David Packard and AEI’s “Near-Death Experience”
Johns Hopkins case study explores challenges, and opportunities, facing philanthropic supporters of respected think tank as it faced bankruptcy 35 years ago.
“Few of the histories of the conservative movement give pride of place to David Packard as a paladin of conservative philanthropy, perhaps because the foundation he endowed focused so heavily in future decades on environmental and reproductive health causes rather than supporting the conservative movement,” according to a December case study from Johns Hopkins University’s SNF Angora Institute.
David Packard, Conservative Philanthropist
But Packard “was, in fact, a very generous supporter of a range of conservative organizations, and as the fourth richest man in the country in 1986, he could afford to be,” write Steven Teles and Jessica A. Gover in the study, which Teles referenced during his conversation with The Giving Review last week.
A lifelong Republican, “Packard was not shy about the role that businessmen needed to play in protecting the ‘free enterprise system,’” continue Teles and Gover. They then note that “a few years before Henry Ford II famously resigned from the Ford Foundation board in protest of its increasingly left-leaning grantmaking, David Packard gave a widely publicized speech similarly arguing that philanthropy should support the cause of defending capitalism, and reconsider its support for institutions seen as undermining it.”
In 1986, consistent with that thinking, “Packard, in concert with the other members of the board, decided to bail out” the American Enterprise Institute (AEI), according to Teles and Gover in the paper, “The American Enterprise Institute’s Near-Death Experience.” AEI needed $1.8 million, and Packard gave it half of that amount—helping spur others to give the rest.
Questions and Considerations
As Teles and Gover well-describe it, Packard had been fed up by mismanagement at AEI, which had been facing strong competition in a changing think-tank “marketplace” that newly included a more-aggressive Heritage Foundation. When approached with what he knew was a last-ditch request for support necessary to keep the institution up and running, Packard set up a special, emergency board meeting at his home in Palo Alto, Calif. The agenda was starkly simple: to save or close AEI.
Teles and Gover provide a page’s worth of good questions for the case study’s readers to consider, putting them in the hypothetical position of being “a member of AEI’s board at that moment.” Most of them are particularly relevant to those interested in matters regarding public policy and policy-oriented philanthropy, including Giving Review readers. (Giving Review co-editor William A. Schambra was interviewed for the Teles-Gover study.)
From the standpoint of those who have come to see AEI as a big part of the infrastructure of a “Conservatism, Inc.,” that has actually failed to further the general thinking and causes of conservatism, of course, Packard’s real-life rescue might seem dubious. New energy in a different entity that may have succeeded AEI—even if only a smaller, maybe more-focused version of it—would perhaps have been helpful, the argument would be.
From a policy standpoint, AEI has clearly made many valuable specific contributions—like them or not—to the formulation, development, and implementation of conservatism and conservative policy ideas, proposals, and solutions after the Packard-led revival. One cannot know whether these Packard-enabled contributions—or, if so, how many—would still have been made by any entity that might’ve been a leaner successor to AEI. In fact, the argument would be, his saving support allowed, if not created, necessary new energy.
From a philanthropic standpoint, Packard probably made the right call in spending his money in such a big chunk. When he died in 1996, control of the David and Lucile Packard Foundation went to his three liberal daughters and one conservative son. Many consider the foundation’s grantmaking to be in violation of his donor intent.
Had Packard retained the money, more of it would likely have been spent in such violation. His risky ’86 decision certainly bolsters the argument that many make for disbursing one’s wealth in the form of grants sooner, rather than risk leaving it to others later.
This article first appeared in the Giving Review on January 26, 2021.