April 8, 2009 | Read Time: 2 minutes
In a recent column in The Chronicle of Philanthropy, William A. Schambra of the Hudson Institute argues that foundations need to remember that what they “do best and most reliably is simply to make grants to worthwhile nonprofit organizations.”
On their blog Values, the authors of Philanthrocapitalism, Matthew Bishop and Michael Green, begin their response with a simple, “Oh dear.”
They write that Mr. Schambra points out, correctly, that many small charities do excellent work and are being hit hard by the recession.
“But then he makes two giant leaps of pessimism to argue that philanthropists should stick to the basics of doling out small grants,” the pair writes.
First, Mr. Bishop and Mr. Green say Mr. Schambra is wrong to predict that hard times will, in their words, “drive corporate do-gooding off the agenda.” Smart corporate leaders, they say, recognize that cutting back on giving can be “a false economy.”
Moreover, they argue that so-called philanthrocapitalists will continue trying to find profitable ways to ameliorate social problems, not because they think earning money is easy but because they recognize that profitable means of fixing social ills will ultimately attract greater support.
Second, the writers contest Mr. Schambra’s critical assessment of the Ed in ’08 campaign, an effort by the Gates and Broad Foundations to elevate the issue of education during the last presidential campaign. They say they disagree that the campaign’s result will dissuade grant makers to stay away from public policy.
One area of policy some foundations have been trying to influence is how the stimulus package is spent. Mr. Schambra says that foundations should instead focus on giving money to small groups that will not benefit from the emergency spending.
But Mr. Bishop and Mr. Green write: “Surely it is worthwhile for foundations to risk failure by trying to get government to use a trillion dollars wisely rather than sounding the retreat from engagement with the government, and ending up spending tiny sums by comparison trying to paper over the cracks?”
What do you think?
