In testimony before the Walsh Commission, Morris Hillquit, the labor lawyer and Socialist Party leader, said that large foundations like Rockefeller, Carnegie, and Russell Sage “represent in the domain of philanthropy just what trusts represent in the industrial field.” Edward P. Costigan, who would later represent Colorado in the Senate, called the Rockefeller Foundation “a supreme example of the philanthropy which deadens, by its large benefactions, a public criticism which otherwise would be as formidable as inevitable.” Even feudalism and slavery, Costigan went on, “boasted of their occasional generosity.” The Reverend John Haynes Holmes of the New York Church of the Messiah, who would serve for two decades as chair of the board of the American Civil Liberties Union, called foundations “essentially repugnant to the whole idea of a democratic society.”
In 2013 you’d be hard-pressed to find anyone close to the mainstream of American civic life and political thought raising those kinds of fundamental concerns. Is it because 100 years of practice has erased them? Or because philanthropy has deadened criticism, as Costigan warned, with its “large benefactions”?
The closest we come today is the emerging critique of the Gates Foundation, with its $3 billion-a-year spend rate that is at least four times as big as the next largest philanthropy. Gates is in a class by itself when it comes to size, but its influence in the few areas it has identified for strategic investment is even greater than it might be precisely because it is not scattered, but quite focused on particular approaches to education reform in the United States and public health abroad. When Dean Rusk was running the Rockefeller Foundation, he reportedly said he kept an eye on the Ford Foundation because what the “fat boy in the canoe does makes a difference to everybody else.” If Ford, then the largest foundation, was the fat boy in the canoe, then Gates is the blue whale in the toy sailboat. Not only does what it does make a difference to others in the fields it engages in—it can virtually define the fields and set the policy agenda for government as well as philanthropy.
Laurie Garrett of the Council on Foreign Relations has argued that in focusing on a few big diseases in the developing world, Gates has drawn dollars away from more basic and vital investments in health systems and primary care. A 2007 Los Angeles Times article raised similar concerns, asserting that “the focus on a few diseases has shortchanged basic needs such as nutrition and transportation” and that “Gates-funded vaccination programs have instructed caregivers to ignore—even discourage patients from discussing—ailments that the vaccinations cannot prevent.”
Ed Skloot, the president of the Surdna Foundation until 2007, tells the story in his Alliance magazine article, “The Gated Community,” of Gates’s six-year, $2 billion initiative to break up large public high schools into smaller ones:
Despite the paucity of hard evidence to support this assertion, with foundation support the small-schools programme became a cornerstone of thinking in the minds of many educational reformers, planners and administrators. The foundation became a market-maker. In six years, it funded the establishment of more than 2,600 schools in 45 states and the District of Columbia, reaching well over 750,000 students. However, despite some success in New York City, where the program was more complex and robust than in other places, in 2008 the small schools program was all but dropped.
While Skloot claims the foundation never gave much of an explanation, Bill Gates in his 2009 annual letter acknowledged, “Many of the small schools we invested in did not improve students’ achievement in any significant way.” After a while, Skloot writes, “The new silver bullets of choice appeared to be…charter schools, standardized testing, national curricula, merit pay for teachers, reorganizing or closing underperforming schools, developing accurate data in and across funding sites, and improved management.” In these areas, Gates worked closely with the Broad and Walton family foundations. Skloot concludes:
It can certainly be argued that education reform is so complex that only consortia of large, well-positioned change agents can make significant systems change in the public policy and schooling environment, but it is also legitimate to point out that when “irresistible forces meet immovable objects” in the educational and political arena, more students may be hurt than helped. Nor did students and their families ask to be subjects in philanthropically driven educational experiments.
I don’t single out Gates—though it’s hard to avoid doing so in this context—because I think the foundation is ill-intentioned or reckless about its engagements. I know the people who run the place; they are trying to make a better world and, of late, they’ve listened more to their critics and tried to adjust. I don’t personally know Gates, who forthrightly defended the advantages of size to Matthew Bishop and Michael Green, authors of the 2008 book Philanthrocapitalism, by asking: “When it comes down to me sitting down with a pharma company and saying, ‘Hey, here is the thing that would be great to do,’ do you think that our size hurts us? Do you think a bunch of tiny foundations could do that?” But of late, Gates has shown some capacity to change—softening, for instance, the demonization of teachers’ unions that the foundation’s allies have made a central theme of their reform efforts.