Rachel's Democracy & Health News #839 January 26, 2006 PHILANTHROPY AND DEMOCRACY: A VIEW FROM THE U.S. 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 raised by the organizers of the Philanthropy Australia Conference session October 12, 2005, was this: "As I see it what is the role of philanthropy in modern democracy?" My answer: The role of philanthropy is to help ensure that modern democracy fulfils its obligations to the commonweal by keeping governments and other institutions wielding power, including corporations, the media, and educational institutions, 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. The ultimate goal must be structural reform and transformation, not simply amelioration of the present situation. It helps by supporting those organizations that are committed in theory and in practice to community, equity, justice, and democracy. Democracy is more than voting. 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 needs of the vulnerable, the powerless, and the 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 on some of the issues and the responses in the United States because I know it best. In other countries the issues confronting democracy will differ. In most cases with which I am familiar these differences will be matters of degree. The responses of philanthropy 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 by dealing with structural issues not just charity. ** 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 Government's social compact with its citizens. Foundations support groups that monitor the actions of government and the press making transparent the opaqueness of government and corporations. ** In October the Government emasculated the inter-governmental National Environmental Justice Advisory Committee (NEJAC) 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 led to the formation of NEJAC to coordinate the work of all Federal agencies, demonstrate that race is a central factor in environmental issues. Foundations are supporting constituency-based economic and environmental justice community organizations to reverse this decision, working through their elected public officials and public opinion. ** Law in the U.S does not require voting. The proportion of eligible voters who actually participate in elections is small. Challenges to voting rights are increasing, especially the rights of the poor and people of color. A requirement that voters show picture identification recently adopted by some states in the south is in effect a 'poll tax," requiring people to prove eligibility (and incur cost to do so) rather than assuming they are eligible. In the November 2005 election for Mayor of New York City, and for the governorship 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 governorship of New Jersey, who self-financed their bids for office. It also favors candidates 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 are stymied by promises made to the rich and powerful, and by the strength of incumbency. As a result some of the very best possible candidates are discouraged from running for public office, at any governance level. Populist commentator Jim Hightower, in the sixties an elected Secretary of Agriculture in Texas, highlighted the problem in the title of his book, If the gods had meant us to vote they would have given us candidates (2000). Foundations are supporting efforts to describe a fair program for campaign finance that does not favor the wealthy, and are actively involved in supporting public education around these issues. Foundations are also exercising their ownership obligations in the companies in their financial portfolios by filing shareholder resolutions and by voting their proxies requesting companies to publish in their annual reports the recipients of their political contributions. ** 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 and actual information 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 national environmental organizations to respond to this effort at emasculating an important tool to protect the health and welfare of communities. ** At the end of October 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. This is a significant step back from previous rules and regulations. Foundations are supporting vigorous efforts at public education and mobilization to maintain the right of community and nonprofit 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, directed toward the poor and middle class. The bi-partisan Congressional Budget office found that similar tax cuts recently enacted have been ineffective in stimulating the economy, the ostensible reason for the tax cuts then and now. 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 let 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. In addition, groups of foundations are protesting at this federal-level abridgement of their rights as foundations to act in the public interest supporting causes the present Administration considers unpopular. ** The Administration has been secretly paying psuedo 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. ** Corporate power is at an historical peak, and the abuse of that power, including a lack of accountability to shareholders, stakeholder, employees and communities, is considerable. Foundations are owners of significant corporate assets and some of them use these assets to achieve great corporate accountability and transparency toward the common good. Corporations are the greatest economic force in the world today. Foundations in collaboration with other concerned owners are increasingly filing shareholder resolutions and voting proxies in support of shareholder resolutions that support human rights, the environment, workers, and equal opportunity, among other things. These combined efforts have been successful in changing corporate behavior. 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 provide more support to assist community and watchdog groups hold governments and other powerful organizations 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, corporate and other institutional activities. Foundations in the U.S. can fund community 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 that have real constituencies, grassroots rather than Astroturf. The groups they seek are those where the dialog and decisions are part of a democratic process, to which the group is accountable. This is democratic base building. Any response to the challenges to democracy requires philanthropy to look inwardly as well. To whom are we accountable? Are we transparent in our relations with grant seekers and the public-at-large? Are our efforts focused on structural and systemic change to protect democracy, or are we satisfied with amelioration of the problems facing our nation, filling in for government? As the African-American slave, abolitionist and intellectual Frederick Douglass 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." What philanthropy in the U.S. is doing pales in the face of challenges to democracy today. Social justice philanthropy, a rough measure of what is needed, is estimated to be only about 15 percent of total grantmaking. Philanthropies in every 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 inclusion of the vulnerable, the powerless, and the unpopular. Who comes to the table of democracy will decide what democracy really means. This is the challenge to philanthropy in the U.S. and worldwide. ============== * 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. ==========  These notes are an expansion of ideas presented at Philanthropy Australia's Conference in Melbourne on October 12, 2005. I am profoundly indebted to PA for their invitation to participate. On October 17 I delivered the Stegley lecture at the Centre for Asian Philanthropy and Social Investment at Swinburne University, "Equity, democracy, community, and philanthropy". The text of that lecture will be available on the Centre's website sometime in February 2006. Since I see these remarks as part of a continuing dialog, reactions as well as comments and critiques are very welcome. Contact me at firstname.lastname@example.org, with "NZ Philanthropy" in the subject line since I have a very active spam blocker. This article was prepared at the request of Philanthropy New Zealand. An earlier version appeared in Philanthropy New Zealand News, Vol. 2, No. 40, Summer 2005, pgs. 14-16.