Successful Philanthropy for Liberty

Successful Philanthropy for Liberty

Wooster Study on Philanthropic Giving
December 30, 2004

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Every donor who creates a foundation must answer some of the same questions. Who should get my money? How do I know my money is being put to good use? How do I know that the money I give advances the cause of liberty and limited government?

The field of philanthropy is one where failures are legion. Part of the reason why foundations fail is that they ignore or repudiate their donor’s intentions. Look at the history of a large liberal foundation, and you’ll find that its founders were mainly heroic entrepreneurs who were champions of free enterprise. For example, Andrew Carnegie was a devoted student of Herbert Spencer and Lord Acton. John D. MacArthur, in a 1974 interview in Nation’s Business, denounced environmentalists as “bearded jerks and little old ladies” who “are obstructionists and just throw rocks in your path.” Yet the MacArthur Foundation, acting in its founder’s name, is one of the leading liberal environmentalist groups. The Carnegie Corporation is also one of America’s most active liberal foundations.

These foundations abandoned their founders’ ideas because Carnegie and MacArthur left no instructions on how their money was to be spent. Carnegie left half his fortune to the Carnegie Corporation without any restrictions. After his death in 1919, the trustees responded to Carnegie’s wish to “use their own judgment” to promote a statist agenda. Similarly, John D. MacArthur left his wealth to the MacArthur Foundation with no instructions. Although the foundation’s board was initially made up of MacArthur friends and associates and prominent conservatives like broadcaster Paul Harvey and Nixon Treasury Secretary William Simon, a battle between John MacArthur’s liberal son, Rod MacArthur, and the conservatives ended with the Left firmly in control of the MacArthur Foundation by 1981.

So how might philanthropists ensure that their money goes to causes they support? Martin Morse Wooster explains.