MEDICAL MATCHMAKERS • STAMP-SIZED SPACECRAFT • ROBIN HOOD THEN & NOW A PUBLICATION OF THE
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Patrons of Their Place Meet Pitt and Barbara Hyde 2017 winners of the William E. Simon Prize for Philanthropic Leadership
PhilMag.org
The State of Florida said I couldn’t call pure skim milk “skim milk” because I did not inject it with additives.
But business owners have the right to tell the truth, and that is what I was doing.
I fought for my First Amendment rights.
And I won.
I am IJ.
Mary Lou Wesselhoeft Altha, Florida
www.IJ.org
Institute for Justice National Law Firm for Liberty
“Something new under the sun” arrived early in 2016… “the definitive work on private giving” –Boston Globe
Here’s what experts said:
“I am amazed, overjoyed, intrigued, inspired!” “Most worthwhile book on the subject.” “I started browsing and couldn’t put it down.” “I found one excitement after another.” “An epic and important new book.” “I was not prepared for how readable it is.” “A frame-shifting contribution.” “The indispensable roadmap.” “Spectacular! A magnificent work, full of treasures.”
And now it’s available in a portable new Compact Edition — fully updated to 2017! qualified donors may request copies: Main@PhilanthropyRoundtable.org or (202) 822-8333 for sale at Amazon.com
table of contents
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features
18 M aking Miracles in Memphis
From work to school to arts to recreation, Pitt and Barbara Hyde show how to energize a hometown. By Evan Sparks
28 T iny Ships to the Stars
A billionaire’s ambitious plans to send stamp-sized spacecraft light years away. By Jeff Foust
34 Three Donors, a Trustee, and a Library
One of the largest libraries in the world is a product of private philanthropy. By John Steele Gordon
38 Biblio Benefactors
40 M edical Matchmakers
While federal health-care policy is in disarray, these charities and volunteers are offering help now. By David Bass, Madeline Fry, Howard Husock, Caitrin Keiper, Jen Para, Sean Parnell, Evan Sparks, and Liz Essley Whyte
departments 4 Briefly Noted
Veterans and entrepreneurs mobilize in
hurricane season. Symphony for a broken orchestra. Running for a cause. Land trusts built on love. Where is the SPLC’s money going?
11 Nonprofit Spotlight At Junior Achievement’s BizTown, kids learn finance and adult responsibilities.
A P U B L I CATI O N O F THE
12 Interviews David Saltzman The founding head of the Robin Hood Foundation on fighting poverty like a New Yorker. Orville Rogers Pilot. Veteran. Christian. Investor. Philanthropist. And a 99-year-old competitive runner!
51 Ideas Should Donors Invest in School Districts? Charter-like deregulation might open a door for effective philanthropy on the district level. By Nithin Iyengar, Kate Lewis-LaMonica, and Mike Perigo
54 Books Teach a Man to Teach a Man to Fish One doctor’s shortcut to supplying Africa with surgeons. By Andrew Evans Battle Creek Alchemy Two philanthropic brothers achieved their radically different legacies in reactive opposition to each other. By Ashley May Settling for Stasis Americans use technology for comfort, not revolution. By Ryan Streeter Books in Brief Calling all churches to adopt a school.
60 President’s Note
Tax reform and philanthropy’s three-percent solution. By Adam Meyerson FALL 2017
Adam Meyerson PRE SI D E N T
Karl Zinsmeister
VI C E PR E S ID E N T , P U BL ICA T IO N S
Caitrin Keiper E D I TO R
Ashley May
MA NAG I N G E D ITO R
Taryn Wolf
A RT D I R E CT O R
David Bass Arthur Brooks John Steele Gordon Leslie Lenkowsky Christopher Levenick Bruno Manno John J. Miller Tom Riley Naomi Schaefer Riley Andrea Scott Andy Smarick Daniel P. Smith Evan Sparks Ryan Streeter Justin Torres Scott Walter Liz Essley Whyte
C O NTRI B U T IN G E D IT O R S Philanthropy is a multi-prize-winning magazine (FOLIO awards in 2015 and 2016, American InHouse Design 2016, min 2016). It is published quarterly by The Philanthropy Roundtable. The mission of the Roundtable, a 501c3 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. All editorial or business inquiries: Editor@PhilanthropyRoundtable.org Philanthropy 1120 20th Street NW Suite 550 South Washington, D.C. 20036 (202) 822-8333 Copyright © 2017 The Philanthropy Roundtable All rights reserved Cover: Sergio Ingravalle Follow us online:
@PhilanthropyMag, @PhilanthropyRnd
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More than 3,000 highly skilled vets signed up to help after 50 inches of water descended on Texas.
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of dollars were flowing to Team Rubicon within a few days. USAA has stepped up its support of Team R ubicon over the last three years, contributing funds as well as in-kind donations of capacities and expertise. “When we have these significant alliances, we want it to be more than just money,” said Milby Hartwell, director of corporate responsibility for USAA. “We want to be able to engage our employees and engage our skills.” Team Rubicon expects to remain in Houston beyond the initial recovery to participate in rebuilding work. The team in Rockport has been the advance guard on the non-rescue side. It built an effective command post in a Walmart parking lot there. “If you have some experience in a military operations center, then a lot of this stuff just makes sense automatically,” Huvane says. While the processes are not exactly the same, “command and control is much easier to absorb when you’ve had that background.” Deeply motivated volunteers like Huvane have the skills to help in situations like the Harvey recovery. Over 3,000 Team Rubicon volunteers signed up to respond in Texas—which, even for the largest operation in Team Rubicon’s history, was more than it could initially deploy. But in the weeks and months ahead, their talents will be called upon as Houston puts itself back together. With the benefit of Team Rubicon’s work in recovering from 2012’s Hurricane Sandy, the group
Jennifer Caswell
Who You Gonna Call? It was hurricane season, and Team Rubicon was on high alert. This group brings veterans to disaster areas, allowing them to employ the range of technical and leadership skills they gained through their military service. They are usually some of the very first responders to hit a turbulent scene. Sure enough, when Hurricane Harvey smashed into the Texas coast, Team R ubicon’s swift-water rescue vets from the Navy were fishing people from the floodwaters within 48 hours. Veterans “are naturally very good at bringing order to chaos,” says Jake Wood, the nonprofit’s co-founder and CEO. And chaos is what they found during and after the wettest storm ever to hit the United States. Cars were submerged; rivers ran where streets used to be. In Rockport, Texas, where Harvey made landfall, the wreckage was still largely untouched a week after the storm. The power was out, and the windblown debris had “blocked everything,” says Dan Huvane, incident commander for Team Rubicon in Rockport. Team Rubicon’s rescue teams in Texas, including ten boats and 28 rescue specialists, worked in coordination with other groups and local authorities to save lives, but the group’s work didn’t stop there. While the swift-boat teams were at work in Houston hauling people out of submerged houses, small groups of veterans had deployed throughout the region to assess the damage and prepare the way for more volunteers to come. These recon and assessment teams used “smartphones and tablets and some geo-spatial mapping and big-data software from our partner Palantir,” notes Wood, in order to direct aid efforts more efficiently. Palantir, which also offered 50 volunteers to help on the tech side, was joined by many other corporate donors: FedEx contributed shipping for supplies, Southwest and American Airlines provided transportation, Microsoft furnished devices, and more. And other partners provided that most fungible asset: cash. Immediately after the storm, USAA, the veteran-focused financial-services provider based in San Antonio, pledged to give $1 million to three relief groups, including Team Rubicon. It also matched donations from its employees to those organizations, ultimately meaning hundreds of thousands
Kirk Jackson, Team Rubicon
briefly noted
Restaurant Volunteers to the Rescue It was the morning of August 26, and like many other Good Samaritan boat owners in Houston, Richard Knight was canoeing down the streets looking for people who needed to be rescued from their flooded homes. The rains that H urricane Harvey had started dumping on Houston the night before would ultimately total 51 inches in some places. After a day and a half of paddling victims to higher ground, as well as checking flooded cars and houses full of water (some to the point where mattresses were bumping up against the ceiling) Knight decided it was time to get back to his paid profession.
Houston’s independent restaurant owners came together to keep Harvey survivors fed for weeks until other help could arrive.
Jennifer Caswell
Kirk Jackson, Team Rubicon
is now formulating a long-term recovery plan for Texas. Meanwhile, it deployed volunteers to Irmaflooded Florida, having already staged boats and water nearby even before the storm hit. In keeping with its military connection, Team Rubicon names each of its missions. The recovery mission to muck out flooded houses and clear debris in Houston was given an apt name: Operation Hard Hustle. “It always hits me to be surrounded by so many veterans,” says Huvane, “who are lending a hand to a community without hesitation.” —Andrew Evans
FALL 2017
Knight is a chef. And one of several in Houston who set up rescue kitchens. These men and women recruited other volunteers and then made tens of thousands of meals for refugees and first responders. Rescue kitchens are useful in many ways. Loss of electricity is typical after a hurricane, and restaurants without power will soon see their perishables and frozen foods wasted. “Restaurants were not going to open for three to ten days,” says Knight, so “the food was just going to be thrown away. And we had a lot of hungry people who needed their bellies filled.” A Brit who moved to Houston in 1998, Knight and his wife and business partner Carrie set up shop in a central commissary called Midtown Kitchen Collective. For over two weeks, they led an army of volunteers who cranked out hot meals, cold sandwiches, tacos, and more. The storm hit on August 25. eptember By the time the group ceased operations on S 10, it had served an estimated 250,000 meals. Volunteers also created a matchmaking website: IHaveFoodINeedFood.com. It was simple, with just a home page and two basic forms. “I Have Food” was for professional kitchens that wanted to donate meals, and “I Need Food” was for groups that needed help. In this way, the “haves” were paired with the “needs.” Four blocks away from Midtown Kitchen Collective, chefs and managers from the restaurant Reef mobilized their own independent operation, despite damage to their own property. “The staff didn’t flinch,” says owner Jennifer Caswell. “When setting up a kitchen in triage mode, having a cool head and being able to organize and run efficiently is a big part of it.” With the help of volunteers, Reef sent out meals and supplies by the truckload, despite many obstacles. Days started around 8 a.m. for the restaurant owners, and ended in the wee hours of the following morning—sometimes as late as 5 a.m. Meanwhile, about 30 miles outside town, chef Veronica Rademacher of the prepared-meals company Vital Kitchen set up a network of small volunteer kitchens that sprang into action as soon as it was safe to travel. The greater Houston area covers approximately 1,660 square miles and is home to nearly 5 million people. After Hurricane Harvey, Houston looked like a poorly planned Venice where no one thought to raise the buildings—its spider-web of freeways becoming bayous, and streets and parking lots looking like lakes. Rademacher worked around this. “We started with six places throughout the city,” she says. “Because of the high water, I didn’t want volunteers to have to commute very far. For our kitchen in the Montrose neighborhood, for example, all of our volunteers were within walking distance.” Farther north, in the suburbs, members of Nick Rama’s Facebook group, “Nick’s Local Eats & Foodie 5
briefly noted
PhilAphorisms
Do your little bit of good where you are; it’s those little bits of good put together that overwhelm the world. —DESMOND TUTU from The Almanac of American Philanthropy, now available in a new compact edition! 6
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In those first dark days, however, it was the small, spontaneously created rescue kitchens that met immediate needs. There was no red tape or bureaucracy to hold them back, and lots of grassroots action and Texan can-do. Their sustenance got Houston’s recovery off to a good start. —Phaedra Cook
Make a Joyful Noise These instruments had seen better days. A Jupiter trumpet with a bent second valve. A Safran violin with a dislocated soundboard. A Bundy clarinet missing corks. They’d been living in basements and closets of various Philadelphia public schools, waiting for repair or spring cleaning. Then people got creative. Dozens of instruments were pulled out for use on stage in Symphony for a Broken Orchestra, a brand-new composition by Pulitzer-prize-winning composer David Lang. Challenged to create beautiful music out of broken vessels, Lang studied the sounds of various malformed tools and crafted a composition for performance by a colorful mix of Philadelphians: students, classical impresarios from the Curtis Institute of Music and Philadelphia Orchestra, hip-hop artists, musicians from the traditional “Mummers” parade, and people completely new to music. Each instrument used in the endeavor will be ushered afterward to a repair
Mike Lavoie
An inventive charitable effort turns broken musical instruments into something beautiful, and then into repaired instruments useable by schoolchildren.
Image courtesy of Temple Contemporary, Tyler School of Art
News” were mobilizing in much the same way, organizing four kitchens “where people were bringing ingredients and helping to put together and send out food.” All of this was in addition to countless independent restaurants also preparing meals to feed their immediate community. The first few days, while the flooding was at its worst, the volunteer rescue kitchens were “islands,” sending meals to groups and shelters reachable by tall trucks. As the water receded, the ability of these rescue kitchens to send meals by truck grew, eventually allowing prepared food to reach hard-hit areas of southeast Texas like Beaumont and Port Arthur. Once the flood levels went down, some of the groups were able to cooperate, sending over any excess ingredients that the others lacked. After the first few days, perishables like bread and produce started running short. Tortillas took the place of bread and tacos dominated menus. Eventually, the food supply trucks started showing up. Midtown Kitchen Collective received a large donation of goods from distributors Martin Foods and Marble Ranch. Volunteer Cat Nguyen started a “chef ’s pantry” next door. Volunteers at other rescue kitchens could simply come by to pick up what they needed. While the selection was limited, everyone made do. It took about ten days for the need for meals to start to fade. By then, many Houstonians had been able to leave the shelters or were relocated to larger ones where big corporations, such as grocery chain H-E-B, took care of the food.
Mike Lavoie
Image courtesy of Temple Contemporary, Tyler School of Art
of all money raised will also go into a legacy fund at the school district for future instrument repair.
shop and returned to public schools in good shape to further music-education programs. It all started in 2015, when Rob Blackson at Temple Contemporary (a Temple University art gallery) found out that there were well over 1,000 broken instruments owned by the Philadelphia school district, with no plan or funds to repair them. He approached several musical groups—the P hiladelphia Orchestra, the Curtis Institute, Orchestra 2001—and asked if they would be interested in a scheme to fix the instruments. With partners in hand, including the school district, Blackson went looking for funding. The Pew Center for Arts & Heritage and the Barra Foundation gave cornerstone grants, and the project was off and running. W ith a budget of $480,000, Temple Contemporary will host two performances in early December, repair 800 or more instruments, pay for repair kits that will go to schools for future fixes, and train teachers on how to use them. Training sessions will be recorded and uploaded to TeacherTube, so instructors can replace that pesky saxophone pad years down the road when the in-person training has perished from memory. Temple Contemporary has set up a website, SymphonyForABrokenOrchestra.org, where individual donors can adopt an instrument and pay for its repair. These givers will receive a free ticket to the concert, and a note from the student who will use the revived instrument during the school year. A portion
The Chicago Marathon is not only a physical but a fundraising feat.
Running for a Cause Lynda Radman always remembered the generosity of Ronald McDonald House Charities. In 2006, she and her young daughter lived at a Ronald McDonald House for three months while her toddler son, Liam, received treatment for a tumor on his brain stem at the University of Chicago’s medical center. Amid the scary hospital stress, “the house gave us a chance to be together as a family, to eat a well-rounded meal, and to be with Liam every moment possible.” Even after Liam’s passing in 2008, Radman remained grateful to the charity, so in 2015 she started running Chicago marathons to raise money and awareness for the Ronald McDonald House. Last year she and 800 other runners for the House collected nearly $1.1 million, and Radman will return to the starting line this October to run her third fundraiser for the organization. The $6 million that runners in Chicago alone have raised for their Ronald McDonald House over the last decade has supported more than 18,000 families with sick children. That funds the main house, in-hospital family rooms, and a mobile-care unit. “What Ronald McDonald House provided for me,” says Radman, “was a true blessing,” and why she finds it satisfying to boost the organization now. Ronald McDonald House is one of more than 170 nonprofit organizations involved in the Chicago Marathon’s official Charity Program, which saw participating runners raise $17 million for various causes in 2016.
3 cities 5 years $400 million Just the nation’s three largest marathons— New York, Chicago, and Boston—have contributed nearly $400 million to philanthropic endeavors over the last five years. (Boston Athletic Association, New York Marathon News Team, Chicago Marathon News Team)
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Across the country, charity marathons have emerged as a major source of money and attention for nonprofits big and small, national and local, fueling everything from medical research and humanitarian initiatives to educational causes and animal welfare. For example, a Chicago-based nonprofit called Imerman Angels that provides one-on-one support to cancer patients and caregivers raised nearly $750,000 in 2015 and 2016 at the Chicago Marathon. Through its well-established Team in Training program, which helps runners raise money through a variety of charitable athletic events, the Leukemia & Lymphoma Society supports 300 research investigations, pushing more than $1 billion into research, and helping more than 55,000 patients with the cost of treatments. —Daniel P. Smith
Where Is the SPLC’s Money Going? Following the deadly white-nationalist rally in Charlottesville this summer, giving to the Southern Poverty Law Center surged. Tim Cook, Apple’s CEO, announced a company donation of $1 million and said Apple would match employee contributions to the group two-to-one. J. P.
This school year,
3,500 teachers & school leaders will be trained by the innovative
Relay Graduate School of Education, up from 400 teachers during the program’s launch year in 2011-2012. That means almost
400,000 students will be influenced by a Relay-trained educator this year. (https://www.relay.edu/about-us/impact) 8
PHILANTHROPY
Morgan Chase made a $500,000 gift. Actor George Clooney donated $1 million. It’s unlikely most of its donors know that the SPLC actually spends very little of its funds today on the civil-rights activities it was founded for—as Philanthropy noted in our Spring 2017 issue. In fact, only a fraction of its $353 million in assets go toward any charitable activity at all, with the vast majority parked in investment funds—many of them overseas investment havens that provide tax benefits and secrecy. Recent reporting in the Washington Free Beacon revealed the nonprofit has millions of dollars of “financial interests” in the Cayman Islands, British Virgin Islands, and Bermuda. While little is publicly available on the full extent of the SPLC’s foreign business interests, the Weekly Standard later found $69 million worth of “non-U.S. equity funds” in the SPLC’s 2016 annual report. “It’s unusual for an organization other than a university to have an endowment that large,” says Alan Dye, a partner at Webster, Chamberlain & Bean, a law firm that provides legal services to nonprofits. “Usually you advise clients to have a rainy-day fund but normally we’re talking about two times the annual budget at the maximum end. Here, you’ve got one that’s over seven times more than the annual budget of the organization. That’s more than a rainy-day fund. It’s hard to understand what that’s necessary for.” Though many people are giving money to the organization, “the funds are not being spent for charitable purposes, they’re being hoarded,” Dye continues. “The other thing that is most unusual about it is the fact that so much of it is invested in tax havens.” As a nonprofit, the SPLC is not subject to most of the same taxes that make those havens attractive to other wealthy entities. But it is exposed to “unrelated business income tax” on certain investments—the details of which may be hidden by the use of offshore accounts. No information was acknowledged on the SPLC’s unrelated business income-tax returns other than the mere mention of the offshore interests. Other experts familiar with the workings of nonprofits have also commented that, although it is legal, it is unusual for a civil-rights organization located in the United States to be using offshore entities. The SPLC has maintained that its usage of offshore entities is normal, although, as the Weekly Standard noted, the American Civil Liberties Union and its related ACLU Foundation, another large civil-rights organization, has more than $250 million in combined assets but reported no foreign investments on its tax forms. —Joe Schoffstall
Karl Zinsmeister
briefly noted
C Sw ha e ri et ty
Karl Zinsmeister
A Trust Built on Love
Earlier this year I explored the extreme northwestern part of Michigan—a beautiful and fairly wild area. The snow and ice had only retreated a few weeks prior and the trilliums and cowslips and trout lilies were in the midst of their brief wildflower glory. Of course, spring in wilderness regions produces another natural sensation: courtship rituals among big birds. Out in the swamps and lakes I got pretty close to lots of them. Like some sandhill cranes. These birds are around five feet tall, with scarlet heads, long dagger-like beaks, and draping tail feathers. The pairs I saw weren’t doing any of the dancing they’re famous for. But they were bugling and rattling away at each other, and at me. That’s one of the most distinctive sounds of wide-open spaces in America. Sandhill cranes have long windpipes that coil into their breasts—which, much like the tubes of a French horn, give them a deep, rich voice that can sometimes be heard miles away. While creeping up on those birds I flushed a fat ruffed grouse, and encountered a pair of coyotes running at high speed— FALL 2017
whether toward or away from something, I couldn’t tell. I also bushwhacked across some of the astonishing sand dunes that rise up hundreds of feet along Lake Michigan. In one section I came upon a fragile trout stream that cut right through one of these towering heaps of sand, a deep slash whose steep sides seemed to threaten to cave in at any moment, but which has apparently always been able to carve its way through any sand that avalanches into its streambed. I discovered a group of wild mute swans, and got to watch a couple of males battling each other for access to a female. These swans are huge, heavy birds and it’s quite a sight to see them flying at each other, wings pounding and beaks ripping. Several of these rambles took me over land bearing small signs announcing that the Grand Traverse Regional Land Conservancy had taken responsibility for keeping the wild area I was exploring well cared-for and open to the public. After I got home I learned that through 25 years of private donations, that nonprofit is now the custodian of 40,000 9
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American charitable invention dating back to 1890, when the first one was created in Massachusetts. In the last few decades they’ve become the fastest growing and most effective tool of nature conservation in the U.S. There are now about 2,000 local land trusts. Together, they manage and open to the public 56 million acres of natural space. The territory under their protection jumped 20 percent just in the last five years. In 2015, 6.3 million people took a recreational visit to these lands. And 5 million Americans are now dues-paying members of a land trust in their area. Most land trusts are locally rooted and controlled, but there are also a few national organizations. These include groups that specialize in certain kinds of locales— like the American Farmland Trust. Or the Wetlands America Trust, which was created by the hunters behind Ducks Unlimited to keep wildfowl habitat healthy. Another national group is the Civil War Trust, with the very specialized mission of saving sacred battlefields. The single biggest land trust today is the Nature Conservancy, which now takes care of 5 million acres, in all 50 U.S. PHILANTHROPY
states, that have been donated, or purchased with funds provided by the conservancy’s one million contributors, or protected with easements created by the private owners of the property. The reason land trusts have become such popular charities is because they are practical, non-confrontational, and apolitical. They rely on partnerships and voluntary transactions by willing landowners. They don’t take anything away from anyone, or try to control private owners through regulations or litigation. They start with respect for the existing guardians of a special piece of land. As conservationist Michael Fischer has put it, instead of channeling anger, or outrage, or a desire to tell others what to do with their possessions, land trusts use love as their principal motivating force—love of land, love of nature, love of outdoor beauty. It’s a philanthropic formula that has won the heart of lots of Americans. —Karl Zinsmeister
(For more stories like this, subscribe to the Sweet Charity podcast at SweetCharityPodcast.org)
Karl Zinsmeister
acres of wild lands, forests, or historic farm plots, and 124 miles of shoreline. Its $11 million endowment, plus $3 million of cash donated in a typical year by more than 3,000 area supporters, plus thousands of donated volunteer hours, allows the group to operate 34 different local nature preserves, maintain 65 miles of hiking trails, and oversee 200 conservation easements. Donations in the latest year increased its caretaking by an extra 800 acres of land, and three additional miles of shoreline. Like many similar land-conserving charities scattered all across our country, the mission of this trust is to work with private landowners to protect private land. One major technique is to help owners establish voluntary conservation easements on territory they possess. Another method is for the conservancy itself to acquire high-value natural property, either through donation or by buying it with cash gifted by the public. All of the resulting preserves are opened to public access so residents can enjoy hiking, canoeing, birding, biking, fishing, hunting, and other outdoor activities. In addition to these recreational uses, trusts sometimes permit intelligent timbering, farming, and even mining, or gas and oil extraction. The resources are managed with creative flexibility to produce the best long-run outcome. Land trusts do all this with full respect for private-property rights, and a strong interest in making sure local economies remain healthy, since stewardship of nature thrives most when communities and residents are prospering. Private charitable land trusts like this one are now one of the top ways we Americans conserve forests, prairies, shorelines, and other natural land, along with wildlife and scenic agricultural land. Land conservancies are a unique
nonprofit spotlight
Teaching kids business smarts since 1919.
Bill Straus Photography, Inc.
Junior Achievement It’s not every day that you meet a 15-yearold CFO. But Arden Bean of Charlotte, North Carolina, loves finance. This bright teenager dreams of attending UCLA and becoming a future business leader. Her vision began with a fifth-grade field trip to “BizTown,” a simulated city where elementary students take on different roles in commerce and government and try together to keep the gears of their mini- civilization humming. Bean was hooked, and returned for several summers to attend its camp, where she had a blast as “CFO of the food court.” When summer camp gave way to summer internships, she diligently socked away half of each paycheck, because she knows “it’s important to save.” It’s an understatement to say that most teenagers don’t think (or act!) this way. And outside of the financial aspects, she gained invaluable life lessons about teamwork, leadership, and soft skills. As she worked with other students running the town, she noticed that “some people were bossy” and remembers thinking, “that’s not going to work.” She realized the importance of collaboration. BizTown is just one component of Junior Achievement, a national nonprofit that provides financial literacy, workforce-readiness skills, and entrepreneurship training to young people. Starting with programming in kindergarten and
continuing through high school, J.A. emphasizes financial responsibility and independence. Sarah Cherne, president of Junior Achievement of Central Carolinas, explains the significance of teaching kids these values: “As human beings, we are designed to contribute. When you contribute, it does something to your mind and spirit.” Founded by two business executives and a senator in 1919, J.A. uses age-appropriate information to guide students’ development as functioning members of society: money management, how to put a budget together, and “how that budget corresponds to your income, your lifestyle, and the lifestyle you’d like to have,” says Cherne. It’s an ethos rooted in accountability, self-determination, and being productive, regardless of what path you follow. “You can’t have the rewards without the work,” she says. Some of the programs at the elementary-school level include “Our City,” “Our Community,” and “Our Families.” Middle-school students learn about “Economics for Success,” the “Global Marketplace,” and “It’s My Future.” In high school the programs focus on preparing students for their next steps in education or employment. J.A. has programs in all 50 states, and reaches almost 5 million students per year. Although there is uniformity in the programs FALL 2017
and curriculum they implement across the country, each J.A. has a distinct relationship to its community. In some regional chapters, like in the Central C arolinas, J.A. partners with schools; throughout the Charlotte metro area, its curriculum is taught to approximately 45,000 students a year. Charlotte’s major industry is banking, which is a natural fit for the organization. “Because we have a lot of financial institutions in our city, people understand the relevance of our work and our mission,” says Cherne. At J.A. of the Central Carolinas, about 4,000 volunteers are trained to teach J.A.’s curriculum. Sometimes employees from local corporations will participate, undertaking a group volunteer project. Other times J.A. participants who went through the program years ago return as volunteers. Matthew Clatworthy, a senior vice president at Woodforest National Bank, is an active supporter of J.A. of Central Carolinas, as a personal donor, volunteer, and newly minted board member. Woodforest Bank also contributes to J.A., both locally and nationally. “This was a no-brainer partnership,” Clatworthy says. “Junior Achievement has found a gap in the development of our youth and their programs do a fantastic job in helping youth to see what their future could be, and giving them the tools in order to achieve that vision.” It’s an “amazing experience,” he says, to “see children go through the curriculum, starting off not knowing what they want to do or be, and then when the programs are wrapped up, they have a plan.” A surprising number of those childhood plans come to fruition. One piece of evidence: half of the board of J.A. of Central Carolinas is comprised of alumni, now successful business leaders in their own right. As J.A. helps students focus on business vocations, its own mission is s trengthened—and communities get more fiscally responsible adults positioned to contribute to future prosperity. —Allison Futterman 11
interviews DAVID SALTZMAN
Philanthropy: Aside from college, you’ve lived your whole life in New York. How has the city changed over time? Saltzman: When I graduated from college, New York was tough and seedy and unsafe. Think about Taxi Driver, the Martin Scorsese movie with R obert De Niro. That’s what New York was like back then. Every woman would walk around with her keys in her fist in case she needed to defend herself, and nobody I knew felt safe walking around at night by themselves. The murder rate was sky high. Today New York City is the safest big city in the country. Back then, it was one of the least safe big cities. It was also decimated by AIDS and crack and a fear 12
For half his life, David Saltzman led the Robin Hood Foundation. He helped develop hard-headed measures of charitable effectiveness, then raised over $2.5 billion in donations for charities for the poor in New York City.
of not being able to fight its way back to prosperity. All the same, there was tremendous pride, and lots of hope, and that’s what saved New York. Philanthropy: So why did you settle in the city? Saltzman: I was born and raised in New York. My parents were born and raised in New York. It was home, and I had an overwhelming desire to try and do whatever I could to make my hometown better. It bothered me, it angered me, it inspired me, that the biggest city in the United States of America, and an example for the rest of the world, had so many problems. I went to Columbia University to get a master’s degree in public policy, and while PHILANTHROPY
I was there I started working for the city’s department of social services. I was helping homeless people, people with AIDS, and hungry people. Then I was asked to work at the department of health, where I taught adolescents about HIV. The commissioner of health feared that prostitutes and their clients were going to spread HIV, and he asked me to help develop what was then a top-secret program to do outreach to street walkers. So from 9 to 5 I was working with adolescents, and then from 10 at night until 4 in the morning I was leading a small team trying to help the most vulnerable people avoid a deadly disease. It was the most depressing experience of my life and one of the experiences that most fueled me going forward.
Courtesy of Robin Hood
When David Saltzman was 27, he took a risk. His friends had an idea to pool their resources and knowledge and create a poverty-f ighting superfunder focused on New York City. But nobody wanted to leave their job to run a grantmaker with an uncertain future. All other options exhausted, the founding board turned to Saltzman and asked if he would take the position. Leaving his safe government perch and recruiting orman Atkins, to be co- his college buddy, N executive director, he took the leap. Twenty-seven years later, Saltzman is f inally moving on—and leaving behind a massively larger organization. Since 1988, the Robin Hood Foundation has raised more than $2.5 billion for New York City charities for the poor, and built a reputation as a leader in targeting philanthropy for maximum effect. In his next phase, Saltzman will remain on the Robin Hood board, as well as the board of the Relay Graduate School of Education, a top trainer of charter-school teachers. In the Robin Hood off ices in Union Square, P hilanthropy met with the lifelong New Yorker and asked him about his organization’s founding, education reform, New York in the 1980s, and how he managed to stay in one job for half his life without burnout.
Courtesy of Robin Hood
Times Square at that time was a hub for prostitution. There were lots of others throughout the city, but Times Square was super seedy. We were working with people as young as 13, many of whom had been kicked out of their homes or run away, lots of abuse, and they were selling themselves for $5 with a condom, $10 without, often 10 or 12 times a night. Each of those kids was going to die. Either somebody was going to kill them, or they were going to kill themselves. There was nothing that I could do to save those young people. I wanted to figure out what it would take to save lives.
That night, Paul inspired us to come together to start what eventually became known as the Robin Hood Foundation. The idea was simple: let’s pool our intellectual, financial, and emotional resources to help our neighbors. As the five of us began to share our hopes with friends and family, more and more people said, “Oh, I’d like to help. I’d like to be a part of that. I want to pool my Philanthropy: Along the way you met Paul resources, benefit from the thinking of others, and try to figure out how to help people Tudor Jones and other wealthy donors. Saltzman: A professor of mine from grad- who live just a few blocks away.” Robin uate school was made president of the New Hood began to grow quickly. York City board of education and asked me to be his right hand, so I was lucky at Philanthropy: Robin Hood is famous for a very young age to be helping the head its hard focus on measuring results. Was of the largest public-school system in the that baked in from the beginning? country. At the time there were 1.1 million Saltzman: There was always a desire to public-school students. I helped him with apply investment principles to charitable policy, budget, legal, morale, press issues, giving. How do we make sure that we are etc. I imagined that that was how I would having the maximum impact with our charitable dollars? How do we measure spend the rest of my life. But my sister introduced me to the our success reaching our goals? investor Glenn Dubin, and through him, When we started, most traditional I met Paul. What I was struck by when I funding organizations received narrative met both of those people was how smart applications from organizations seeking they were, how compassionate and caring support, and then a professional would read and unlike the stereotype of successful those applications and allocate the money. people from the financial world. It was clear to us that a well-written application might mean that there was a really Philanthropy: They had an idea for this terrific, lifesaving organization behind it, or organization called Robin Hood. How did it might just mean that there was a really gifted writer involved. Conversely, a lousy they convince you to get involved? Saltzman: Glenn is also a lifelong New application might indicate the group is Yorker and he felt a moral obligation to weak, or it could mean they are too busy help. Paul grew up in Memphis, came to saving lives to create fancy paperwork. New York, and fell in love with the city, and To get around this, the first thing we felt he had a moral obligation to help oth- did was to visit organizations, just go and ers, too. They were both doing their own see what’s happening. Meet the people volunteering and they were both contrib- who were running and volunteering at the organizations and begin to look carefully uting their time and money. One night, Paul had us over to dinner at programming models and figure out if at his bachelor pad along with Peter B orish they were succeeding. Luckily, because we and Moe Chessa. Peter cares deeply about were focused solely on New York City, vishelping others and was working with Paul iting an organization meant hopping on a at Tudor Investment Corporation. Paul subway or walking down the street, rather knew Moe through volunteer work in than getting on a plane. Then we decided it would make sense Bedford-Stuyvesant, which was then one of the poorest neighborhoods in the country. to hire independent, third-party evaluators FALL 2017
to measure the success of the groups that we were supporting. Many of our grantees didn’t have the resources to measure their success, so having an independent team come in, paid for by Robin Hood, to help them find out if they were meeting their goals, was a tremendous gift. By then we had a sense of how individual organizations were doing, and how organizations with similar goals compared. For two schools serving similar populations, we could look at reading scores and math scores, attendance, graduation rates, what happened to people after they graduated or dropped out. Were girls having babies? Were boys becoming fathers too early? Were people ending up in prison? We could begin to see where there was an opportunity for us to make a difference. What was really hard for us was comparing dissimilar organizations: a school vs. an early-childhood program vs. a job-training project vs. a shelter for the homeless. It wasn’t until a wonderful, brilliant man by the name of Michael Weinstein joined Robin Hood that we were able to develop metrics that enabled us to compare dissimilar efforts. Michael and the team that he recruited really deserve credit for that. Philanthropy: You’ve said before that your founding team couldn’t find anyone to lead Robin Hood. Saltzman: We offered the job to all sorts of people, and all sorts of people said no. We were all under the age of 32, and when we said our money was coming from a hedge fund nobody knew what that was—people thought it was a company pruning hedges, topiary. There was no reason for people to leave good jobs to work for a startup with an uncertain future. S o the other people on the board, truly reluctantly, asked me if I would be interested in running it. I loved the idea of trying to grow something. People didn’t use the term “entrepreneur” at the time, but I loved the idea of being an entrepreneur. I was 27, and I was lucky enough that I had had the opportunity to run something at the department of health and liked the challenge of it. But I also knew that I couldn’t do it by myself. Norman Atkins was, simply put, the smartest person I knew. He and I 13
interviews had been friends in college. He was a journalist, and he and his wife had a baby, my godson, and were living this idyllic life in Bearsville, New York. Norman was writing and life was good. I said, “You want to try something that’s completely unknown? The worst thing that happens is we try to do something noble and fail. The best thing that happens is we save a bunch of lives.” He said, “I’m in.” So the Atkins family moved to Brooklyn and he spent seven years here being the co-director and brains of the place. Philanthropy: My impression of the Robin Hood board is that it’s a lot of successful people with strong wills. How do you avoid fractures? Saltzman: People choose to serve on Robin Hood’s board because they want to be a part of a highly effective organization. We debate the best ways to help needy citizens based on objective data. We’ve been lucky over the years that Robin Hood has attracted people from left, center, and right. Philanthropy: Tell us a little bit about some of Robin Hood’s early failed grants. What did you learn from them? Saltzman: Our failed grants taught us the importance of using data. It’s not the only tool, but an important tool. More often than we would’ve liked, we made grants based on a seemingly strong, charismatic leader who had a great story to tell. Sometimes those charismatic leaders succeeded and other times they did not. The lesson that we learned was gather data, analyze data, and use data as a tool in grantmaking. Philanthropy: You’ve spent a lot of time applying business principles to the nonprofit
Star Academy which then grew into Uncommon Schools, one of the best charter networks in the country. Emary, who is absurdly smart and insightful, has led Robin Hood’s education team for the past world. Does the road travel the other way? two decades. She was an early backer of What can business learn from nonprofits? some of the great charter networks in the Saltzman: Nonprofits recruit and motivate country: KIPP, Uncommon, Achievement an extraordinary group of people without First, Success, and others. money as a major tool. I marvel at how much money some people are paid in the Philanthropy: Robin Hood was also business sphere. We don’t have that priv- instrumental in creating the Relay ilege in the not-for-profit world, and yet G raduate School of Education. Why we manage to recruit some of the most another graduate school? amazing human beings on the planet to Saltzman: One of the great things about the cause. That’s something that businesses the not-for-profit world is that nothing can take note of. is proprietary. If somebody has a better I’ll also say that one of the great take- solution, they are excited to share it with aways for me from my years at Robin Hood anybody and everybody and to give it away is that working together provides opportu- for free. So it’s not surprising that Norman nities to be more effective than working Atkins and Dave Levin, both great educaalone, and that being part of a community tion innovators, would cook up over a meal that cares for distressed people brings great the idea of starting a new graduate school of joy that we could never capture on our own. education to train teachers not just for their two networks of schools, Uncommon and Philanthropy: Why did you get involved KIPP, but also for any other schools that with education reform? wanted top teachers. Saltzman: When we started Robin Hood Relay has been wildly successful there were about 1,400 public schools in and is now in 12 cities across the counNew York. Other than the elite schools that try training thousands of great principals people have to take tests to get into, only a and teachers every year. They’re going to handful were good schools, just a handful. Yet charter schools and having a profound all of us at Robin Hood, certainly Paul Tudor influence on kids’ lives. Jones, our current chair Larry R obbins, and other board members, knew that a strong Philanthropy: There are worries today education was a path out of poverty. that the right-left coalition behind educaSo from the start we’ve been anxious to tion reform is splintering. Does that keep fund effective schools. We are agnostic about you up at night? the organizational structure of the schools, Saltzman: Far too many poor children in so we fund traditional public schools, char- New York City and across this country are ter schools, parochial schools, and Protestant denied great educations—even though we schools. What we care about is funding now know what it takes to provide them. great education. Norman Atkins and Emary That’s what keeps me up at night. Aronson deserve the real credit in this area. Norman left Robin Hood to start a Philanthropy: The tagline at Robin Hood charter school in Newark called North for a while was “fight povery like a New Yorker.” What does that mean? Saltzman: It means to help your neighbor with true humility, some swagger, as much intelligence as possible, and with all the tenacity you can muster. That’s why I am thrilled that Wes Moore is Robin Hood’s new CEO. Wes is a mighty force for good who will help lead Robin Hood to even more success during this time of unparalleled need. P
Far too many poor children in New York City and across this country are denied great educations—even though we know what it takes to provide them. That’s what keeps me up at night. 14
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Orville Rogers is 99 years old, runs eight to ten miles a week, and translated $1.5 million in earnings to $34 million in donations, with more giving to come.
ORVILLE ROGERS Charitable giving in America is not just the province of the super-wealthy. Gifts from successful individuals who are far from the top 1 percent are crucial. And an important chunk of our total giving comes from donors who give staggering percentages of their personal income to causes dear to their heart. One such donor is Orville Rogers, a 99-year-old Texan who grew up on a farm in rural Oklahoma after being abandoned by his father at the age of six. He learned to fly in World War II, and became a commercial pilot for Braniff Airways. A thrifty liver, and aggressive and astute investor, he translated modest salaries into millions in stocks and land. Motivated by his deep Baptist faith, he then quietly became a heavy donor. He has given away at least $34 million, with more to come. Rogers is also a marvel of physical fitness. He started running at age 50 and now holds 11 age-group world records. He has his eyes on records in the 100-104-year-old category— including f ield events like the high jump, shotput, and javelin. At his Dallas home, Philanthropy spoke with Rogers about his military experience, his investments, the reasons for exercising, why he gives, and his faith in God, whom he credits for all the good in his long, adventurous life.
Rogers: The Air Force came at the end of World War II. I was in the Army Air Corps training command, instructing other pilots. I stayed in the Reserve, and in 1952 they recalled me for active duty during the Korean conflict. I was assigned to Carswell Air Force Base in Fort Worth where they were flying the biggest airplane in the world—the B-36 bomber. It had ten engines, six reciprocating and four jets. I loved that airplane. I went from copilot to pilot to airplane commander in about a year, and wound up in charge of a B-36 with atomic-bomb capabilities. We could carry 84,000 pounds of explosives at one time. We were prepared emotionally, physically, in every way to drop an atom bomb on a target if war required that. We were on call 24/7, and I’m very grateful that I never had to answer that call. If I had, my crew’s assigned target would have been on the north side of Moscow. The sequel to that story is that in 2004, my wife and I were with a party of about 230 people on a mission trip to Russia. We did street witnessing and helped in medical and eyeglass clinics, within five miles Philanthropy: When were you born? of where my target was 52 years before. Rogers: November 28, 1917, so this year I’ll So instead of death and destruction from be 100, good Lord willing. I asked God for above, we were bringing the abundant life a lot in life. I wanted a beautiful wife, and found in our Lord. a wonderful family, and a good occupation. But I never asked God for a long life, or Philanthropy: What did you think of fame, or riches, and I’ve gotten all three. President Harry Truman’s decision to use the atomic bomb? Philanthropy: You spent your career as an Rogers: I’m very grateful. In July 1945 when they dropped the atom bomb, I was airline pilot. How did that come about? Rogers: I’d wanted to be a pilot since I assigned to a B-17 base for training. In knew what an airplane was. I was named another two months, I would’ve been on for Orville Wright, after all. But in college my way to the Pacific theater. It probaI decided that God wanted me in some bly saved thousands of lives, because the kind of religious work, so I went to semi- Japanese would’ve bitterly fought any connary planning to enter church or missionary quest of their homeland. They had proved service. But just after I enrolled, the U.S. that in their defense of the island chains, government held the first draft preceding which we took only gradually from them World War II. So help me, my number was at terrible cost. Both sides would’ve had the seventh one drawn out of the big fish- tremendous casualties if we had to invade bowl. I asked if I could get in the Air Corps Japan. I’m convinced the atomic bomb instead of the walking Army, and they said saved lives, on net, instead of taking them. sure. That did two things: it gave me a free It may have saved my life. education in flying, and it was God’s way of turning me around from a Christian voca- Philanthropy: How did you and your wife tion to service through a layman’s career. Esther Beth approach giving? Rogers: We had talked about it before Philanthropy: When you were drafted, the we were married. We were both Baptist, Air Force wasn’t around yet. and thought tithing was a good idea. We FALL 2017
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interviews started out. Within a few years, we made a conscious decision to increase that level of giving. We heard an industrialist, R. G. LeTourneau, speak at a church in Dallas, and he described how he and his wife had started out tithing but rapidly increased it to the point where they were living on 10 percent of their income and giving 90 percent to God. We talked this over and decided we could do a lot better than our tithe. We gradually increased it to the point where we were giving a great deal of money to the Lord’s work. The only reason I’m comfortable telling you this is because Jesus said in his sermon on the mount, “Let your light so shine before men that they may see your good works and glorify your Father in heaven.” I’m willing to let my giving be known to people who might be interested, in the hopes that it might inspire them to do good works themselves.
Rogers: God doesn’t just shovel out benefits; he expects you to use your brains. I studied Walmart, then invested in it against the advice of my broker, who said it was overpriced. I decided it had huge promise. I accumulated quite a big block of stock in Walmart that I bought for less than a dollar a share; it was worth $70 or $75 a share when I gave it away. Some Braniff friends and I invested in real estate in northwestern Fort Worth. When we bought about 6,000 acres of farm property up there we didn’t know there was gas under it. Along came the Barnett Shale boom, where they learned how to fracture the limestone to the point where it would economically produce natural gas. Philanthropy: You say you have given money away “for the Lord’s work.” Rogers: We were very interested in Christian education, and so we supported our church academy, a small seminary called Criswell College, Dallas Baptist University,
I hope to set more running records. And I continue to invest in the stock market. I want to return to God all the assets I can to further his work on earth. We are just stewards for a while, and then we leave. Philanthropy: How did $1.5 million you made during your 40 working years in the military and then Braniff Airways multiply to the point where you could give away $34 million? Rogers: Being a pilot was a precarious existence. I had to take two physicals and three flying checks every year, and if I failed any of those I was out of a job. So I and most of the other pilots started to invest heavily for a rainy day, plowing as much surplus income as we could into savings. After studying the Wall Street Journal for about six months I opened a stock-market account in 1953. Later I got into land investing, which led to the oil and gas business, and God just blessed it all.
and Southwestern Seminary. I got interested in Wycliffe in 1965, and we have been large contributors to Bible translators like Wycliffe, JAARS, the Seed Company, and the International Linguistics Center.
flying airplanes was a delightful revelation to me. Philanthropy: How did you start running? Rogers: When I was 50 years old I picked up a book called Aerobics written by an Air Force officer named Kenneth Cooper. It sold millions of copies and helped spark today’s exercise revolution. It told of his experience training Air Force recruits in San Antonio, and how exercise helped them to live a better, healthier, and longer life. I started running the next day. I’ve logged over 42,000 miles. And if you think that’s a lot, let me tell you about two friends of mine. Frank Shorter and Bill Rodgers are both famous marathoners. They came to Dallas about two years ago, and I talked to them at length. At that time they had run 180,000 miles, and were still going. I’m sure they must be over 200,000 by now. People ask me, “How do your knees hold up?” Dr. Cooper of the Cooper Clinic says it’s commoner to rust out than to wear out. A peer-reviewed study at Stanford University a few years ago found that those who exercised had fewer joint problems than the ones who did not. Philanthropy: How did you transition to competitive running? Rogers: I ran locally with the Cross- Country Club of Dallas for a long time, until I outgrew them. I got interested in national competitive running nine years ago, when I was approaching 90. I looked up the records, and I thought, “Maybe I can do that.” So I had a talk with God, and said, “Lord, I want this. I’ll try to give you all the glory if I’m successful.” Well, I went to Boston and set two world records. Subsequently I’ve set a dozen more. These days I run about eight or ten miles a week. I usually go to the Cooper Clinic Monday, Wednesday, and Friday, and I’ll run two or three miles total, and include a few wind sprints in there to try and keep my speed up. And then I lift weights for about 35 minutes, at Dr. Cooper’s strong suggestion.
Philanthropy: You also got personally involved in Bible translation. Rogers: I started ferrying airplanes for Wycliffe long before I retired from Braniff, in my off-days and vacation time. In 1965 I met Wycliffe founder Cam Townsend, and he challenged me to raise the money to pay off an airplane that was going to Bogota, Colombia, for missionary work. I did, then delivered it to Bogota. That was the first of some 45 or so ferry flights I did delivering airplanes to South America, Philanthropy: I heard you were an early the southwest Pacific, and Africa. That was Philanthropy: I heard you recently discovinvestor in Walmart. pure joy. Finding I could serve the Lord by ered a new sibling. 16
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Rogers: It was very dramatic. My father left us when I was young, and my mother took us back to live on her parents’ farm. So for 90 years, I never heard anything from or about my father. Three years ago, I was sitting at my computer and the phone rang. It said “Bend, Oregon.” I didn’t know anybody from there, so I thought about not answering it. But I did, and this nice lady’s voice came on and asked, “Is this Orville Rogers?” I said, “Yes, ma’am.” And she stated right out of the blue, “My name is Sandra, and I am your sister.” I had no idea that my father had remarried. They had one daughter, and she has three children. We visited each other and just hit it off wonderfully well. She and her family are believers, that’s the icing on the cake. Her son-in-law is Tom Clarke, who was president of Nike from 1994 to 2000. He took me through Nike headquarters and gave me two or three sets of running gear, shoes, and a jacket. So I’m a proud supporter of Nike now. Philanthropy: What are some of your goals as you turn 100? Rogers: I’ve been thinking about that. I’ve never been 100 before, I need to get prepared. I hope to set more running records. And I continue to invest in the stock market. I want to return to God all the assets I can to further his work on earth. We are just stewards for a while, and then we leave. In the sermon on the mount, Jesus said, “Lay up yourselves treasures in heaven, not on earth.” Philanthropy: Have you tried to teach giving to others? Rogers: We taught our children at a very early age that God owns it all, and we just return to him as much as we can given the circumstances and expenses of life. They got the idea. I determined early on that I was capable of donating more by investing rather than giving all of my earnings away immediately. Young people should not hesitate to accumulate wealth, if they are doing it for God’s work. P
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Making From work to school to arts to recreation, Pitt and Barbara Hyde show how to energize a hometown Leadership—missed the memo to go with the flow. They riled teachers’ unions by funding the first Memphis charter Viewed from Pitt and Barbara school in 2001. That same year they led Hyde’s office perched on the bluffs an effort to bring an NBA team to town of Memphis, the Mississippi River amid local footdragging. In 2002, they appears to meander lazily on its way. gathered supporters to revitalize the city’s But appearances can deceive. The river’s biggest park and put it under nonprofit smooth, muddy surface hides a powerful management; the county commission flow of more than 300,000 cubic feet stymied the plan. each second, moving boats along at a But the Hydes weren’t going to rate of up to three miles per hour amid give up. Today the park, Shelby Farms, is a threatening eddies and undercurrents. Barbara and Pitt—winners of the 2017 prime example for other cities of how William E. Simon Prize for P hilanthropic to improve urban life quality through 18
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greenspace, and it’s privately managed. The NBA team, the Grizzlies, is not only in town—it’s made the playoffs for seven consecutive seasons. And now even the education powers-that-be are singing the virtues of school reform. The Hydes, meanwhile, continue to do what they’ve always done when problems pop up: gather concerned citizens, search for capable leaders, and offer lead gifts to make their community exemplary.
Sergio Ingrvalle
By Evan Sparks
Sergio Ingrvalle
g Miracles grocers in 12 states, bringing in $500 with future FedEx creator Fred Smith— million in annual sales. The company Pitt went off to the University of North also operated about 100 supermarkets Carolina to study economics. He came and had a regional drugstore chain. home and went to work at Malone and It would have been a management A retail revolution Hyde—and then tragedy struck. His challenge for a seasoned executive, Pitt Hyde is Memphis-born. His father fell ill and had to withdraw from much less a young man only a few years grandfather started the family food active management of the company. out of school. Pitt remembers it as a distributing company, Malone and Hyde. By age 28, Pitt was CEO of the largest “baptism by fire.” But he must have been Growing up “we talked business all the wholesale food company in the South. a natural, because the company grew time,” Pitt remembers. “I first started At the time, Malone and Hyde into the third-largest wholesale food hanging about supermarkets when I was supplied more than 1,000 independent distributor in the country. five years old.” After graduating from local private Contributing editor Evan Sparks, who grew up in Memphis, is editor-in-chief of the schools—where he became fast friends ABA Banking Journal. FALL 2017
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At 28, Pitt was CEO of the largest wholesale food company in the South. Then he created AutoZone, the category-making car-parts retailer. 20
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thing that has continued to differentiate us to this day is the AutoZone culture of putting customers first.” To continually remind employees of their key to success, AutoZone has actually trademarked a clunky acronym: WITTDTJR, or “wittajer,” as AutoZoners pronounce it. It stands for “Whatever it takes to do the job right.” A customer doing a car repair is likely to be frustrated and stressed, AutoZone recognized early on. “You woke up, it was 20 degrees, and your car won’t start,” says Bill Rhodes, who is now CEO of the company. “You haven’t been saving for a $100 battery but you have to get one right now, and you’re not in the best frame of mind. Our AutoZoners take that customer, provide him exceptional service, and turn that bad day into an okay day.” One of the things Pitt learned from Sam Walton was the importance, in building a high-growth company, of an energetic shared workplace culture. Every morning, before customers arrive, AutoZone store employees gather for a corporate cheer (a trick Pitt adopted from Walton) and a recitation of the company pledge: “AutoZoners always put customers first! We know our parts and products. Our stores look great! We’ve got the best merchandise at the right price.” AutoZone revved ahead. It opened its hundredth store in 1983 and its thousandth in 1995. Since going public, AutoZone stock has outpaced the S&P 500 index twelvefold. The startup became a Fortune 500 firm in 1999. Looking homeward But while AutoZone was flourishing, Pitt’s hometown was struggling. In 1968, the first year Pitt took on major responsibilities at his family’s company, M artin Luther King Jr. was assassinated at the L orraine Motel. Unrest, crime, and white flight followed. “The city took an incredible hit,” Pitt remembers. “The economy just went flat.” Jobs fled the urban core for the suburban fringe, and there was a deep racial divide. Pitt was convinced, along with most of Memphis’s black leaders, that the Lorraine Motel needed to be dealt with properly—unlike most of his fellow white civic leaders, who “wanted to bulldoze it and erase it,” he says. So he began working with a black leadership group on a plan to build a civil-rights museum that could convert a source of tragedy and shame into a place of education. The National Civil Rights Museum was Pitt’s first major philanthropic project—one he says he’s devoted more hours to than any other. He spent five years “busting my rear,” navigating the initial resistance of the Memphis business community, infighting among the
Jamie Kripke
For advice he consulted another Southern entrepreneur he’d come to know: Sam Walton. The older man had founded Walmart about a decade before Pitt took the reins at his family company, and operated in the same small-town markets that Malone and Hyde supplied. The two men, though a generation apart in age, took a shine to each other. In the early 1970s, Pitt became one of just two non-Waltons on the Walmart board. “I learned a hell of a lot from him,” Pitt reflects. “He was the most amazing retailer.” At that time Walmart was years away from disrupting the local grocery trade, but Pitt was nonetheless growing worried about the future of small independent grocers—his company’s bread and butter. “I was concerned about the long-term outlook for the food wholesale and distribution business,” he says, “even though we were doing very well.” In the grocery business, a good profit margin is 1.5 percent. He started searching for a less cutthroat market to expand into. Auto parts caught his eye. “That was the first time I’d been exposed to the do-it-yourself market,” he says. He and his team started investigating, and what they found smelled like opportunity. There was no nationally dominant auto-parts retailer. “The general quality of the regional companies was not good—yet everybody was growing and making money.” Profit margins on auto-part sales were so high—around 10 percent—because when a customer is buying a part, he really needs it. He doesn’t have time or inclination to shop around; he has to have an alternator now. Pitt—who notes with a chuckle that he has never been a “car guy”—decided to try it out. His team opened Auto Shack in a small town about 40 miles west of Memphis in 1979. Though he didn’t know auto parts, he was a merchandising expert, and figured out how to get the specialized parts customers needed into stores faster than the competition. In 1987, Auto Shack spun out of Malone and Hyde and ultimately became AutoZone. “He took his family business and completely revolutionized it,” marvels Fred Smith. What really set the company apart were helpful employees and strong customer service. “When we first got into the business our approach was very unique. Once competitors saw what we were doing they copied our store layout, and everything else,” Pitt says. “The one
Jamie Kripke
Pitt didn’t consider himself a “car guy,” but nonetheless led AutoZone to smashing success; the company opened its thousandth store in 1995.
fellow proponents, and general suspicion of his motives. “It was challenging,” he recalls. “I kept thinking, ‘You have to keep the long view in mind, because this is something that is important to the city and to the country.’ ” When the space opened in 1991, tension turned into healing. Visitors today are presented with a detailed history of the civil-rights movement. The exhibits culminate in a view of King’s room, number 306, preserved as it was the day he died. “We have our issues today,” says Pitt, “but the museum helps us think of the progress that has been made, and be thankful for the people who made that possible.” Soon, Pitt would have help on his civic projects. Long before she married into the Hyde family, Barbara Rosser’s life was shaped by philanthropy. A native of Atlanta, she attended the University of North Carolina on a Morehead Scholarship, endowed by a Carolinian who built his wealth through the Union Carbide company. After graduating she did a stint as a teacher in Kenya, then returned to UNC as a development officer. She raised funds for the college’s first million-dollar-endowed professorship. In 1990, Barbara called as a fundraiser on a 1965 graduate named Pitt. Not long after, Pitt joined an alumni trip to the former Soviet Union that Barbara led. Romance blossomed; the pair were married in 1992. In Memphis, Barbara became the leader of what is now the Hyde Family Foundations. “As somebody who used to raise money for a living, it feels like a dream to get to be on the other side of the table,” she says. “While it is a privilege, I’ve learned how hard it is to give money away in a manner that makes a real difference—and that doesn’t have unintended consequences.” Barbara’s gift for fundraising has fueled what has become a Hyde signature strategy: partnerships. The Hydes are leaders in Memphis philanthropy, but FALL 2017
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turn these factors to a positive, Memphis could become a model.” One model result can be seen while walking the streets of south Memphis. St. Andrew’s AME Church is housed in an impressive modern building surrounded by trim bungalows on tree-lined streets. Two decades ago, it was at the end of a long spell of “disinvestment, devastation, disenrollment,” says Kenneth Robinson, who arrived to pastor St. Andrew’s at the time. “It was, charitably, a dying church.” And the neighborhood was suffering the same fate. When churches like St. Andrew’s that anchor a community start to decline, the entire area can struggle. Gone are the community volunteers. Gone are the relationships among parishioners. Gone are the open doors and shared spaces. Robinson was a physician, ordained minister, and developer when his bishop sent him “kicking and screaming” to Memphis. Under his leadership, St. Andrew’s started a community development corporation to help catalyze investment alongside the church members’ own contributions to the neighborhood. In the big cities of the North, church-related CDCs were common, but “in Memphis, which had been stuck in the late ’60s,” there were no counterparts, Robinson says. Pitt and Barbara took note. The Hydes’ first major project with Robinson, in the late 1990s, was renovating the gym at the St. Andrew’s community center, then financing an 80-unit apartment building. “After building three or four singlefamily houses, our little faith-based CDC took on a huge administrative, managerial, red-tape project. But we worked it through Pitt and his property management company,” Robinson remembers. “We figured out how to get it done and generated, with a huge commitment from the Hyde Family Foundation, this marvelous high-end apartment community.” The Hydes doubled down on St. Andrew’s with support for its Circles PHILANTHROPY
of Success Learning Academy, the first elementary charter school to open in Tennessee. “It was a risky investment at that time, but it didn’t really matter to Pitt and Barbara that the state had very restrictive initial charter-school legislation. We were interested in new opportunities for kids who had potential but were languishing. So were they. And they just kept plugging and pushing.”
Lisa Buser
they almost never go it alone. “In almost every major project that we’ve been involved in, I’ve helped raise a significant amount of money in addition to what we give,” she comments. “That skillset of not being scared to ask other people for money has been helpful.” They seek not just co-funders but partners to ensure that projects succeed, and they earn trust by listening. Rip Rapson, president and CEO of the Kresge Foundation, recalls a dinner that Pitt and Barbara hosted to discuss possible improvements to the downtown riverfront. “They essentially receded and let other people talk about what their priorities were and where they saw the community going. They are great table-setters.” Pitt and Barbara’s personalities and strengths balance each other as well. “She’s got her eye on the horizon, on the big picture. And he wants to know, ‘Will it work?’ ” says Jen Andrews, executive director at Shelby Farms Park. “It’s almost like insurance, protecting the success of the organizations they help lead.” Pitt credits Barbara with an important shift in the family giving. “I’d always been engaged in philanthropy,” he says. “But it was more responding to the good organizations within the community, traditional support. Then we started thinking, ‘Look, if we’re going to really make a difference in this town, we’ve got to be instigators of positive change. How do we stretch ourselves to do that?’ ” Their strategy had two parts. First, they would focus “all of our energies on Memphis,” says Pitt. They knew that their vision of a revitalized hometown would require a lot of money, far more than they had themselves. It would also call for intense personal engagement with community leaders. Extending beyond Memphis would dilute their efforts. Second, they would seek to make the city a model for urban revival. “We saw Memphis as the perfect test,” Pitt says. “Memphis is a big enough city to have all the same problems and opportunities as any urban center. We have a minoritymajority population, and a high poverty index. If we can demonstrate that we can
Lisa Buser
Pitt lobbied the Tennessee state assembly to pass the state’s first charter-school law. Barbara lobbied top education-reform organizations like Teach For America, TNTP, and others to come to Memphis.
A new career in civic reform In 1996, at the age of 53, Pitt was diagnosed with prostate cancer. He began the process of stepping down from the top spot at AutoZone and dedicating the majority of his time to philanthropy and civic leadership with Barbara. He got interested in his surgeon’s scientific research and began supporting it philanthropically.
He also created a for-profit company to develop new therapies. (“I wish it were actually for-profit,” he laughs ruefully. “I’m still struggling through the profit part.”) Building on Memphis’s reputation as a c ancertreatment center and as the home to Tennessee’s oldest medical college, Pitt also launched the Memphis Bioworks Foundation, a nonprofit to help develop the FALL 2017
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Thanks to efforts by the Hydes and other philanthropists to build up a grand park for Memphians, only 12 percent of the park’s budget now comes from taxpayers, while public attendance has tripled.
several local high schools enrolled freshman classes in the hundreds but graduated seniors only by the tens. In 2001, 39 percent of Memphis’s 165 public schools were on a state watchlist for poor performance. And poor schools were a direct driver of the high poverty levels that held Memphis back. “Economic development is based in large part on the ability of your workforce,” says Memphis mayor Jim Strickland. “I want to build a city where high-quality workers want to live.” Coincidentally, a new no-excuses school program emphasizing a mix of academic skills and personal character was just beginning its national expansion. After Mike Feinberg and Dave Levin’s first two KIPP 24
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Courtesy of The Hyde Family Foundations
biomedical field in the city by p roviding support for medical entrepreneurs, workforce training for future employees, and new facilities. Pitt and his fellow business leaders see biomedical investments—along with another current Hyde project, the redevelopment of Memphis’s fractured medical district—as crucial to driving economic growth that will help all Memphians thrive. “We need the next FedEx, the next AutoZone,” says Fred Smith. “We need new activities in the startup and technology sphere that might build a new major employer.” Education was an obvious place to start toward economic revival. Public schools serving poor neighborhoods were in deep distress. In the late 1990s,
schools were featured on “60 Minutes” in 2000, Gap founders Don and Doris Fisher poured an initial $15 million into expanding their program. The Hydes helped bring KIPP Diamond Academy to Memphis in 2001—as a “contract school,” because charters were not yet permitted in Tennessee. Pitt helped change that. He lobbied the Tennessee General Assembly in 2002 to get the state’s first charter-school law passed, literally walking the halls and finding allies wherever he could. As a former CEO of one of Tennessee’s largest private employers, he had the confidence of many lawmakers, and his personal engagement was a key reason the bill passed, notes Jamie Woodson, then a Tennessee state representative and now the leader of a statewide education advocacy organization. The new charter-school law was restrictive—limiting charters to areas where the existing schools were categorized as poor. And Pitt knew that charters alone wouldn’t solve the myriad problems afflicting the public schools. “They never bought into the idea of a silver bullet,” says Carol Coletta, a longtime Memphian and Hyde family friend now at the Kresge Foundation. The Hydes sought to use all available tools and methods to increase the overall number of high-quality school spots. This meant bringing in new charter networks like KIPP, and supporting private schools with good outcomes. It also meant trying to improve the quality of teachers and principals in Memphis’s conventional public schools by attracting and supporting talented educators. Barbara led the way in persuading Teach For America, TNTP, and New Leaders in the mid-2000s to bring their energetic young teachers to Memphis, an effort that continues with the Memphis Education Fund initiative the Hydes helped found. They also used political and public-policy levers to prod the school district to improve schools. These local efforts by Pitt and Barbara gained national attention in 2009, when Tennessee threw its hat into the federal competition for $4.4 billion “Race to the Top” money, for the best state plans to raise student performance. Pitt worked with former U.S. Senate majority leader Bill Frist, a Nashvillian, to put together a group of CEOs and civic leaders to advocate for strong statewide education reforms. One idea was to use student-performance results in assessing, retraining, and paying teachers. Tennessee collected good data on student achievement, but “the teachers’ union had it written in legislation that these results could not be used for teacher evaluation,” Pitt points out. “So here we were spending $7 or $8 million to gather information that served no purpose.” Pitt’s group got written into the state’s Race to the Top application a commitment to use student-performance data to improve teaching. A bill legalizing that, and making a raft of other reforms, was signed into law.
Courtesy of The Hyde Family Foundations
This in turn sparked good news from oundation. the Bill & Melinda Gates F It would grant Memphis schools $90 million for a teacher-effectiveness initiative—to complement the reforms Hyde and company pushed through the legislature. The Gates money “got the teachers union to agree to a host of reforms: measuring student outcomes, pay for performance, teacher evaluations based on student outcomes,” says Pitt. Tennessee ultimately took home $500 million of federal money to implement its reform plan. The Hydes rejoiced in the supplemental funding— and in the new laws now in place to hold teachers and schools accountable. With the funds, the state created Tennessee’s Achievement School District, a staterun district that took over more than 30 especially troubled schools—some to operate itself, but most turned into charters run by new operators. All but three of the ASD schools are in Memphis. In 2011, the remaining Memphis City Schools dissolved and merged into the Shelby County Schools system. The Hydes were also instrumental in working with Shelby County Schools to establish an “innovation zone” to give traditional public schools the same autonomous and flexible features as schools in the ASD. (For more on innovation zones, see page 51.) With these major changes in the public school ecosystem, the Hydes are busy—supporting the conventional district schools run by Shelby County, the state-run ASD schools, lots of charter schools, and more. “Our whole focus is on quality. We are agnostic about who delivers it,” says Pitt. That willingness to work with all parties extends to faith-based schools as well—which is fitting for a city that ranks in the top five nationally in houses of worship per capita. “Some of our most powerful partners have been churches,” says Barbara. “The faith community is one of M emphis’s authentic assets. It helps bridge racial divides, and solve social issues of concern to all Memphians.” The Hydes were part of an effort to reopen eight previously closed C atholic schools in Memphis—known as the “Miracle in Memphis.” It’s nearly unheard of for a Catholic school to be brought
middle. It became a popular spot for biking, hiking, jogging, and sailing, but with a modest appropriation from the back once it has closed. But these so-called county it was “undercapitalized and underdeveloped,” Barbara says. “Jubilee” Catholic schools are now As suburbs grew up around the park, thriving. Other faith-based grantees of emphis Teacher pressure mounted for the county to begin the Hydes include the M Residency, which provides training, selling off parcels for development. “Every living accommodations, and classroom major city in the country is interested in experience to evangelical Christians who improving its green, recreational, outdoor receive a master’s degree in exchange for a areas,” Pitt explains. “We were struck by commitment to teach in an urban school the fact that we had this huge asset just for at least three years. sitting there. Most cities have had to spend a fortune assembling park space! The stage Taking it outside was set.” On a mild summer Saturday, the place to The Hydes joined with other be in Memphis is Shelby Farms Park. At activists and donors in an effort to place 4,500 acres—nearly six times the size of the park under a nonprofit conservancy, New York’s Central Park—the grounds but developers who wanted access to the offer options for lovely solitude even land and citizens suspicious of putting when thousands of hikers, bikers, and public lands under unelected charitable picnickers are on the premises. On our visit, management convinced the Shelby a young father rides by slowly, pulling his County Commission to reject the plan by napping daughter in a bike trailer, while a two-vote margin. The Hydes regrouped
Tennessee’s Race to the Top application included a promise to use hard-headed measures of student performance to evaluate teacher effectiveness. All thanks to the leadership of the Hydes. rambunctious twin boys follow on training wheels. Near the visitor center, on a massive green lawn, a free yoga class is concluding. At the other end of the lake, a new restaurant called the Kitchen—launched by Elon Musk’s brother Kimbal—hosts a packed patio of brunchers. For anyone who had not been to Shelby Farms Park in the past few years, the place is unrecognizable. The park had been through previous incarnations as a failed utopian commune (in the nineteenth century) and a penal farm (in the twentieth). Starting in the 1970s, Shelby County shut down most of the penal-farm operations and began allowing recreational use as a county park. But it remained something of a hodgepodge—experimental fields here, an R.V. park there, an expo center at one end. A freeway shot through the FALL 2017
and strengthened grassroots support for the park, and in 2007 the county awarded the conservancy a contract. The conservancy board, chaired by Barbara, commissioned a master plan. The Hydes made a $20 million challenge grant to jumpstart the initiative—the couple’s largest gift up to that point. The park’s celebrated design came from a public competition. The winning entry came from James Corner, the landscape architect who created Manhattan’s beloved High Line. At the heart of the park is a lake—today named Hyde Lake—doubled in size and surrounded by native plants. A visitor center, event space, and eatery all opened just last year. Meanwhile, widened and enhanced trails lead to smaller lakes, offleash areas, playgrounds, picnic sites, and even a bison herd. 25
pedestrian path on an unused rail lane of a Mississippi River bridge, connecting downtown Memphis to Arkansas’s is improved access, a point of pride for network of levee trails. The Big River Pitt and Barbara, who are avid cyclists. Crossing, as it’s called, is the longest Bikers and pedestrians can now get to public pedestrian and bike crossing the park from a new bridge to the south of the M ississippi. “You really get a and a ten-mile rail trail stretching from perspective on the river out there, and midtown Memphis. sense of the power of it, and then the The Hydes are actively supporting beauty of Memphis sitting there on the other efforts to extend the walking and bluff,” says Barbara. biking network though Memphis’s green Pitt adds that bikers can now ride space. They co-funded a new bike and from Arkansas to Shelby Farms Park, 17
The event spaces provide earned revenue, enough to match the park’s considerable philanthropic support on the current track. Taxpayers provide just 12 percent of the park’s budget, a flat sum that has not increased since the pre-conservancy days, even as park attendance has tripled to two million people annually. A major driver of Shelby Farms Park’s growing attendance 26
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Lisa Buser
The Hydes ask: “Where’s the next generation of philanthropists in Memphis going to come from?”
Lisa Buser
This work has restored not only land but also the Hydes’ enthusiasm for public giving. Being able to see large projects to completion “is just feeding our souls,” says Barbara. “It’s giving us so much back. It’s recharging our batteries so we can keep on with the long, hard work of education reform, for instance.”
in management and money raising, and provided criticism. That coaching helped prepare Andrews to step up as executive director of the conservancy in 2016, responsible in her early 30s for a $4.6 million budget and oversight of nearly 40 The next generation employees. Pitt offers his own varieties Talk with Pitt and Barbara long enough of assistance. With his motto of “retail is and the word “generational” will make an detail” honed during his business career, appearance. It’s the way they talk about he tells Andrews what he notices when he the projects they take on. The work of walks a trail or bikes the park. improving schools is a multi-generational The Hydes’ leadership investments are task, while Shelby Farms Park is a formal as well as personal. They support generation-defining public asset for the city. programs like the New Memphis Institute, The word also applies to their investments which Barbara calls “probably our most in local leadership. “We’re beginning to powerful long-term strategic investment think about that next generation: Where in leadership development in the city.” The are the emerging leaders in Memphis group provides opportunities for emerging coming from? Where’s the next generation leaders—say, new Teach For America corps of philanthropists in Memphis going to members or young FedEx managers—to come from?” “get really engaged in the city and ramp The need for leadership development up their knowledge and involvement.” is something Pitt understands intuitively, The Hyde Family Foundations “has been having stepped into the top job at a big the training ground for cultivating our top business at such a young age, and he and millennial leaders,” says Micah Greenstein, Barbara place a premium on mentoring senior rabbi at Temple Israel in Memphis. rising leaders. Take Ekundayo Bandele. Peer donors also learn from the The playwright and stage director is Hydes. “They mentor people like my wife founder of the local Hattiloo Theatre, and me to be better philanthropists,” says which was hailed nationally when it hired Bill Rhodes, the current AutoZone CEO. Olivier Award-winner Katori Hall as “Not only are they leading with their artistic director. As his theater has grown, financial resources, they’re intellectual Bandele has had to complement his leaders too.” Rip Rapson of the Kresge artistic talents with leadership skills. The Foundation says that for national-level foundation put him through an executive- funders, “the Hyde Foundation is a sherpa, training class that included one-on-one with rich ground-level intelligence.” coaching, instruction in fundraising and The Hyde seal of approval has become board management, and introductions to so well known in Memphis that private other nonprofit leaders. “They invested in foundations and corporate givers are me personally as an arts administrator.” often happy to follow suit. “There’s hardly Jen Andrews also found herself miles, entirely on dedicated paths. “We’ve anything they’ve been involved in that we gone from being a totally bike-unfriendly sliding into leadership roles thanks to haven’t,” says FedEx’s Fred Smith. Barbara Hyde. She was hired out of place to being rated one of the top bikeThis determined, intelligent, longcollege a little over a decade ago as an friendly places in the country.” running, and (when necessary) brave entry-level employee at the Shelby Farms giving and civic leadership is gradually Another project the Hydes are Park Conservancy. “Barbara saw an funding is the Wolf River Greenway, changing the texture of Memphis. “It opportunity for me in development that I used to feel like there was a very small which within a few years will see a didn’t even see in myself,” Andrews says. 36-mile trail run along the urban river handful of philanthropists in the city who “Having someone believe in you is an from Shelby County’s eastern border were willing to dig in and engage,” says incredible gift. It seemed like a lot to take Barbara. “Over the last 25 years I’ve seen to the M ississippi River. As with on but she thought I could do it.” Shelby Farms Park, the project involves that change. Other philanthropists are Barbara provided mentoring, made stepping up, in a huge way.” That’s what improving an existing but underused introductions, opened doors to instruction infectious success can lead to. P asset—in this case, floodplain land. FALL 2017
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A billionaire’s ambitious plans to send stamp-sized spacecraft light years away
istockphoto.com / den-belitsky
By Jeff Foust
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istockphoto.com / den-belitsky
S
pace—the vast expanse of stars and moons and asteroids and nothingness extending beyond the borders of our small terrestrial home—was once only visited by poets and dreamers in their imagination. Then, in one of the great beneficial side effects of the terrifying faceoff between powerful nations in the last century, human beings began to walk among the stars. The infinity of space became visible and visitable, and we designed bigger and bigger vessels to transport us on more ambitious missions. More recently, the accessibility of space to humans receded somewhat. NASA abandoned its most powerful rocket and gave up its capability of shuttling people into space. But as the U.S. government stepped back, American private companies pressed forward. Firms like Blue Origin, SpaceX, and others are now pushing the edges of where we go and who or what goes there. Other nations are also getting into space.
Now a new venture created with donated money is beginning to develop space forays. And these are of a new sort: miniscule in size, extraordinarily distant in reach. These experiments could uncover new methods of travel that might eventually take people further than ever before thought practical. Big gift for tiny craft On June 23, an Indian rocket lifted off from a spaceport on the country’s east coast. The primary purpose of the launch was to place an Earth observation satellite into orbit. There was enough extra room in the rocket, though, to carry 30 additional small satellites, flying to space as cosmic hitchhikers. Among those 30 satellites were two built by universities and companies in Germany for science and technology demonstrations. Those satellites in turn had hitchhikers of their own: tiny spacecraft, each the size of a postage stamp and weighing just four grams, called “Sprites.” Those Sprites, while remaining attached to the larger satellites, are designed to be full-fledged spacecraft, equipped with computers, radios, sensors, and other components needed to operate independently in space. The flight provided an opportunity to test how well those Sprites could function in the harshness of space.
Jeff Foust is editor of the Space Review. FALL 2017
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Light sailing On April 12 of last year—the 55th anniversary of the launch of the first human, Yuri Gagarin, into space— another Yuri took the stage at a press conference at New York’s One World Trade Center. Yuri Milner, a Russian-born billionaire now living in Silicon Valley, made his wealth first with a series of Russian Internet companies, then expanded it dramatically with sage early investments in companies like Airbnb, Facebook, and Twitter. Milner, joined at the press conference by a panel of scientists, engineers, and other experts, said he wanted to accelerate progress in space. “Space travel, as we know it, is slow,” he said. “How do we go faster? How do we go further? How do we make this next leap?” NASA has already launched several spacecraft that have left the solar system, or are on trajectories that will take them out of it. These include the twin Voyager probes launched 40 years ago. Those spacecraft, though, would take many thousands of years to reach the nearest stars. What Milner proposed was a technology-development program to allow spacecraft to travel to the nearest stars in as little as 20 years. That is possible, he said, because of advances in 30
The first destination of Breakthrough Starshot: Alpha Centauri. At just 4.4 light years away, this is the closest star system to us. Very small vessels equipped with cameras and communications would be propelled to one fifth the speed of light by Earth-based lasers pushing on sails attached to each craft.
several key areas, from microelectronics to nanotechnology to lasers. “The Breakthrough Starshot concept is based on technology either already available or likely to be available in the near future,” Milner said. “But as with any moonshot, there are major engineering challenges to solve.” PHILANTHROPY
The concept involves development of those stamp-sized Sprite spacecraft. Each would deploy a small “lightsail” about a meter across. A giant laser array on Earth, with up to 100 billion watts of power, would fire at the sails, accelerating them to speeds as high as 20 percent of the speed of light.
Breakthrough Initiatives; istockphoto.com / cemagraphics
Why build satellites that small in the first place? They may be the key to humanity’s first journeys beyond the solar system within a human lifetime. If all goes as planned, today’s new “Breakthrough Starshot” project could, within a few decades, be sending versions of those Sprites on missions to the nearest stars, even scouting planets that could be habitable. What sets Breakthrough Starshot apart is not just its advanced technology and its audacious goals. Breakthrough Starshot is not a project of NASA or another national space agency, or even a private company. Instead, it was kicked off as a philanthropic venture by a single billionaire.
Breakthrough Initiatives; istockphoto.com / cemagraphics
Each Sprite, which the project also calls a StarChip, would be an individual spacecraft, with all the tools needed to collect data on the star systems they fly past. “We can equip this smart electronics with all kinds of probes, and the idea would be to collect data that cannot be acquired from the Earth,” says Avi Loeb, a Harvard University physicist who also serves as chairman of the project’s advisory committee. The idea of massive lasers pushing chip-sized spacecraft to other stars
sounds like something out of science fiction. Yet the concept has been studied for years. “The laser technology has advanced to such a state, along with other technologies, that it’s actually quite feasible to send a very small probe—a few grams—at some reasonable fraction of the speed of light in the next few decades,” says Pete Worden, executive director of Breakthrough Starshot. Worden, who handles the day-today operations of the project, is perhaps uniquely suited for this job. FALL 2017
A retired Air Force general with a Ph.D. in astronomy, he worked on advanced-technology programs throughout his military career, from missile defense to a small spacecraft mission to the Moon in the 1990s called Clementine. Later, he spent nearly a decade as director of NASA’s Ames Research Center, the agency’s outpost in Silicon Valley, supporting small-satellite and other programs, and building up relationships with the companies in the area. 31
Businessman and philanthropist Yuri Milner aims to radically extend mankind’s reach into space by means of stamp-sized spacecraft that can reach other stars in just 20 years.
around the world, and to develop advanced computer systems to more efficiently process the data those telescopes collect. On a smaller scale, Milner is also supporting a project to study the star nearest the Sun, Proxima Centauri. Are we alone? Astronomers discovered a somewhat Breakthrough Starshot is not Milner’s Earth-like planet orbiting that star in first space-related philanthropic 2016. Milner is funding development of program. In 2015, he announced an instrument to be used on telescopes at Breakthrough Listen, a ten-year, $100 the European Southern Observatory in million effort to fund projects that Chile to see if that planet, or potentially monitor radio and other signals from others orbiting the star, has any of the space for signs of other civilizations. qualities needed for habitability— Milner’s donation breathed new life making it a likely early destination for into that work, which had operated on Breakthrough Starshot. shoestring budgets since Congress canceled Before those projects, Milner NASA funding for it in the early 1990s. established the Breakthrough Prize in Breakthrough Listen has used his money 2012, which offers multimillion-dollar to purchase time on radio telescopes awards in physics, life sciences, and 32
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mathematics. While initially funded by Milner, others philanthropists, including Facebook founder Mark Zuckerberg and Google co-founder Sergey Brin, are now also funding the prizes, which have funneled about $200 million to dozens of scientists at the leading edges of their fields. Worden first met Milner through the Breakthough Prize effort, when the foundation asked to hold the prize ceremony at NASA Ames. Milner later talked with Worden about his ideas for what became Breakthough Listen and Breakthrough Starshot. Over time, “he started chatting with me about another part of his vision, which is really a renewed and well-funded private search for life in the universe,” says Worden. That convinced Worden to leave
Bebeto Matthews / apimages
Milner’s $100 million donation will go toward studies of some of the key technology issues, from the development of Sprites to nanotechnology needed for the lightsails to developing arrays of lasers that can operate together at the required power. The project will also study other issues, like the policy challenges of operating a giant laser that, if misused, could damage satellites in Earth’s orbit. “This looks good enough that Mr. Milner committed $100 million to begin the research on it,” Worden says. That included the test of the Sprites on the satellites launched in June, as well as upcoming calls for proposals to fund research on lasers and lightsails. But that $100 million, as large a sum as it is, is just a down payment on the overall project: Worden and others estimate developing the various systems needed for sending StarChips on interstellar journeys could easily cost $10 billion or more. That likely means that future development will involve governments as well as private funding sources. First, though, Breakthrough Starshot will explore how feasible the project is. “There are, to be sure, formidable challenges to this. It’s going to take a lot of work,” he says. “But we’re very excited about that effort.” “There are many challenges in this project. It’s an ambitious project, but we don’t see any dealbreakers based on fundamental physics principles,” Loeb says. “So we think we can overcome these challenges with enough innovation and ingenuity.”
Bebeto Matthews / apimages
organizations in funding space missions. “The relationship of the space programs with the foundation community is, NASA and become chairman of the it seems to me, where biomedical Breakthrough Prize Foundation. Worden said all these efforts are tied research was 20 years ago,” says Sandya together by a single theme that is one of Narayanswami, former head of the office humanity’s most fundamental questions: of foundation relations at the California Institute of Technology. are we alone? “I think in the next few Narayanswami now works as a years, either we’ll find a life-bearing consultant advising organizations planet around one of the nearest stars,” seeking to raise money for space he says, “or we’ll find some evidence of missions. “It’s still at a very, very early life in our own solar system.” stage, and it’s evolving,” she says of the relationship between space projects and Star checks: the next generation philanthropy. “It’s hard for me to predict Milner’s twin $100 million projects are the biggest philanthropic space initiatives where it will go.” Space projects have to fight a today. They are, though, part of a larger trend of private funding of space projects perception that such efforts are still solely once solely in the domain of government in the realm of government agencies. Jon Morse knows that all too well. The agencies like NASA. These surges of former head of NASA’s astrophysics philanthropic and for-profit effort are division, responsible for missions like the driven by a desire to do more missions Hubble Space Telescope, he has been more quickly than what governments can accomplish, and powered by growing spending the last several years running the BoldlyGo Institute, which seeks technical and commercial capabilities private funding for space telescopes and that put more and cheaper missions other missions that don’t fit in NASA’s within the reach of private funders. budget today. Szabolcs Marka is a professor of When he’s contacted foundations, physics at Columbia University who he often gets the same response. “So far, studies gravitational waves, a prediction what we have found is that when we of Albert Einstein’s theory of general approach a lot of people, they say, ‘Well, relativity that was finally confirmed in isn’t NASA doing this?’ ” He answers, 2016. He’s involved with a European “Yes, NASA’s doing things, but there’s mission called the Laser Interferometer room to do a lot more.” Space Antenna that will also search Similarly, the B612 Foundation— for gravitational waves. However, this multibillion-dollar mission, first proposed named after the asteroid in Antoine de in the 1990s, won’t launch until the 2030s. Saint-Exupéry’s The Little Prince—sought to raise money for a space telescope called He thinks private funding could support Sentinel to look for asteroids near the interim missions that can make advances Earth that could pose an impact risk. B612 in the field before LISA launches. “Many started Sentinel in 2012, hoping to raise of my colleagues are impatient,” he said. the $500 million needed for the mission to “We don’t want to wait 40 years for our launch as soon as 2017. dreams to come true.” By this year, though, B612 had raised There is small but growing only a tiny fraction of that total cost. The interest among foundations and other
Donors and private investors are financing the next big chapter in space exploration, powered by growing technical and commercial capabilities that put nimbler, cheaper missions within reach. FALL 2017
organization announced in June it was abandoning Sentinel and focusing instead on small spacecraft missions to augment NASA’s asteroid search efforts. “We think it makes more sense for us to focus on these smaller, but more numerous, asteroids,” says Ed Lu, co-founder of the B612 Foundation. Men and women working on space projects hope that Milner’s new funding of Breakthrough Starshot and related projects can open the door to philanthropic funding of other proposed missions as well. This would be a fresh approach, but also a return to the way space science was done long before the launch of the first satellite. Alexander MacDonald, a NASA economist and author of The Long Space Age, sees parallels between this new interest in philanthropic funding of space ventures and projects in the nineteenth and twentieth centuries to build astronomical observatories with donated money. He studied 40 such observatories developed in the United States through World War II by philanthropists. “If you add up how much private capital was involved in the construction and operation of those observatories, the total is over $9 billion” in present-day dollars, he says. For perspective, NASA’s annual budget this year was $19.5 billion. Philanthropic funding of space projects like Milner’s Breakthrough Starshot could be the next great contribution of private donors to the science of astronomy. “Our funders are high-net-worth people, all of whom made their resources in the high-tech area, and I think a lot of them feel it’s important that they provide something back as a legacy,” says Worden. “Certainly for Yuri Milner, that’s his objective.” Only in Milner’s case, his legacy will not be an observatory on a mountaintop but, instead, a spacecraft the size of a stamp speeding toward another star system. P 33
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Inge Johnsson / Alamy Stock Photo
THREE DONORS, a TRUSTEE, and a LIBRARY
One of the largest libraries in the world is a product of private philanthropy
Inge Johnsson / Alamy Stock Photo
By John Steele Gordon
New York City, with a trivial exception at the birth of our republic, has never been a national or even state capital. So while many of the institutions of London or Paris are the creation of government, the glories of New York mostly express the private successes and aspirations of its residents. There is no greater example on earth of the power of philanthropy than the museums, hospitals, theaters and music halls, parks, universities, and architectural gems of New York City. Consider the New York Public Library. With more than 53 million items in its collection, there are only two libraries in the world that are substantially larger—the Library of Congress, and the British Library—both controlled by national governments. The New York Public Library, however, is a private, nongovernmental nonprofit owned by the
Astor, Lenox, and Tilden foundations. It is a product of the generosity of three of the richest men in nineteenth-century New York, as well as many other donors who have continued to provide major funding in recent decades. Donor one: a cautious giver Libraries go back a long way in New York City. The oldest still operating is the New York Society Library, founded in 1754. But from its earliest days, it has been a subscription library—patrons pay an annual fee (currently $260) to make use of it. As New York City began to explode in size in the early nineteenth century, the need for a free public library became ever ogswell, more acute. In 1838, James C a noted scholar and bibliophile, began talking with his friend and patron John Jacob Astor about establishing one.
Historian John Steele Gordon is a contributing editor to Philanthropy. FALL 2017
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The New York Public Library is not a city agency. It is a private, non-governmental nonprofit. 36
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library’s hours were insufficient. One cartoon of the day showed a sign on the front door reading, “This library open every other Monday, from 9:58 to 10:00 a.m.” And the library was not easy to use—a quarter century after it had opened, fewer than half the books were catalogued. So while 51,856 people used the Astor Library in 1882, New York did not yet have a true public library. Donor two: the collector Unlike John Jacob Astor, James Lenox was born rich. He was the only son of the prominent merchant and Scots immigrant Robert Lenox who, on his death in 1839, left his son several million dollars, plus 30 acres of farmland located between what is now Park Avenue and Central Park. At that time, Lenox Hill was miles north of the city. But as New York continued to roar uptown, the value of the land would increase exponentially, and with it Lenox’s wealth. Lenox never married and was for the most part a recluse. But he was a passionate bibliophile and art collector. Eventually his house at Fifth Avenue and 12th Street overflowed with 50,000 books, including the only Gutenberg Bible in the New World. Stacked on the floor and on tables, many of these books were inaccessible. In 1870, Lenox decided to build on his uptown property a proper library, professionally staffed and organized, to house his ever-growing collection. He hired the distinguished architect Richard Morris Hunt to design the building, and Hunt produced one of New York’s early architectural masterworks between 70th and 71st streets, facing Fifth Avenue and Central Park. (After it was torn down in 1912, there rose in its place the house of Henry Clay Frick, which today houses the Frick Collection, one of the world’s greatest art museums.) The Lenox Library, containing almost entirely rare books, was not open to the public but only to scholars. It added greatly to New York as an international center of culture. But the city still lacked a truly public library. Donor three: the steward Samuel Tilden was born in 1814 in New Lebanon, New York, 150 miles north of Manhattan, son of a prosperous family that manufactured patent medicines. Educated in law, he practiced the profession with skill and success. A careful and gifted investor, he gathered a large fortune. Indeed he was so good at investing that several friends, including former President Martin Van Buren, had him manage their finances. Like James Lenox, Tilden never married, but unlike Lenox he was a sociable fellow and a member of several
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Astor had moved to New York from his native ermany as a young man of 20, shortly after the end G of the American Revolution. He arrived with only five pounds in money and seven flutes that he intended to sell. But he soon prospered mightily in the fur trade and began investing in Manhattan real estate. As the city grew, Astor would buy rural land up- island and wait for the city to reach it. For instance, in 1803 he bought Aaron Burr’s 160-acre estate outside then-suburban Greenwich Village, for $1,000 an acre. By the 1820s, he was carving each acre of land into more than a dozen lots of 25 by 100 feet, which he could sell for a total of around $20,000. By the 1830s Astor was by far the richest man in the country, though not an especially generous one. On one occasion, when a group of men called on him to make a contribution to some worthy cause, he wrote out a check for $50. The men looked at it with some dismay and one said, “Mr. Astor, even your son W illiam gave us $100.” “Well,” said Astor, who had a keen sense of humor, “William has a rich man for a father. I am a poor man’s son.” Still, Astor was no skinflint. He loved the theater and the company of literary men, many of whose incomes he subsidized. And he wanted to leave one substantial legacy to his home city by which he would be remembered. In 1838, he agreed to fund a library in his will with $400,000, then a vast sum. Astor died in 1848 and the library opened in 1854, with nearly 90,000 books in its collection. The building, on Lafayette Street in the East Village, is still there, now the Public Theater. Washington Irving, an intimate friend of Astor’s, was chairman of the board of trustees. By 1895, thanks to further donations by the Astor family, the library had two new extensions of the building, and the collection numbered 225,000. While open to the public without fee, it was principally aimed at scholars, and books could not be taken off the premises. Some complained that the
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civic organizations. His house facing Gramercy Park is now the home of the National Arts Club. Tilden entered politics as an antiTammany reformist. He served in the New York State Assembly, and in 1874 he was elected governor of the state. In 1876 he was nominated for President. While he won more votes than the Republican candidate, Rutherford B. Hayes, Hayes won the Electoral College by a single vote after the most disputed presidential election in American history. Tilden remains to this day the only presidential candidate to have won an absolute majority of the popular vote (not just a plurality) but still lose the election. He was good humored about it, quipping, “I can retire to private life with the consciousness that I shall receive from posterity the credit of having been elected to the highest position in the gift of the people, without any of the cares and responsibilities of the office.” When Tilden died in 1886, he left an estate of about $7 million—with $4 million of it designated to “establish and maintain a free library and reading room in the city of New York.” The will, however, was disputed by some of Tilden’s relatives, and in the end only about $2.4 million was left available for that purpose. But in the 1880s that was still a large sum of money. The money remained in the care of Tilden’s trustee John Bigelow until 1895, when Bigelow arranged a literary merger. Both the Astor and Lenox libraries had begun to struggle financially, with diminishing endowments and growing collections. Bigelow skillfully negotiated an agreement to combine the libraries and merge them with the Tilden trust. The new organization was to be called the New York Public Library, Astor, Lenox, and Tilden Foundations. In 1901, the New York Public Library merged with the New York Free Circulating Library, which catered to ordinary people rather than scholars. A new building was needed and the city agreed to build it on land that had held the old Croton Reservoir between 40th and 42nd streets on Fifth Avenue. John Billings, the first director of the New York Public Library, planned out
a reading room 247 feet long by 78 feet wide, atop seven floors of book stacks with 75 miles of shelves. He devised a system for processing book requests and getting them to readers efficiently. When the library opened to the public on May 12, 1911, the first book asked for was delivered in only six minutes. The architectural firm of Carrère & Hastings created one of the great Beaux Arts buildings in the world, and one of the city’s most notable landmarks. The main reading room ranks with the concourse of Grand Central Terminal as one of the most admired interior spaces in New York. The much-loved stone lions in front of the main entrance were named Patience and Fortitude by Mayor Fiorello La Guardia during the Great Depression. Perhaps Billings’s greatest contribution to making the New York Public Library truly a library for all New Yorkers was to convince Andrew Carnegie in 1901 to donate $5.4 million to build 63 branch libraries throughout Manhattan and the Bronx (Brooklyn and Queens have their own library systems). (As with most of his library donations, Carnegie supported the construction of New York’s branch libraries on the condition that the city provide operating funds.) These neighborhood libraries have for generations been engines of upward mobility for millions of New Yorkers.
Three successful businessmen and bibliophiles gave their books, and money, to create a true public library for New York City: John Jacob Astor (top right), James Lenox (top left), and Samuel Tilden (bottom).
of the main reading room. The clothing designer Bill Blass paid for the restoration of the catalog room. Brooke Astor was so generous in her lifetime with many different projects that the majestic front hall was named in her honor. When the soft Vermont marble of the facade needed restoration in 2008, investor Stephen Schwarzman donated $100 million to get that done while also expanding the book stacks under Bryant Park, the nine-acre green space behind the library. Today the New York Public Library remains an independent nonprofit that serves 17 million people every year, with millions more using its books and information online. The services of the library are free for everyone thanks to a mix of city funding, large gifts, and tens of thousands of dues-paying members. A continuing tradition The world’s greatest public library, The creative giving that created the created by three book-loving donors, New York Public Library has continued throughout its existence. In 1999, the Rose continues to enrich the life of its city and country thanks to the enduring power of family, prominent in New York City real the philanthropic impulse. P estate, donated money for the restoration FALL 2017
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BIBLIO BENEFACTORS
Peabody Institute Library (Baltimore) After building a successful library in his hometown, banker George Peabody went on to construct other Peabody libraries, including this gem in Baltimore, now a research library focused on the nineteenth century at Johns Hopkins
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University. It contains over 300,000 volumes in a high space demarcated by six layers of cast-iron work, covered in gold leaf. Peabody intended this library to be a cultural center for Baltimore, offering public lectures, a music school, and an art gallery, as well as books for residents.
PHILANTHROPY
Baysinger Architects; Michelle Gilders / Alamy Stock Photo
The creation of libraries is a deep vein in philanthropy, starting in the days of George Peabody, often referred to as the “father of modern philanthropy.� A banker by trade, Peabody turned to charitable causes in the early 1850s when he built a library to celebrate the centennial of his Massachusetts hometown. More Peabody libraries followed. Enoch Pratt and Andrew Carnegie picked up the torch for library philanthropy in the 1880s, cementing into philanthropic missions for decades to come the creation of open, inspiring buildings stocked with materials that everyday Americans can use to improve their minds and practical skills.
Boston Public Library (Boston) The first large and free municipal library in the United States was the Boston Public Library. Merchant Joshua Bates donated $50,000 to the library project with the stipulations that it include a room seating 100 to 150 readers at desks, and be completely free.
Baysinger Architects; Michelle Gilders / Alamy Stock Photo
Carnegie Libraries (Marion, Illinois) This quaint library in Marion, Illinois, is one of many built with Andrew Carnegie’s wealth of spirit and funds. Born in meager circumstances, Carnegie credited his rise in part to a kindly man in his town who gave young Andrew access to precious books. Inspired by this experience and the library building of Enoch Pratt, Carnegie determined to make books accessible to the American public. Building over 2,800 libraries, Carnegie provided buildings only if communities could show they would acquire books and make the institutions thrive.
he Library Company of T Philadelphia (Philadelphia) America’s first successful lending library, the Library Company of Philadelphia was one of Benjamin Franklin’s many projects to build up our new civil society. Long before the nation’s birth, Franklin convinced members of his Junto mutualimprovement society to gather funds to purchase books and make them available to the library’s subscribers, starting in 1731. This building still houses the collections of the American Philosophical Society, while an expanded Library Company, free and open to the public and sustained by private donations, takes up residence nearby. FALL 2017
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Evelin Bunder
While federal health-care policy is in disarray, these charities and volunteers are offering help now By David Bass, Madeline Fry, Howard Husock, Caitrin Keiper, Jen Para, Sean Parnell, Evan Sparks, and Liz Essley Whyte It’s no secret that America is struggling with healthcare delivery and costs. But as legislators and advocacy groups wrestle over how to regulate and shape the medical industry, hoping for better results in years to come, nonprofit providers are taking action now— rising to meet needs in their own communities, creatively harnessing unusual or unused resources, and experimenting with new ways to care for the neediest. In this compendium, we take a stroll around the country to sample a few of these bright spots of compassion and ingenuity. While by no means comprehensive, or the answer to all of America’s health-care needs, these charities show that there is an important role for civil society in medicine, one that may need to grow in coming years.
Evelin Bunder
The Doctor Is In. And So Is God.
Soon after launching their own private p rimarycare practice in 1988, husband-and-wife doctors Alieta and John Eck discovered a problem. They wanted to help their needy patients but found that Medicaid’s low reimbursement rates were jeopardizing the financial sustainability of their clinic. “After you pay for overhead, you’re really doing it for free,” says Alieta. So they decided
to try an unorthodox approach: Create a private clinic staffed by volunteer medical professionals specifically oriented to help the impoverished. “It ended up being better for e veryone—the patients, doctors, nurses. Everyone.” After many years of planning and preparation, the Zarephath Health Center opened in 2003 in north-central New Jersey. Based off the Biblical parable of the Good Samaritan, the premise is simple: provide quality, commonsense medical care to those truly in need, without government or insurance help, by tapping volunteers who donate services, funds, equipment, and expertise. The Ecks were partly inspired by Marvin Olasky’s writings describing how private charity can often help the impoverished more effectively than government programs. Today, Zarephath Health Center serves 300 to 400 people per month—men and women with nowhere else to turn for medical care. (Volunteers screen patients for need.) The clinic is open 12 hours per week and doctors volunteer their time in shifts. The Federal Tort Claims Act helps protect medical professionals who volunteer their time—if their services are offered for free, medical malpractice liability isn’t an issue. State laws provide additional protections for most of the 1,200 free clinics in the country, including those in New Jersey.
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Without government or insurance help, medical professionals and other volunteers at the clinic provide quality care that encompasses the physical, psychological, and spiritual well-being of patients. 42
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The church associated with the clinic has also grown—from 150 to 2,000—an expansion that Alieta suspects is partly because people want to be part of a local congregation that’s doing practical good. “It’s an extraordinarily satisfying way to help people and get them on their feet,” she says. A lot of former patients end up coming back and volunteering at the clinic, too. “People are able to help each other out,” says John, “and that’s one of the things that surprise me—many people who are homeless are very resourceful, and once they find help they’re willing to help others as well.” David Bass is a contributing editor to Philanthropy.
From Lost Cause to Long Life
In 1962, a diagnosis of leukemia or lymphoma was a virtual death sentence. Just 4 percent of children diagnosed with acute lymphoblastic leukemia (ALL), the most common cancer in children, would survive five years. Widespread medical opinion held that children with blood cancers should be given palliative care and be made as comfortable as possible until their inevitable death. But medical innovation, including combinations of highly toxic and painful chemotherapy drugs, was beginning to prove that childhood cancers could be repelled. One of the key milestones came at a small, obscure, underfunded hospital in Memphis, Tennessee. Under the direction of a brilliant young oncologist named Donald Pinkel, the hospital attempted what he called “total therapy” on young children with ALL. For two or three years, the children received combinations of numerous chemo drugs, paired with high-dose radiation. The regimen caused severe nausea and had a high risk of infection, and “was considered so overwhelmingly toxic that the trial was assigned to relatively junior physicians under Pinkel’s supervision because the senior researchers, knowing its risks, did not want to run it,” writes Pulitzer-winning cancer historian Siddhartha Mukherjee. And yet, in 1968, Pinkel and his team published some preliminary but astounding results: of 31 patients, 27 entered full remission. Thirteen of the children never relapsed. In 1979, after another decade of results, 80 percent of ALL patients treated with combination chemo and radiation had not relapsed
Evelin Bunder
Early on, one of the biggest challenges was finding a building. But a solution came when a nearby church donated a 900-square-foot facility and congregation members helped reconstruct the building, enabling Zarephath to be debt-free from the start. More recently, the nonprofit has moved to a larger 5,000-square-foot building with five exam rooms, three intake rooms, a classroom, and plenty of room to expand. The Ecks define “health” as stretching far beyond medical care to encompass the physical, psychological, and spiritual well-being of their patients. Nearby churches offer clothing, housing assistance, and a food bank for patients. And Zarephath’s treatment methodology helps patients overcome the deep-seated needs that often accompany physical symptoms. Alieta recalls the story of a 16-year-old girl who arrived in New Jersey from Florida after her mother (who was a prostitute) passed away. Living with her father, she went to Zarephath for help with a cold sore. Soon after, volunteers from the clinic began to provide emotional and financial support she desperately needed. Since then, she’s going to school regularly and has joined a church youth group. In another instance, a 24-year-old young woman, Jennifer, had been living out of her car. She was hungry and had few clothes, and was suffering from thyroid problems. The Zarephath community gave her medication and helped her locate food, long-term shelter, and a job. The next week, Jennifer came back and needed a business suit for her new job, and it turned out someone had just donated a suit in her exact size. She’s now married with a child. “I think doctors would love medicine again if they did this,” says John. “We’ve done it now for 14 years, and after we put in our volunteer hours we always come home feeling blessed.” The Zarephath model has inspired at least one other clinic in New Jersey, founded by an ophthalmologist. The Ecks refuse to accept government support because of the red tape and entanglements involved, and instead raise around $65,000 each year for operational costs from individuals across the country. “We sometimes get checks for $10,000 from people we don’t even know,” says Alieta.
Evelin Bunder
in five years after treatment. They were effectively cured. This miracle of modern medicine took place at St. Jude Children’s Research Hospital, a nonsectarian institution named after the patron saint of hopeless causes. For the first time, a life after leukemia beckoned to children. Today, St. Jude patients with ALL survive five years 94 percent of the time. The breakthrough stemmed not just from innovation but also desperation. Pinkel’s all-out “total therapy” was born of a desperate desire to beat back ALL and other cancers like it. And St. Jude’s desperate push to end cancer’s death sentence started with the hospital’s founder. It’s now a famous story: a young Arab-American performer named Amos Kairouz—wallowing in the depths of the Great Depression, out of work, newly married and with a baby on the way—gave $7 to a Detroit Catholic church and prayed to St. Jude Thaddeus: “Show me my way in life and I will build you a shrine.” Amos Kairouz became Danny Thomas, one of the most popular and recognized TV stars of the 1950s. Six decades ago this year, in fulfillment of his promise, Thomas and his wife Rose Marie began fundraising for a new hospital to treat the deadliest childhood diseases. They set up ALSAC, a charity initially funded by America’s Arab, Lebanese, and Syrian Christian immigrant communities, and built St. Jude, which opened in 1962. While St. Jude became known for its aggressive approach to treatment, it also deserves to be known just as much for the compassion with which that treatment is delivered. Families at St. Jude pay nothing out of pocket for their children’s care—not even for copays on medication, lunch at the cafeteria, or travel and lodging if they come from out of town. And the hospital itself is an environment of hope and good cheer. Bald toddlers race down brightly painted hallways on trikes, and child-life programming helps kids and their families cope with the painful treatments. Moreover, no child is turned away. As long as a referred child meets the criteria for one of St. Jude’s active research trials
in cancer, blood disorders, or infectious diseases, he is admitted. The hospital covers about a quarter of its costs from federal grants and private insurance, but the remainder—the vast majority of the $2.4 million it costs to run the hospital each day—comes from philanthropic contributions to ALSAC, St. Jude’s dedicated fundraising arm. And while the hospital receives numerous large gifts, the average donation is about $30, a reflection of St. Jude’s grassroots support from millions of Americans. St. Jude has reached many other milestones since 1962: the first bonemarrow transplant cure for s ickle-cell disease, the first 3D computer modeling of brain radiation to minimize side effects, the largest release of free cancer genome data for scientific research, the largest long-term study of childhood cancer survivors. So much progress is owed to that first push to conquer leukemia and the hope it engendered in cancer patients and charitable Americans. What made St. Jude’s researchers so daring, so aggressive? Surely part of it was knowing that their support came directly from millions of generous Americans impatient to cure diseases and unwilling to accept a deadly status quo. Cancer-free since 2002, contributing editor Evan Sparks was the 19,039th patient treated at St. Jude. FALL 2017
There’s No Place Like Home
At a time when the number of chronically ill and elderly confined to their homes keeps rising, and the number of those willing to work as home-health aides has failed to keep up, a small program in New Mexico is using community volunteers to close the gap. That there’s a need cannot be doubted. As in so many parts of the U.S., the over-65 population in Santa Fe is expected to grow by 64 percent by 2030. Yet the city has what a local hospital official calls a “total lack of infrastructure” to care for these needs. This is where Coming Home Connection’s completely free, volunteer-provided in-home health care helps—care that often is 24/7 and extends for months and years as well as for the short-term, filling a critical need 43
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Evelin Bunder
For now, the organization operates on only $250,000 a year, supported by the Con Alma Foundation, St. Vincent’s Hospital Foundation, Kresge Foundation, Santa Fe Community Foundation, Rotary Club, and several New Mexico family foundations. In 2009, as the program was and night. The man “had never before felt getting started, CHC received a grant loved” until this time and “felt safe for the of $350,000 from the Robert Wood Johnson Foundation. first time in his life.” The CHC volunteers I met referred Most of what CHC does is defined with disdain to our popular culture as long-term palliative care, end-of-life that “ignores or fears death.” In today’s care, and disability support. Volunteers modern, disconnected society, CHC offers help with meal preparation, getting in the great gift of sharing in the illnesses and out of bed, fall prevention, driving and deaths of other humans—loving, and shopping, changing dressings, and humane, often invisible works of charity. just being a friend. One local volunteer Howard Husock directs the Manhattan specializes in modifying homes with for the elderly, the chronically ill, the Institute’s social entrepreneurship initiative. grab bars at no charge. Donated medical uninsured, and low-income adults. This is adapted from “House Calls that equipment such as wheelchairs and Founded in 2007 by Glenys Carl, Work. Price: Zero” at Forbes.com. walkers are also loaned free of charge. CHC operates in a straightforward Certain volunteers have specialized fashion. Carl recruits volunteers, many training to care for high-need patients, from a local nursing program run by a community college, as well as others with but generally even those patients Connecting the Dots no medical training. Some 400 volunteers require something short of professional Over the past several decades, nursing care. As a practical matter, that have been trained since 2007 and all are prescription drugs have become an required to submit to a background check means CHC can help someone with and attend a three-day training program. incontinence but not with a feeding tube. increasingly important and expensive component of health care. For those The mandatory three-day volunteer A registered nurse in the CHC office with coverage, much of the cost may be training focuses on practical instruction runs patient intake, assessing needs and paid directly by insurance companies around care skills (lifting, transfers, making a care plan. wound care, first aid, following doctor’s or employers. But patients with highCHC volunteers provide gradually deductible plans can find themselves orders, etc.), hospice care, ethical increasing amounts of care for dying decision-making, grief counseling, and struggling to pay for needed medicines, patients, working closely to help them volunteer self-care. not to mention the uninsured. to stay in their homes through their last Fortunately nearly all pharmaceutical The experience of Coming Home days. Though most people prefer to die at manufacturers offer patient-assistance home, this option is generally not funded Connection makes clear that such relatively basic assistance could help many programs that give significant discounts by insurance plans. But many of those stay in their homes. Those suffering from or even free medicines to patients who assisted just need temporary help after qualify. But most patients aren’t aware of chronic, life-threatening illness may not something like knee surgery. Whatever choose hospice care at home unless there the need, teams of volunteers provide is live-in family or a caregiver. Hospice in-home care for as long as necessary, care entails one or two visits a day (to collectively supplying more than 20,000 check the patient’s health and pain levels hours of service annually. and adjust medication) but does not assist One volunteer, Christina Simic, describes how CHC cared for her friend, with daily living. Carl herself, originally a middle-aged man dying of tongue and from Wales, remembers hospice homes (which originated in Wales and England) throat cancer. He had no insurance and no close family relations. Carl told the and has aspirations to build a small, homelike hospice house in Santa Fe, where man, “we will be there for you,” which was a “precious and priceless” gesture, says patients could go for round-the-clock hospice care or respite care for families of Simic. As her friend declined, a team of 25 volunteers took turns with his care day the chronically and terminally ill.
Evelin Bunder
these programs, and they can be challenging to track down and navigate—pharmaceutical companies are understandably a little reluctant to broadcast widely the ways that patients can get free medicines. For the past 20 years, one charity has promoted these programs and connected patients with them. The Boston-based nonprofit NeedyMeds connects cashstrapped patients with patient-assistance programs run by drug companies, as well as other types of aid. NeedyMeds was started by Dr. Richard Sagall, a family physician, and Libby Overly, a medical social worker, who realized in 1997 that the Internet was an ideal medium for making information about patient- assistance programs available. Deanna C. is one patient who benefited greatly from NeedyMeds and the patient-assistance program it connected her to. Diagnosed with bipolar disorder and attention deficit hyperactivity disorder, it took her five years of trying different medications before discovering Abilify, which allowed her to get back to work. But after a back injury, she lost her healthinsurance coverage, and she was unable to afford the nearly $1,000 monthly cost of the drug. By signing up for the patient-assistance program offered by the drug’s maker, her cost was cut to $5 per month. In recent years, NeedyMeds has expanded beyond patient-assistance programs, including directories of free- and reduced-price medical and dental clinics as well as medical-imaging centers that provide lower prices to the uninsured than hospitals. There is also a series of educational webinars addressing a range of topics, including a recent one on how diabetes patients can better manage their condition, and another on the many ways to save on drug costs. In 2009 the charity launched a prescription-drug discount card, which reduces the price of medicines by about 50 percent on average for patients paying at the pharmacy. So far, nearly $200 million has been saved by patients using the card. Because NeedyMeds focuses on connecting patients with the assistance programs of pharmaceutical companies, it’s difficult to gauge the overall savings the group has managed to deliver to patients. But according to Dr. Sagall, between 18,000 and 20,000 people connect with NeedyMeds each week either online or through the organization’s helpline, and patient- assistance programs run by drug companies overall give away about $4 billion in medicines each year. Sean Parnell is vice president of public policy at The Philanthropy Roundtable and author of The Self-Pay Patient.
Social-media Salvation
Charles Curreri was stunned when he learned that his friend Marsha Reekie had myelofibrosis, a rare form of bone-marrow cancer. The two had been friends for eight years, meeting through work. Curreri was an American Airlines pilot captain, while Reekie worked for the Allied Pilots Association and had helped thousands of pilots retain their medical licenses, a requirement to fly. Reekie told Curreri about her disease and mentioned that this was going to be a very expensive journey, even though she had insurance. The lifesaving bone-marrow transplant alone, not including the $1,000-a-day hospital-room charges, was going to cost $500,000. She and her husband were planning to sell their house so they wouldn’t acquire too much debt. Curreri proposed that they start a crowdfunding campaign—a fundraiser through peer-to-peer networks to draw online donations. He’d done it before to raise money for other coworkers: once for a family who lost their home in a fire, and another time for a single parent whose son died. He set up a campaign on behalf of Reekie on GoFundMe, one of many crowdfunding websites, but he didn’t know what monetary goal he should set, ultimately settling on $20,000. “If we even get $5,000, I’d be grateful,” she laughed. Within 48 hours of launching the campaign, the site had raised over $200,000. Three weeks later, donations totaled $354,122. “I never in my life imagined this,” says Reekie. “I’m so, so grateful and humbled. This is lifesaving for me.” GoFundMe CEO Rob Soloman describes crowdfunding as a “digital safety net.” It’s easy to start a campaign and transfer money, which makes fundraising practical for those in need. Many donors also feel more connected when giving directly to a specific person rather than a large organization.
Thanks to philanthropic contributions, families at St. Jude pay nothing for the superb care (totaling $2.4 million per day) offered to their seriously ill children. FALL 2017
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Sharing Is Caring
The Affordable Care Act mandates that everyone have health insurance, qualify for an exemption, or pay a penalty. One little-known exemption allowed by lawmakers sounds to some people like an artifact of a bygone era: “health-care sharing ministries.” But these are not only bursting successes but some of the most intriguing examples today of American mutual aid. The ministries now help more than a million members with similar beliefs pitch in to cover each other’s major medical bills, in some cases even writing checks directly to each other accompanied by a get-well card. For a few hundred dollars a month, depending on the plan (some start at just $45 for an individual), members can have the security of knowing
Volunteers help with meal preparation, getting in and out of bed, fall prevention, driving and shopping, changing dressings, and just being a friend. 46
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others have pledged to help with their major medical bills, without having to pay for insurance. All four of the major networks are Christian in origin and require their members to agree to live according to certain standards, such as not smoking. This helps keep down costs, leaders say, since members are not engaging in unhealthy and risky behaviors. Three of the ministries—Christian Healthcare Ministries, Samaritan Ministries, and Medi-Share— are evangelical Protestant in flavor, while one, Liberty Healthshare, is marketed with more emphasis on avoiding government largesse. Two of them also have branches geared toward Catholics: Christ Medicus Foundation Curo, and Solidarity Healthshare. The ministries do have limitations. Routine medical bills for things like check-ups or eyeglasses or even minor accidents are often not eligible for sharing, which may make some members less likely to seek preventative care. Many people with pre-existing conditions are not eligible to join. Some of the plans have a maximum on how much can be shared per health need (at Samaritan, it’s $250,000, though there is an additional program members can enroll in for unlimited sharing of qualified medical expenses). Some potential customers may find the lifestyle requirements onerous: Christian Healthcare Ministries, for example, will not cover medical bills related to an out-of-wedlock pregnancy. But leaders say their members are usually already meeting the lifestyle requirements when they join. In addition, those who want to join Medi-share or Samaritan must agree to detailed statements of faith. “There’s nothing that any of the ministries require that’s outside of what people are already living in their Christian life anyhow,” says Joel Noble of the Alliance of Health Care Sharing Ministries. Since routine care isn’t covered, members often put away money on a regular basis for standard expenses, and shop around for the best prices, or take the time to negotiate with medical providers. The ministries try to help members save on those regular costs, too. Samaritan enrolls its members in EnvisionRx, which offers discounts on prescriptions. And Medi-share membership now includes access to a telemedicine service called MDLIVE. Michael Gardner, director of communications at Medi-share, used the service earlier this year when his nine-year-old daughter came down with what appeared to be an ear infection. Instead of shelling out $300 and waiting in line for urgent care, he paid nothing out of pocket and was able to see a
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Most campaigns don’t unfold as beautifully as Reekie’s. Nerdwallet estimates that about 90 percent of medical crowdfunding campaigns don’t reach their goal. Lots of money now changes hands this way, though: Between 2010 and early 2016, reports GoFundMe, of the $2 billion raised on its site, $930 million went to health-care assistance. A study from the University of Minnesota found that a similar site, GiveForward, reduced medical-related bankruptcies in all of America by 4 percent. Some critics, such as health-care ethics professor Jeremy Snyder, have raised concerns about the model, arguing that “medical resources for crowdfunding campaigns are largely distributed according to personal appeal, sensationalism, one’s social position, or luck.” He observes that campaigners are more likely to fundraise well if they have a sympathetic story and are media-savvy. Immigrants, people with mental illnesses, the poor, and older adults are less likely to have the digital skills to create a successful campaign. Curreri thinks Reekie’s success springs from something simpler: her humble personality and years of kindness in helping pilots. Most of the more than 2,000 people who donated to her were from the aviation community. “She’s the angel of American Airlines and APA,” he says. “Everybody loves her. A lot of the money donated is just people giving back to her.” Jen Para is web producer for the Houston Business Journal.
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The Road Less Traveled
When the going gets tough, nurses get going—on Health Wagon, a roving charity that provides care to uninsured patients. Health Wagon was started in 1980 by Sister Bernie Kenny, a member of the Medical Missionaries of Mary. Partnering with the Richmond-based hospital St. Mary’s, Sister Kenny traveled throughout Appalachian Virginia dispensing care from a Volkswagon Beetle. The Beetle that ferried Sister Kenny is long gone (though one hopes it might one day find a place in the Smithsonian’s exhibit “Giving in America”). In its place, Health Wagon today operates two fixed clinics and two mobile clinics, traveling regularly to 11 different sites and three annual health fairs in southwest Virginia. doctor online and get a prescription in In 2016, it reported more than 9,000 less than half an hour. active patients and over 33,000 patient At one point ministry leaders encounters between its clinics and fairs. worried the Affordable Care Act would The clinic focuses on delivering doom their systems of mutual aid. Instead primary care that might otherwise be out of it turned out to be a boon, ensuring slow reach for the uninsured, including helping but steady growth for the ministries. patients understand how to manage chronic “As premiums went up, people were conditions like diabetes, update their looking at other options, more affordable immunizations, and maintain basic dental options,” Noble says. “There were a lot care. It also provides screenings for a variety of people that didn’t have choices any of diseases and offers low-cost laboratory longer as insurance companies began to services and free or low-cost medicines. It leave the marketplace.” also connects patients in need of further Ministry leaders feel quite lucky specialty treatment with the University of to have secured their carve-out in the Virginia Health System, including through Affordable Care Act. “We obviously telemedicine that allows patients to access were praying that our members would be care without having to travel long distances. able to continue what we’ve been doing,” The treatment is delivered almost Samaritan’s Anthony Hopp said in 2014. entirely by nurse practitioners as well as It remains unclear what the future holds registered nurses and licensed practical for the ministries as the ACA totters and nurses. All told, eight non-M.D. medical Congress shows no signs of agreeing on professionals as well as about the same alternatives. Noble says he’s confident, number of office and administrative staff though, that the demonstrated value provide crucial primary-care services and popularity of these burden-sharing for 9,000 patients, all for less than $1.7 ministries would allow their participants million, or less than $200 per active to find a place in any new regime. patient and about $50 per patient visit. Contributing editor Liz Essley Whyte is a And it’s in-depth care as well: according reporter at the Center for Public Integrity. to Health Wagon, each patient visit is For more details on health-care sharing about 45 minutes long, compared to the ministries, see “Sharing Health” in our estimated 15 minutes that average patients Summer 2014 issue. with insurance spend with their doctor. FALL 2017
Health Wagon isn’t the only charity taking this approach. Since 1985 Remote Area Medical, composed of over 100,000 volunteers, has treated over 700,000 individuals at free medical, dental, and vision mobile clinics, including a yearly “pop-up clinic” in Wise, Virginia, the nation’s largest clinic event to date. Sean Parnell is vice president of public policy at The Philanthropy Roundtable and author of The Self-Pay Patient.
The Missing Link
It is not often that you see women in tattoos and tank tops laughing alongside women in burkas. But at Found in Translation, a nonprofit training program for immigrant women to become medical interpreters, this is an everyday occurrence. The first languages of trainees include Hindi, Somali, Russian, Portuguese, Haitian Creole, Mandarin, Spanish, and Arabic—all languages in high demand among Boston’s medical providers serving immigrant patients. In the free, 14-week course, held in space donated by one of Boston’s leading hospitals, these women learn to explain to patients in their own language what health-care professionals are saying about 47
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The result is a much brighter future for these women and their families than they would have on their own, and it has made FIT a go-to provider of interpretive services, especially for unusual languages such as Swahili. Meeting a market need, boosting impoverished women, and allowing non-English-speaking patients to receive the care they need: That’s a three in one. Howard Husock directs the social entrepreneurship initiative at the Manhattan Institute. This is adapted from “The Immigrants Doctors Want: The Need for Medical Interpreters” at Forbes.com.
Playing the Long Game
America has faced many drug crises over the past half century. Throughout those decades, the nonprofit Teen Challenge USA has steadily and faithfully reintegrated thousands of former substance abusers into productive society. Today, more than 5,000 people recover from substance abuse in 260 Teen
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turn into income (a recent class included both a doctor and a lawyer)—that America wants to help them adapt and thrive. Participants feed off each other’s successes on this front. The program is competitive, fielding their diagnosis and treatment. Through hundreds of applications for about 30 written examinations as well as role- spots every year. Rigorous essays and playing, they learn the basics of anatomy and physiology, C-sections, chemotherapy, interviews are required to apply, and robust oral and written examinations are blood-sugar levels, and much more. They practice explaining to patients, needed to graduate. Approximately half of each class are living in shelters when conversationally and without medical they enter, often with children. Yet within jargon, what’s going on. In turn, they’ll explain to physicians the concerns of their three months of graduation over 80 percent are employed. patients. It’s a combination that can be Founding board member Mark lifesaving—in more ways than one. Stewart attributes the charity’s success The program was founded by to its intensive selection process— Russian-born Maria Vertkin, whose which focuses on both merit (including parents brought her to Boston after having first emigrated to Israel. A trained English-language fluency) and social worker, she was working in a high- motivation (as reflected in an essay about life setbacks and how the applicant school guidance program for immigrant adolescents and had an idea for how they has overcome them). To maximize its could turn their position of having a foot accessibility the organization made a in two different cultures into an economic decision not to charge tuition. So it had to find other ways to make sure asset—“unleashing their skills,” as she participants are invested and committed put it. She launched the program with to the program. FIT is unapologetic a $40,000 grant from the Kip Tiernan about identifying and assisting only Social Justice Fellowship. those with the best chance to succeed—a Found in Translation serves many reflection of its twin desires to make the missions, not least of which is lifting women and their families out of poverty. best use of its investment and to establish Many of the women, says a former board its reputation among employers as a provider of top-quality job candidates. member, “have been on public assistance The service provided by this and want to get off. They want to be a nonprofit compares with similar services model for their kids.” The organization’s by for-profit interpreter training newsletter features stories of upward programs that charge about $1,000 for mobility, such as that of graduate the basic course but include on average Denise, a single mother who once lived less than half the training (100 hours at in a shelter and couldn’t find a job or an FIT versus 40 at most other courses). The apartment. With the help of Found in exit exam is designed to be demanding, Translation, which initially appealed to and some graduates have had to take it her because it was free and offered child more than once. Vertkin emphasizes that care, she has gone on to hold a full-time Found in Translation’s selectivity and position at United Health Care. Like rigor differentiate it from competitors Denise, many participants find the child that take all comers who can pay. care, professional mentoring, f inancialBut inside the competitive literacy training, and transportation assistance provided by the program to be structure, Vertkin has created a program crucial to its success. culture where classmates help each other This is also an assimilation program, as they go out into the workforce, while demonstrating to immigrant women— FIT comes alongside with job-search some of whom have professional-level assistance, professional support, national backgrounds they haven’t yet managed to certification, and followup training.
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inform the programming, and students absorb them along the way. It costs about $15,000 for students to go through the program for a year, but no one is rejected for lack of funding; the price to participate is evaluated on a case-by-case basis. Because tuition is heavily subsidized, Batluck says many of the centers operate from paycheck to paycheck. But none of the ministries across the United States have closed for lack of funding. Private donations supply 44 percent of the organization’s budget, with the other half coming from sales of curriculum and products and from fees. Rarely do centers accept federal funding, which could require Challenge centers across the U.S. Almost entirely privately funded, Teen Challenge them to compromise their treatment model, but they do occasionally partner rehabilitates participants by adopting a with local governments. long-term, whole-life approach, centered Separate studies of local Teen on Christian programming that spurs its students to transform their living patterns. Challenge centers by the National Founded in 1960 to rehabilitate teen Institute of Drug Abuse and a professor niversity of Tennessee found boys, the program is no longer limited to at the U adolescents, despite its name. Now Teen that 80 to 90 percent of Teen Challenge Challenge has different centers for men, graduates were still abstaining from drugs women, and youth. Each center is a little years later. More anecdotal proof of the different—organization president Joseph program’s effectiveness comes from its staff: almost half of its employees are Batluck compares them to franchise themselves graduates. organizations—with some offering Madeline Fry is a writer from Atlanta. GED programs, and one providing services as a licensed detox center. The average adult entering Teen Challenge has struggled with addiction for ten years and tried rehab half a dozen Millions of Magic Moments times. The length of the program varies from 12 to 18 months, depending on the On any given day at Shriners Hospitals need of the participant. It typically begins for Children in St. Louis, young patients in strollers, wheelchairs, and leg braces with a six-month period of instruction, what Teen Challenge calls “spiritual wander and speak in small voices in the foyer. Parents, nurses, and Shriners boot camp,” followed by a year or so of volunteers with their iconic maroon training, which consists of following a curriculum similar to the 12-step fez hats watch and help as the children entertain themselves with TV, tablets, and program, attending Bible study, and performing community service. their own imaginations while waiting to be called for their appointments. Batluck says that its religious model is essential to helping patients recover not just physically but in every aspect of their lives. This happens even though most of those who arrive start with little or no interest in faith. “You don’t have to believe what we believe to get in,” he says, or even “to make it through the program.” But its core values intrinsically
One boy walks in with his mother, but unlike the other patients, he doesn’t have leg braces or a cast. Instead, his right shoe is thicker than the other, and his right ankle has small, dark, bruised dots. Behind the welcome desk, one of the two men in fezzes holds out his hand for a high-five: “Hey, Conner! How you doing?” Conner, it turns out, is about to go to summer camp, where he’ll enjoy horseback riding and scuba diving. But not too long ago, Conner was in a wheelchair, explains volunteer Don Gabel, a Shriners member since 1974. Thanks to the doctors at the St. Louis Shriners hospital, Conner can walk. “It feels so good to see a kid in a wheelchair progress along and walk out of the hospital,” Gabel says. olleen This happens all the time, says C Hogland, a surgical nurse who has been working at the St. Louis Shriners hospital for 35 years. But the moment a child can walk for the first time never loses its magic. “One girl with forearm crutches was so excited she could walk without them that she threw them on the ground, ready to take off,” she says, laughing. “We were worried she might overstrain her legs.” Another time, a boy upgraded from a traditional wheelchair to an electric wheelchair. “It seems so small, but he gained the ability to be independent,” she says. “He wasn’t strong enough to push the traditional wheelchair by himself, and as soon as he got his new chair that he could move with the flick of his finger, he was racing down the halls with the nurses trying to catch up.” The Shriners Hospitals for C hildren network will treat any child, up to 18 years old, regardless of his or her family’s ability to pay. The hospitals do take insurance, but if a family can’t make the deductible, the Shriners will cover it.
Pharmaceutical manufacturers run very large patient-assistance programs that give discounts or free medicines to needy individuals. FALL 2017
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The first Shriners hospital opened in 1922 in Shreveport, Louisiana. The St. Louis location opened in 1924. In the early days, Shriners members paid a $2 assessment fee to fund the hospitals, which specialized in treating polio. Today, there are 22 hospitals in the U.S., Mexico, and Canada that focus on burn care, cleft lips and palates, spinal-cord injuries, and orthopedics. All the hospitals are funded through private donations and a nearly $9 billion endowment. Shriners chapters hold fundraisers year-round for the hospital, and the members also give their time, logging thousands of hours a month. “These guys will get up at 2 a.m. to pick up a patient and drop her off at the hospital, and then sit and wait hours for the surgery or treatment to get done before driving her back home—all free of charge—and they’ll even buy the child dinner,” says Max Montgomery, public-relations manager at the St. Louis location. “We wouldn’t be able to provide care without them.” The St. Louis hospital alone treats nearly 13,000 children every year, mostly from the Midwest but also from as far away as Belize and Colombia. “We can never have too many patients,” he adds. However, after just two years at its current location, the St. Louis Shriners hospital is already outgrowing its 90,000-square-foot space, sandwiched among three other medical centers. The St. Louis Shriners hospital, which specializes in orthopedic care, also boasts of having a premier regenerative research laboratory in partnership with Washington University School of Medicine. The research team is currently working on stem cells modified to regenerate joints damaged by arthritis. Last year, the team created a living-tissue joint replacement for the hip. Before,
So he founded Volunteers in edicine, a network of pro-bono clinics M children who needed a new hip would that offer free, high-quality care, staffed undergo surgery to receive a metal joint by other retired doctors, nurses, and that had to be replaced every few years dentists with skills and time to spare. because of muscle and bone growth. With They also draw active professionals who the living-tissue technology, the child has carve out a few days each month to a new hip that will grow with him. volunteer. “It’s the kind of experience that “Because Shriners is not under motivates people to go into medicine in insurance restraints, doctors can be the first place,” Arthur Peisner, chairman innovative,” Montgomery says. In fact, of a clinic in Massachusetts, told his the equipment at the regenerative local paper. Individuals who were called research laboratory is so advanced that to medicine by a strong desire to serve a Duke University physician moved his people, only to find the bureaucratic entire research team of 20 to St. Louis realities of practice dispiriting, often to participate in its work. In almost a discover that the mission of VIM renews century of health-care philanthropy, their sense of purpose. Shriners Hospitals for Children has saved The VIM Alliance has grown to and improved the lives of millions of nearly 100 clinics from coast to coast children around the world. (and outside the official tally many more Jen Para is web producer of the Houston clinics that have been inspired by VIM Business Journal. without joining the network). These offer patients a full range of services, including dental work, mental-health care, nutrition counseling, and referral to a nearby hospital when necessary. Patients are Look in the Mirror treated free of charge, with perhaps a and Volunteer nominal fee to fill their prescriptions. Dr. Jack McConnell was enjoying his Each clinic is independently managed retirement. After an eventful career and supported by grants and donations as a pediatrician and pharmaceutical from the local community. researcher who helped develop Tylenol While the free labor of thousands and MRI technology, he and his wife of medical professionals drives these decamped to the beach at Hilton Head, facilities, donors cover building rents, lab South Carolina, for some rest and charges, support staff, and medication relaxation. But he couldn’t help but notice costs. The end product is half a million that the seasonal tourist economy left annual patient visits, all produced at a one in three local residents periodically modest philanthropic outlay of a few unemployed and uninsured. “It was not hundred dollars per patient, including all lab work and medicines. The average cost until I stopped saying, ‘Someone should look into this problem,’ and realized I was per patient visit is $80. Various federal speaking to myself that it really turned and state laws protect the volunteers from malpractice claims. around,” he explained. Because the clinics don’t take government funding, each has the flexibility to tailor its operations to the needs of the community, and they don’t stand or fall according to political priorities. Says executive director Amy Hamlin, “Safety-net clinics are going to be needed for a very, very long time.” Caitrin Keiper is editor of Philanthropy. P
The satisfaction of working in this charitable medical facility “is the kind of experience that motivates people to go into medicine in the first place,” explains one doctor. 50
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ideas Should Donors Invest in School Districts?
Charter-like deregulation might open a door for effective philanthropy on the district level BY NITHIN IYENGAR, KATE LEWIS - LAMONICA, AND MIKE PERIGO
With all the philanthropic energy surrounding K-12 education, few donors invest in school districts. The reasons why are reflected in our recent survey of 289 Philanthropy Roundtable members. It revealed that broad support for improving the quality of public schools coincides with a lack of confidence, in the minds of most funders, in the ability of administrators of conventional school districts to innovate and enact real improvements. That’s why 70 percent of respondents to the survey said that when they want to invest in serious reform models, they primarily do that in charter schools. Six in ten lack confidence in district efforts to “turn around” dysfunctional schools. An equal number question local political commitment to reform, and the ability of typical districts to execute credible improvement strategies. As one respondent put it: “As a matter of policy, we would not fund a school district directly. There is no way to be certain that dollars add value for the intended purpose rather than just replacing dollars reallocated to other purposes.” None of this comes as a surprise. In fact, we typically counsel philanthropists to approach school-district investments with a high degree of caution. Funders who do invest in school districts usually make smaller gifts for discrete programs, like enrichment activities, extended-day programs, technology investments, or teacher training. Two thirds of survey respondents said they would be more willing to support school-district initiatives under two conditions: districts must demonstrate sustained improvement in student achievement, and they must give the schools the autonomy they need to achieve better teaching and improved learning.
In some places, this is already happening. An article earlier in this issue (see page 25) describes how Barbara and Pitt Hyde have invested in an “innovation zone” where traditional public school districts allow more flexible experimentation with new ways of doing things. Innovation zones provide schools within the “zone” more control over their own staffing, curriculum, and budgeting—freeing them, for instance, from some union contract strictures. The schools remain under the district’s jurisdiction, and are held accountable for significant improvement in student outcomes. Over the past few years, the Hydes and other donors have become increasingly involved in innovation zones in Denver, Indianapolis, and Memphis, with some investments exceeding $10 million. While each zone is tailor-made to fit local conditions, the versions in those three cities all loosen strictures to facilitate better teaching, more learning, and accelerated student outcomes—with an emphasis on turning around low-performing schools. Interest in innovation zones has picked up in recent years as legislatures in six states have given school districts the authority to grant select schools varying degrees of autonomy from school-district and state policies. Early results from this new wave of innovation zones show potential. Some funders see a new path that might allow givers to invest in districts and still demand results and accountability. Denver dares to differ High-quality charter schools have for years been philanthropy’s go-to method of delivering significant improvements in student learning, particularly in the most neglected neighborhoods. But innovation zones— with their operational autonomy, promise of improvement in student achievement, FALL 2017
and money-saving use of existing district facilities and other resources—have given some funders reason to reconsider district-led reform initiatives. The Denver-based Gates F amily F oundation (no relation to the S eattle-based Bill & Melinda Gates Foundation) is one such donor. The foundation has long supported improving educational outcomes in Denver, but until recently put its education funds to work mostly in charter schools or nonprofits that support them. It had learned, explains foundation executive Mary Seawell, that its most effective investments were those taking place outside of conventional district schools. In 2016, the foundation revisited this strategy. While continuing its support for charters, the leadership saw promising attributes in Denver’s growing number of innovation schools. Authorized by a 2008 state law, the Denver public school district had 38 innovation schools by 2016, all operating with waivers from certain state and district rules. Four innovation schools were interested in banding together in an innovation zone to gain even more autonomy. The foundation funded Empower Schools, an education nonprofit, to design the zone, which become known as the Luminary L earning Network, and provided two years of launch support. It also helped support the incubation and ultimate approval of the network by the board of education. It was one of the foundation’s first major investments outside of charter schools. Mike Perigo is a partner with the Bridgespan Group’s San Francisco office and co-head of the Education Practice. Nithin Iyengar is a manager and Kate Lewis-LaMonica is a consultant in the San Francisco office. 51
ideas Schools in the innovation zone answer to an independent, nonprofit board that guarantees enhanced flexibility over hiring, curriculum, and budgets via a memorandum of understanding with the Denver board of education. In turn, the nonprofit board is held accountable for the schools’ performance. Patience is a virtue Another philanthropic collaborative worked patiently to create an innovation zone in Memphis. The donor partners include the Hyde Family, Poplar, and P yramid Peak foundations. All had previously made significant investments in improving Memphis schools by focusing primarily on growing high-performing charter schools and supporting effective teachers. In 2010, the Tennessee legislature passed a law creating a state-run A chievement School District with a mandate to take over the state’s lowest-performing schools—the bottom 5 percent—and either run them directly or hand them over to a charter operator. The Achievement School District set the ambitious goal of moving schools from the bottom 5 percent to the top 25 percent. Memphis had the highest concentration of such schools—69 out of 85 statewide. By the 2016-17 school year, the Achievement School District managed directly or via charters 29 Memphis schools serving 13,000 students. The Tennessee law also offered school districts extra flexibility to try out their own reform initiatives. The Memphis-area Shelby County Schools created a homegrown turnaround plan by launching the “iZone” in 2012 to improve a group of under performing schools. The iZone emulated the Achievement School District—setting its sights on moving schools from the bottom 5 percent to the top 25 percent. The school board appointed a regional superintendent, Sharon Griffin, to oversee the iZone. Griffin, a successful turnaround principal, empowered iZone principals to pick their teachers without the usual tenure strictures, and she created a high-quality coaching model to support them. By the 2016-17 school year, the iZone had grown to 21 schools. 52
Jim Boyd, executive director of the yramid Peak Foundation, saw promise in P the iZone but was cautious based on the rise and fall of other reform efforts over the years. “We wanted to see the will of the district to be a true partner,” Boyd says. “It took a while and several conversations with Superintendent Dorsey Hopson pushing us and our pushing back to get to a place where were able to reach an agreement about how we would fund this and work together.” To lay the groundwork for a potential larger investment, the Memphis P hilanthropic Collaborative provided modest financial support for the iZone’s leaders to develop a strategic plan. They also provided funding for improved recruitment and development for high-performing principals and teachers. Boyd explains: “We began exploring investments in specific areas that would not get lost in the district’s general budget.” For its part, the school board ensured that the iZone wouldn’t falter when federal funding ran out in 2016, allocating district funds to make up for the shortfall. Moreover, the school board consistently demonstrated its commitment to the iZone, including the promotion of Griffin to the district’s number-two position, chief of schools. Three years after launch, an outside evaluation showed encouraging results. In a 2015 study by Vanderbilt University, several of the iZone schools were on track to become top 25 percent schools, with many more posting annual double-digit gains in reading and math test scores. Student performance, buttressed by ongoing school-board support, convinced Boyd that the effort merited substantial foundation investment. In 2016, Pyramid Peak and other Memphis funders committed more than $10 million over three years to expand and sustain the iZone. While the Memphis funders showed patience, they weren’t passive. They continued to advocate at the state level to ensure that the state policy remained in effect. And they laid out certain “eligibility” requirements that the iZone needed to achieve to merit substantial funding, including real improvement in student learning and evidence that the district could maintain the initiative over time. PHILANTHROPY
Mind the gap Districts don’t typically design reform initiatives in a way that donors find attractive. In our experience, donors want a clear “investable entity”—a dedicated team they can hold accountable, with control of donated funds that are not allowed to disappear into the school district’s operating budget. Donors also expect to invest for a limited period of time during which the reforms take root and thereafter do not require sustained philanthropic support. These were the key criteria followed by the Mind Trust, an Indianapolis nonprofit that over the past decade has raised more than $73 million to bring creative ideas to that city’s schools. Only recently has the Mind Trust considered district-led school reform. The group was founded in 2006 to increase the number of high-quality schools in Indianapolis, and charters now serve over 35 percent of the roughly 45,000 students who live within the Indianapolis Public Schools boundaries, many of them quite effectively. Yet meanwhile, many of the conventional district schools consistently got D or F rankings from the state. So the Mind Trust released a 150-page report in 2011 that called for increasing autonomy for all IPS schools, to mirror the autonomy that had enabled many of the city’s charters to thrive. While initially met with skepticism, the report eventually helped spur the district’s board and superintendent to embrace many of the Mind Trust’s suggested reforms. That community support set the stage for the state legislature in 2014 to pass a law that gives school districts authority to create Innovation Network Schools. Such schools operate with the autonomy to make decisions about all aspects of their school—both academic and operational—but they are held accountable by the school board for agreed-upon student outcomes. Nonprofits manage the schools under contract with the school board, guaranteeing crucial independence and stipulating clear expectations. The new law gave Mind Trust the green light to “work collaboratively with
the district to grow the number of schools that have the key conditions for s uccess— true autonomy, outstanding talent, and public accountability,” says Brandon Brown of the Mind Trust. His nonprofit was confident that the contractual agreement between the district and Innovation Schools created an opportunity that was built to last—despite any changes in district leadership. So the Mind Trust joined with the Indianapolis Public Schools and mayor’s office to create the Innovation School Fellowship, an incubator for Innovation Network Schools. Fellows have unprecedented opportunities to launch schools that have freedoms and flexibilities similar to a charter school, with the financial support and services of a district school (including a school building at little to no cost). The Mind Trust has worked with IPS to select four cohorts of fellows who have gone on to develop ten Innovation Network Schools, with eight more in the pipeline. Many of the city’s leading charter operators have agreed to take advantage of the fellowship to restart some of the district’s low-performing schools. “This type of charter-district collaboration would have been unfathomable just a few years ago,” says Brown. Early results are promising: enrollment at Innovation Network Schools is up and indicators demonstrate strong academic growth. The Mind Trust carefully structures its giving to meet the unique needs of each school it incubates. It supports planning fellowships for the schools’ leaders, and it provides startup funding to help pay for items associated with a school’s launch. Afterwards, the Mind Trust expects that schools sustain themselves on per-pupil funding from the state. Thus, the Mind Trust’s support for an “accountable entity” provides a catalytic investment for a limited period. And by giving support directly to individual Innovation Network Schools, its investments avoid becoming comingled with the school district’s operating budget. “Our investments are directed toward talented operators and individuals that agree to launch schools with the key conditions for success,” says Brown.
Key features of a healthy innovation zone The early gains of these innovation zones show signs of reinventing what it can mean to invest in school-district reform. Unfortunately these examples are still very much the exception to the rule. Funders interested in following suit would be wise to emphasize the following criteria if they want to work with their own district schools: Set ambitious goals. The most promising innovation zones commit to and hold schools accountable for ambitious goals in teaching and learning. Rather than settle for incremental improvement, such as moving off a list of low-performing schools, they aim to accelerate student learning toward the top quartile of schools. Innovation zones hold schools accountable for such performance via contractual agreements or principal evaluations.
schools live in high-poverty neighborhoods where student achievement lags behind national averages and economic mobility remains elusive. Closing this gap requires a significant improvement in teaching and learning over multiple years, and the most promising innovation zones recognize this. As a result, they provide financial incentives for well-prepared teachers to serve and use teacher residencies and hearty preparation programs to keep talented teachers in the classroom. They provide instructional supports and professional-learning opportunities at the school level. Follow the students. The most promising innovation zones include each of the schools that feed students from kindergarten to high-school graduation. By ensuring that students receive multiple years of great instruction without gaps that throw them back into dysfunctional schools, children are able to “pick up steam” and narrow academic deficits as they age.
We counsel philanthropists to approach school-district investments with a high degree of caution. Here’s a new path that might allow givers to invest in districts and still demand results. Guarantee autonomy. Innovation zones have the flexibility to pick principals and teachers best able to lead classroom improvement, add time to the school day, tailor professional developmental and other supports for teachers, and allocate financial resources as necessary to support the improvement effort. In most cases, the ability to provide such autonomy was created by state law. At the local district level, the autonomy is often guaranteed via a performance contract or board policy that can withstand superintendent transitions or changes in district practices. Guaranteed autonomy distinguishes innovation zones from most turnaround efforts, and is a crucial enabler for putting teaching and learning front and center. Prioritize excellence in teaching. A large proportion of students in low-performing FALL 2017
Aim for sustainability and scalability. The most promising zones have longterm sustainability and scalability as an aspiration from the start. There is a clear commitment to the improvement effort—led by the superintendent and leadership team—often codified in a board policy or contract. There is a clear “investable entity” other than the overall district fund. Districts ensure that the maximum possible state and federal funding goes to the schools. And districts agree to support zone leadership over periods of years. Designs often start small and aim to demonstrate that effective reforms can be sustained and expanded once proven. With success, there is a vision of using the lessons learned to drive improvement across the broader district. P 53
books
Teach a Man to Teach a Man to Fish One doctor’s shortcut to supplying Africa with surgeons BY AN DRE W EVA N S
Brain surgery: The words alone invoke both awe and dread. A surgeon’s ability to expose and heal that sphere of mysteries is amazing and terrifying. Now imagine brain surgery in rural Tanzania, a Cessna flight away from any major urban area, at a poorly equipped hospital, by a “doctor” who hasn’t gone to medical school. The idea sounds crazy, even doomed. But Tony Bartelme’s argument in A Surgeon in the Village is that this idea is not only plausible, it is the best way to build vital surgical capacity across Africa and much of the developing world. Bartelme’s book follows American neurosurgeon Dilan Ellegala as he sets out to solve a crisis of medical capacity in Tanzania. After nearly burning out in neurosurgical residency, Ellegala takes a sabbatical at the Haydom Lutheran Hospital in rural Tanzania, where he hopes to take a deep breath before returning to his high-intensity career track. Ellegala finds Haydom to be a bustling hub of health care—the only source of health care, really—for two million people. In this swarm of activity Ellegala discovers two things that unsettle him: A crushing load of people who need basic brain surgery, and an ever-rotating cast of Western doctors who come in for short spurts. The permanent Tanzanian personnel work around the Western doctors, knowing that their latest saviors will be there only a few weeks. And Ellegala, with his medical-school debt and ambition, knows that he will be one of those leaving soon, too. S o instead of filling his time with surgeries, Ellegala takes another approach, which would become the central idea animating the organization he founds, Madaktari Africa. He selects a promising Tanzanian technician with a few years of formal medical training but no M.D. and teaches him to do basic brain surgery. The process, Bartelme shows, is quite similar to Ellegala’s own training in the United States, minus years and years of formal schooling: See (and touch) the brain, follow very specific procedures under close supervision, then do the procedures yourself. 54
A Surgeon in the Village: An American Doctor Teaches Brain Surgery in Africa By Tony Bartelme
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E llegala’s Tanzanian protégé is Emmanuel Mayegga, and he serves as the test case for Ellegala’s theory, which is that Western doctors can teach relatively complex procedures to capable Tanzanians and break their total dependence on a stream of shortterm foreign volunteers. Mayegga isn’t perfect, but Ellegala wasn’t either while he was being trained. He once drilled too far into a patient’s skull and bore into the brain itself. And just as Ellegala built independence and confidence during his training, leading to stellar competence, Mayegga does the same, allowing him to continue to do lifesaving surgeries after his mentor returns to the U.S. So Ellegala teaches Mayegga. And Mayegga teaches another, so that when he leaves to go to formal medical school, the surgeries continue. And this doctor trains another to do the same, and the surgeries still continue, without Western doctors present, with very respectable results. Lives are saved, and saved by Tanzanian hands. “Teach a man to fish is not enough,” Ellegala says. “Our job is to cultivate leaders to teach.” Ellegala’s pioneering work reminds us that urgent global-health work isn’t limited to investing in preventable diseases. “A huge infrastructure had been created to combat malaria, AIDS, and tuberculosis— important work,” Bartelme writes. “But that didn’t help a mother who lost her child because no obstetrician was there to do a C-section, nor did it help the boy who became an invalid after a motorcycle accident because a trauma doctor wasn’t available to set his bones. Families who lost loved ones because of this dearth of doctors also lost trust in the hospital.” Accidents that cause hemorrhaging on the brain are not uncommon, and when they happen, patients need surgery to release pressure and remove clots so they stay alive. This doesn’t necessarily require cutting-edge neurology. When a baby contracts hydrocephalus, a deadly condition where water builds up in the brain, surgical intervention is required. That doesn’t have to take place in a Western-style surgical theater. W hile the need is expansive, the focus from major funders isn’t there, Bartelme contends. He quotes the founders of the international medical charity Partners In Health, Paul Farmer and Jim Kim: “Although disease treatable by surgery remains a ranking killer of the world’s poor, major financers of public health have shown that they do not regard surgical disease as a priority.” Bartelme does not explore the reasons why major donors have mostly hewed tightly to infectious diseases like malaria, but it is not hard to imagine
why. These diseases are huge killers, and the solutions are relatively simple and easily implemented. Training surgeons is personnel-intensive, requiring deep expertise, long-term maintenance of infrastructure, and enduring management capabilities that developing countries don’t have. So Madaktari Af rica has partnered with American teaching hospitals to bring Western medical expertise in a range of disciplines to promising African medical professionals. The deep relationships necessary for their teach-first model are best suited to smaller-scale initiatives. Ellegala is closely connected to the people at Haydom hospital, and has kept returning there to train up leaders. Intense mentoring is essential to the model he has developed, and that is hard to buy with large grants that can become faceless and bureaucratic. Smaller initiatives can also be nimbler, allowing them to circumvent the blockages that bureaucracies can impose. Ellegala did not choose to teach M.D.s how to operate on the brain—there were no Tanzanian M.D.s at the hospital. He chose the person who showed the most potential. This ability to see past credentials and regulations to the person (who will be the key to success) is essential. The example of Haydom also shows that certain basic medical infrastructure and supplies are a precondition for success. Ellegala could improvise the fashioning of some metal pieces into surgical tools, but if the hospital hadn’t had a C.T. scanner, any brain surgery would have been impossible. The hospital had one of three C.T. machines in the whole of Tanzania, which the Norwegian group Friends of Haydom bought for it. It costs money both to purchase technology and to service it when it breaks. Ellegala’s teaching initiative tries to harness the benefits of short-term medical mission trips while mitigating the drawbacks. Very few Western doctors are able to live permanently in places like Haydom. Ellegala and his wife, a Dutch doctor whom he met in Haydom, love the hospital, but can’t move there forever. By sharing their expertise with local practitioners during these short-term trips, the expertise stays when they leave. Dilan Ellegala’s vision of building up competent local doctors to do surgery is having a greater impact than he could have wrought by wielding his impressive skills on his own. He saw that he had something more fundamental than his technique to share—his knowledge. And he found that he could entrust it to the people he found in Tanzania.
Battle Creek Alchemy Two philanthropic brothers achieved their radically different legacies in reactive opposition to each other B Y ASH LE Y M AY
The Kelloggs: The Battling Brothers of Battle Creek By Howard Markel
Andrew Evans has worked as a consultant in Rwanda. FALL 2017
Prior to chemistry, there was alchemy, the Middle-Age practice of combining mixtures of substances together, along with incantation, in search of elixirs of life. In the modern era we use the word to represent a mixing of substances of little value to produce something of real worth, a magical transformation of banal to beautiful. Can this combinational miracle take place with people? In The Kelloggs: The Battling Brothers of Battle Creek, doctor and medical writer Howard Markel examines the lives of two brothers: John Kellogg and Will Kellogg. One domineering and cruel, the other brooding and repressed, their personalities and actions meld and combust in two monumental efforts at advancing health: the Battle Creek Sanitarium, and breakfast cereal. While each brother would rather be free of the other, it’s their twisted, cyclical relationship that keeps the reaction, and their success, bubbling. John was the chosen one in the family, doted on by his parents and celebrated by the Seventh Day Adventist church—which paid for him to receive the best medical training available in the U.S. Given influence and power at a young age, John was begged to take hold of the Western Institute, a Seventh Day Adventist facility committed to the cause of “health reform.” He wrote articles, edited journals, and spoke around the nation about “biologic living,” an advanced early understanding that well-being is strongly influenced by actions such as eating “healthy” foods and not smoking. W ill, on the other hand, was taught to make brooms. Working long hours in his father’s factory, he rose to be a salesman and showed himself a skillful manager. But accolades for his achievements were withheld, and after a failed trip to Texas to save the endangered broom factory of another Adventist, Will came home to Battle Creek and took a job with his brother, who had big plans for the Western Institute, plans that in hindsight only a sterling executive like Will could make a reality. What emerged was the Battle Creek Sanitarium, a national destination for medical treatment and 55
books recuperation and preventative care, replete with an impressive dining room serving healthful fresh foods produced right on the property of the “San.” As John’s fame grew and guest visits increased, Will ran the organization with exacting precision, and the San became its own nonprofit separate from the Adventist church. John received more and more speaking engagements, courted celebrity patients, and saw his ideas go from outsider’s fancy to growing norm. But the San’s rise did not result in increased rewards for Will, who worked long hours for incommensurate pay, suffering insults and public humiliation from the mouth of his brother often enough to be noticed by staff. Some accounts note that while John biked he made Will jog beside him to record his thoughts, and that he even made Will follow him into the bathroom so he could dictate on the pot. There was no task too menial to be assigned to Will and no performance adequate to meet John’s vision for a better, bigger San. I t was during this era of working together that the brothers began to experiment with creating processed foods, using the dining room at the San as their test audience. Fixated on the gastrointestinal system, John applied his mind to finding foods that spurred regular, smooth bowel movements, reduced gas, and limited constipation. Will took notes and experimented himself. Guests at the San were welcome to purchase boxes of these foods, and one of the dry cereals, a flaked corn, was increasingly popular. Who perfected that flaked corn process would be a source of mystery, animosity, and legal wrangling for years to come. W ill told his imperious brother, who was always in search of more money to build up the institution, that there was potential in the cereal business. John wasn’t
convinced, claiming that the Sanitarium’s inventions were meant to be enjoyed by all, not used for profit. But when former San patient C. W. Post left the dining room and started a lucrative cereal business, Will decided to pursue his own venture. A devastating fire delayed his departure, but by 1903 John’s rebuilt San was gleaming, and Will was finally free of his brother’s oversight. Even decades later, Will would tell employees leaving the San that “your happiness is just beginning.” Not long after Will declared his independence, the turbulence between the brothers boiled over. Will bought from his brother the right to sell the San’s pressed-corn breakfast food. Under Will’s discipline, his Kellogg’s cereal company grew and grew and grew by selling “corn flakes” to Americans seeking more convenient, tasty, and healthy breakfast foods. John cultivated a rival cereal company, also called Kellogg’s. Will litigated. In court, the brothers’ differences came into stark relief. John demeaned Will, claiming that calling the company “Kellogg” took advantage of John’s good name, as he was the only famous Kellogg and his medical support for the product was assumed. He spoke of Will as his lackey and flat-minded minion. Will was cool, logical, and to the point—the point being that Will had John’s relinquishment of the rights to corn flakes in writing, and that the name on the box was W. K. Kellogg, one Will made popular through mass advertising and quality production. The courts ruled in favor of Will, and the brothers, now bitterest of enemies, never resumed their relationship. T he brothers were on divergent paths. John continued to be well known, but by his old age he had lost his status in the Adventist church, and control of the San. While he was still known for treating patients like Henry Ford, John D. Rockefeller Jr., and George Bernard Shaw, he was increasingly known in medical circles as something of a quack. His behavior
Sibling rivalry fueled the innovations of the Sanitarium, and created the golden-brown flakes carrying calories and vitamins to countless Americans. 56
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grew erratic; he was seen in Florida sunbathing in a ragtag man-thong. The trajectory for Will was quite different. Though reticent to the very end, and by no means a happy man, he hosted Hollywood belles in Pomona, cultivated one of the finest Arabian horse stables in the United States, and successfully ran a company known the world over. He left the bulk of his fortune to the ellogg Foundation, hoping needy W. K. K children could have more of the joy that was missing in his life. Today this foundation, located in Battle Creek, has $9.5 billion in assets and gives over $400 million a year. One of the largest foundations in the United States, it was one of the foremost funders of the community-college movement, and has taken on causes affecting women and children like dental care, early-childhood education, and support for working families. Interested, like the Kellogg family, in transforming human nature and society, the foundation has funded many liberal organizations like the Tides Foundation, NAACP, Southern Poverty Law Center, and others promoting equality causes. John, although certainly less wealthy than Will, nevertheless made serious contributions of time and treasure himself, in his case to the disreputable cause of eugenics. John fell for many fads of his day, more and more so as he aged, and he used his star power in retirement to gather luminaries to promote manipulations of the gene pool for social betterment. John left his assets to his philanthropy, the “Life Betterment Foundation,” for this purpose. Markel documents John’s actions that diverged from the cold utilitarianism of the eugenics cause—he adopted many children off the streets and from dire situations, with the full expectation that discipline and a healthy environment could turn them around. The eugenic stain on his character, however, will never wash away. At points it appears that Markel is trying to restore an appreciation for John.
He certainly argues that his medical achievements are undervalued. And while the doctor certainly had some wild theories, some of his “radical” ideas appear commonsensical today. There are also many pages dedicated to the evolution of medicine in the Kelloggs’ day, and anyone curious about the development of medical knowledge will find plenty to soak in. Although Markel makes a valiant effort to do them both justice, the majority of ink is spilt for John and not Will. Perhaps made chary by being forced to defend his reputation in a courtroom, Will was hesitant to even release bios of himself for business publications. He had his personal diaries kept under lock and key at the W. K. Kellogg Foundation, and even today no author may view them without foundation approval of the author’s final text. Markel would not agree to that, and therefore never saw the diaries. Instead he used as a research base a biography of Will produced by his grandson. And of course, he has Will as described in John’s copious letters and notes. But overall, Markel’s book is not about either John or Will. It’s about their psychologic drive to outdo, belittle, and push one another. It was this cocktail of cruel competition that fueled the public-health innovations of the Sanitarium, and the golden-brown flakes delivering vitamins and calories to countless Americans who just wanted a healthy, filling breakfast. Ashley May is managing editor of Philanthropy.
Settling for Stasis Americans use technology for comfort, not revolution BY RYAN ST REET ER
For those old enough to remember life before the Internet and cell phones, the past 30 years may seem like an era of revolutionary change. Together with other new digital technologies, the Internet has made almost everything easier: from banking to travel to finding dog-sitters, even meeting future spouses. During this same period, European communism gave way to messy democracy, while the rise of China in the East has shifted the balance of global power. Terrorism has gone from a localized phenomenon in places like Britain and Israel to a cancerous global threat. There’s a widespread sense that rapid change is the new normal—even in charitable circles, where prominent donors have committed themselves to “disruptive” solutions rather than conventional twentieth-century models of philanthropy.
The Complacent Class: The SelfDefeating Quest for the American Dream By Tyler Cowen
FALL 2017
Tyler Cowen’s book The Complacent Class argues the opposite. Beneath the roiling surface of change, Cowen argues, contemporary America is now characterized by “stasis”—a pervasive aversion to risk, change, and conflict, and a preference instead for comfort and convenience. While technological advances can indeed upend the status quo, Americans very often use technology to further entrench their own positions and ideas, along with others who think and act like them. In contrast to the restless adventurism of our forebears who risked everything to launch new lives, build towns, and create businesses, we have become a nation of homebodies less likely than ever to try something new unless Yelp or TripAdvisor has approved. And Cowen isn’t talking only about legions of adult men who could work but instead stay home playing video games. He’s talking about middle America. For one thing, Americans move a lot less than they used to. This reinforces segregation by income and social class. And despite a widespread belief that we are an entrepreneurial country, startups as a percentage of all businesses have been declining for three decades. This means not only fewer fresh enterprises, but also that fewer employees work for someone who has started a company, fewer mentored by an entrepreneur or inspired by that creative energy. We are growing accustomed to steady advances in efficiency and quality, that is true, but we have lost our taste for large-scale advances that truly change people’s lives the way that the introduction of electricity, air conditioning, and automobiles did. As a young Facebook employee once famously said, “The best minds of my generation are thinking about how to make people click ads.” To top it off, a smaller set of larger companies are dominating important industries. There’s a lack of competition in major sectors like finance, health care, and manufacturing, accompanied by sluggish growth in GDP and living standards. Cowen compares 1900-1950 with 1965-2015 and concludes that the scope of change in living standards in the past 50 years does not come close to what Americans experienced in the first half of the twentieth century. The personalization of music playlists and the improvement of music quality through digitization are nothing compared to the life-altering introduction of radios and televisions in the first place. Economic stasis has been matched by other forms of political and cultural complacency. Cowen writes that even political unrest in our era pales in comparison to the intensity, disruption, and violence of the 57
books civil-rights era, which may strike readers as a good thing. And it is. But increasing stability comes at price. Striving to overcome deep societal blockages, at risk to personal comfort and well-being, has historically been a source of innovation and progress. It’s a paradox that the very technological advances making us feel as though we are living amidst rapid change are often responsible for our stasis. “Most Americans,” Cowen writes, “don’t like change very much, unless it is on terms that they manage and control, and they now have the resources and the technology to manage their lives…more and more, to the country’s long-run collective detriment.” Cowen’s most original observation concerns “matching,” which he calls “the grand new project of our time” and “the supreme skill of the complacent class.” We now have the ability to arrange our lives according to our preferences unlike ever
offerings for your children in the community is possible without having to take time to have multiple conversations. But our tribal human nature leads us to use matching technology to associate with others who like what we like and think like we do. This is why the rise of the Internet has seen greater polarity in people’s political views and sources by which they keep informed. Given a choice, humans avoid the discomfort that difference brings and latch onto what is familiar and comfortable. We are conformists at heart. Reform, let alone transformation, is the natural goal of very few people. Along with the kind of life that technology has made possible, government has been a major contributor to complacency over the past 50 years through its role as a provider of security through entitlements and social-welfare programs. Most Americans favor the largest money-transfer programs regardless of their politics, making political
Will we Americans start addressing the deep conflicts knocking at our door, or just keep fine-tuning our Netflix preferences? before in human history, which in turn means we are less likely to put ourselves in situations that challenge our preferences and interests. Striving to confront life’s big challenges head-on has given way to averting them with better technology. At the level of personal experience, matching is quite positive. As I listen to music on my app, I receive recommendations for other music I might like. As I shop for products online, I receive special offers for similar products I might like to have but never would have found on my own. Finding associations, restaurants, churches, and people with similar interests is remarkably easier compared to a past in which hours and hours of sifting through Yellow Pages, visiting libraries and city halls, and making numerous phone calls yielded mixed results. Learning what people in your neighborhood think about the local school and extracurricular 58
door, while the rest of America fine-tunes its Netflix preferences. On a local level, some community leaders and philanthropists have made a good start by joining together with the aim of injecting more appetite for adventure and risk into today’s rising generation. Getting teenagers out of their comfort zones and into elements they can’t control, through programs ranging from the Scouts to Outward Bound to camps across the country, will help them face challenges, take responsibility, and get their faces out of screens. Programs that foster entrepreneurialism, such as Venture for America and Junior Achievement, are helping to normalize economic risk again. Institutions like the University of North Dakota’s Center for Innovation are expanding education to include real-world experience with business creation. Any substantive volunteer opportunity like Habitat for Humanity that encourages hard work and team coordination helps ground young people in concrete productivity. This is an older American view of the pursuit of happiness: that striving for betterment, overcoming obstacles, and confronting challenges is part of the game. By contrast, the complacency that Cowen diagnoses understands happiness as the alleviation of discomfort, and the validation of personal preferences. At what point, one wonders, did the “American Dream” become less about striving and more about never facing stress? By showing how progress has, ironically, sowed the seeds of cultural stagnation, and even led to a peculiar distaste for progress itself, Cowen has challenged conventional views of what is good for us today. There are many deep implications of that for philanthropists to think through. Do we want to make life “better” for ourselves in ways that could make life worse for our children? Are we willing to improve prospects for future Americans in ways that might make adults a little less comfortable today? Sometimes, carefully defining what’s “good” is the first step in doing good for society. But that won’t happen unless we first realize we may have a problem. And that comfort might not be the best goal for culture reformers.
competition and debate mostly an activity at the margins. I n the end, Cowen doesn’t think this state of affairs can hold. Just as we are perfecting the art of complacency and creating greater contentment in our daily lives, the world is rapidly careening toward instability and conflict. The federal budget cannot continue to grow entitlements at the present rate. Global trends away from democracy and stability are alarming and suggest new forms of significant geopolitical disruption. Cowen does not predict how things will turn out in the end, but he is confident that the complacent class is in for a rude awakening in the coming decades. The question for philanthropy is whether givers will be shocked like everyone Contributing editor Ryan Streeter is director else, or whether prescient donors will start of domestic policy studies at the American addressing the deep conflicts knocking at our Enterprise Institute. PHILANTHROPY
{books in brief } The Jonathan Effect: Helping Kids and Schools Win the Battle Against Poverty By Mike Tenbusch
Calling All Churches A Detroit school mentor asks congregants to step up
Within the Detroit public-school system, only 45 percent of fifth graders from 2004 made it to graduation by 2011. That means many of the remaining 55 percent fell into the demographic of “disconnected youth”—the more than 5 million American young people between 16 and 24 who are neither working nor attending school. The problems thwarting at-risk students start before they leave for school each morning, writes Detroit native Mike Tenbusch in The Jonathan Effect. He estimates that at least half of the students in high-poverty public high schools come from a home environment lacking stable living conditions and an expectation of everyday school attendance. They need help beyond the walls of the classroom. Tenbusch argues that one-onone relationships with adult mentors can help these kids stay in school and succeed. Drawing from the Biblical story of how Jonathan’s friendship steadies and strengthens David, he calls for churchgoers to love, inspire, and assist urban high-school students. He suggests this can change the course both of many young lives and of communities. Tenbusch’s ideas are not new or dramatic, but his voice of experience gives them new life. Tenbusch has spent his life focused on inner-city schools. Where he grew up in Detroit, shootings and gang violence
were frequent, and while a member of the citywide school board he was more likely to encounter fights than academic excellence during high-school visits. He has come to believe that churches can supply the best antidote for these problems—adult mentors—and calls on church leaders to marshal “relational capital.” Because it focuses on church-school partnerships, the book is targeted toward a religious audience. Non-churchgoing readers may be inspired, but the emphasis is on using churches to bring groups of people into schools to reach individual children on a large scale. All people can mentor, Tenbusch argues, but Christians have a particular calling: “No other sector in American society has the depth and breadth of people who can and should help.” He points out that there are 300,000 churches and 100,000 public schools in America. If one third of churches adopted a school, there could be a bloom of partnerships. Tenbusch dates the genesis of churchschool mentoring to the early 1990s, when pastor Tony Evans connected his Oak Cliff Bible Fellowship with a nearby Dallas high school. More recently, he cites a thriving example from his hometown. Oak Pointe Church made a commitment to partner with Cody High School in Detroit two years ago, and since then, church members have sold concessions at home games, met students for lunch every other Monday, taught piano, and helped in the STEM lab. (Another worthwhile effort close to home is Kids Hope USA, a Holland, Michiganbased nonprofit which has fostered 1,000 church-school partnerships in 34 states.) From this and other examples Tenbusch draws practical tips, like the value of having a liaison represent the church in the school, and using programs like clothing closets to establish a presence. FALL 2017
When churches partner with schools, the biggest results come from the establishment of individual relationships. Tenbusch characterizes the Jonathan commitment as more than a traditional mentoring role. He identifies four crucial elements: Both Jonathan and David enter the relationship freely. There is no formal time requirement. The goal is for David to reach a long-term achievement (like college, marriage, or career). And because it is based on friendship, both members are expected to give and take and stick it out through thick and thin. Weaved in between each chapter of the book is a story of the author’s own friendship with a teenager named Keyvon. When Tenbusch met Keyvon at Cody High School, the boy offered to fight him. Instead, the two of them went out for a meal. Years later, Tenbusch maintains a connection to Keyvon; when he was kicked out of his house Tenbush helped him find a job. Readers might expect to learn that Keyvon is now happily employed and living a self-sufficient life. But at the time this book published, Keyvon was facing four years in prison for selling cocaine. Tenbusch, a lawyer, planned to represent him in court. Even after years of friendship with a stable adult, Keyvon could be going to prison. The Jonathan commitment will not guarantee that Davids live successful lives. Tenbusch warns mentors and churches against thinking they’re going to save the world by entering these partnerships. “You will not change the community or city where your school is located,” the author explains. “That work will be done by the David you befriend.” In the meantime, these relationships are meant to benefit both partners. And they will unfold in the imperfect, up-and-down, two-steps-forward-one-step-back way that fallen humans navigate life. —Madeline Fry 59
president’s note Tax Reform and Philanthropy’s Three-Percent Solution
tested poverty programs have reduced the incidence of hunger, homelessness, and other forms of material poverty. But this public spending has also coincided with the collapse of families, the breakdown of the social fabric, the opioid epidemic, and a slowdown in upward mobility. There is not much the government can do to strengthen our tradition of neighbor helping neighbor, to put families back together, or to restore a spirit of optimism that the American Dream is still alive for those who work hard and act with integrity. This is primarily the work of cultural institutions and civil society: churches and other religious congregations, mentoring initiatives, job fairs, character-building programs such as youth sports, Scouting, and robotics. A new infusion of philanthropy focused on social capital could make a huge difference. The second great opportunity for donors is to ramp up philanthropic spending on K-12 reform, building on one of the greatest success stories of charitable giving in recent decades: the growth of multiple charter-school and religious- and other private-school networks where low-income children excel academically. These learning environments, made possible by philanthropy, offer families high-quality options while most of the existing public K-12 system is in crisis. Substantial increases in K-12 giving could spread these successes, overcome policy barriers that prevent public school systems from reforming themselves, and transform today’s ineffective teachers’ colleges into centers of excellence. A third opportunity for donors is to achieve dramatic improvements in higher education. The future of our flagship state universities is in jeopardy at a time of tight state budgets, unsustainable tuition increases, and damaging political correctness. Donors are in a position to protect excellence, drive needed reforms and innovation, and protect free inquiry on these campuses. Similarly, private funders can strengthen the community-college system that is crucial in career training and upward mobility. Charitable giving is not just the province of the rich. It is a mass phenomenon in this country. Allowing all Americans to deduct their charitable giving from their taxable income is a crucial first step in achieving a “three-percent solution” for philanthropy. It would build on the long American tradition of citizens stepping up to solve problems without waiting for government to act. And it could supercharge social healing and national excellence in America.
Three broad objectives should guide tax reform. Restoring vigorous economic growth. Simplifying the tax code. And strengthening civil society, so that fewer decisions are made by the federal government and more are made by voluntary associations. One of the best ways to achieve this last goal is to increase charitable giving to three percent of GDP. Tax reform could help achieve this goal by making the charitable deduction universally available to Americans of all income levels. America is the most charitable country on earth. No other country comes close. For the last 50 years, Americans have voluntarily given two percent of GDP for charitable causes. In Britain, France, Germany, Japan, Canada, and other major industrial democracies, charitable giving is one percent of the economy or much less. Last year, Americans gave an astonishing $390 billion to charity, plus volunteer hours that are worth at least that much or more. But we can do better. Charitable giving is central to American society. It is the lifeblood of our churches, synagogues, and other religious institutions. It has helped to make our private and public colleges the best in the world. It is indispensable for the flourishing of the arts, science, medical research, and natural habitat. It provides food for the hungry, care for the sick, shelter for the homeless. In Houston and Florida we are seeing the amazing work of volunteers and private givers in response to Harvey’s and Irma’s devastation. Charitable giving also has the potential to do much more for America. Imagine if instead of two percent of GDP, Americans gave three percent. That’s a reachable goal, not a utopian dream. And at the current pace of our economy, it would yield an additional $200 billion donated every year. What would $200 billion in extra charitable giving do for our country? We can’t say for sure, because donors follow their own experience and convictions to find the best ways of making a difference. That’s why decentralized charity is so effective. There are three great opportunities, however, where a substantial increase in charitable giving could help achieve breakthrough solutions for national crises over the next decade. The first is to offer hope and opportunity for low- income families and neighborhoods. The trillion dollars Adam Meyerson, President spent annually by federal and state governments on means- The Philanthropy Roundtable 60
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Whitney Ball established DonorsTrust to help people just like you. She believed in limited government, personal responsibility, and free enterprise. She built those principles into DonorsTrust’s DNA, along with a commitment to preserve and defend the intent of donors to use their charitable giving to advance those ideas. At DonorsTrust, we believe private giving, as opposed to governmental involvement, is the best answer to society’s needs. Our clients think so too. In fact, they’ve contributed over $1 billion to organizations that exemplify these ideas — in public policy, social welfare, religion, health, the environment, economics, governance, foreign relations, and arts and culture. We lost Whitney in 2015. DonorsTrust was her legacy. Let us help you secure yours. Call us at (703) 535–3563 or visit donorstrust.org to discover how to simplify your giving, create a lasting legacy, and protect the principles of freedom we cherish.
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The Philanthropy Roundtable extends its sincere thanks to the donors listed below for their generous support of our 2017 Annual Meeting.
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The Ahmanson Foundation Anonymous (2) H. N. & Frances C. Berger Foundation Edyth Bush Charitable Foundation M. J. Murdock Charitable Trust Dr. Phillips Charities As of September 22, 2017
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