Philanthropy New Zealand News July 15, 2005 PHILANTHROPY AND DEMOCRACY Rachel's summary: "Democracy is in crisis in the so-called advanced countries of the world and in the so-called developing countries. Here I will reflect mainly on the United States because I know it best. In other countries the issues of democracy will differ. In most cases with which I am familiar the differences will be matters of degree. But the obligations of the philanthropic sector are the same." -- Stephen Viederman By Stephen Viederman* "Hope has two beautiful daughters: Anger and Courage. Anger at the way things are, and courage to change them." -- St. Augustine The question of the session put forward by the organizers of the Philanthropy Australia conference session was: As I see it what is the role of philanthropy in modern democracy? My answer: To help ensure that modern democracy fulfils its obligations to the commonweal by keeping governments and other institutions wielding power, including the corporations, the media, educational institutions, remaining accountable and transparent to all citizens and residents. Philanthropy has a unique opportunity, and therefore responsibility, since it is master of its own resources, and not reliant on outside funding. Democracy is more than voting, despite the rhetoric in the U.S. media today. It requires of us all a commitment to the commonweal, the common good: to justice, equity and community. Julian Burnside, in his opening address to the Philanthropy Australia conference on October 9 spoke eloquently of the need for this when he directed our attention to the vulnerable, the powerless, and unpopular. Democracy is in crisis in the so-called advanced countries of the world and in the so-called developing countries. Here I will reflect mainly on the United States because I know it best. In other countries the issues of democracy will differ. In most cases with which I am familiar the differences will be matters of degree. The responses of philanthropy, which I address later in these remarks, will also differ. But the obligations of the philanthropic sector I assert are the same. ** Reacting to hurricane Katrina, President Bush stated that the government would do all it could, and called on all Americans to do their part in the recovery and rebuilding. Subsequent actions have shown that the government is not fulfilling its obligations either administratively or financially. Foundations in the U.S. are supporting rebuilding efforts through local organizations in the affected communities dealing with structural issues there. ** Federal rules require Government contractors to pay the prevailing wage in the place where the work is done, and to hire locals first. In a series of cost-plus contracts for Katrina cleanup these rules were waived. If these rules had been implemented they would have had a significant social and economic impact on the survivors, and would have reflected what many believe to be the social compact of the Government with its citizens. Foundations support groups that monitor the press observing the failure of the government and corporations to be transparent. ** In October the Government emasculated the National Environmental Justice Advisory Committee by declaring that race was no longer to be considered an issue in guiding federal agencies in their cleanup of environmental problems. This despite the fact that studies over the last two decades that lead to the formation of NEJAC, which is to coordinate the work of all Federal agencies, have demonstrated just the opposite. Foundations are supporting constituency-based economic and environmental justice community organizations to reverse this decision, working through their elected public officials and public opinion. ** Voting is not required by law in the U.S. The proportion of eligible voters who actually participate in elections is small, and falling. Challenges to voting rights are increasing, especially for the poor and people of color. In the November 2005 election for Mayor of New York City, and for the governship of New Jersey, fewer than 50 percent of eligible voters went to the polls. Voter apathy is strong. The influence of corporate money and lobbyists, the "K Street" phenomena, induces a sense of powerlessness. The cost of elections favors candidates who are among the very rich, like the New York winner, Michael Bloomberg, and the competing candidates for the governship of New Jersey, who all self financed their bids for office, or those with great money raising machines that make big promises to the givers, especially the corporations, to be made good at a later date. Foundations are supporting nonpartisan voter registration and education on the issues, and get out the vote campaigns. ** Prospects for significant campaign finance reform is stymied by promises made. As a result some of the very best possible candidates are discouraged from running for public office, at any governance level. As populist commentator Jim Hightower, formerly an elected Secretary of Agriculture in Texas in the sixties described the situation in the title of one of his books, If God Intended Us to Vote He Would Have Given Us Candidates for Vote For. Foundations are supporting efforts to describe a fair program for campaign finance, and are actively involved in public education around these issues. ** The U.S. Environmental Protection Agency (US EPA) recently proposed sweeping changes to the Toxics Release Inventory (TRI), which became law in 1986, and which is the premier environmental regulation credited with providing citizens with the right-to-know about pollution sources in their neighborhoods. First, EPA has proposed requiring facilities to report their toxic emissions only once every other year instead of every year. Companies would not be required to produce a report covering two years of data - they would simply get a pass every other year. The second proposal would allow facilities to release ten times as much pollution before triggering requirements to report on the quantity of toxic chemicals released. In response, an industry group, the American Chemistry Council has launched a major chemical industry public relations campaign claiming that the TRI is not so essential. Foundations are supporting community-based and environmental organizations to respond to this effort at emasculating an important tool to protect the health and welfare of communities. ** Oct. 26, 2005 the House of Representatives passed overwhelmingly the Housing Finance Reform Act, which includes a provision that disqualifies nonprofits from receiving affordable housing grants if they have engaged in voter registration and other nonpartisan voter activities, lobbying, or produced "electioneering communications." Organizations applying for the funds are barred from participating in such activities up to 12 months prior to their application, and during the period of the grant even if they use non- federal funds to pay for them. Most troubling, affiliation or association with any entity that has engaged in any of the restricted activities also disqualifies a nonprofit from receiving affordable housing funds under the bill. Foundations are support vigorous efforts at public education and mobilization to maintain the right of organizations to participate in the democratic process. ** The Congress is now (mid-November 2005) considering legislation that would reduce tax rates on the very wealthy while considering cost-cutting offsets in Medicare, student loans, food stamps for the poor, and programs for children. The bi-partisan Congressional Budget office has found that similar tax cuts a year ago have been ineffective in stimulating the economy. Foundations are supporting public education efforts, advocacy and mobilization to insure that people are aware of these assaults on the 'safety net' and activated to have their elected representatives know their concerns. ** A foundation working on issues that are perceived as unpopular by the present Administration was told by its lawyer not to engage in policy or strategic discussions by email in order to avoid government eavesdropping. What they are funding is perfectly legal. The foundation in question is not backing down, and groups of foundations are protesting at the federal the abridgement of their rights as foundations to act in the public interest. ** The Administration has been secretly paying journalists significant amounts of money to report favorably on its initiatives. Foundations are supporting watchdog groups that are exposing government's efforts to at best confuse, at worst to lie, to the public. These observations on the state of democracy are not a counsel of despair, as dispiriting as they are. They are rather a call to action for the philanthropic community in the U.S. to assist community and watchdog groups hold governments at all levels accountable to all citizens and residents of the country, not just to a chosen few. They can help groups to insist on greater transparency on all aspects of government activities. Foundations in the U.S. can fund organizing, advocacy and mobilization around public issues, although they cannot fund support for the passage of specific legislation. There are many non-governmental organizations that desperately need support to defend the public good at community, municipal, state and national levels. Foundations support voter education and registration, and 'get out the vote' campaigns. Voting is a basic right in a democracy. Foundations also support public education campaigns around specific issues. Many foundations in supporting these efforts focus on groups have real constituencies. The groups they seek are those where the dialog and decisions and part of a democratic process, to which the group is accountable. Often membership groups do not reflect views of the membership because there is no communication on the issues. Foundations as owners of significant corporate assets also use these assets to achieve great corporate accountability and transparency toward the common good. Corporations are the greatest economic force in the world today. Voting proxies in support of shareholder resolutions that support human rights, the environment, workers, equal opportunity, among other things, has been successful in changing corporate behavior. Some American foundations have taken the lead in filing successful shareholder resolutions in areas that support their grantmaking. The Jessie Smith Noyes Foundation got Intel to change its policies so that they now share information with communities. The Nathan Cummings Foundation has achieved greater transparency around political funding of corporations in their portfolio. The Needmor Fund has achieved better working conditions for farm workers. These efforts also reflect on the democratic impulse. The response to the challenges to democracy requires that foundations look inwardly as well. To whom are we accountable? Are we transparent in our relations with grant seekers and the public at-large? As the African-American slave, abolitionist and intellectual observed in the 19th century: "If there is no struggle, there is no progress. Those who profess to favor freedom, yet depreciate agitation, are men who want crops without plowing up the ground...Power concedes nothing without a demand." South African Archbishop and Nobel laureate Desmond Tutu a century later notes: "There can be no neutrality. If you are neutral in situations of injustice, you have chosen the side of the oppressor. If an elephant has his foot on the tail of a mouse and you say that you are neutral, the mouse will not appreciate your neutrality." Philanthropies in each country will have to assess the problems of democracy in their countries, the political and social culture, and design appropriate responses to protect and nourish democracy. To reframe Julian Burnside's challenge to foundations, democracy cannot survive without including the vulnerable, the powerless, and unpopular. Who comes to the table of democracy will decide what democracy really means. This is the challenge to philanthropy. ============== * Stephen Viederman is an activist, educator, writer, speaker and consultant on a wide range of issues including sustainability; the social role of higher education; the future of philanthropy and whether it can meet the challenges of democracy and civil society; environmental and economic justice; redefining fiduciary responsibility and issues of social investment; the limits of corporate social responsibility within the context of how we define the economy; population and the environment; and science and public policy. An underlying theme in his work is the problem of effecting long-term institutional change toward a just society. In 2000 Steve retired as President of the New York-based Jessie Smith Noyes Foundation. Reprinted from Philanthropy New Zealand News, Vol. 2, No. 40, Summer 2005, pgs. 14-16.