a moment, and I said, “You know what, fill up the hole.” It was the most expensive hole in Chester County.

And next to it was 500 acres that was bought by the county. We combined the two lots into a 1,000-acre preserve. We bought a farm next to that. So there are approximately 1,200 acres

without a house on it to preserve some beautiful rolling hills. People can go on walks with their dogs or ride their horses or go fox hunting. It’s the largest park in Chester County.

Philanthropy: Is it true you still live in the same house you bought decades ago?

Lenfest: We bought it in 1966 for $35,000.

We still live there. We got air conditioning last year. There are a lot of big oak trees, so it’s very cool at night. We also have a place in Rittenhouse Square in Center City, Philadelphia. We didn’t have that until we sold the company.

SPRING 2014

Philanthropy: Let’s talk about journalism and your investment in the Philadelphia Inquirer. You once told a reporter there that you joined the paper’s ownership team not “for an investment but for a public purpose.” Do you consider journalism a public good? Does it need philanthropic backing?

Lenfest: Absolutely. The Philadelphia Inquirer started in 1829. I was at the Library of Congress to see a Civil War exhibit, and on the wall was an issue of the Inquirer. It’s had a public purpose, taking stands on various issues, and reporting the news—local news. What form of media 9

interview

The Museum of the American Revolution, to which Lenfest has

can accomplish the need of the Inquirer in Philadelphia? None. So that requires a responsible ownership with integrity that doesn’t use the newspaper for its own ends.

Philanthropy: Do you think newspapers could transition to nonprofit models eventually? Should they?

Lenfest: I think eventually it would be wonderful if nonprofits would own newspapers. And they’re allowed to do that in the U.S. code now, to take in that kind of revenue. Eventually I foresee foundations taking ownership of newspapers. Newspapers don’t have to be limited to the paper.

In the digital age, it doesn’t make any difference in what form the journalism takes place, but the journalism is the key to it— the coverage, in a responsible way, of local news. And investigative reporting.

Philanthropy: You’ve said: “There is nothing more rewarding, if you measure your impact based on money spent, than protecting the oceans.” Why do you have 10

that gave to you, or has the institution impressed you in other ways?

Lenfest: More of the latter. I went to law school there. Normally your allegiance is to the college you went to for undergraduate studies, in my case Washington and Lee, where I’ve given substantial amounts also.

But Columbia has a great new president and development program. We created new professorships to increase the teaching spectrum of the arts and sciences, as well as support the law school. I grew to particularly like the liberal arts program, called the core curriculum. It was first started in 1919, when after the First World War it had courses for Army officers explaining American ideals and what Europe was about and so forth, which gave them background for service overseas. It has evolved since then, and it’s a requirement for every undergraduate. I did research on the value of that curriculum by corresponding with the alumni. They reported that those Philanthropy: You’ve given more than liberal arts followed them the rest of their $100 million to Columbia University. Do lives. It broadened their interests and their you consider that giving back to a school lives. They became better persons. such a strong love for the ocean, and what makes this philanthropy rewarding?

Lenfest: My father was a naval architect, so we were surrounded with ship lore in my childhood. When I was 19 I got a job on a tanker, and we’d go to Venezuela and pick up crude, take it to Aruba and get it refined, then go to Europe. I was in the U.S. Navy on destroyers. So I’ve had some experience with the sea, and I just grew to love it.

The seas are always a big dumping ground. Whatever we want to get rid of we dump in the ocean. There is a crying need as the ocean turns more acidic and less fish remain. It’s an overlooked resource that needs protection. So I was happy to help in a small way. Our Lenfest Ocean Program does research by using resources and professors from universities all over the world. Action is based on legitimate research, which is what we’re all about.

PHILANTHROPY

The Museum of the American Revolution, art by NC3D

committed more than $50 million, aims to transport visitors to the frontlines of battle.

Visitors to the Museum of the American Revolution will be able to

The Museum of the American Revolution, art by NC3D

step aboard the deck of a privateer, as shown in this mock-up for a future exhibit.

Philanthropy: What did you learn from the millions of dollars you spent on the Lenfest Arts Campaign to promote Philadelphia arts on TV? Do you consider it a success?

Lenfest: I’ve spent close to $2 million a year. That’s been very successful. The idea is to sell tickets. We don’t say: “Support the Philadelphia Orchestra.” We say: “On Thursday night, they play Shostakovich’s fifth symphony, and here’s how you buy a ticket.” That leads to a better bottom line for the institutions. If you asked them whether it helped, they would all say they can’t afford to be on television without the support we’ve given them.

Philanthropy: You gave more than $50 million to the Museum of the American Revolution. Why? Lenfest: There’s no museum in the nation that is devoted entirely to the American Revolution. And that’s what gave us our independence. It was probably the greatest revolution in the history of mankind. Look

what we created. We created this nation.

The principles of the American Revolution have gone throughout the world. The lessons of the revolution, I think, are important to young people today. It shouldn’t be just a museum of artifacts, but of the principles of the founding. Liberty is not just liberty; it’s responsibility. You have to have a responsible citizenry. They have to recognize the principles that created our liberty.

Philanthropy: The museum was originally supposed to be in Valley Forge, but has been relocated to Philadelphia. What happened?

Lenfest: The neighbors in the area and also the National Park Service did not want a private museum next to the federal Valley Forge Park. So we exchanged our property in Valley Forge for a property that’s in the historic district of Philadelphia, where 2 million visitors come every year. It’s a much better location for us.

Philadelphia is the city which founded this nation. The Declaration of Independence and the Constitution were both created in SPRING 2014

Philadelphia. It was the first capital of the United States. It’s a logical place for the Museum of the American Revolution.

Philanthropy: Your children have been increasingly active in philanthropy. Did you show them the ropes?

Lenfest: When we sold the company we asked each of our three children to set up his or her own foundation. I’m not on the board of any of their foundations. We let them pick their own boards, which is another principle of mine. Family foundations are generally a big mistake, because children lose interest if they can’t have some sway in how the funds are donated.

So we let each child have his or her own foundation, and they’ve done well. Brook, for example, through his foundation started probably the best charter school in Philadelphia. The public-school system has actually asked the charter school he founded to take on the worst schools in the district. One had the most violence in the city system. Now there’s none. They’ve done a great job. P 11

philanthropy the press AND

lar, its reporting staff bone thin. And the Newseum, for all its physical grandeur, is following an eerily similar path. Despite successive waves of layoffs, its budget shortfalls continue to grow, and the philanthropic foundation that operates the facility has shrunk from a billion-dollar endowment to just $340 million.

Can philanthropists and businessmen with a taste for “social investing” do more than just soften the losses at news-reporting organizations whose business models have collapsed? Can they subsidize certain kinds of investigating and publishing to serve public interests? Can they help discover and extend new formats, new reporters, and new subjects that will strengthen journalism’s role in maintaining the health and freedom of American society?

Some givers think public-spirited investment may have a significant role to play in future news reporting. A few already are putting big money into the field. Others think philanthropy will only distract the press from independent oversight of the public interest.

In the pages that follow you can have a look at some current experiments, then decide for yourself.

Newseum

The Newseum—perched opposite the National Gallery of Art on Pennsylvania Avenue in our nation’s capital—is an emblem, in a way it never wanted to be, of journalism today.

Just like the profession it celebrates, the museum is threatened by financial travails. For now, the Newseum is being kept afloat by philanthropy. Whether the wider culture and industry of news reporting can be rescued by the same savior is a question examined by this issue of Philanthropy magazine.

When the glitzy shrine to popular journalism that is pictured here opened in 2008, the news business in America was closer to its high-water mark. The year before, the New York Times had moved its reporters into a grand new edifice into which the publisher sunk close to half a billion dollars. The big cheese of the websites created to hook readers on cheaper fare, the Huffington Post, was then just three years old, and exactly halfway from its 2005 founding to its 2011 sale for $315 million.

By 2014, newspapers, TV news programs, and news magazines were in tatters, with former heavyweight Newsweek being given away for a dol-

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Newseum

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Bri Hermanson

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PROFIT AND THE

Free Press An ink-stained veteran doubts that philanthropy can solve today’s crisis in journalism

By Seth Lipsky

Bri Hermanson

I

n the early days of the Bolshevik revolution, a question arose of whether suspended press freedoms should be restored. “It is as private property that we must examine the question of the press,” argued a Leninist delegate, saying that the return of confiscated printing equipment and paper would be “an inadmissible surrender to the will of capital.”

Then Lenin himself stood and stated that “we Bolsheviki have always said that when we reached a position of power we would close the bourgeois press. He who now talks about the ‘freedom of the press’ goes backward, and halts our headlong course.”

Today our media institutions aren’t being suppressed from without; they are collapsing from within. Yet the vitality of the press once again boils down to a matter of economic independence and strength. Beset with declining circulation and advertising revenues, newspapers and magazines are struggling to find their footing in the new digital landscape where, we are told, information wants to be both free in price and free of control. Those may be contradictory states.

Though they perform what many people consider to be a public service, our great organs of reporting have always been moneymaking companies. The ability to make vigorous profits via mass sales of advertising and circulation has been the first and last source of their independence from government control and other forms of pressure. If news reporting can no longer earn its own keep economically, how durable is this public service?

No less an institution than the Columbia School of Journalism issued a report in 2009 calling into question the future of reporting based on the for-profit model.

The Reconstruction of American Journalism noted that shining a bright light on the activities of powerful figures and institutions is one of the most significant purposes of an independent press. In a note published with the report, though, then-dean Nicholas Lemann suggested that the Internet “has brought the days when privately owned newspapers could be the main bearers of this reporting function to an end.”

The report called for, among other things, the introduction of a system of government subsidies to news organizations. It was a startling recommendation in and of itself, but even more so because one of the authors, Leonard Downie, had long taken a radical stand for press independence from government. As executive editor of the Washington Post, he had declared he would refrain even from voting in elections, lest he lose his detachment. Now, Downie was proposing that critical reporting on government and similar institutions should be subsidized by—the government.

Somewhat more promisingly, the Columbia report also called for exploring legislation and regulatory changes to Seth Lipsky is editor of the New York Sun and spent 19 years at the Wall Street Journal. As a GI, he covered combat in Vietnam for the Pacific edition of Stars and Stripes.

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make it easier to operate news organizations as nonprofits, or to create hybrids between limited liability companies and charities. With newspapers’ business model in shambles and government assistance a frightening alternative, is philanthropy the answer?

their success. The paper, being itself technically for-profit, is unrestricted in its ability to endorse political candidates and advocate for or against legislation.

Farrugia came to the Day long after it was set up in its current structure and arrived from a for-profit newspaper, the Philadelphia Inquirer. He stops short of saying that nonTo the rescue? profit newspapering is the wave of the future. But he does There are, and have been for decades, some important non- say that it “liberates you to take chances.” profit institutions in the newspaper world. For instance, the most famous of our news wires, the Associated Press. Profit as the armor of the press baron Originally organized in the mid-nineteenth century, the Many other publications have been supported by philanAP now has something like 1,400 newspaper members, thropy over the years. The American Spectator and the including the greatest names in for-profit journalism. It Washington Monthly are two of many not-for-profit politemploys more than 2,000 editors and journalists, who are ical magazines. The nonprofit ProPublica has set a high fiercely competitive, including against the association’s own standard for online, liberal, investigative reporting (see page members, and who have racked up an enviable record of 20). Bill Keller, former editor of the New York Times, now Pulitzers and other prizes. The AP aggressively defends its leads a nonprofit journalism venture focused on the U.S. own copyrights. criminal justice system.

A few distinguished publications are also seated within While I admire all of these journalists and instinot-for-profit structures like educational institutions. When tutions (and write a monthly column for the American I worked for Alabama’s Anniston Star in the late 1960s, I Spectator), I am a skeptic of the idea that not-for-profit remember sitting in the paneled study of its publisher, journalism and philanthropically supported publications H. Brandt Ayers, one of the heroic southern newspaper- are the answer to the industry’s woes. This strikes me men who stood with the civil rights movement, nursing as chimerical, and disconnected from the history of our a bourbon and listening to him extol the virtues of family trade and the institutions it built. ownership. It is hard to imagine a more idealistic steward of One way to think about this problem is to reflect such a trust. Yet when the change of generations came, the on what newspaperdom was like in the days when it Ayers family situated the paper within a journalism school. was expanding. Philanthropy played little, if any, role Likewise, the Tampa Bay Times is controlled by the Poyn- in underwriting the free press, which was operated in ter Institute, a journalism training center founded by the a spirit very different from the refined world of nonproprietary family. profit institutions. Who, after all, are the great builders of The Day of New London, Connecticut, is issued by a newspaperdom? McCormick, Murdoch, the Ochses and for-profit publishing company, but 96 percent of the shares the Sulzbergers, Marshall Field, Hearst, Luce, Pulitzer, in that enterprise are owned by a trust which has a dual Dana, Scripps, Bennett, Howard, Cowles, Graham. In all mandate to operate the Day and support a charity estab- cases these proprietors sought wide popularity and glolished by the paper’s late proprietor. “This arrangement,” the ried in their profits, and for good reason: Earned profit Day says, “ensures that the newspaper will remain indepen- was the armor of the press. dent and locally owned and that profits from the newspaper Who can imagine any of these piratical—in the will be distributed to nonprofit organizations within the best sense of the word—press barons structuring their Day’s primary circulation area.” businesses in a way that prevented them from pocketing When I called Gary Farrugia, the newspaper’s pub- their profits and butting heads with politicians? Why lisher who is also CEO of the trust, he dismissed concerns would it make any more sense to structure a newspaper that being seated within a not-for-profit might diminish as a not-for-profit corporation than it would to structure entrepreneurial spirit. He says his executives “dive for every a blast-furnace or an airline or a chip maker as a public penny,” compete ferociously, and get paid in accordance with charity? No doubt there are a few great industrial companies that are owned by charities (Hershey’s chocolate comes to mind). But they weren’t owned by charities in their years of expansion.

My own sense of this situation isn’t original. As early as the 1920s, none other than President Calvin Coolidge dismissed concerns that the press was controlled by “men of wealth” and might support “the private interests of those who own the papers.” He declared that “there is little cause for the fear that our journalism, merely because it is pros-

The future of the newspaper, as vital as it is, cannot be allowed to depend on charity. Colonel McCormick was right.

The first objective of a newspaper is to make a profit.

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perous, is likely to betray us.” He argued that “a press which maintains an intimate touch with the business currents of the nation, is likely to be more reliable than it would be if it were a stranger to these influences.” This is the context in which he famously declared: “After all, the chief business of the American people is business.”

More recently, one of the greatest editors of my generation, Jack Fuller of the Chicago Tribune, in his classic book News Values, warned that “the future of the newspaper, as vital as it is to the future of society, cannot be allowed to depend on charity.” Its future “is most secure if the decisions concerning it make financial sense....

Colonel McCormick was right. The first objective of a newspaper is to make a profit.”

Media competition It’s not that I haven’t explored the nonprofit approach myself. In the 1990s, I established a public charity to raise money to provide grants to journalists of all backgrounds working on Jewish stories. At the time, I was editor of the Forward, a nationally circulated weekly aimed at Jewish readers. My little charity was designed to direct money to journalists working a beat that wasn’t, it seemed, large enough to sustain a for-profit effort. It raised and distributed to reporters several hundred thousand dollars.

There were rewarding moments. And no doubt similar satisfactions occur at other charities designed to foster journalistic work on particular subjects—religion, health care, free markets, whatever. My own experience, though, led me to doubt that grantmaking could become a fundamental solution to the difficulties of publications with small audiences or declining revenues. Indeed I came to the conclusion that philanthropic efforts could actually damage for-profit newspapering, though I blame the newspapers as much as the foundations.

The problem arose with the advent of the modern op-ed page. The idea of opening up a page for opinion opposite the editorial page was originally launched in the 1920s by Pulitzer’s New York World. Newspaper columnists and opinion writers became huge circulation-drivers. Their pictures were plastered on delivery trucks. Spencer Tracy and Katharine Hepburn played the archetypes in the popular film Woman of the Year.

The modern op-ed page, introduced by the New York Times in 1970, flung open the door to opinion journalism not just to newspaper staff but to public intellectuals and academics ensconced at nonprofit think tanks and colleges.

Over time, this migration of press stars from inside the journalistic tent to nonprofit institutions undermined the business model of journalism.

I felt this when I was editing the New York Sun, a newspaper I launched in 2002, in partnership with managing editor Ira Stoll and a group of private investors. We aimed to, among other things, seize the local New York City

beat from the New York Times, and provide a principled counterpoint to its left-leaning editorial stance. One of our keenest frustrations was with well-meaning not-for-profits employing some of the best columnists in the business and incenting them to publish in as many of the papers in town as they could. So it was harder to exploit them for competitive purposes. In the circulation war, they were, in effect, hors de combat.

When I was unable to raise additional capital to cover operating losses, we ceased printing. One of the ideas pressed on me at the time was that we transfer the publication to a not-for-profit institution. But I had no enthusiasm for this strategy, and I eventually purchased the Sun’s copyrights and trademarks, and operate it as a web publication today. This experience caused me to see the proliferation of nonprofit information sources as something that undermines the viability of commercial journalism.

I’m not suggesting that news organizations be protected from the threat of philanthropy. That would be akin to, as Frederic Bastiat famously satirized, a “candlemakers’ petition” to blot out the sun in order to subsidize those who sold wax and wicks. But the experience contains a lesson for anyone who believes that the competitive and dynamic nature of the news business will be unaffected by dependency on charitable or, heaven help us, government funding. (Is it a coincidence that commercial radio stations providing local news reporting and classical music died off when NPR arrived with its mix of charitable and government funding?)

On the road to elsewhere?

The dispersal of the punditry, the shift of reading to the Internet—these kinds of developments are not going to reverse. So it is all the more urgent for news organizations to find a for-profit model that holds up in the digital age.

Can philanthropies help in that transition? Probably. But on the margin. By far the best result will still be the emergence of a business structure that allows reporting organizations to pay their own bills, hire good people, and retain their economic independence and self-reliance.

From the Bolshevik revolution to the golden age of newspapers, the lesson of history is that self-supporting profitability provides both the entrepreneurial force and the absolute autonomy that make a powerful and independent press possible. Philanthropists who want to keep journalism vigorous might therefore want to spend less energy setting up ersatz newspapers and more time building up the profitability of our marketplaces, and protecting the right to private property—which is what the press ultimately is.

When the whole history of the press is written, the greatest bastion of its freedom may well be seen to be the 30 percent profit margin. Lenin, whatever else can be said about him, knew his enemy. P SPRING 2014

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© jameslee1 / istockphoto.com, © Danil Melekhin / istockphoto.com

INVESTIGATIVE PHILANTHROPY? © jameslee1 / istockphoto.com, © Danil Melekhin / istockphoto.com

Local news and research journalism as charity causes

A

s the business models of news publishing sink, managers are tossing overboard costly remnants of the golden age of newspapers and magazines, such as foreign bureaus and investigative reporting. The decline of the latter in particular has alarmed public-minded citizens concerned about the ability of the press to hold government and other large institutions accountable. In response, some philanthropists have taken it upon themselves to fund deeply researched journalism focused on the public interest. Some of these new philanthropic enterprises focus on local news that everyday citizens need but rarely get from national entities. Others add ideological perspective from either the left or the right. In the pages following, Philanthropy examines several projects in nonprofit journalism, and the donors behind them.

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N O N P RO F I T, G O L D - P LAT E D, R E PO RT I N G Herb Sandler decided he was on to something when his infant investigative nonprofit, ProPublica, exposed a scandal in California in its very first months: Nurses who had abused patients or failed drug tests were allowed to keep working because the board that oversaw their licenses took years to process complaints. The next day the governor fired the board. Then ProPublica opened up its reporters’ playbook, giving other journalists step-by-step instructions on how to track the story in their area, and hosting conference calls for people to phone in questions.

“I came from a world that was dog-eat-dog, and we would never give out any information that was competitive,” says Sandler, a San Francisco philanthropist and former financier. “But this is exactly the opposite. We want bad practices stopped, and not just in the area we happen to be looking at.”

Since its founding in 2008, ProPublica has established itself as an active journalistic investigator. The muckraking publication is popular within the media establishment. It focuses on topics like fracking, campaign finance controls, civil rights, health care, gun control, Guantanamo, the Gulf oil spill, and labor laws—all topics of special interest to the left, though ProPublica’s leaders say they strive for objectivity in reporting.

Herb Sandler grew up poor in New York City and worked his way into the investment world. His wife Marion was one of the early professional women on Wall Street. In 2006, just before the financial meltdown, they sold the mortgage company they had jointly built to Wachovia Corporation for $24 billion. Their personal share came to about a tenth of that. The Sandlers had previously decided to give away most of their money during their lifetimes. “We want to effect changes to improve people’s lives,” states Herb.

As he and his wife considered philanthropic targets, the economic struggles of the establishment media seemed threatening. “Many states,” he says, “no longer actually have

Many states no longer actually have anybody following what’s going on in the state capital, God help us.

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anybody following what’s going on in the state capital, God help us.” As papers closed and cubicles emptied, the Sandlers began to brainstorm with friends in the industry. They concluded they had to start something new, because the traditional business model was broken. And they needed a visionary leader to head the effort.

Soon they found themselves in New York talking to Paul Steiger, managing editor of the Wall Street Journal for 16 years. Steiger sketched a rough picture of his ideal investigative nonprofit: a newsroom of full-time reporters, giving away content for free on a website. “We didn’t want to have that atmosphere of a think tank where people with patches on their sleeves, smoking their pipes, would generate something every six months or so and it would be quiet the rest of the time,” says Steiger. He was planning to retire from the Journal at the end of 2007, and he worried about the demise of energetic newsgathering just as the Sandlers did.

“I remember going down in the elevator and having one of these eureka moments,” Sandler says. “Here we are looking for someone to run this thing. And we were just in the office of the smartest and most respected guy in journalism.” Eventually Steiger agreed to become editor-in-chief of a new journalistic nonprofit.

The Sandlers agreed to fund it for three years at up to $10 million a year. Their total support has now exceeded $35 million. “That was an enormous backstop,” says Richard Tofel, president of ProPublica. In 2009, “the number of news organizations that were 100 percent confident in their ability to continue in business through 2011 was not a huge number,” he notes. That allowed the nonprofit to scoop up some high-caliber journalists.

In addition to their money, the Sandlers donated business smarts. Herb helped with office space and brought other supporters on board. Marion came up with the name ProPublica. Although Marion passed away in 2012, Herb still speaks about the project as “we,” while Tofel and Steiger speak of “they.”

The founding team established that the Sandlers and other board members should never know what stories the staff was working on. That “gives me essentially the same

© Alex Belomlinsky / istockphoto.com, © kemie / istockphoto.com

By Biz Carson

© Alex Belomlinsky / istockphoto.com, © kemie / istockphoto.com

freedom I had when I was running the Wall Street Journal,” Steiger told “PBS NewsHour” in 2008. Media critic Jack Shafer nonetheless questioned the nonprofit’s financial dependency on one couple with a history of giving to liberal political causes. “What do the Sandlers want for their millions?” Shafer wrote. Though ProPublica has pushed to broaden its donor base, the Sandlers’ foundation remains by far the largest contributor.

The operation’s high costs have also raised eyebrows.

In its first full year, 2009, ProPublica shelled out more than $6.4 million for salaries and other benefits for 47 staff members, with some reporters earning nearly $200,000 in compensation, journalism site Mediabistro pointed out. Nieman Lab called the 13,000-word investigation into a New Orleans hospital conducted in 2009 by ProPublica and the New York Times Magazine for $400,000 a “remarkable and tragic story that may also represent the most expensive single piece of print journalism in years.” The Atlantic’s Peter Osnos pointed out the $750,000 price tag of the acclaimed 2013 series on the dangers of acetaminophen.

Early in its existence, ProPublica began partnering with legacy media organizations to develop stories as well as print them. “It’s not easy to blend cultures with an outside organization,” says Marc Duvoisin, managing editor of the Los Angeles Times. “It’s hard enough to do investigative reporting well just within your own newsroom.” But “they were an unusual startup,” he explains, in that they had “people who had worked in the news business for a long time…and began with a lot more gravity.”

Sometimes ProPublica presents a finished piece to a media outlet, or publishes the story online with no partner involved. Some partners like to be involved from the beginning. The Atlantic published its first joint story with ProPublica in 2010. “It makes sense to get involved very far upstream in the editing process, practically in the story conception phase so that we’re all clear at the beginning…what the ambitions of the story are,” states Atlantic editor James Bennet.

“It’s very hard to imagine doing it with another, more traditional media organization.”

Five years after its founding, ProPublica is not saving journalism. It operates more on the scale of a high-end boutique than a Walmart, suggests Tofel.

The staff “is large by the standards of nonprofit journalism, but small by the standards of traditional journalism,” says board member Mark Colodny.

The organization has managed to break a number of stories. In 2010 it became the first online news

organization to be awarded a Pulitzer for investigative reporting. The article by Sheri Fink, published in partnership with the New York Times Magazine, chronicled the life-and-death decisions that doctors made about euthanasia at a hospital in New Orleans in the wake of Hurricane Katrina. A year later, the Pulitzer Prize for national reporting went to Jesse Eisinger and Jake Bernstein for their exposé on Wall Street practices that first delayed and then worsened the nation’s economic meltdown.

These days, its investigations page lists subjects ranging from policing (65 stories) and “Obamacare and You” (45 stories, mostly critical), to tainted drywall (34 stories) and surveillance (39 stories). ProPublica’s Dollars for Docs series about payments to physicians by pharmaceutical companies spawned an online marketplace where journalists or others can pay to download the stories’ data.

S andler would love to see 20 or 30 more ProPublicas. “Our objective is: Have we legitimately found an abuse of power? Have we found something that we could all agree is terrible?”

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Biz Carson is a writer living in San Francisco.

D I G G I N G D E E P I N TO T H E H E A RT O F T E XA S

By Ari N. Schulman

John Thornton, a software venture capitalist who’s been a leading player in the Austin, Texas, tech boom of the past two decades, remembers a moment in 2008 when it looked like newspapers “could actually, literally go out of business.”

Media watchers were searching for an answer to the disastrous economics of newsprint. Thornton himself looked into buying struggling local newspapers, but as much as he cared about the work they were doing, he just couldn’t see the business rationale for buying them. So Thornton—also a longtime political contributor and philanthropist to the 22

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ballet or a private hospital, which rely on philanthropic support.

“We need it. Many people recognize it,” suggests board member Paul Sagan. “A few can afford to lean in and do more. That’s the only way we’re going to get this quality of journalism.”

arts—decided that if journalism were to survive, it might have to have a philanthropic flavor.

In 2009, he co-founded the Texas Tribune, a nonprofit media organization aimed at reporting on government, policy, politics, and state affairs. Thornton provided the $1 million seed money and recruited established state journalists to form the editorial core, including co-founders Ross Ramsey, then editor of the politics newsletter Texas Weekly, and Evan Smith, then editor of Texas Monthly. The organization raised another $2.6 million by its launch date. Since then it has won a slew of awards, attracted 18 million unique visitors to its website, and placed its stories on TV stations, radio, and in major national newspapers.

In an article written a few months before the launch of the Tribune, Thornton argued that “‘capital J’ Journalism—journalism that takes on serious, complex issues and puts them in the context of how citizens interact with their government”—should be supported as a public good, along with things like clean air, public safety, and national defense.

The founding premise of the Tribune is that these sorts of goods are essential to a functioning society, but that “public service journalism…is expensive.”Thornton suggests “there is a need for informed communities that is greater than what the market will provide.”

Many of the most lucrative revenue-generating trends in news media today are also the ones that are most at odds with this capital-J Journalism: celebrity obsession, sensationalism, fluff reporting, and what Thornton calls “gotcha” stories. By contrast, Thornton’s nonprofit offers an array of traditional serious content in new-media forms. The Tribune also hosts a variety of events around the state, including moderated debates and panels with elected officials and other public figures. Aimed at encouraging direct participation from the public in local and state affairs, these events are recorded and published on the nonprofit’s website.

Many of the Tribune’s earliest donors—including Thornton himself—were also contributors to Democratic causes. But Thornton says that the donor base has since balanced out. The nonprofit also tries to eliminate potential conflicts of interest stemming from its relationships with donors and advertisers by diversifying its income sources, so that “if anybody gets so offended that

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they decide to part ways with us, it’ll be disappointing but not fatal,” Thornton says.

The Tribune, though flying under the nonprofit flag, is far from uninterested in business matters. After all, it’s not that there’s no money in hard news—just not as much as the content costs. A large and growing part of the Tribune’s income stream still comes from old-fashioned earned revenue: advertising, subscription fees to its specialty publications, and tickets to some of its events, as well as a PBS/NPR-style membership model of individual reader donations.

Thornton estimates that philanthropy now contributes only a third of the Tribune’s income, and he aims to bring that share down further.

What the Tribune seems to have achieved is a model that combines business and philanthropy.

This structure allows it to find ways to make revenue without distorting its core mission—and then put that revenue right back into its mission. It’s a not-entirely-not-for-profit model that leverages the money-making aspects of journalism for the sake of doing more and better journalism.

The relative success of his model means that Thornton is now focused on growth rather than survival. Instead of needing support to “keep the lights on,” he says, the Tribune is now at a point where it can use philanthropy to “break new ground.” He aims to make the Tribune a major voice on business coverage, and talks of expanding a “border bureau” so that it can become the authority on Texas-Mexico issues, which he considers neglected.

Thornton is confident that the Tribune is popular among politicians, news media, and other public policy followers in Texas. And, thanks to its partnership with the New York Times—several Texas-themed stories a week are published under the Times’s imprimatur—it also has a voice on the national stage (while the Gray Lady has an easy way to supplement the work of its regional bureau). But Thornton sees the next big step as capturing a broader audience among the general public. Ratings and readership may no longer be a bottom-line concern, but Thornton believes that “the Trib is responsible to produce content that engages people. It can’t all be broccoli and castor oil.”

“One of the knocks on the Tribune,” Thornton acknowledges, is that “there’s no Woodward and Bernstein episode yet.” But what he’s really after is “filling in the gaps” left by an ailing news media, leveraging the explanatory powers of both detailed reporting and digital platforms “to help the citizens of Texas to make more responsible decisions in their civic lives.” Five years

in, Thornton is cautiously buoyant about the Tribune’s progress, and its prospects as a model for similar ventures: “I think my money here has done tremendously more good than any I ever gave to partisan politics.”

Ari N. Schulman, an Austin native and fifth-generation Texan, is executive editor of The New Atlantis.

WATC H D O G S, P RO A N D A M AT E U R

By Jonathan V. Last

Food stamps aren’t what they used to be. States have phased out the actual paper stamps and switched to magnetic swipe cards, known as electronic benefit transfers, or EBT cards. They work like debit cards, which apparently opens a door to easy fraud and misuse.

In 2011, the New Mexico branch of the Franklin Center’s journalism project, Watchdog.org, decided to see just how much EBT cards were being abused.

It requested the logs for the state’s 196,000 EBT cards and examined every transaction these cards were used for over the course of two months. What it found was amazing. Some of the cards were being run not in New Mexico, but across the country. Many were used to make cash withdrawals at ATMs. They were used in strip clubs, liquor stores, bars, and casinos. Other local media outlets picked up the story, and the state House of Representatives passed a bill aimed at curbing the problem.

It was the type of discovery that newspapers once specialized in. But at the dawning of the new millennium Craigslist replaced classified ads, and news was distributed for free on the web—drying up funds in traditional newsrooms. Which is why the Franklin Center was created.

The Franklin Center for Government and Public Integrity was established in 2009, the brainchild of Jason Stverak, a placid, keenly observant Midwesterner who

I think my money here has done more good than any I ever gave to partisan politics.

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A $250 M I L L I O N E X P E R I M E N T

© jameslee1 / istockphoto.com, © zoom-zoom / istockphoto.com

By David Donadio

If the Internet destroyed newspapers as we know them, who better to reinvent them than a celebrated web magnate?

Such was the buzz surrounding Jeff Bezos’s $250 million purchase of the Washington Post last summer. Then, just as industry observers began to speculate about how the Amazon CEO might transform one of the country’s most venerable media institutions for the digital age, an even more experimental media venture emerged.

Another cyber tycoon, eBay founder Pierre Omidyar, launched an online-only operation called First Look Media. Omidyar too had briefly considered buying the Post. Instead he decided to allot a quarter-billion dollars to starting a new media empire from scratch. “What could you do with that same amount of capital if you built something from the ground up?” Omidyar asked aloud on NPR. “It lets you throw out all the old rules. It lets you build things in a completely different way.”

In his voiceover narration on a slick animated video that introduced First Look in February, Omidyar presented his vision for the new media venture. “First Look is a marriage between a technology company and a new kind of newsroom,” he states, as friendly cartoon journalists wiggle across the screen. “Our goal is to experiment, innovate, and overcome existing obstacles, to make it easier for journalists to deliver the transformative stories we all need.”

The video’s charming design and chummy tone are a stark contrast to the type of material First Look published in its first month. The organization’s inaugural story on February 10, 2014 summarized classified documents leaked by former U.S. intelligence contractor Edward Snowden to reveal that the U.S. military is targeting drone strikes in Pakistan to the locations of cell phones used by persons listed as terrorists. Many additional stories derived from classified documents have followed on the Intercept, First Look’s initial website.

To manage his new enterprise, Omidyar picked a team of champions who crusade hard from the left. The Intercept’s top four editors are Glenn Greenwald, who lives in Brazil and has led publication of the Snowden leaks; Jeremy Scahill, hired from the Nation; Berlin-based filmmaker Laura Poitras; and Liliana Segura of the Nation and the Campaign to End the Death Penalty. In addition to being heroes of political progressives, all four have histories of breaking down the boundary between news and opinion.

In an official release, Omidyar envisions that various arms of First Look will eventually provide “robust coverage of politics, government, sports, entertainment and lifestyle, arts and culture, business, technology, and investigative news.” That’s a lot of ground to cover, but Omidyar is not a media novice. In 2010, he founded Honolulu Civil Beat, a subscriber-driven news website that provides investigative coverage of politics and government in Hawaii.

Unlike Civil Beat, First Look’s journalism arm will be a nonprofit. Reportedly it will be underwritten by a new technology company. Thus far, Omidyar has disclosed little about what products or services that company will sell.

It’s clear that Omidyar intends to use his fortune to create a marriage of journalism, entertainment, and aggressive political activism through First Look. “If the model is a blend of ProPublica and Greenwald’s Snowden-related work,” suggests Olivier Knox, White House correspondent for Yahoo News, “there’s no doubt that it could have a huge impact.”

David Donadio is principal of writing and public relations firm Iambic, and was a Phillips Foundation Robert Novak fellow in 2008.

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By Maria Servold

After several Minnesota news outlets, including the Minneapolis Star Tribune, cut their staffs significantly seven years ago, some journalists and readers came to Joel Kramer, a former editor at the Star Tribune, and asked if he could do something about the shrinking coverage of local news.

Kramer, who had steered two investigative projects to Pulitzer awards, took on the challenge. “I decided, after doing some research, that there was an interesting possibility of online-only,” he says. Since so many journalists had recently lost their jobs, a new website would have a base of writing talent to pull from. The result is MinnPost, an online-only news website that serves several hundred thousand Minnesotans looking for in-depth analysis of topics that sometimes no longer get covered by local newspapers.

MinnPost’s initial funding of $850,000 came from four families: Lee Lynch and Terry Saario, John and Sage Cowles, David and Vicki Cox, and Joel and Lau26

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S E RV I N G LO CA L S T H E N E W S T H E Y C RAV E

rie Kramer. The nonpartisan nonprofit is sustained by contributions from readers (about 55 percent of current funding), grants from foundations (15 percent), modest advertising sales, and an annual fundraiser. Its annual budget is about $1.5 million, and it finished 2013 with a surplus for the fourth time in a row.

To become sustainable and less dependent on major grants, Kramer says, the organization needs more annual memberships (they were up 6 percent in 2013). About 4,000 people have donated to MinnPost since it began, and almost a third of those have signed up for automatic giving or given more than once. Significant grants from the Knight, Bush, McKnight, and Joyce foundations have also helped keep the operation going.

The nonprofit mostly employs editors and business managers. It has a small number of reporters on staff, and works with more writers on a contract basis.

Kramer describes MinnPost’s coverage of politics and policy, education, arts, and the environment as “generally more sophisticated and deeper…than the mass media can sustain. Right from the beginning we had certain ideas about how we’d do this that differentiated us.” The publication steers away from celebrity news. One of its brochures declares: “NO Britney. NO Paris. NO Lindsay.”

Twin Cities media observers say MinnPost has enhanced the region’s news offerings. “By adding another voice, it’s made everybody step up what they’re already doing,” says James Lileks, a metro columnist at the Star Tribune, National Review columnist, and member of the Twin Cities journalism world since about 1980. “It’s got built-in credibility from local established sources, and it has that cachet of serious journalism because it’s staffed partly by people who used to be in print. They have lots of good people working for them.” Its greatest asset is its ability “to cover things in detail that newspapers don’t have the space for and may not have the interest or time for.

Who could possibly complain that there’s another journalism voice out there?”

Kramer says he keeps a careful eye on the site’s traffic and aims stories at readers who visit the site multiple times per month. In 2013, there were more than 100,000 people who visited MinnPost at least twice a month, a figure that has more than doubled from a few years ago. Getting those readers to become sustaining member-donors is crucial.

“Our target audience is news-intense Minnesotans,” Kramer says. “That means they go to multiple

© jameslee1 / istockphoto.com, © Henrik5000 / istockphoto.com

sources for news, they care about quality. Our goal is to get a share of the time of the intense people. We know there are a lot more than 100,000….There’s lots more opportunity.” “slush funds” in the Affordable Care Act, and illegal lobbying within the Obama administration. A few Maria Servold is the assistant director of the Dow AMI stories have fueled Congressional investigations Journalism Program at Hillsdale College. and stirred media controversy, and they’ve been picked up by big aggregators like the Drudge Report. Miniter believes AMI’s story on a slush fund in the immigraD R I L L I N G F RO M T H E R I G H T tion bill helped to kill it in the House.

By Kate Havard AMI’s reporting is intended for broad distribution.

Richard Miniter had a problem—a good problem. “As Too much conservative media “doesn’t reach beyond the an investigative reporter, I had more tips than I knew choir,” Miniter says. And independents and liberals will what to do with,” he says. “It was like drinking from a often not even get a chance to see a story if it debuts in fire hose. What I needed was a team.” a conservative journal. “We aim to put things out where Finding his team at an established news outlet would they could have the most impact, quickly.” be difficult. For years, he notes, there was “more will than To that end, AMI publishes its stories in outwallet” for investigative journalism. But Miniter had an lets with little discernible slant—places like Forbes, idea for how to solve the wallet problem: He would start Investor’s Business Daily, and the Daily Mail, and a nonprofit to churn out investigative journalism, funded deliberately avoids publications that openly position by philanthropists, with good writers and editors at the themselves on the right. Miniter says news outlets helm. Then, he would offer its stories to major news out- have never turned down an AMI story because it was lets for free. too conservative.

The idea was not original. “Of course there were “You need to break stories in mainstream outlets if about 40 nonprofits already doing this kind of work,” you want to change minds,” Miniter says. “And you need including the most famous, ProPublica. But Miniter’s trust. We’re using writers who have established their brainchild would set itself apart from these other credibility.” AMI contracts with experienced journalists investigative nonprofits: It would lean to the right who hail from places like Newsweek, Forbes, and Harpinstead of the left. Thus was the American Media er’s. The managing editor, William Schulz, was a senior Institute born to offer “first and fearless investigative editor at Reader’s Digest for nearly 40 years. reporting for the mainstream media.”

Miniter’s project is not cheap. He says it can cost Though nearly all such investigative outlets say AMI between $25,000 and $150,000 to produce a major they are nonpartisan, plenty of observers beg to differ. investigative story. Each article is different, with some “There’s no balance, no countervailing argument from requiring just paychecks for writers, and others involving the other side,” says Colin Hanna, president of Let Free- travel. The outlet published just a handful of stories in dom Ring USA, a nonprofit that supports AMI. “I want its first year of operation. Miniter says eight to ten more AMI to keep on breaking well-documented stories that are currently in the works.

Investigative reporting, he says, is like “drilling for go against conventional wisdom and assumptions,” says Hanna. “Freedom, fairness, and free enterprise are all oil—sometimes you get a gusher, sometimes nothing at all.” But “we’re diggers,” he says. “That’s what we undermined” by the status quo.

Miniter says his goal is not to report stories with any do. It’s fun.” agenda—rather, AMI aims to distinguish itself by whom or what it puts under the microscope. “We want to hold Kate Havard is the Tikvah fellow at the Wall Street big things accountable,” he explains. “Big government, Journal’s opinion page. P big labor, and big businesses—abuses of the public trust.”

If an investigation turns up information unflattering to conservatives, he says AMI won’t hesitate to publish the information. But, he adds, there are many sacred cows out there that only AMI will be willing to expose.

So far AMI has investigated U.S. intelligence leading up to the Benghazi embassy attack, hidden

You need to break stories in mainstream outlets if you want to change minds. And you need trust.

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IQ BUILDING

RELIGION IN REPORTERS A donor-funded conference educates the media on faith

Rodrigo Varela Photography

M

By Andrea Scott

citizens. According to the Pew Research Center, 56 percent of Americans say that religion is “very important” to them, while another 26 percent say it’s “somewhat important.” This can powerfully influence both private and public actions.

Despite its pervasive importance, religion is a foreign land to many, perhaps most, reporters. “I was practically born and raised in the news business, and know firsthand that newsrooms are exceedingly secular places,” says veteran journalist Carl Cannon, Washington bureau chief of RealClearPolitics. “But the people we cover—and our audiences—are steeped in religious faith of all kinds.

So to accurately cover the political and civic life of this country, journalists need to know what’s going on in the spiritual life of their fellow Americans.” This, however, is a struggle for under-informed reporters.

uch news today is somehow related to religion, as a glance at the headlines reveals: Turmoil in the Middle East. Church relief missions after a natural disaster. The actions of Pope Francis. Challenges to the Affordable Care Act’s contraception mandate. The ebb and flow of local religious programs that feed the hungry, operate schools, fight addictions, and run hospitals. Statements by the Dalai Lama. Same-sex marriage and abortion debates. Jihadist terror. Differences in community life and politics that link to spiritual perspective. Many of today’s evolving stories are intricately entwined with religious issues.

And beyond its role as a factor in news events, faith is of deep and urgent personal relevance to many Andrea Scott is assistant editor of Philanthropy.

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Religion has been slighted in the secular media, because we reporters are not familiar with it. When religion erupts in our political life in undeniable ways, a lot of us have to scramble to keep up.

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Yorker, Lisa Miller of New York magazine, Nancy Gibbs and David van Biema of Time, and more than 200 other journalists from 40 media outlets.

Opening minds to new breezes It’s a gusty November night on Miami’s South Beach.

Journalists, featured speakers, and program supporters mingle on an outdoor terrace in the salty air. The oceanfront setting in an art-deco hotel aims to whisk guests away from ordinary life in their busy stomping grounds.

Some, like ABC News correspondent Dan Harris and Washington Post political reporter Karen Tumulty, are old hands at Cromartie’s gatherings. Others, like the Economist Washington bureau chief David Rennie and Texas Monthly writer Erica Greider, are here for the first time.

One newcomer—a thoughtful liberal at a left-leaning publication—wonders aloud why Cromartie invited her.

Rodrigo Varela Photography

“Religion is a subject that has traditionally been slighted in the secular media in our coverage of politics, largely, I think, because we reporters have been scared off the subject by our lack of familiarity with it,” says Weekly Standard senior editor Andrew Ferguson. “Political coverage in general has suffered as a result, and when religion erupts in our political life in undeniable ways—think of the rise of both the religious right and religious left in the past generation—a lot of us have to scramble to keep up.”

For the past three decades, one recourse for scrambling reporters has been to call Michael Cromartie, an evangelical Christian who works at the D.C.-based Ethics and Public Policy Center, for background information on their stories. Cromartie became increasingly concerned about the religious illiteracy of the journalists he spoke with. “I would get phone calls, from really smart reporters, asking some of the most misinformed questions.” For instance, one journalist asked for the name of the author and publisher when Cromartie mentioned the book of Ephesians. Religious subjects were a “whole new universe” for many of these reporters, he realized, and he wanted to do something about it.

Luis Lugo, then director of the Pew Forum on Religion and Public Life, says he also wanted to “educate the press on religion.” Initially, the two joined forces to offer local lunchtime seminars, a staple of the D.C. think-tank world. But Lugo prodded Cromartie to “think outside the box as if money were not an issue.” Cromartie proposed getting the journalists out of Washington and “away from their deadlines, to actually have a reflective two days with serious scholars.” In 2002, they launched a series of weekend conferences, now hosted semiannually near Miami, featuring experts and believers like megachurch pastors Tim Keller and Rick Warren, National Institutes of Health director Francis Collins, Pakistani ambassador Husain Haqqani, and others.

Each invitation-only conference is limited to about 20 influential correspondents, columnists, producers, and opinion leaders from both print and broadcast media.

The Faith Angle Forum, as it came to be called, has welcomed David Brooks and Ross Douthat of the New York Times, Christopher Hitchens of Vanity Fair, Mike Allen of Politico, Rachel Zoll of the Associated Press, Clare Duffy of “NBC Nightly News,” Nina Easton of Fortune, Malcolm Gladwell and Peter Boyer of the New

Rodrigo Varela Photography

Theologian L. Gregory Jones helped reporters think about forgiveness in public life at the most recent Faith Angle Forum.

It’s clear many attendees are not religious. So what could be his intention?

Cromartie tells anyone who asks that his goal is to bring together “smart people on all sides” and create a robust dialogue. His intention is not to convert anyone, but to help journalists better their craft by exposing them to excellent speakers purveying ideas with which they may not be familiar.

The first of these speakers is L. Gregory Jones, a theology professor at Duke University. He leads journalists through a consideration of how the concept of forgiveness can play out in the public sphere. Addressing ideas of genuine remorse, accountability, humility, and healing, Jones draws on examples from traumatized communities like Rwanda and post-shooting Virginia Tech,

to disgraced public figures such as Lance Armstrong and Mark Sanford.

Theological concepts like sin and repentance, as it turns out, have a very practical application in the news business. Atlantic political reporter Molly Ball asks a pointed question: “How do we afford these people their human capacity for absolution, while also not letting them off the hook?” Jones describes what real atonement looks like, citing Watergate-conspirator-turned-prison-evangelist Chuck Colson as an example.

“I found the session about forgiveness enormously helpful as a human being,” says Will Saletan afterward.

A writer on “politics, science, technology, and other stuff ” at Slate and the author of Bearing Right: How Conservatives Won the Abortion War, he comments that SPRING 2014

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The Daily Beast's Michelle Cottle asks a question as part of the open-floor discussion allowing reporters to grill the experts.

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church attendance with a more welcoming stance toward overseas arrivals. Skerry references his extensive interviews with border patrol agents, who turn out to sympathize with would-be immigrants, belying simple claims of racism.

Putting a face on faith The Faith Angle Forum attempts to be relevant and immediately useful to journalists.

“We try very hard to make the sessions timely to what the reporters are covering now in the news,” Cromartie says. The aim, though, is “education, not influencing legislation.” Past topics have included just-war theory, the rise of the megachurch, the evolution of the Christian right, and a discussion of Protestant theologian Reinhold Neibuhr inspired by then-Presidential candidate Barack Obama’s mention of him as a favorite philosopher.

Rodrigo Varela Photography

“it was interesting to be exposed to a wisdom that we can all relate to and share, and maybe begin to associate that with religion instead of associating religion with some political movement.”

Another session features NASA astronomer Jennifer Wiseman, the new director of the Dialogue on Science, Ethics, and Religion for the American Association for the Advancement of Science. She presents some stunning images from the Hubble telescope and sparks a wide-ranging conversation on the latest advances in cosmology and the different ways religious believers engage with unfolding developments in science.

The forum doesn’t shy away from policy issues. Political scientist Peter Skerry and demographer John Green make a presentation on the history of U.S. immigration, along with a breakdown of the diverse views religious people hold on the topic. Green points out data linking more frequent

Rodrigo Varela Photography

In the run-up to the 2012 elections, the conference featured a discussion on the Church of Jesus Christ of Latter-day Saints. At the time, “not many political reporters could have told you more than a few sentences about Mormonism, even though one of the two men who were contesting to be our next President was a devout Mormon,” notes Ferguson.

“What we really wanted to do is understand, from both a Mormon and a non-Mormon perspective: What is Mormonism? How does it shape his character? What are the myths and what are the realities?” says NPR religion correspondent Barbara Bradley Hagerty. The Faith Angle takes “a deep dive,” she says, into the subject at hand, whether that be Mormonism, immigration, or Islam.

Bradley Hagerty serves on a steering committee that recommends topics for each conference. Everyone on this committee brings something different to the table, she explains. Jeffrey Goldberg of the Atlantic has a deep knowledge of the Middle East. New York Times columnist David Brooks and Washington Post writer E. J. Dionne offer experienced views of politics. Carl Cannon is also an adviser, as are Washington Post columnist Michael Gerson and The New Republic’s Franklin Foer.

As major media outlets, like the rest of the nation, become more partisan and polarized, bias and lack of understanding for other viewpoints can run rampant. That may be a harsh generalization, Gerson says, but “there are pockets of the journalistic community that have a low level of religious literacy,” he admits. One aim of the forum is “to expose journalists in an intimate setting to religious leaders they might not meet in other circumstances, and may even have a caricatured image of.”

“What I think this forum really does is defang religion,” says Slate’s Saletan. “It debunks the ignorant impression that a lot of journalists have of religion as something that is inherently politically conservative, backward, fundamentalist, and narrow.”

Many of the participants say that this is the only chance they’ve had in years to ponder these subjects at length. Journalists “often don’t have time for deeper, more fundamental debates about religion, ethics, science, public policy, and their intersection,” Gerson adds. “This is one of the few places for them to get away and ask those questions and talk to one another about this set of issues.” Bradley Hagerty says she leaves each forum having learned something new.

Reaching the public Though relatively few people get to participate in a forum, the goal of the sessions ultimately is to inform the general public. Educating one reporter can bring a revised message to thousands or even millions in his or her audience. Session audio and transcripts are also made available online for direct reference. The relationships that are built at the conferences are another effect of the forum.

In South Beach, many of the reporters work on stories during breaks, and live-tweet discussions, bringing the conference conversations to cyberspace. Kirsten Powers—a Fox News Democratic contributor, Daily Beast columnist, and darling of liberal punditry—is a frequent Faith Angle guest. She recently recounted in Christianity Today her surprising (to everyone, including her, she says) conversion to evangelical Christianity. As the conference progressed, she shared her running conversation with her 131,000 Twitter followers. Religion News Service reporter Sarah Pulliam Bailey and Daily Beast correspondent Michelle Cottle also broadcast the forum via social media.

The conferences also lead directly to stories. In South Beach, the Economist’s “Lexington” columnist and Washington bureau chief David Rennie made his own Twitter debut, and penned two columns based on the sessions: “Forget the Huddled Masses: Treating immigrants as a charity case is not working, time to change course,” and “All About Adam: A furious—and political—debate about the origins of mankind.” Gerson published a Washington Post op-ed on evangelicals and immigration reform out of the day’s events.

Pew footed most of bill in the first ten years of the program; since then, Cromartie has patched together a series of donors to pay for the two events each year.

Each conference costs $150,000 to produce. Donors are invited to attend the conference as observers. Recent observers included Deborah Haarsma, president of BioLogos Foundation, which promotes the idea that science and Biblical faith are in harmony; educator Jerry Pattengale, who attended on behalf of Indiana Wesleyan and also was taking notes for Hobby Lobby craft store magnates, the Green family; and Earl Whipple of the Templeton Foundation, which regards these dialogues as “critically important” and frequently supports them.

Lugo, who is now the director of community initiatives for the Douglas and Maria DeVos Foundation, believes it is useful for philanthropy to support reporter education on crucial topics. “As monies become scarcer for journalists to do this in-depth education, it has been even more important for the philanthropic world to close that gap,” he argues.

Gerson calls the Faith Angle Forum a “strategic intervention.” It “doesn’t often have the immediate outcome,” he says, “but it is playing an extraordinary purpose to expose some of the most influential people in America to the most important ideas and debates in America.” P

What I think this forum really does is defang religion. It debunks the ignorant impression that a lot of journalists have of religion as something inherently backward and narrow.

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Training the next generation of conservative journalists

By Justin Torres

Jessica Abrams landed an internship at BBC “World News America” through the National Journalism Center.

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I

National Journalism Center

n today’s media market, training young journalists might seem like teaching workers to make buggy whips, circa 1905. But four nonprofit programs are betting that while media may evolve, the need for professional gatherers and interpreters of news is eternal—and that if journalistic ranks are to gain a healthy diversity of opinion, there is a particular need for news-gatherers open to conservative perspectives.

The oldest of these programs, the National Journalism Center, since 1977 has offered budding reporters the chance to intern with media outlets in Washington, D.C., while attending journalism classes taught by experienced faculty, many of them alumni of the program. The newest, the four-year-old Student Free Press Association, gives campus journalists a national platform for their work, as well as paid fellowships with publishers of political journalism. A third organization, now in its 21st year, is the Robert Novak Journalism Fellowship, which offers reporters in the first decade of their career the chance to work on a yearlong project of their choosing. The fourth, the Buckley Journalism Fellowships, has since 2009 installed one or two young journalists each year at National Review, giving them on-the-job training at the flagship conservative magazine.

All four of these programs aim to balance out what they see as the dominant liberal bent of the media by teaching the tools of the trade to individuals open to issues of interest to conservatives and libertarians.

Reporters wanted The programs have another thing in common: They want budding reporters—the traditional gumshoes who ferret out facts and figures—and not editorialists. “The first thing we tell our reporters is, ‘No one cares about your opinion,’” says Hannah Jackman, program director of the NJC (which is now a division of Young America’s Foundation). “Solid reporting gives you respect and credibility. The best way to be influential and be marketable is to be a great reporter.” To develop that inquisitive instinct, NJC started a weekly Wednesday evening workshop for its interns focused on investigative reporting, taught by experienced alumni. They want their graduates to be “comfortable with investigative work,” she says.

Jackman’s words are echoed by Lindsay Craig, who heads the National Review Institute, the nonprofit arm of the magazine that houses the Buckley Journalism Fellowship. “We’re looking for young people who have expressed an interest in journalism—not just political bloggery,” she says. “There are a lot of kids who only know how to write what they feel. Real journalists understand the value of having multiple sources for their assertions, and know that editors will push you in certain places to make you a better writer.” The program was designed “in the tradition of Buckley—who was always finding and nurturing young talent—to be able

to continue this commitment to up-and-coming journalists in a way that was valuable to the magazine,” says Craig. Buckley Fellows spend a year writing for National Review. The program includes regular lunchtime training sessions on journalistic practice and meetings with prominent writers.

Novak Fellowship head John Farley—himself a journalism-school graduate who worked for a daily paper in Florida—connects the program’s focus on reporting and investigation to the influence of its namesake. The fellowships began in 1994 as a program of the Phillips Foundation, a small grantmaking organization established by publisher Tom Phillips. Robert Novak was an original trustee of the foundation, and suggested a fellowship in journalism to counter the leftward drift of his profession. The program has grown to include five to ten annual awardees, who are paid up to $50,000 to research and report a particular topic. Originally called Phillips Fellowships, they were renamed within a year of Novak’s death in 2009, and the program is now housed at the Fund for American Studies, where Tom Phillips continues to support it, along with grants from the Charles Koch, Diana Davis Spencer, JM, Bradley, and GFC foundations.

Novak, who wrote one of the longest-running columns in American journalistic history, never abandoned traditional reporting methods even as he was increasingly called upon to offer analysis and opinion on the news.

“Bob was one of the great journalists of the twentieth century, and one of the few columnists who was a reporting columnist,” says Farley. “He was very proud of that fact and it really set him apart from the crowd.” Farley recalls Novak speaking with young fellowship recipients just before his death from cancer, when he had to use a wheelchair. His widow Geraldine remains a devoted supporter of the program.

From the ground up John Miller, founder of the Student Free Press Association, was once one of the many wannabe journalists who make their way to Washington.

Miller has been involved in campus journalism since he edited the Michigan Review, the conservative newspaper at the University of Michigan. After graduation he got an internship at the D.C. political magazine The New Republic, then spent many years at National Review, while publishing at a host of outlets (including Philanthropy, where he is a contributing editor). Having long attempted to help other conservative and libertarian campus journalists with internships and mentorship, he now heads the Dow Journalism Program at Hillsdale College in Michigan.

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The Student Free Press Association arose from Miller’s interest in the next generation of journalists. The group’s online news portal, the College Fix, publishes the original work of right-leaning student writers, in order to give them “a platform from which they could get more attention” than from just the campus level. On a recent Friday, for example, the website featured stories about a small Christian college nixing its “Crusader” mascot for fear of giving offense (before anyone had complained); a story from Dartmouth about Republican students being barred from a campus meeting to plan Martin Luther King Jr. holiday events; and video featuring New York University students confessing their ignorance of Benghazi—with two saying they’d be interested in going there for a study abroad program. “What makes us different is that we’re working with student journalists while they’re still in college,” says Miller, “helping them to break stories on their campus and exposing them to a wider national audience than they would otherwise have.”

Coupled with the College Fix is a fellowship program, which pays campus journalists while they work stints at media outlets such as the Weekly Standard, National Review, RealClearPolitics, the Hill, and the Washington Examiner.

paid internship—even just a few hundred dollars a week—makes all the difference for students who don’t have the resources to intern for free and might otherwise have been unable to break into the field.

Nikki Grey, an NJC alumna from 2011, credits the program with radically reshaping her life. Grey spent her teenage years in the Nevada foster-care system after her mother died and her father relinquished his parental rights. As a child living in group homes and shuffling from foster parent to foster parent, she took comfort in books, her journal, and teachers who encouraged her as a writer. After high school she joined the 2 percent of foster kids who go to college, graduating in 2011 from the University of Nevada. A paid internship through NJC landed her at the Daily Caller, Tucker Carlson’s online publication. “So many of the people in journalism come from very similar, often privileged backgrounds,” Grey says. “For me, it seemed impossible just to go to college. NJC put me on the same level with them.” Grey landed a job as a features writer at the Santa Barbara NewsPress, and presently is working on her first novel.

The fellowships and website are supported by grants from the Searle Freedom Trust and the Bradley, Hertog, JM, Apgar, and Rumsfeld foundations.

Students who really integrate into a news outlet sometimes snag permanent reporting jobs. That was how it worked for Adam O’Neal, a senior at the University of California–Irvine who was studying literary journalism and working part-time as a radio producer.

O’Neal hoped to come to D.C. to break into political journalism but couldn’t afford to take an unpaid internship. Through the Student Free Press Association and its $400 per week stipend, he was able to spend two months working at the online political reporting outfit RealClearPolitics. At the end of his fellowship, he was hired full-time. “I’m not exaggerating when I say that the paid fellowship was a life-changer for me,” says O’Neal. “I would never have been able to afford to do this without that stipend.”

O’Neal has written long stories on Chris Christie’s political trajectory and changes to marijuana laws, as well as shorter, breaking-news items.

When speaking to alumni of these four programs, it is striking how often the existence of a 36

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Tracking impact in changing times For all four of these programs, the goal is to train journalists who will influence and help balance the national debate in years to come. All four struggle with precisely how to measure and define success in reaching that goal.

The Buckley Fellowship program scored an early triumph last year when its first graduate—National Review writer Robert Costa, who had won widespread notice for his reporting during the recent federal government shutdown—was hired by the Washington Post as a national political reporter, a crossover from conservative to establishment media.

NJC has recently invested in a full-time staff member charged with reaching out to and tracking the program’s 2,000 alumni. “Like with any nonprofit, when you’re trying to run the program leanly, it’s no small task to spend time” assessing impact, says Jackman. Tracking has two goals: helping NJC get a handle on how effective the program is at placing alumni in the news industry, and developing mentoring networks that can deepen the experience—and future career opportunities—of current students.

National Journalism Center

It is striking how often the existence of a paid internship—even just a few hundred dollars a week—makes all the difference for students who don’t have the resources to intern for free.

National Journalism Center

For Farley, the impact of the 117 Novak alumni is a similar exercise in biography. These former fellows, he says, “are climbing the ranks as reporters, writers, editors, and anchors, and a lot of them have written books that are moving debates.” He points to former Novak Fellows who now occupy positions at the Manchester Union-Leader, the Washington Examiner, the Washington Free Beacon, and the Weekly Standard. “We can point to millions of eyeballs on the work of our fellows.”

Younger than NJC or the Novak Fellowships, the Student Free Press Association has had fewer opportunities for national influence. Miller points to the explosive growth of the College Fix as an early indicator of influence. The website attracts millions of unique visitors in a year. The College Fix has been cited many times by the web’s heavyweight news aggregator, the Drudge Report.

These programs range from the relatively inexpensive (approximately $5,000 per participant in stipends and indirect costs for the Student Free Press Association and NJC) to $75,000 in salary and benefits for each Buckley Fellow. All four programs rely heavily or exclusively on philanthropic donations. A striking optimism suffuses these programs—the sense that journalism remains a proud and valuable profession even as individual media outlets change, evolve, or die.

To Jackman, the hands-on training provided by a program like NJC is even more important in a digital world where, as she puts it, “anybody sitting at a computer in their living room can be a journalist.” With the dismantling of the traditional layers of editors at daily papers and magazines, it’s critical that the journalists of tomorrow prize careful checks on the quality of content. NJC is also training young journalists to use social media as a way to push their content, offering video workshops that teach students how to use iPhone video clips and pictures to enliven stories.

To Farley, the present age is “a really exciting time for journalism. One platform—the daily newspaper—is fading,” but Farley notes that change has always been a hallmark of the news business. “When I came out of journalism school, television was changing print media and killing evening newspapers.” Now, the Novak Fellows are increasingly active in new media, and a number of alumni are blogger-reporters or work in online political or cultural journalism. “I can’t predict what the field is going to look like in 20 years,” he says, “but we’re training people to be on the vanguard of that.”

“The forms by which we consume the news have changed many times, and who knows where we’ll end up in a decade,” echoes Miller. “We don’t know which medium will survive, but we do know there will be media.” Wherever future readers and viewers go to get their news, these programs are working to ensure that there are qualified journalists available to dish it up and balance it out. P

Matthew Pitchford’s internship at the Daily Caller, through the National Journalism Center, gave him a look inside the White House press room.

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The Stroke Recovery Center in Palm Springs, California, enjoyed valuable air time thanks to a partnership

CBS Local 2, Š gbrundin / istockphoto.com

between philanthropy and a local TV station.

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Charity A California philanthropy and a television station join forces to stimulate giving

By Chris Weinkopf

CBS Local 2, © gbrundin / istockphoto.com

T

In the spotlight In 2008, the H. N. and Frances C. Berger Foundation, a Palm Desert-based philanthropy that has donated more than $400 million throughout California and the U.S., was called on by representatives of a regional TV station.

CBS Local 2 had dreamt up a simple idea: Each month, Berger would present a charity from the community with a grant of $25,000 for the excellence of its work, and the TV station would publicize what the nonprofit does.

The combination of funds and exposure would give the recipient charity a real boost. The foundation liked the concept. It agreed to a 12-month trial run. Thus was born the Coachella Valley Spotlight.

“We do a story about the charity on ‘Eye on the Desert’—our program that runs at 6:45 p.m. Monday through Friday—about what the organization does, how it gives back to the community—and then we have a check-presentation ceremony that also gets a story,” explains Mike Stutz, general manager of the company that owns CBS Local 2. For the rest of the month, the station periodically salutes the organization on its top-of-the-hour identification breaks. “We make it a big deal.”

Six years after its launch, the Coachella Valley Spotlight is thriving, having distributed $1.5 million in grants and countless dollars in free airtime to more than 60 charities in the valley. Beneficiaries have ranged from

his is a very bifurcated market,” says Don Perry, a retired broadcaster and the former manager of CBS Local 2 in California’s Coachella Valley, about 120 miles southeast of Los Angeles. “It has extreme wealth and extreme poverty, with very little middle class. It’s kind of like Aspen. If you work here, you can’t afford to live here.”

Best known for the twin resort cities of Palm Springs and Palm Desert, the Coachella Valley offers sultry temperatures that lure upward of 150,000 part-time residents, or “snowbirds,” each winter. The valley is a desert but, thanks to irrigation, it’s sprinkled with oases of green. There are more than 100 golf courses, attracting wealthy retirees, and 100,000 acres of farmland, drawing indigent fieldworkers.

The result is a mix of lavish houses in gated neighborhoods and mobile homes in trailer parks.

From this concentration of wealth and poverty emerge an estimated 1,000 charitable organizations serving a population of more than 400,000 residents.

Like many nonprofits, the local helping groups are rich in ideas and enthusiasm but short on revenues, exposure, and volunteers. But this region has produced a model for magnifying charitable action in a small market. A local foundation and a television station have harnessed the reach of mass media to the power of philanthropy, devis- Chris Weinkopf is the communications manager at southern California’s Thomas Aquinas College. ing a system worthy of being copied elsewhere.

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veterans’ programs to addiction-recovery clinics to afterschool ventures. The feature is a popular part of the local newscast, and between 60 and 100 charities apply for the program annually.

“Initially we were doing the Spotlight just for the benefit of others,” says Catharine Reed, a member of the Berger Foundation’s board of directors. “But we have been amazed to see how it has helped the foundation, too, by raising awareness and letting us meet new people and learn about more organizations in our community.”

The program likewise has been an asset for the station, delivering monthly, ready-made installments of what local news desks crave most nowadays: positive stories, drawn from the community, with a strong human-interest element. “Our business has changed,” says Stutz. “When I started out 30 years ago, there were three affiliates in the market. CNN was just getting started. You didn’t have the Internet. You didn’t have all the competition you have today.” Now, to differentiate themselves from what’s available online and elsewhere, local news stations must offer truly local content—and preferably not the usual fare of drug arrests and house fires.

“What better way to show localism than to highlight these nonprofits that do so much for our community?” asks Stutz.

For the small nonprofits that have basked in the glow of the Coachella Valley Spotlight, the combination of $25,000 and widespread recognition has been a boon, and in some cases a lifesaver.

Win-win-win For the small nonprofits that have basked in the glow of the Coachella Valley Spotlight, the combination of $25,000 and widespread recognition has been a boon, and in some cases a lifesaver. The Berger Foundation “has the power to exponentially expand its donations by using TV and other media to promote you,” says Christy Porter, executive director of Hidden Harvest, a Spotlight awardee that delivers surplus produce from local farmlands to needy residents. “Everybody watches CBS. That’s where ‘NCIS’ is,” she adds, tongue-in-cheek.

The coverage also serves the nonprofits in ways beyond the financial. A soup kitchen, after all, no matter how well stocked, is of little use if no one knows where to find it. The televised promotions enable charities to reach those who need their help. “Being on TV for a whole month, I would get phone calls every day from people looking to get dental services at our clinic,” says Marianne Benson, founder of another 40

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Spotlight honoree, Desert Friends of the Developmentally Disabled.

Other groups have found that the airtime is a powerful recruitment tool. “We had a huge influx of volunteers,” says Erica Stone, founder of SOS Ride, which offers transportation for nearby military personnel to and from local hubs.

“And it came at just the right time—in the summer, when we need help even more because all the snowbirds leave.”

Most of all, for these small organizations, receiving a grant from a major philanthropy and appearing on TV has proven invaluable in making new connections within the valley. “It was a real boost for us, that’s for sure,” says Tim Ingram, president and executive director of Camp of Champions A & M, which hosts sports clinics at local schools as an incentive for improved academic performance. “It cemented our credibility with people, schools, and other charitable foundations and organizations.” Now, when Camp of Champions approaches a prospective donor or partner, it does so as an established, trusted presence in the community.

Taking it to the next level Heightened prominence can also aid charitable organizations’ fundraising. “This year has been our best year for fundraising in the history of Tools for Tomorrow,” says Edward DiNicola, reflecting on the nine months since his after-school program was chosen for the Coachella Valley Spotlight. “And it’s because of the exposure and people being able to see the results of what we do.”

Not all the honorees have been able to replicate that success. “I don’t think the recognition led to any bigger donors for us,” laments Tim Evans, chaplain and co-founder of the Unforgettables Foundation, which assists grieving families who are too poor to pay for their children’s funerals. Evans doesn’t fault the Spotlight for this failure. His group didn’t anticipate the sudden spike in publicity. “We should have been more prepared to parlay that, to leverage that to higher levels,” he reflects.

“There’s no doubt that being part of the Spotlight was phenomenal for our organization—it was a ten. But I’m just a little bit remiss that we didn’t make more out of it, because I realize that your five minutes in the sun comes and goes very quickly.”

Lessons like this continue to be learned. “Every year we ask, ‘How can we do this better?’” says the Berger Foundation’s Reed. Following up with Spotlight beneficiaries in the months after the award helps keep things on track.

CBS’s Stutz has promoted the charity spotlight idea as a “best practice” to the sister stations in his company.

Christopher McGuire, a vice president of the Berger Foundation, reports he has discussed the concept with his peers at Philanthropy Roundtable meetings. Given the benefits for charities, foundation, and station alike, the Spotlight may be a philanthropy and media collaboration that could shine in many other parts of the country. P

Frances and H.N. Berger (top) established the foundation that now partners with CBS Local 2 in the Coachella Valley to showcase charities like Baseball Buddies, pictured below, a

CBS Local 2, Š gbrundin / istockphoto.com

program for children with physical or emotional challenges.

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Lisa Buser

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PHILANTHROPY

GIVING IT ALL Alan Barnhart and his brother Eric owned a $250 million company.

Owned. Past tense.

Because they gave it away.

Lisa Buser ????? checking

By Liz Essley Whyte

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Alan Barnhart

I

nearly $100 million of its profits to charity. Moreover, in 2007 they decided to go even further. They gave the entire company away. Though they still run its daily operations, the National Christian Foundation (NCF) now owns Barnhart Crane & Rigging. The brothers will never reap its accrued value; they kept none of it.

“That’s one of the things that make Alan and Eric “The love of money is a root of all kinds of evil…” so rare: they decided to give it all away,” says NCF “Do not lay up for yourselves treasures on earth…” president David Wills. “That was their wealth. They “It is hard for a rich man to enter the kingdom of heaven…” didn’t have three other companies. That was it.”

No matter where he turned, it seemed to him that Scripture was sending a very clear warning: Money can be dangerous.

“I read all these verses, and I thought: ‘I want to be good in business, and I’m competitive,’” Barnhart says. “But I didn’t want to make a lot of money if doing so would damage my life. And I could see where it really could.”

So Alan and his brother Eric decided to do something unusual: They vowed to cap their income, earning no more than the middle-class members of their Memphis, Tennessee, Sunday school class did, and give much of their company’s profits to charity. In their first year of business, they gave away $50,000—more than Alan’s salary.

Now, nearly 30 years later, the results are even more tremendous: The Barnharts oversee a $250 million crane and rigging company, and they’ve donated

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Simple living Alan Barnhart is a modest man, with a soft Tennessee drawl. He wears jeans and cotton oxfords to work. He started giving interviews about his philanthropy only after others convinced him to do so. “‘Don’t let the left hand know what the right hand is doing.’ For the first 15 years that was our thinking,” Barnhart says. But “people challenged us, [saying] what’s happened to your company is pretty unusual…. God has done amazing things through your company, and you need to tell people all that you’ve done with what God’s done.”

He is quick to emphasize that his salary cap was not a vow of poverty. “We have vehicles and air conditioning. It was not a Mother Teresa lifestyle.”

Liz Essley Whyte is managing editor of Philanthropy.

Lisa Buser

n 1986, Alan Barnhart was 25 and planning to go into business with his brother. An evangelical Christian, he wondered what Scripture had to say about the profits he hoped to make. So he combed the Bible for whatever advice it had to offer about money. That’s when he came across verses like this:

Lisa Buser

To make sure they stuck to their limit, the Barnharts told their associates at the company about their income pledge, enlisting others to hold them to their promise. He and his brother allowed themselves cost-of-living adjustments, and salary increases when children were born. Alan has six children; Eric has five. Alan and his wife Katherine are the Barnhart family spokespeople, while Eric is the brainy, quiet engineer, friends say.

One of the best things about their lifestyle choice, Alan says, is that his children did not grow up wealthy.

“There’s great benefits to a kid to hear the word ‘no,’ and the theology of the Rolling Stones: ‘You don’t always get what you want,’” he says. The Barnhart kids didn’t get trips to Disney World, or even treats at the grocery store. Instead their parents took them to developing countries to see the wells, churches, and farms their gifts had enabled. “It wasn’t about things.

It wasn’t about money. It wasn’t about wanting. I taught them the joy of giving early. I taught them the joy of contentment,” Katherine says.

And the Barnharts taught their children about God. They speak of Him often. “It is God who has led us in this, and it is He who multiplied us,” states Katherine. Though donors of many religious—and non-religious—backgrounds give generously, and interpretations of Scripture’s teaching on wealth differ, the Barnharts stand out in their willingness to act on what they believe God has called them to.

Operating Very Effectively—develops a relationship with one or two grant recipients, researching their effectiveness and vetting their requests. Under NCF ownership the group will continue to give away company earnings.

Katherine says the group actively searches for the best people addressing a problem, rather than giving money only to groups with powerful fundraising arms. GROVE volunteers take small grant requests to a six-member committee for approval; requests for more than $100,000 go before a 12-member board that meets quarterly. Most of the donations boost international development and Christian ministry in Africa, the Middle East, India, and southeast Asia, where the group sees needs larger than those at home.

“That’s where God is really working,” says Joye Allen, GROVE administrator. The group focuses its giving on five causes: Christian evangelism, church planting, Christian discipleship, leadership training, and ministering to the poor.

GROVE’s biggest grants—millions of dollars’ worth—have gone to Hope International, which provides microfinance in the developing world; the Seed Company, a Bible translation group; and Strategic Resources Group, an umbrella organization for Christian ministries in the Middle East. Though the bulk of its giving is overseas, the group has also given domestically, to places like Repairing the Breach, which works with youth in rundown Memphis neighborhoods, and Citizens for Community Values, which helps women escape the sex trade.

The profits headed toward charity are not funneled through a corporate foundation or invested for future giving. The Barnharts want to put their dollars to work for God right away. “We want to get the money and invest it in other people as quickly as possible. We see a higher return in investments in people than we do in investment instruments,” Alan says.

Profit with a purpose Using business skills to serve God through “constructive work” and “ministry funding” is at the heart of the purpose statement posted on the Barnharts’ company website. The brothers’ attempt to directly harness capitalist plentitude to do spiritual work is further explained in one of the company’s “core values,” which proclaims: “Prof it with a Purpose—We will attempt to make a profit and will invest the profit to expand the company and to meet the needs of people (physically, Giving it all away mentally, spiritually).”

The Barnhart brothers had given away millions in In practice, about 50 percent of all company earn- annual profits when, in 2006, they approached Wills ings are donated immediately to charity. The other 50 percent are used to grow the business. The firm has been run that way since the beginning.

And the Barnharts don’t even allow themselves the luxury of choosing where their company’s gifts should go. A group of 55 employees and spouses decides where to distribute half of the money made every year

by Barnhart Crane & Rigging. Each employee in the group—which is dubbed GROVE, God’s Resources

Alan and Eric did something unusual: They vowed to cap their income, earning no more than the middle-class members of their Sunday school class did, and give much of their profits to charity.

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with a big question: How do we give away our entire company? Many successful businessmen leave their private companies to their foundations when they die, but doing so while still living is unusual, even in the philanthropic world. So National Christian Foundation staff got to work on figuring out how to accomplish what the Barnharts requested.

In 2007, the Barnharts got what they wanted: They put 99 percent of their business ownership interests, in the form of non-voting stock, into a charitable trust under the National Christian Foundation. In 2012 they gave the remaining 1 percent to a second charitable trust that gives NCF the beneficial interest and ultimate ownership but allows the family to retain operating control by serving as trustee. NCF sought, and received, special approval from the IRS for the arrangement.

Wills credits the Barnharts’ deep convictions for the unusual gift. “They actually don’t believe that they own their company anyway. It wasn’t theirs; it was God’s.

They were just taking care of it for him,” Wills says.

“When they gave away their company, it didn’t change their life at all, Alan will say. It significantly changed their balance sheet, but it didn’t change their lives.”

Not alone The Barnharts are not alone in giving away their source of income. The National Christian Foundation has 46

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D. Jones Photography

Leo Linbeck III

developed a specialty in working with entrepreneurs who want to donate businesses, parts of businesses, or other assets—which helps account for the foundation’s explosive growth. NCF grew from a two-person operation three decades ago to the 19th biggest American recipient of private gifts, topping Harvard, Yale, and the American Heart Association in 2012. The foundation has received about $1 billion worth of companies since it started facilitating that type of giving in 2002, Wills says.

NCF isn’t the only foundation that is channeling entrepreneurial gifts to charity. The Greater Houston Community Foundation owns about 12 percent of local businessman Leo Linbeck III’s construction, real estate, health care, and education firm, Aquinas Companies, which earns $500 million in annual revenues. The plan, Linbeck says, is to transfer more and more of the company to a supporting organization of the foundation. By the time he dies, if not before, he wants the foundation to own it all, though the Linbeck family will still steer the firm and run its day-to-day operations.

For Linbeck, the choice to give away his company came down to one principle: stewardship. He wanted to work to benefit others, and did not want his family to feel entitled to wealth. Yet he thought a for-profit business was the best way to help people. “From an overall societal benefit standpoint, there’s a whole lot more benefit that comes out of for-profit businesses than philanthropic contributions,” he says.

In addition to gradually shifting the ownership of Aquinas to the community foundation, Linbeck also funnels 10 percent of its annual profits to GHCF, reinvesting the other 90 percent in business operations. Linbeck, a devout Catholic, calls that a tithe. His idea of stewardship, he says, emerges from a Catholic worldview in which wealth and work should be dedicated to human relationships more than to personal consumption. Yet he is matter-of-fact about his generosity. “There are not that many branches in the decision tree,” he says. “When you’ve got enough to consume, and you’re satisfied, and you don’t want to consume anymore, you’ve got to do something with it.”

For both Linbeck and the Barnharts, giving is inspired by deeply rooted spiritual beliefs. “Giving feeds our soul,” says Katherine Barnhart. “Giving has us looking outward. It requires something of who you are. We are giving in order to serve the God that we love.” P

ideas

From Promising to Proven The charter school boom ahead

BY KARL ZINSMEISTER

From Promising to Proven

A Wise Giver’s Guide to Expanding on the Success of Charter Schools

Twenty-five years ago, charter schools hadn’t even been dreamed up.Today they are mushrooming across the country.There are 6,500 charter schools operating in 42 states, with more than 600 new ones opening every year. Within a blink there will be 3 million American children attending these freshly invented institutions (and 5 million students in them by the end of this decade).

It is philanthropy that has made all of this possible. Without generous donors, charter schools could never have rooted and multiplied in this way. And philanthropists have driven relentless annual improvements—better trained school founders, more prepared teachers, sharper curricula, smarter technology—that have allowed charter schools to churn out impressive results.

Studies show that student performance in charter schools is accelerating every year, as high-performing models replace weaker ones. Charter schools as a whole already exceed conventional schools in results. The top charters that are now growing so fast elevate student outcomes more than any other schools in the U.S.—especially among poor and minority children.

Charter schooling may be the most important social innovation of our age, and it is just beginning to boom. Philanthropists anxious to improve America have more opportunities to make a difference through charter schools than in almost any other way. This book provides the facts, examples, cautionaries, inspiration, research, and practical experience that philanthropists will need as charter schooling shifts gears from promising experiment to mainstream movement bringing improved opportunity to millions of students.

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extremely innovative in shaping teacher pay, the first time, and an additional 300,000 creating curricula, experimenting with class children enroll (while a million kids remain structures, and adapting technology. They on waiting lists). Charter school attendance often share a commitment to rigorous test- really began to accelerate around 2009, and ing and sharing student results with parents as this is written it looks like there may be 5 million children in charters before the end and the public.

Having begun from nothing, the of the current decade. charter school movement spread slowly.

Not until year ten did the total number Expanding charter networks of American children in charters pass Many funders have concluded that the 500,000. Then donors began to notice surest and fastest way to add excellent school seats is to take existing charter some startling patterns.

Bill Gates explains that after his schools with well-tested features and foundation decided in the mid-1990s to launch them in bulk. In essence, donors focus on U.S. schooling, it poured about are extending the reach of charter school $2 billion into various education experi- “brands” by creating franchises. Today, ments. During the first decade, he reports, nonprofits operating multi-campus net“many of the schools that we invested in works of schools are adding students at did not improve students’ achievement in ten times the rate of single-campus charany significant way.” There was, however, ter schools or for-profit operators.

The national brand that has received one fascinating exception. “A few of the schools that we funded achieved some- support from more funders than any other thing amazing. They replaced schools is KIPP Schools. All KIPP leaders undergo with low expectations and low results a common training program, and every with ones that have high expectations and school subscribes to a set of principles called high results.” And there was a common the “five pillars,” with a no-excuses focus on variable: “Almost all of these schools were student performance, as demonstrated on standardized tests. KIPP’s headquarters procharter schools.”

Other philanthropists had the vides individual schools with regular support same experience. Eli Broad, one of the and guidance, and closely monitors results. biggest givers to education in the U.S., But each school operates independently observed that “charter school systems are or as part of a city-level network, which delivering the best student outcomes, leads some researchers to describe KIPP as particularly for poor and minority stu- employing the “franchise” model. dents.” Ted Mitchell of the NewSchools Venture Fund drew some bold botKarl Zinsmeister is author of tom lines: “Good charter schools have From Promising to Proven: pretty much eliminated the high-school A Wise Giver’s Guide to dropout rate. And they’ve doubled the Expanding on the Success From Promising college-going rate of underserved kids.” of Charter Schools, the new to Proven Today, the number, variety, and quality handbook on charter school of charter schools are soaring. In 2014, 2.6 philanthropy just published million children are attending 6,500 charter by The Philanthropy Roundtable. Go to schools in the U.S. Every year now, more www.PhilanthropyRoundtable.org/guidebook than 600 new charters open their doors for to get a copy.

FROM PROMISING TO PROVEN

For years, philanthropists large and small have labored to improve student outcomes at ineffective public schools. From the Ford Foundation’s decades of interventions, to hordes of concerned corporate donors hoping to encourage excellence, to the more than $1 billion spent in Walter Annenberg’s “challenge,” these donors ended up with shockingly little to show for their large efforts.

Then in 1991, Minnesota pioneered the concept of public, open-admission schools operated by nonprofits or other independent parties, without heavy regulation. Teachers and leaders in these schools were given great autonomy, but faced closure if the school didn’t show good student results. California passed a similar law the next year.

The nation’s first charter school opened in St. Paul, Minnesota, in 1992. It was designed for students who had dropped out of school, and most of the charters that followed were likewise focused on children let down by conventional schools. About two thirds of charter school students today are minority or low-income.

While they are funded by taxpayers, typical charter schools receive less than 80 percent of the support given to conventional public schools. Philanthropy has thus played a very large role in financing charters, as well as in establishing their mission and operating strategies. And charter schools have evolved to have many distinctive features.

They generally have longer school days and longer school years. Many place high expectations on students (resulting in 100 percent college acceptance at many leading inner-city charters). They often have strict discipline, and many require parents and students to sign contracts that commit them to serious duties. Many recruit teachers and principals outside of traditional credential channels, seeking particularly creative and dedicated individuals. Charters have been

A Wise Giver’s Guide to Expanding on the Success of Charter Schools Karl Zinsmeister

PhilanthropyRoundtable.org (202) 822-8333

Free copies of this guidebook are available to qualified donors.

An e-book version is available from major online booksellers.

PHILANTHROPY

The most impressive fact about KIPP is its consistent, superior student performance. KIPP students, 86 percent of whom are low-income and 95 percent African-American or Latino, perform better than their local district counterparts in more than nine cases out of ten, on both reading and math. More than 93 percent of children who complete eighth grade at a KIPP school graduate from high school, and more than 83 percent go on to college. In conventional public schools with similar demographics, the college matriculation rate is 20 percent. KIPPsters complete bachelor’s degrees at rates higher than the general U.S. population, and at four times the rate of other students from poor communities.

Another very successful charter operator, Achievement First, is expanding to meet rippling public demand in New York, Connecticut, and Rhode Island.

Starting in 2003 with one school, by 2013 Achievement First had expanded (with philanthropic help) to 25 elementary, middle, and high schools, with more to come.

The Achievement First network currently serves some 8,100 children, many of them poor and minority students.

Achievement First has made remarkable progress with its children. On the 2012 New York state math assessment, 88 percent of its pupils achieved proficiency, compared to 60 percent of all students in New York City, and 65 percent of all students statewide. In language arts, 58 percent of Achievement First students achieved proficiency, versus 47 percent of all New York City students and 55 percent of all students in New York.

In Connecticut, 61 percent of Achievement First high-schoolers who took the U.S. History Advanced Placement exam scored a 4 or 5 (out of 5), compared to only 33 percent of students across the U.S. More than 75 percent of Achievement First high-school graduates earn a bachelor’s degree within six years. (The overall college graduation rates for African-American and Latino adults are 18 percent and 11 percent respectively.)

A third impressive charter network, Uncommon Schools, is now replicating itself on additional campuses. At pres-

ent, the organization serves about 9,000 students at 38 charter schools across Massachusetts, New Jersey, and New York.

Eight out of ten are low-income, and 98 percent are African-American or Hispanic.

Like other fast-growing high-quality charter operators, Uncommon Schools gets remarkable results with its underprivileged children. In recent years, Uncommon closed 56 percent of the achievement gap between its African-American students and white students in the same state. In 2012, 100 percent of the network’s high school seniors took the SAT exam, achieving an average score 72 points above the national average.

Netflix founder and entrepreneur par excellence Reed Hastings helped found Aspire Public Schools, one of the very first charter management organizations, by supplying its original funding and many of its animating ideas. The program immediately caught on, and within 15 years of its 1998 startup it was educating 13,500 students annually in 37 schools.

As a group, Aspire’s students significantly outperform the average score on California’s statewide achievement exams, and they come out head and shoulders above comparable students in conventional schools. Two thirds of Aspire schools, with

Some large nonprofit charter school operators KIPP Schools

141 schools and 51,000 students in 21 states, and counting

Aspire Schools

37 schools and 14,000 students in California and Tennessee

Uncommon Schools

38 schools in New York, New Jersey, and Massachusetts, serving about 9,000 students

Achievement First

25 schools enrolling 8,100 in three states

YES Prep

13 campuses and 8,000 students in Houston, with 10 more schools on the way in Texas, Tennessee, and Louisiana

Success Academy Charter Schools

22 New York City schools enrolling 6,700 students, on a path to 40 campuses

Alliance College-Ready Public Schools

22 L.A. schools with more than 10,000 students

Lighthouse Academies

21 schools in eight states

Green Dot Schools

20 schools, most in L.A.; more than 10,000 students

Great Hearts Academies

16 schools in metropolitan Phoenix, to become 22, and one in Texas

Mastery Schools

15 Philadelphia academies, mostly “turnarounds” of failed conventional public schools

BASIS Schools

12, soon to be 15, schools in Arizona, Texas, and D.C.

IDEA Public Schools

30 schools in Texas, on a path to 56 schools by 2017

Noble Network

15 Chicago campuses with 9,000 students

Uplift Education

13 schools in the Dallas-Fort Worth area

PUC Schools

13 campuses in southern California

High Tech High

12 schools and 5,200 pupils in San Diego, with a special focus on math, engineering, and technical careers

Rocketship Education

10 schools in California and Wisconsin, with others on the way for Tennessee, Indiana, Louisiana, Texas, and D.C.

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student bodies composed mostly of minority and low-income children, have already exceeded the state target for “academic excellence.” Indeed, if you treat Aspire as its own school district, it ranks in the top 5 percent for performance and achievement, when compared to similar-size districts across California. And the schools get better every year: On California’s Academic Performance Index, Aspire’s total score has increased, without fail, each year since the network was founded.

Silicon Valley birthed another charter network in Rocketship Education, the brainchild of philanthropist and CEO John Danner. Rocketship is well known as a pioneer in the field of blended learning—mixing computerized instruction and face-to-face tutoring to create personalized instruction for each student. Though 90 percent of its students are low-income, and 75 percent come from non-English-speaking homes, fully 80 percent of Rocketeers score at the “proficient” or “advanced” level for math on the California Standards Test. That’s nearly the same as the 83 percent rate achieved in California’s ten most affluent districts.

Rocketship’s blended learning model, which requires fewer teachers, also offers economic advantages that have made it easier to expand. The organization’s first school opened in San Jose, California, in 2007. Its success soon led to a total of eight Rocketship schools in the city, serving 4,500 pupils.

Despite this rapid growth, the organization still has 2,500 families on its waiting list. In 2013, Rocketship opened its first school in Milwaukee, a city where only 46 percent of elementary-age children are expected to graduate from high school. With strong philanthropic support, Rocketship will open eight schools in Milwaukee during the next four years and another eight in Nashville, where its first school opens in 2014. The organization has also won charters to oper-

ate in New Orleans, Indianapolis, Memphis, and Washington, D.C. Its goal is to operate in 50 cities and serve 1 million children.

After starting as an experiment in trailers on a deserted parking lot in Houston, the school network known as YES Prep now has 8,000 students on 13 campuses. Donors impressed by its ability to get some of the top results in the U.S. are supporting a massive expansion that will make the network twice as big in a matter of years, including new campuses in Louisiana, Tennessee, and probably other states. The standardized test scores of YES Prep’s overwhelmingly low-income and minority students are consistently higher in every subject than the average score across Texas. Its dropout rate of 1 percent compares to 16 percent in the wider Houston public school district.

The BASIS charter school network, yet another high-performing group now undergoing expansion with help from givers, operates a dozen schools in Arizona, Texas, and D.C., with more in the works.

BASIS administers a rigorous, A.P.-based curriculum to students across the board. “We have been severely underestimating all kids,” argues co-founder Michael Block.

BASIS negotiates an initial salary individually with each teacher. It also offers performance-based financial incentives.

Teachers of A.P. courses, for instance, earn an additional $100 for every student who makes a grade of 4 on the exam, and an additional $200 for every student who earns a 5. Rather than traditional sick days, BASIS gives teachers a “wellness bonus” of $1,500.

They then lose a pre-determined amount for each sick day taken.

The results of all of this are outstanding.

The typical student at this open-admission public school takes ten A.P. exams, and the average score is 3.6. In 2012, BASIS students outscored national averages on A.P. exams in 23 different subjects. In 2012, more than 25

The charter school movement spread slowly.

Not until year ten did the total number of American children in charters pass 500,000. Then donors began to notice some startling patterns.

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percent of all BASIS seniors were National Merit Scholarship Finalists, an honor earned by about 1 percent of all U.S. high school seniors. International tests like the PISA exam show that BASIS students are competitive with the best scholars anywhere in the world. The network’s major goal is to maintain its extremely high and consistent level of quality as it continues to grow with philanthropic support. “All cities should have a BASIS,” say the network’s leaders.

A very different charter school operator now in expansion mode is Great Hearts Academies. Built on an academically rigorous, classical liberal arts education with an emphasis on the great books, Great Hearts has 16 schools in Arizona and more on the way, including one in Texas. Currently more than 9,000 students sit on waiting lists.

Great Hearts has no electives. All students take the same challenging sequence in math, science, foreign language, fine arts, and humanities. Students learn Algebra I in seventh grade, putting them on a path to complete calculus in eleventh and twelfth grade. Three years of Latin begin in sixth grade. Medieval history is required in eighth grade, music and poetry in ninth and tenth. The “core reading list” for elementary students includes Don Quixote, Gulliver’s Travels, Treasure Island, and Narrative of the Life of Frederick Douglass. For middle and high school, the list includes the Aeneid, As I Lay Dying, Crime and Punishment, Federalist #10, Henry V, Plessy v.

Ferguson, and Plato’s Republic.

Great Hearts also forms its students morally, seeking to “graduate thoughtful leaders of character who will contribute to a more philosophical, humane, and just society.” Students wear uniforms and adhere to an honor code. The schools try to instill nine core virtues in students: humility, integrity, friendship, perseverance, wisdom, courage, responsibility, honesty, and citizenship. One “philosophical pillar” of the network’s culture is that “sarcasm, bad will, and apathy are toxic to the work of teaching and learning.”

Great Hearts vigorously recruits instructors it believes will be exceptional classroom leaders, regardless of their backgrounds or state certifications. “We place stock in content expertise and pedagogy, which don’t neces-

sarily track with teacher credentialing,” says donor and co-founder Jay Heiler.

On 2012 statewide assessments, Great Hearts students outperformed the average Arizona student in every tested subject and every grade level. Of the five schools with 2012 graduating classes, between 83 and 97 percent of graduating seniors were headed to four-year colleges. Thirteen percent of all seniors at Chandler Prep, one of the network’s high schools, were named National Merit Scholarship Finalists.

What does research say?

In the 2013 U.S. News and World Report rankings of public high schools, 41 charters made it into the top 200. Since charter schools represent about 5 percent of the high school market, that finding means 21 percent of our best institutions are charters—an impressive over-representation.

Yet there are poor and mediocre charters as well as excellent ones. How does the overall mix stack up? Stanford’s Center for Research on Education Outcomes (CREDO) offers the definitive research on this subject. It zeroes in on hard measures of achievement (primarily test scores), makes adjustments for demographic and economic status of the students being compared, and provides comprehensive results over time. Its initial study of charter school quality began in 2009; the latest was released in 2013.

CREDO has found that charters are more likely than conventional schools to be great. They are also more likely to be crummy. Yet the greats outnumber the crummies. Overall, charters are already as good as or better than conventional schools, and they are accelerating steadily, as weak schools get closed down and many strong ones get founded—especially replications by the top nonprofit chains such as those mentioned above.

One of the crispest findings is that charters are especially valuable to poor and minority children. In the words of a research summary: “This study found that public charter schools posted superior results with historically disadvantaged student populations…. In nearly every category and subject area [charters] outperformed traditional public schools for

the following student populations: Black, Hispanic, high-poverty, English-language learners, and special education.”

Thanks to funding from the Robertson, Fairbanks, and Smith Richardson foundations, among others, the CREDO investigators supplemented their national study with regional investigations. During 2012 and 2013, they conducted quality studies in five states that indicate how high the bar has risen in the charter sector.

In Massachusetts, the typical charter school student now absorbs the equivalent of two and a half extra months of learning every year in math, compared to peers in conventional public schools, and one and a half extra months of learning in reading. This advantage was even larger at big-city schools. In Boston, charter students surpassed conventional students by the equivalent of 13 months of additional learning per year in math, and 12 months in reading. In other words, by the time regular public school kids learned one year of material, the charter pupils had covered about two years’ worth of knowledge. Not one single Boston charter school was found to have significantly lower-than-average learning gains.

In Michigan, a typical charter school student gained an extra two months of learning in both math and reading over the course of a school year, compared to regular public school children. Here again, the advantage was especially pronounced within urban areas, with charter kids in Detroit gaining nearly three months of extra achievement.

In math, 42 percent of charter schools outperformed their district school counterparts, with only 6 percent performing worse. In reading, 35 percent exceeded district schools, while 2 percent lagged.

The same investigation in New York City found charter students outstripping others by five months of extra learning

per year in math, and one extra month in reading.

Indiana students absorbed an extra month and a half of learning per year in both math and reading.

And in New Jersey, charter students gained three extra months of learning in math, and two extra months in reading, each school year. The big-city effect was again present: In Newark, charter students gained an additional nine months per year in math, and seven and a half months in reading.

A successful social movement Charter schooling is no longer in its experimental stage. It is a proven model. Good charter school operators have demonstrated that they can produce consistently impressive results with the very same children who are floundering in conventional urban schools.

It’s already clear that charter schooling is one of the great self-organizing social movements of our age. An army of independent social entrepreneurs refused to accept the heartbreaking failures of our government-run schools.

Long lists of private donors like Don and Doris Fisher, the Walton family, Eli and Edythe Broad, Laura and John Arnold, Bill and Melinda Gates, Katherine Bradley, Michael and Susan Dell, and others made heavy investments over many years.

They powered a spontaneous uprising, with little or no help from the education establishment, and constructed an alternate universe for students.

As philanthropists now deploy an additional surge of resources into bringing today’s best charter schools to new communities, I’ll make a prediction: A decade from now, the cumulative results are likely to demonstrate that charter schools are the most important social innovation in America of the last generation. P

Overall, charters are already as good as or better than conventional schools, and they are accelerating steadily, as weak schools get closed down and many strong ones get founded.

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ideas 100 Years of Experts Armed with Money… …sure didn’t do much for Cleveland

BY WILLIAM SCHAMBRA

Frederick Goff—father of the first community foundation, the Cleveland Foundation, whose centenary we observe in 2014—railed so fervently and frequently against the evils of the “dead hand” that his daughter came to fear the dark staircase in her home, certain that the “dead hand would reach out and grab her,” reports historian Nathaniel Howard.

Goff ’s fear was that, left to their own devices, wealthy individuals tended to bind their accumulated fortunes in unbreakable trusts to institutions or causes that were self-serving, narrow, transitory, and peripheral to the public interest. Better to bequeath their fortunes to a publicly governed trust broadly committed to the interests of the entire community, he concluded. Its trustees would construe shortsighted donors’ intentions as generously as possible, and would even “disregard the originally expressed preference regarding the purposes to which income might be devoted, if in the course of years those purposes become obsolete or harmful.”

Although community foundations now offer donor-advised funds that adhere to their creators’ wishes, it’s clear that their original purpose was to substitute for donor intent a flexible, forward-looking view of the community interest, which could be discerned only by enlightened civic elites. Goff “was the first to expound the idea that the wealth of a community belonged to all of its people, not just to a chosen few,” former Cleveland Foundation staffer Bruce Newman once observed.

Frederick Goff might have seemed an unlikely champion of this rather collectivist view of wealth. He was, after all, an attorney at the Cleveland firm that handled the interests of John Rockefeller 52

(whose career as oil magnate also began in Cleveland), and later a banker.

Saving the world At the turn of the twentieth century, Goff ’s hometown was booming with steel manufacturing, oil refining, shipping, and other heavy industries. It faced all the challenges of the era’s industrial cities— inadequate housing, a swollen population, pollution, and a corrupt political system.

But Cleveland was a hotbed of progressive ideas for facing these challenges.

T heodore Roosevelt was then promoting a “new nationalism” that envisioned a blend of public-private problem-solving. Roosevelt believed that concentrated corporate interests, properly harnessed by a powerful central government, could transcend narrow profit motives and pursue a broader public interest. Historian Peter Dobkin Hall suggests that businessmen in the Midwest at that time tended to be “willing to work with or through private-sector entities such as the Chamber of Commerce to define the public interest, and through municipal government to implement their goals.”

Goff ’s community foundation idea “constituted a nearly perfect expression” of this ethos, Hall says. The Cleveland Foundation was created to receive charitable trusts, either designated by donors for a particular purpose or left to the discretion of the foundation. The funds would be left in private banks. Disbursement would be managed by a distribution committee with both private and public representatives.

Goff shared with the larger progressive movement the desire to stop merely treating the symptoms of public problems and get to their root causes. This could be accomplished by professional PHILANTHROPY

experts systematically applying the newly developing social sciences to festering urban problems. Well before his foundation had even begun to produce income, Goff proposed “a great social and economic survey of Cleveland, to uncover the causes of poverty and crime and point out the cure,” modeled on the social surveys the Russell Sage Foundation had sponsored in Pittsburgh.

Although that grand survey was never undertaken, Goff ’s foundation tackled major issues during its first decade, including reforms of Cleveland’s justice system, systems of charity, public education, recreation, local universities, and use of the Lake Erie waterfront. With what Hall describes as the “curious tendency of [the] Cleveland elite to look beyond itself for expertise to advise its social experiments,” a parade of prominent national progressive scholars and activists were brought in to study these problems.

Raymond Moley, later a key New Deal adviser, was recruited to be the first full-time director of the Cleveland Foundation; Leonard Ayres from Russell Sage worked on the education survey; and progressive legal giants Roscoe Pound and Felix Frankfurter conducted the work on the criminal justice system, along with future Rockefeller Foundation president Raymond Fosdick.

The surveys invariably condemned the confusion, redundancy, corruption, waste, and inefficiency of existing systems, which could only be remedied by centralization, rationalization, profesWilliam Schambra, a contributing editor to Philanthropy, is the director of the Hudson Institute’s Bradley Center for Philanthropy and Civic Renewal.

sionalization, and the replacement of self-interested partisan administration by experts. While some of these reports were well received, others provoked a hostile reaction from the allegedly mistaken, wasteful, and corrupt. The survey of the courts notably led a local judge to condemn it as a “criminal waste of money,” and to threaten to jail the foundation’s distribution committee for contempt. But Goff, according to Moley, was so “flushed by the results of the crime survey that he wanted to commit the Foundation to a completely crusading future.”

Nonetheless, the foundation’s zeal began to wane after the legal survey, notes journalist Diana Tittle. When Frederick Goff died in 1923, the foundation entered “a period of relative invisibility and reticence.” Only in the 1960s would it “resume the practice of critically examining the performance of civic institutions.”

Unwilling to preside over a trust that would simply “dole out money to worthy and qualified charities,” Moley left the foundation en route to bigger powers inside the New Deal. Imbued with the progressive’s preference for large abstractions over smaller human interests, Moley could not bear the thought that “my days would be occupied with interviews with hopeful donees, hour after hour, day after day, interminably…. This surely was not the way I intended to spend the prime years of my life.”

The ’60s: politics and remedial reading When the ’60s arrived, the Cleveland Foundation returned to pot-stirring with a vengeance. As part of its national plan to stimulate low-income “community action” against poverty, the Ford Foundation provided $1.25 million for a new, quasi-independent account, the Greater Cleveland Associated Foundation (GCAF). Ford’s legendary poverty fighter Paul Ylvisaker saw to it that his former Harvard classmate, James Adolphus Norton, would be its director. Ford hoped such substantial block grants

would galvanize quiescent foundations like Cleveland’s into working for “social change,” as Ylvisaker put it.

With generous funding from other Cleveland foundations in addition to this Ford money, along with the first gush of dollars from the federal anti-poverty programs, GCAF was designed to be a massive, comprehensive attack on the city’s problems, thereby returning to Goff ’s original vision of the community foundation as a city’s pre-eminent civic innovator.

GCAF’s education component produced efforts like Community Action for Youth, which would expand social services around a middle school in Cleveland’s troubled Hough neighborhood. Fannie Lewis, later a member of the city council, was deeply involved in the effort, and ultimately deeply disappointed. “When my son entered college, I had to spend $5,000 on remedial reading courses.” This mobilization “disintegrated into a squabble over turf and a scramble for federal dollars,” according to Tittle. As anyone familiar with Cleveland knows, it did not succeed at “making our schools second to none in the country by 1970,” as promised.

By the time GCAF merged with the Cleveland Foundation in 1967, the program had largely fizzled. But Norton assumed the presidency of the larger foundation, and continued to work with Ford to gin up progressive philanthropy in the city. At Norton’s suggestion, Ford provided funding for a major voter registration effort in several Cleveland neighborhoods that helped elect Carl Stokes as the first African-American mayor of a major American city.

Convinced that “we cannot afford to have this mayor fail,” the Cleveland Foundation quietly funded a private

media adviser for Stokes. He helped the new mayor design the program “Cleveland: NOW!” This $1.5 billion spending initiative was yet another comprehensive program to end poverty.

Echoing Chicago’s problem with poverty funding going to inner-city gangs like the East Side Disciples and the Blackstone Rangers, some of Stokes’s dollars found their way to an astrological cult, the Black Nationalists of New Libya, which used them to purchase guns. A police shoot-out with the group in 1968 resulted in seven deaths (including three officers) and five days of riots. Tittle writes that this event “also fatally wounded Cleveland: NOW!” and tainted the work of the community foundation.

The Ford Foundation was ultimately summoned before the House Committee on Ways and Means by Representative Wright Patman (D–TX) to explain, among other controversial acts, its involvement in Cleveland mayoral politics. Patman also took a look at the Cleveland Foundation’s political activities, prompting Norton and representatives of ten other community foundations to hire attorneys.

Although community foundations emerged from the Tax Reform Act of 1969 without the strictures applied to private foundations, and although Norton refused to “fall back into an old-fashioned kind of philanthropy in which we aren’t able to explore the causes of urban problems,” Tittle notes that Patman’s investigations clearly slowed the activist inclinations of the foundation’s board.

Looking back and looking forward As the Cleveland Foundation celebrates its centenary, it can be proud of many things. Throughout a century it distributed

Goff was the first to expound the idea that the wealth of a community belonged to all of its people, not just to a chosen few.

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ideas $1.7 billion of donated money across the community. It helped create the city’s system of parks known as the “Emerald Necklaces;” prompted the merger that produced Case Western Reserve University; launched Cuyahoga Community College; preserved one of the largest performing arts centers in the country; sustained the Cleveland Orchestra, the Cleveland Museum of Art, the Rock and Roll Hall of Fame, and other arts and cultural institutions; supported the city’s growing network of charter schools; and developed the idea of Cleveland as a center for medical technology.

And yet, Cleveland was named America’s “most miserable city” by Forbes in 2010. Visiting in 2012, education expert Diane Ravitch observed that “what struck me was that it is a sad, sad city. Except for sports stadiums, it feels abandoned. The downtown is small and has many empty

meeting “the most intensive, comprehensive campaign ever undertaken by a major American city to improve the quality of public education.” It included, among other things, a “scholarship-in-escrow” program, filling bank accounts for inner-city kids earning good grades.

By the 1990s, the foundation had quietly abandoned the scholarship program. It had demonstrated minimal effects on grades, even as its downstream costs accumulated. In pursuit of education and poverty revolutions, the Cleveland Foundation has designed, coordinated, and funded wave after wave of “intensive, comprehensive campaigns” throughout many decades. And yet the city seems only to lose ground.

Is there an alternative to the foundation’s faltering collectivism? In 2010, comedian and proud Clevelander Drew Carey asked the libertarian Reason Foun-

would be uneven, disorderly, unplanned, and idiosyncratic, but they would have an energy and vibrancy and economic sustainability missing from the “planned” city.

This alternative approach to thinking about Cleveland’s challenges fundamentally questions Frederick Goff ’s premise that there is an enlightened elite that knows better than everyday citizens what’s best for a city. In modern urban America, Goff ’s “dead hand” is far more likely to be attached to a long bureaucratic arm than a businessperson or donor with personal passions.

The Cleveland Foundation’s donor-advised funds, with their uncoordinated purposes and many small disbursements, may be more likely to incubate tomorrow’s social and economic solutions than the foundation’s staff-directed funding.

The inspiration for this fresh vision is much likelier to come from community

Perhaps there is no grand, monolithic, systemic, root-cause solution to the city’s problems, but rather a countless number of smaller, partial answers. commercial buildings. Neighborhoods have boarded up buildings and empty lots where buildings used to be. I was struck by how impoverished the city is, how disheartened the teachers are, and how inadequate is the response of state and city leaders to the collapse of this onceproud city.”

Ravitch had come to town to critique mayor Frank Jackson’s Plan for Transforming Schools—the latest in a century-long string of sweeping reform efforts driven by “public-private” alliances. The Cleveland Foundation is fully behind this effort, with current president Ronald Richard proclaiming it had made “$22.3 million in grants for the reinvention of our public schools,” which “must allow for a total culture change in our anachronistic school system.” Tittle’s book Rebuilding Cleveland, written more than 20 years ago, opens with an eerily similar episode: the Cleveland Foundation announcing at its 1987 annual 54

dation to help him come up with fresh ideas to regenerate his hometown. A six-part video production, “Reason Saves Cleveland,” urged thoroughgoing decentralization and deregulation—the reverse of the Cleveland Foundation’s century-long approach. Open up education with full school choice, sell off municipal assets like the public market and two golf courses, remove red tape from permitting and zoning, lower taxes to attract small businesses, forget about big-ticket silver bullets like stadiums and convention centers, permit bottom-up economic development to revive the neighborhoods.

In other words, no more cumbersome, expensive, intrusive plans—just get out of the way of ambitious individuals and neighborhoods eager to create their own solutions to community needs. Urban expert Joel Kotkin agreed this decentralized approach was preferable to the bureaucratic “concentrated decision-making process” that has characterized Cleveland in the past. The results PHILANTHROPY

groups, small businesses, and neighborhood interests than from a self-appointed convener, coordinator, and consolidator at the center of civic action. In the Internet era of dispersed authority and organic growth, civic renewal is best characterized by the precept to “let a thousand flowers bloom.”

The notion that the community foundation’s days might “be occupied with interviews with hopeful donees, hour after hour, day after day” ought not appall. That might actually be the best way to glean the full array of thoughtful ideas embedded in the everyday citizens and civic groups of Cleveland. Perhaps there is no grand, monolithic, systemic, root-cause solution to the city’s problems, but rather a countless number of smaller, partial answers.

These are today’s new insights on urban “progress,” and they deserve the attention and support of all concerned with reviving our struggling communities. P

Celebrating American History ’s Greatest Donors The Philanthropy Hall of Fame The Philanthropy Hall of Fame celebrates great men and women of the past who changed the nation and the world through their charitable giving. View historical images and read brisk biographical profiles that capture the essence of each man and woman, the sources of their fortunes, and the tactics and results of their philanthropy.

To browse the Hall of Fame, please visit GreatPhilanthropists.org

books Faithful Giving

Happiness spreads to both donor and recipient in Jewish and Christian teachings.

BY SCOT T WA LT ER

The latest social science has good news for philanthropists: Giving profits the giver as well as the receiver. Those who give of their time and money are happier than stingy people, as well as healthier and better liked, as economist Arthur Brooks and others have noted.

This win-win verdict is actually nothing new.

Though only recently verified by the data, it is a central tenet of the three Abrahamic religions— Judaism, Christianity, and Islam—as a new book

by Gary Anderson makes clear. The Notre Dame theology professor’s Charity: The Place of the Poor in the Biblical Tradition includes a brief look at the call for alms in the Koran, Islam’s holy book, and delves deeply into Jewish and Christian Scripture, as well as the most authoritative commentaries, to examine biblical passages on giving.

Jewish and Christian teachings stress our obligations to the needy. Both religions, Anderson observes, also declare that charitable giving will benefit the donor. In fact, Jewish and Christian Scripture and ancient commentary all adapt commercial terms to describe the transaction, declaring that one’s gifts will fund a “treasury” in heaven that, as the Hebrew author of Proverbs puts it, “delivers from death.”

Anderson observes that this conflation of aiding others and benefitting oneself makes some people squirm today, because we presume that an act can only be charitable if it’s done with no regard to oneself. He argues that this puritanical view is a modern notion that grew out of theological disputes in the Protestant Reformation and fails to account for the full range of human motivation. For many devoted givers, the Scriptural arguments will ring true: The desire to help others stems from both self-interest and a deeper belief about the nature of the world.

Consider, Anderson suggests, the case of a young child who spends all her allowance on a present for her mother’s birthday. Obviously, the child is only giving back what her mother first 56

Charity: The Place of the Poor in the Biblical Tradition

By Gary Anderson

PHILANTHROPY

gave her, perhaps partly in hope of increasing her mother’s affection. Yet the child’s generosity— which reveals a budding virtue of charity that may flower over time—grows out of spontaneous love.

The child’s gift also suggests that she intuits the way charity forms part of the deep ordering of the world.

Similarly, Anderson says, in the Judeo-Christian view, whenever we give to the needy or have mercy on a debtor, we already owe everything we possess— and all of Creation itself—to the generous God who formed us, gave us our good fortune, and may reward our generosity. But while charitable giving may build on the natural inclination for self-preservation, he continues, it is not simply self-interested.

He offers another analogy: Imagine you received a windfall and then faced two advisers, one a conventional financial analyst who urged you to invest it in safe index funds for your retirement, the other a saintly person who said true prosperity depends on building heavenly treasure by giving to the poor.

“Imitating the generosity of God would seem to be fraught with far greater risk” than self-interest.

Judeo-Christian charity is not given simply in hopes of raw reward, or to prop up the giver’s self-interest. Rather, it engages a deep “human desire to know and believe that the world is a place formed and guided by charity, that giving to one’s neighbor…is not just a good deed but a declaration of belief about the world and the God who created it.”

That, says Anderson, is “why the financial metaphor of funding a treasury in heaven became so significant for ancient Jews and Christians.” The goal was not to stress what we “gain from charity, but what acts of charity say about the character of the world God has created.”

Anderson’s book, though clearly the work of a scholar, is brief, engaging, and easy to follow, even if one has little prior knowledge of its subject matter. Most readers will be amazed at just how often economic metaphors appear in religious thinking.

We forget, for example, that credo, religious belief, is the root underlying credit and creditor. That makes sense when one considers that a creditor will only extend credit if he believes his borrower will repay him. We also forget that the prayer Jesus taught his disciples includes the line, “Forgive us our debts, as we forgive our debtors.”

Another surprise from the book is the fact that ancient Jews and Christians did not “think of charity to the poor in terms of overall efficiency and effectiveness,” such as one finds in governmental programs that claim to “solve an immediate need but also to redress the circumstances that brought the poverty” about. “The poor you will always have with you,” said Jesus, and in that reality lay opportunities. For most of Jewish and Christian history, charity was an intensely personal “sacramental act,” because “one could meet God in the face of the poor.” This idea is reflected in Jesus’ famous line, “as you did it to one of the least of these my brethren, you did it to me,” and also in Hebrew Scripture: “Whoever is kind to the poor lends to the Lord and will be repaid in full.”

This explains why the charity of Jews and Christians differed radically from that of earlier pagans. In the Greco-Roman world, “the plight of the poor was not felt to be a major concern of the gods.” The pagan rich gave, usually in posthumous bequests, to erect public theaters, baths, and basilicas for governmental offices. Only in Christian times did charity become embodied in hospitals, homes for the elderly, aid to orphans.

Jews and Christians gave whether they were rich or poor; they offered their alms while living; and they sometimes gave their entire lives in service as rabbis, monks, or nuns.

The fourth-century Roman Emperor Julian is called “the Apostate” because he wanted to revive the Greco-Roman paganism then being eclipsed

by Christianity. He worried that a great obstacle to his goal was the “disgraceful” neglect of the poor by pagans. “When no Jew ever has to beg, and the impious [Christians] support not only their own poor but ours as well, all men see that our people lack aid from us,” he wrote.

Even a pagan emperor understood that something was fundamentally wrong with that. Jews and Christians went even further and found immense joy in giving. “Stretch out your hand to the poor,” proclaimed the Jewish author of the book of Sirach in the Apocrypha, “so that your blessing may be complete.”

Wielding the Profit Motive Against Poverty The poor as customers, not victims.

B Y ASH LE Y MAY

The Business Solution to Poverty: Designing Products and Services for Three Billion New Customers

By Paul Polak and Mal Warwick

Philanthropy contributing editor Scott Walter is executive vice president of the Capital Research Center.

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Entrepreneur Badu Bahera runs a successful milk delivery business in northeastern India. He also sells safe drinking water, candy, cookies, cigarettes, laundry soap, shampoo, and Coca-Cola. His work is long and strenuous, but he earns on average $7.50 a day, providing his family with a house that has electricity, a concrete tile roof, and walls made of cinderblock and cement.

Most of Bahera’s customers live in poorer conditions. Purchasing his 2.5 gallon jugs of water for four cents each, the majority earn less than $2 a day. Worldwide, about 2.7 billion people (or three out of every eight of us on earth) live a day-to-day existence along these lines. Yet even those very poor people purchase products they consider integral to their lives.

In The Business Solution to Poverty, entrepreneur Paul Polak and marketing guru Mal Warwick turn development upside down by suggesting that multinational businesses shouldn’t think of the poor as victims, but rather as potential customers.

By designing, marketing, and delivering inexpensive water, health care, agricultural tools, energy, and transportation, businessmen and women have an opportunity to make healthy profits and increase the quality of life for entire communities.

The most direct ways to combat poverty, the authors note, are to help the poor earn more money and purchase necessities cheaply. Their favorite example is Henry Ford’s Model T: Sold with a significantly lower price tag than other automobiles of the time, Ford opened up motorized transport to a whole new class of Americans, thereby increasing their mobility and economic potential. In the process, Ford made a profit, benefiting his employees.

Polak and Warwick see hundreds and thousands of Model T ideas in the world of “zero-based design,” a creative process that asks inventors to start without assumptions. Suppose a team is challenged to build a lamp for use in rural Zambia. Traditional design finds an existing lamp and 57

modifies it for Zambian conditions. Zero-based design starts from scratch.

The authors’ marquee example is the treadle pump, introduced by engineer Gunnar Barnes in 1979. A treadle pump draws water from wells with a set of pedals similar to a Stairmaster. By pushing with his feet, a farmer can irrigate large areas. Polak’s company, International Development Enterprises, is able to install a treadle pump for $25—significantly less than other pumps. Today the company estimates that three million of its devices are in use in Asia and sub-Saharan Africa, generating a cumulative new net income of $300 million for the farmers who use them.

In addition to the puzzles of design and affordability, marketing to the very poor presents its own challenges. The authors highlight the example of Spring Health water, a potable water company in India. Spring Health filmed movies about its product, hired actors to dramatize its importance in rural villages, and produced visual advertisements that did not require literacy. It sponsored demonstrations where residents could test their current water source for E. coli, then test and taste Spring Health water for contrast. The authors argue that marketing to poor consumers is similar to zero-based design: Previous conceptions of best practices and strategy don’t necessarily apply, and businesses have to think outside the box to be successful.

The authors encourage poverty-fighting companies to be in regular contact with potential customers. “Don’t look at poor people as alms-seekers or bystanders to their own lives,” they write. “They’re your customers. Always set out by purposefully listening to understand thoroughly the specific context of their lives—their needs, their wants, their fears, their aspirations.”

Is it possible to create a multinational business that sells to customers living on $2-a-day budgets, transcends cultural differences, can expand rapidly, markets locally, increases the earning potential of the consumer, and makes enough profit to attract commercial investors? Wouldn’t multinational corporations already do this if the task were easy?

The authors touch on the failure of MIT’s charcoal initiative in Haiti. Armed with new and efficient technology to transform agricultural byproducts into marketable charcoal, the “Fuel from the Fields” project 58

A man uses a treadle pump, a low-cost device that can help irrigate large areas.

aimed to help 10,000 Haitian farmers add as much as $500 each per year to their incomes. The new agricultural charcoal would be better than wood charcoal for health and environmental reasons, and would be reasonably priced. Farmers would make a profit off the new equipment in less than a month, with microcredit covering the initial purchase.

Twelve years later, the project has gone nowhere. Only 1,000 families learned to use the technology. The agricultural byproducts assumed to be in abundance decreased in quantity and increased in price. Families in Haiti didn’t see the point in purchasing the new charcoal, and the market never developed.

If nothing else, this vignette shows how difficult it will be to develop the Model Ts of the next century. It will require not only brilliant engineering minds at places like MIT, but also savvy entrepreneurs who can reach retailers like Badu Bahera and sell a product that the poor truly value. It will take shrewd minds to delineate between “wouldn’t it be nice” inventions and products that poor consumers think are vital to their daily lives.

This is where The Business Solution to Poverty leaves the reader wanting. Most of the storytelling is linked to the treadle pump and Spring Health water. Beyond these lonely success stories, the book leans heavily on the dreams of what could be instead of the realities of what is currently working. It is left to the reader to go forth and do—find, nurture, and develop that magic product that will help save the world. And in the many parts of the world lacking civil and economic liberty, Polak and Warwick’s optimistic vision is simply improbable.

For philanthropists, this book is a reminder that alms and aid aren’t magic either. The authors describe uncoordinated relief in harsh terms, and warn, with good evidence on their side, that “giveaways breed dependence and self-doubt instead of change.” But philanthropy has a strategic role to play in creating the conditions for thriving businesses and governments. When it reinforces freedom and opportunity, philanthropy opens doors for entrepreneurs like Badu Bahera, and his neighborhood thrives.

Ashley May is strategic communications specialist at The Philanthropy Roundtable.

PHILANTHROPY

© 2009 Tingju Zhu/IFPRI (CC 2.0)

books

{books in brief } Being a Rockefeller, Becoming Myself: A Memoir

© 2009 Tingju Zhu/IFPRI (CC 2.0)

BY EILEEN ROCKEFELLER

Industrial titan John Rockefeller is an American icon for wealth, fame, and power. His great-granddaughter Eileen currently lives a modest life on a Vermont farm. How she reconciled these two existences is the subject of her new memoir, which traces the trajectory of her life and the many troubles that entered it despite her family’s resources and prestige. The author thus recasts one of America’s most glamorous families in a more human light.

“Real richness and power comes not from the amount of money,” Rockefeller writes, “but from our connections.” She offers intimate glimpses of her family, from her father’s obsession with beetles to the summers she, her siblings, and her mother spent constructing a cabin on an island in Maine. The first half of the book focuses on her often unhappy childhood. Her mother’s depression and her father’s absence left a brood of neglected children.

Eileen, the youngest, was a timid and lonely youngster, and it took many decades for her to get beyond this.

Readers looking for philanthropic rather than personal insights into the Rockefellers will not find much here. The charming anecdotes throughout the book make it entertaining to read, but the private stories heavily outnumber substantive discussions. Eileen’s most cherished philanthropic accomplishment, founding the Institute for the Advancement of Health to foster the study of mind-body connections in disease and wellness, is touched on in one chapter. Even less attention is paid to her work in founding Rockefeller Philanthropy Advisors, or her

involvement, with her husband Paul Growald, in the Growald Family Fund.

Rockefeller refers indirectly to her family’s changing views on public activity and giving. Discussing the events of a meeting at the family estate in 2000, she emphasizes the difference between her generation of Rockefellers and the one before it, which was more focused on politics and prominent displays of wealth. “We chose quieter paths, went incognito, and found as much value in helping a few people as in helping a nation,” she writes. Her light treatment of these topics leaves room for future books on how families can change their use of wealth, even as wealth changes the family. —Kara Runsten

The Up Side of Down: Why Failing Well Is the Key to Success

BY MEGAN MCARDLE

“It’s fine to celebrate success, but it is more important to heed the lessons of failure.” Bill Gates’s oftquoted adage is by now a staple of inspirational messaging in business, philanthropy, the classroom, and beyond. And if the sentiment is not especially original, his own immense success lends it an authority that eclipses the more painful half of the equation. Failure, it implies, is just a waystation to the inevitable happy ending.

At first glance, Megan McArdle’s new book The Up Side of Down seems to do the same. It is the perfect cheery title to appear in this enduringly sluggish economy.

But it amounts to both less and more than a trite guarantee: From corporate crashes to medical errors to Hollywood flops to personal ruin, the book offers a candid reckoning of how badly things really can go wrong, and a field guide to SPRING 2014

why and how “failure can be the best thing that ever happened to you (though it may sometimes feel like the worst).”

McArdle, an economics columnist for Bloomberg View, blends autobiography and incisive research and analysis to make her case. Of particular interest to philanthropists will be the section on “the peril of the promising pilot”—why taking what seems to be a great project and expanding it often doesn’t work.

She surveys a number of celebrated launches gone awry, and notes that the difference in how they ultimately fared was not due to the level of risk undertaken, or the amount of information collected beforehand, but whether or not the directors were brutally honest with themselves when the results were not as expected—honest enough to change course.

That’s logical enough, if hard to take to heart. One of the more counterintuitive chapters describes a Hawaii probation experiment—“the best thing that’s happened to crime since the invention of police”—in which parole violators willingly, repeatedly, enthusiastically return to jail. Another explains why America’s lenient bankruptcy laws, seen worldwide as a puzzling weakness, are actually a source of vitality and strength.

In helping readers make better friends with failure, The Up Side of Down does two important things.

First, it warns against technocratic arrogance: “the idea that someone who is sufficiently smart and dedicated can engineer the risk out of the system.” And second, it delivers an ode to American resilience, one that anybody worried for our future will be glad to hear.

—Caitrin Nicol Keiper 59

face face TO

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Summit for Leaders

The Alliance for Charitable Reform hosted its fifth annual Summit for Leaders on March 5. Audience members heard from three panels: congressional staffers discussing recent tax reform proposals and their potential effects on the charitable sector; nonprofit leaders demonstrating new approaches for communicating to policymakers the importance of private giving; and two policy experts debating how simplifying the tax code and lowering rates would help or hurt incentives for private charitable giving.

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left to right:

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1. Debbie Pierce, Linda Childears, Daniels Fund 2. Suzy DeFrancis, American Red Cross 3. Jan Preble, Wasie Foundation 4. Paul Poteet, staff of Senator John Thune (R-SD) 5. Bill Byrnes, F. M. Kirby Foundation of New Jersey

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Liz Essley Whyte / Taryn Wolf

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SPRING 2014

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The Philanthropy Roundtable 1730 M Street NW, Suite 601 Washington, DC 20036

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