In a sweeping, insightful history, Olivier Zunz has traced the evolution of American philanthropy over the past 150 years and its contribution to democracy and civil society. What is particularly satisfying is his focus—somewhat rare among books about American philanthropy—on the extent to which foundations and other grantmaking programs have been involved in shaping national affairs and public policy. This involvement, Zunz rightfully claims, has been an important force not only in strengthening American democracy but in establishing philanthropic institutions as integral parts of society.
From the first modern foundation, the Peabody Education Fund, established in 1867, to the recent growth of mega-organizations like the Gates Foundation, Zunz explains the transformation of charitable giving from individual acts of financial relief to the formidable efforts of institutions to influence education, health and welfare policies, and the operations of government and private institutions. Zunz’s interest in political and policy advocacy leads him to concentrate almost entirely on the country’s biggest foundations, such as Ford, Rockefeller and Carnegie. Smaller family foundations, some 100,000 in number, constitute by far the largest part of our foundation galaxy, but Zunz pays them little attention because they offer less financial support than their larger counterparts and have shied away from policy and advocacy.
Similarly, Zunz gives short shrift to the hundreds of community foundations (some with very large assets), other grantmaking programs like the United Way and the many religiously oriented funders. These organizations, too, tend as a rule to avoid giving to activist and otherwise contentious organizations, yet they support an enormous number of essential services at the local, state and regional levels, something that the largest foundations have been unwilling and unable to do. The tragic impact of Hurricane Katrina on low-income and minority constituencies in Louisiana, Mississippi and Alabama was partly caused by the failure of large foundations to build in those states a nonprofit infrastructure that could have assisted in the rebuilding process. Perhaps Zunz will write a second volume about the smaller yet significant players in the history of American philanthropy. Their story deserves to be told.
The government recognized the importance of philanthropic institutions when it passed the Sixteenth Amendment in 1913, which besides instituting the income tax also laid the groundwork for tax exemptions to charitable organizations and donors. “Tax exemption has not only nurtured philanthropy in society, it has entrenched it,” Zunz observes. One can question whether tax exemption has been as vital to charitable giving in America as its proponents claim. After all, before 1913 a tradition of individual and institutional giving had already been established here. Yet how many foundations, United Way campaigns and other forms of giving would have developed without tax incentives? Also, because the United States has established through the years a charitable sector far greater than that of any other country, it has claimed the reputation as a nation of great individual generosity. But if the majority of people give primarily because they receive a tax break, can it still be said that Americans are the most generous—or altruistic—people in the world?