Philanthropy

Local Philanthropy Isn’t Local for ‘Citizens of the World’

Activist billionaires use community foundations to funnel even more money to their global and national causes


No word better describes America’s liberal plutocrats than “cosmopolitan,” from κοσμοπολίτης (kosmopolites), literally “universal citizen.” We have the ancient Greeks to thank for the concept as well as the word. The first cosmopolitan was Diogenes, the first of the Cynics (ascetics who cast away their property and possessions to pursue a more virtuous life of the mind, in accord with nature). Diogenes may have hailed from the city of Sinope, but against the patchwork of city-states that peppered Greece he famously declared, “I am a citizen of the world.”

A greater affinity for humankind than individual humans is about the only thing our own “citizens of the world” have in common with the Cynics, however. The lives of America’s transnational liberal billionaires are about as far from ascetic as one can get. The climate-conscious fly private jets and buy island mansions, famous socialists own multiple houses, and the biggest critics of income inequality leverage capital gains losses to pay little-to-no income tax.

America has always had its patricians, but as the word suggests, they saw themselves as patriotic “fathers” of their country, and their wealth and prestige were tied up in their country’s well-being. George Washington commanded armies. Thomas Jefferson was a statesman and diplomat. Robert Morris, probably America’s first millionaire, personally bankrolled the American Revolution.

Contrast that with the spacefaring Jeff Bezos, land-grabbing Bill Gates, or Big Brother–inspired tech billionaires Jack Dorsey and Mark Zuckerberg. The combined forces of global commerce, jet travel, and militant secularism make today’s elites more akin to aircraft carriers than individuals—travelling micro-states able to project power and influence anywhere in the world with wealth equivalent to a small nation’s GDP. Is it any wonder that one strains to find genuine, unabashed patriots in their ranks?

Nowhere is that clearer than in their “philanthropy,” humanitarian giving that is more political than charitable and utterly disconnected from its roots in Christianity’s love for one’s fellow man.

It isn’t only the Ford Foundation or George Soros’s Open Society Foundations, either. Across the nation, a host of community foundations—groups which are supposed to aid their local communities—serve as funnels for liberal billionaires to fund national causes, such as environmental activists, get-out-the-vote groups, litigation nonprofits, labor union fronts, and mass immigration advocacy.

We’ve analyzed grants flowing from a few dozen community foundations to uncover $2.3 billion flowing to 110 highly politically active nonprofits on the left since 2010. These groups range from top liberal think tanks, such as the Center for American Progress, to “animal rights” radicals demanding global population control. Far from merely supporting local philanthropy, America’s community foundations are some of the biggest conduits for activist groups we’ve discovered—yet they receive almost no scrutiny from the press.

That isn’t to say that these community foundations don’t fund bona fide charities, from local philharmonic orchestras to campaigns against child hunger and the Salvation Army. Nor does it suggest that there’s something inherently wrong with community foundations as a philanthropic vehicle.

What it does reveal is how thoroughly our country’s generous nonprofit sector has been hijacked by the left. Charity has been weaponized. It’s less about doing what the government cannot (and should not) do and more of a tax-free political cudgel aimed at changing policies and even the outcome of elections.

What Are Community Foundations For?

According to the Council on Foundations, there are over 800 community foundations nationwide. They have a simple premise: serve the local public, be it in a particular city (St. Louis), geographic region (Middle Tennessee), or an entire state (Oregon). They’re meant to fill a void between private foundations belonging to a wealthy individual or family such as the Ford Foundation and 501(c)(3) public charities supported by multiple donors, inviting donations from local philanthropists to fund an array of charitable causes.

Structurally, community foundations are 501(c)(3) public charities and almost universally centered on donor-advised funds (DAFs), a kind of charitable investment account meant to encourage small-dollar donors to give early and accumulate funds in a local philanthropy, before picking out the charities they ultimately wish to support. My colleague Michael Hartmann and I have written extensively about the advantages of and proposed reforms to DAFs.

The Cleveland Foundation is the world’s first community foundation, formed in 1914 by the banker Frederick Harris Goff. Goff, whose Cleveland Trust Company (now KeyBank) serviced fellow Clevelander John D. Rockefeller’s Standard Oil, was an innovator in philanthropy, envisioning a kind of vehicle that would prioritize the public good over self-interest. That led the Cleveland Foundation to launch a crusade against industrialized urban neglect, poverty, and corruption plaguing the city.

But it also had the unfortunate effect of involving it in the city’s 1967 mayoral race. Philanthropy expert William Schambra has recorded how the Cleveland Foundation—with help from the Ford Foundation—quietly funded a private media advisor and voter registration drives to boost election turnout for Democratic candidate Carl Stokes, who became the first black mayor of a major city by a scant 1,851 votes.

In civic participation there’s a fine line between partisan politics and philanthropy, and the Cleveland and Ford Foundations crossed it—so concluded Democratic members of the powerful U.S. House Ways and Means Committee. Big Philanthropy’s role in tilting an election directly led to potent nonprofit provisions in the 1969 Tax Reform Act passed by Democratic majorities in Congress and signed into law by President Richard Nixon. This law gave us the modern definition of a “private foundation” and strict limits on its electoral activities and lobbying.

Although community foundations escaped Congress’s wrath, the Cleveland affair lays bare their decades-long immersion in American politics, a trend that continues today. It leads this writer to ask: What are community foundations for? If the answer involves helping politicians of either party get elected, it’s time for Congress to go back to the drawing board.

Charting the Grants

Which politically active organizations are the biggest beneficiaries of community foundation money? Our analysis of grants from nearly 170 community foundations between 2010 and 2019 (2018 in the case of groups with missing Form 990 filings) traced $2.3 billion to 110 left-wing groups and their affiliates.

To sift through tens of thousands of grants and avoid cherry-picking recipients, we identified nonprofits that are prominent in a variety of political causes—such as the Center for American ProgressPlanned Parenthood, and Southern Poverty Law Center—or are especially notable for their radicalism (e.g., the communist Alliance for Global Justice) and influence (e.g. the libertarian-turned-lefty Niskanen Center), as well as any local or lobbying affiliates. While not scientific, it gives a sense of just how much the institutional left depends upon funds flowing through community foundations.

Top recipients include Planned Parenthood ($111 million), Earthjustice ($97 million), and the Tides Center ($93 million). For more details and a list of the top 30, including a brief description of their work, please see an appendix at the end of this report.

It’s important to note that these grants ultimately originated with (mostly) anonymous donors, not the community foundations themselves, which serve as conduits for DAF account holders. The largest community foundation givers on this list come from a handful of locales, mostly in California—Los Angeles, San Diego, the San Francisco Bay Area and Marin County—as well as Chicago, Boston, Kansas City, Atlanta, and Memphis, to name a few.

By far the biggest is the Silicon Valley Community Foundation (SVCF), an $8.5 billion behemoth and favorite left-wing vehicle I’ve documented in these pages. Grants from SVCF and its runner-up, the little-known Foundation for the Carolinas (FFTC), account for an impressive 75 percent of the giving in our list, or more than $1.75 billion over nine years.

These are organizations that almost no one has heard of, yet they’re pillars of the professional left and the most abhorrent causes in America. FFTC in particular is the preferred pass-through of Fred Stanback, a mega-donor characterized by Knoxville News in 2018 as a “known proponent of anti-humanist environmentalism” who believes that “protecting the environment hinges on population control,” a fusion of radical environmentalism and what we could call the abortion-industrial complex.

SVCF serves at the pleasure of a handful of Big Tech billionaires, including Facebook’s Mark Zuckerberg, former eBay president Jeff Skoll, Netflix’s Reed Hastings, WhatsApp’s Brian Acton, and Twitter’s Jack Dorsey, and former Starbucks CEO Howard Schultz.

There’s a case to be made that SVCF is a private pass-through vehicle for politically active mega-donors, all of whom are donors to the Democratic Party and left-wing causes. SVCF’s 2019 Form 990 report notes that 70 percent of its contributions that year came from just 11 donors. That figure was worse in 2018, when three quarters of SVCF’s $2 billion in contributions came from only 10 donors. Zuckerberg was and likely still is SVCF’s largest single donor, contributing $1.75 billion in Facebook stock in 2010, followed by another $200 million in shares in November 2018.

That’s after SVCF’s #MeToo scandal in April, when allegations of sexual and emotional abuse by SVCF employees prompted an investigation leading to a flurry of resignations among the top brass, including longtime CEO Emmett Carson. One black staffer was disturbingly told to “Work, slave, work” by the group’s chief fundraiser, Mari Ellen Loijens, whose reported chronicle of misdeeds includes attempting to kiss another female staffer.

Former employees’ scathing reviews on Glassdoor.com painted SVCF’s leadership as avaricious and “incredibly misguided,” with “no mission outside of being the largest community foundation in the world. . . . SVCF ultimately serves little purpose beyond helping the 1% evade taxes by putting money into charitable brokerage accounts.”

The California Bay Area may be blessed with a bumper crop of the affluent, but the shocking overreliance of the country’s largest community foundation on a sprinkling of top-dollar donors undermines its image as a publicly supported nonprofit—or even as one focused on local affairs. As philanthropy critic Alan Cantor noted shortly after the scandal, Carson and associates “found the notion of geographical community too limiting,” choosing to see SVCF as more of a global citizen. The “geographic location, interests, and identity” of SVCF’s community “cannot be placed on any one map,” Carson wrote in 2013. A year after his resignation, the group’s Form 990 report revealed that SVCF’s assets plunged by an incredible $4.6 billion.

What Is Philanthropy For?

All this not only calls attention to a major river of money flowing to political groups, but asks a burning question: Who does philanthropy serve? Until we answer that question—one that our forebears understood—community foundations, private foundations, and 501(c) groups are immaterial.

It’s revealing that the United States is one of a very few countries to offer tax exemption and other benefits to nonprofits. The practice dates back to the Revenue Act of 1909, but the spirit behind it is much older than the republic. Colonial Americans—unlike the British, French, and Spanish—chose to organize numerous citizens’ committees to tackle problems beyond the scope of either individuals or the government—a first in world history. These were the first corporations organized for the public good rather than to sustain a business venture, and their roots reach deep into English common law and the Protestant Reformation, which put the responsibility for godliness in the community upon each individual Christian, not ecclesiastical or secular authorities.

As families were expected to study and emulate the Bible, so were they expected to “work out [their] own salvation with fear and trembling” in the public sphere—that is, do works fit for holiness in an unholy world that reflect their redemption in Jesus Christ. Gratitude for what God has accomplished for the individual believer, not the threat of slipping back into damnation, drove the Puritan colonists in New England. Is it any wonder that in early America the greatest outpouring of committees created for the public benefit was centered there?

φιλανθρώπως (philanthropos) is the love of mankind rooted in the divine image. Modern philanthropy has mistaken itself with the love of money. Once we’ve started down that road, all the good intentions in the world won’t help us escape it.

Appendix: The Recipients

  1. Planned Parenthood, including affiliates: $111 million. America’s largest abortion provider and a pillar of the professional left.
  2. Earthjustice: $97 million. Sierra Club spin-off that litigates against oil, gas, and coal use and other environmental issues.
  3. Tides Center: $93 million. Tides Foundation arm responsible for incubating new activist groups.
  4. Food & Water Watch: $85 million. Anti-fossil fuel activist group heavily active on the state level.
  5. Sierra Club Foundation: $73 million. 501(c)(3) arm of the country’s oldest environmental organization, which recently disowned founder John Muir as irredeemably racist.
  6. Tides Foundation: $62 million. Key pass-through funder that specializes in using DAFs to bundle donations from liberal donors to politically active nonprofits.
  7. Humane Society of the United States, including affiliates: $57 million. Militant vegetarians lobbying for animal rights and animal-free clothing.
  8. Rockefeller Philanthropy Advisors: $54 million. Rockefeller Foundation affiliate that provides consulting services to other left-leaning nonprofits related to “social justice,” environmentalism, and similar causes.
  9. American Civil Liberties Union, including affiliates: $49 million. Historic civil liberties litigation group that’s become a hub for left-wing activism and electioneering on behalf of Democrats.
  10. New Venture Fund: $37 million. Flagship of a $731 million “dark money” network run by Arabella Advisors in Washington, D.C., specializing in pass-through donations to activist groups and popping up new lobbying campaigns.
  11. Conservation International Foundation: $34 million. Left-leaning climate group that supports international greenhouse gas reductions.
  12. US: $32 million. Mass immigration advocacy group heavily funded by Mark Zuckerberg.
  13. Friends of the Earth: $27 million. Dutch environmentalist group associated with the Sierra Club that has expanded into LGBTQ and anti–free speech lobbying.
  14. Barack Obama Foundation: $20 million. Primarily maintains Chicago’s to-be-completed Obama Presidential Library, but also pushes for continuation of Obama’s policies.
  15. Human Rights Watch: $17 million. Left-leaning civil liberties group primarily focused on developing countries, criticized for connections to Saudi Arabia and lack of transparency in its funding (e.g., receiving strong support from George Soros’ Open Society Foundations).
  16. National Audubon Society: $16 million. 19th century conservation nonprofit that has expanded into climate change advocacy.
  17. Clinton Foundation: $15 million. Enough said.
  18. Center for Biological Diversity: $14 million. Radical group that has supported voluntary male sterilization to curb global population growth, fought against Justice Brett Kavanaugh’s Supreme Court confirmation, and tried to block President Trump’s border wall.
  19. Environmental Defense Fund: $13 million. “Green” advocacy and litigation group with a lot of “green” ($210 million in 2018).
  20. 350.org, including affiliates: $12 million. Hard-line environmentalist group founded by Bill McKibben, notably a target of Michael Moore’s Planet of the Humans(2020) for selling out to Big Oil.
  21. Immigrant Legal Resource Center: $12 million. Mass immigration group based in San Francisco.
  22. Greenpeace Fund: $9.5 million. 501(c)(3) arm of one of the country’s most extreme environmental groups, infamous for opposing modern agriculture and its attention-seeking stunts involving harassing whaling ships in the Pacific Ocean.
  23. Center for Reproductive Rights: $8.5 million. Pro-abortion litigation group that aims to overturn pro-life laws in conservative states.
  24. NEO Philanthropy: $6.6 million. Pass-through for liberal donors best known for running the Funders Committee for Civic Participation, an affinity group for leftist donors to strategize over voter mobilization and 2020 Census turnout in order to favor Democrats.
  25. Vera Institute of Justice: $6.4 million. Originally created to help poor New Yorkers get bail bonds, now a broad advocacy front for “racial justice,” anti-incarceration, and mass immigration policies.
  26. Center for American Progress: $6.4 million. The left’s Heritage Foundation—a Democratic Party-aligned think tank founded by Clinton crony John Podesta and funded by a who’s who of liberal funders to formulate policy on pretty much every issue.
  27. New America: $6 million. Think tank epitomizing the technocratic left founded by the late Ted Halstead with close leadership ties to the Obama administration.
  28. Anti-Defamation League: $6 million. Originally created in 1913 to combat anti-Semitism, but has since morphed into a general leftist pressure group, even removing the words “anti-Semitism” from its mission statement in recent years.
  29. Voter Participation Center: $5.6 million. Part of a set of two nonprofits run by the get-out-the-vote guru Page Gardner to register unmarried women and minorities and help Democratic turnout, as well as a key supporter of vote-by-mail in the 2020 election (and beyond).
  30. American Immigration Council: $5 million. Arm of the American Immigration Lawyers Association responsible for lobbying; regularly cites the hate-spewing Southern Poverty Law Center in its criticism of right-leaning immigration groups

 

This article originally appeared in the Giving Review on August 9, 2021.

Hayden Ludwig

Hayden Ludwig is a Senior Investigative Researcher at Capital Research Center. He is also a columnist at the Washington Free Beacon. Ludwig is a native of Orange County, California, and…
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