Private Money, Public Good

How Public is Private Philanthropy? by Evelyn Brody and John Tyler in pdf published by The Philanthropy Roundtable. The authors conclude that there is no basis in curent law for treating private foundations as public money to be controlled in their grants, say, by government action. The poor will have to look to the taxpayer, not the foundations for their entitlement programs.  As a practical matter, if the government begins to treat foundation money as their money, fewer foundations will be set up. A foundation, if controlled in its grants by government, would be just another, more elaborate way to pay taxes. Why bother?

To level society, NCRP, we need a bigger bulldozer.  Let's abolish, for example, intellectual property.

Comments

[Sam]

I strongly disagree with your suggestion to abolish intellectual property. I think that a lot of important production and research (such as the creation of software and entertainment, or the research behind medical technology) is only incentivized by the profits they create when sold under intellectual-property-derived monopolies. These goods/ideas would exist at much smaller levels in the abscence of patents and licensing laws.

The only way to replace the goods and services these industries provide would be through government-funded efforts. This would be extremely clumsy and inefficient. Can you imagine the governemnt deciding, for example, what movies to shoot this year, which web 2.0 websites code to improve, or what types of erectile dysfunction drugs to research? Even with industries in which the government has a more legitimate idea of how to proceed, such as pharmaceutical research, they still lack the efficiency and precise response to public demands of the market mechanism.

Assuming that your suggestion was meant literally, and was not an extreme suggestion meant to imply lesser measures, I think you are deeply in error.

[Phil Cubeta]

But surely all good creative work is done for love?

[Sam]

I would argue that only the most artistic of creative work (writing novels, painting, etc.) is done purely for love, and that a lot of other important creative work (research, hollywood movies) is done at least partially for profit. And even artists must eat.

[Phil Cubeta]

The benefits of intellectual property are much discussed and backed by the owners of it. The downside is less often discussed, and the losers are millions whose creativity is stymied by the attorneys. A balance? Fair use? A little more slack in the system?

[Raul Chadwallah]

An odd feeling to be a bedfellow with folks at the Roundtable, but when government treats private philanthropy as its own, private philanthropy loses some of its ability to shake a fist at government and at business. Ask the folks at the Alliance for Justice how frequently it is that elected officials attempt to curtail nonprofit advocacy rights. Then ask your favorite advocacy organization where most of its funding comes from. Ask the same question of organizations unpopular with individual donors: those serving immigrants, or returning prisoners, or any of the other riff-raff that won't make it onto Oprah.

Private foundations, for all their faults, have an important civilizing role to play. It's not a matter of squeezing entitlement money out of private foundations -- elected officials will always attempt this because they'll do anything to avoid raising taxes. The question is who will most likely give voice to the poor in the deliberations that will determine the distribution of entitlements? Private foundations will always be key funders of those groups nobody else will fund.

It's important to remember this before you pick up your torches and pitchforks and attempt to storm the atrium of the Ford Foundation.

Full disclosure: I don't work at a private foundation, but used to.

[Phil Cubeta]

I like your answer a lot. In investment planning advisors look for "uncorrelated assets" to balance out a portfolio. These are assets that move independently of other asset classes. Private foundations, it seems to me, for all their hubris, idiosyncracies, and manias serve as uncorrelated soical assets in a world dominated by markets and government. To hitch private foundations to either business or government would reduce the fertile variablity in our social systems. I only wish we had more of that; wish we had the equivalent of private foudations funded with micro-gifts, say, and ruled by an elected board.