NCRP Statement Regarding the Philanthropy Roundtable's "How Public is Private Philanthropy: Separating Myth from Reality"

June 30, 2009 — The National Committee for Responsive Philanthropy (NCRP) is pleased that the Philanthropy Roundtable is contributing to the dialogue in our sector about the public's role in private philanthropy. The monograph they recently published, How Public is Private Philanthropy: Separating Myth from Reality, explores many critically important issues and adds to ongoing discussions. Unfortunately, the authors asked the wrong questions and their conclusions miss the mark.

According to authors Evelyn Brody of the Chicago-Kent College of Law and John Tyler of the Ewing Marion Kauffman Foundation, attempts to characterize private philanthropic assets as "public" or "partially-public" dollars threaten the autonomy of philanthropy in America by opening foundations to legislative interference into their governance, mission and decision-making. Efforts to reform the sector, therefore, should not be associated with such "distractions." The final paragraph to the foreword sums up their argument succinctly:

Our analysis does not defend philanthropies from government involvement by saying, "You can't do this to us." Instead, it says, more modestly, "You can't do this to us on the grounds that our assets are public." Stated differently, if philanthropic assets cannot fairly be characterized as public money, proponents of increased government or public mandates must put forth other grounds for imposing on the purposes, structure, and operations of foundations and other charities. If successful, this monograph makes that case and effectively challenges the term "public money" and its application.

The authors' arguments are based on the flawed assumption that private institutions are wholly without external stakeholders who have an interest in how those organizations are run, or what their activities might be. Our nation's recent experience with the bailout of the automotive, banking and insurance industries has demonstrated that this is not the case. Private institutions have a variety of stakeholders beyond the official "owners." For foundations, one such group is taxpayers.