American Foundations

An Investigative History

2001, 345 pages. The MIT Press.

Mark Dowie's new book, American Foundations: An Investigative History, begins with a glossary of terms that sets up his central argument: foundations protect wealthy interests, retard societal progress, wield enormous power, and operate in a nondemocratic manner. The key word in this glossary is "plutocracy" ("the rule of wealth"), and although Mr. Dowie admits that foundations "are not evil institutions, as critics from both the right and the left have sometimes asserted" he nevertheless maintains that "they are indisputably plutocratic." This defect might not be so damning if foundations were simple charities dispensing money for the needy, but Mr. Dowie claims that foundations "exercise great power in American life, power far beyond their wealth" and that this "influence derives directly from the proactive nature of their grantmaking and their methods of leveraging money."

The bulk of American Foundations details the influence of foundations in education, science, health, environment, food, energy, civility, and art. In each of these fields, except science, the book finds evidence of incompetence, arrogance, and limited imagination, although numerous examples of fruitful foundation programs are also offered. Mr. Dowie concludes that, "An overall assessment of twentieth-century foundation philanthropy would grade it a C-minus, at best."

The chapter on art begins with a statement that amply illustrates Mr. Dowie's gift for polemics: "Once admired as a wellspring of robust cultural innovation, an incubator of artistic genius, the United States is now most often esteemed for its adventure movies, nihilistic music, bimbo tv sitcoms, advertising commercials, and stand-up comedy." The chapter proceeds with a brief history of foundation funding for the arts, giving mostly high marks to the pioneering work of the Carnegie, Rockefeller, and Ford foundations. In the midst of this chapter, however, Mr. Dowie's tendency toward overstatement and contradiction undermines his case. In contrast to the risk-taking, avant-garde example set by the Ford Foundation, he states that, "Despite their alleged innovativeness and flexibility, most family and community foundations made their cultural grants to safe and established institutions, like art museums, ballet companies, and symphony orchestras, all of which received large endowments, new buildings, and operational support." This statement is flawed in two respects: it suddenly forgets Ford's massive investment in established institutions, mentioned just a few paragraphs earlier, and it gives the impression that foundations somehow managed to fully capitalize the nation's major arts organizations, which certainly never happened. This chapter concludes with a lukewarm indictment that foundations have capitulated their responsibility to support edgy art, and have instead resigned themselves to funding art for various economic and social ends.

Two of the concluding chapters of the book fault foundations for their lack of imagination and for their failure to operate democratically. Here Mr. Dowie enumerates his proposals for reform. Change the tax laws to require private foundations to expand their universe of trustees beyond family, friends, lawyers, and fiduciaries of millionaires; bring more community leaders and activists into the management of community foundations; break up the large private foundations by capping their assets at $1 billion; allow no one other than the founder to serve on more than one board of trustees (for large foundations that have been broken into smaller institutions). Curiously, the next chapter, entitled "Epilogue," describes the heroic and successful efforts of Irene Diamond to spend down the assets of the Aaron Diamond Foundation in search of an AIDS cure. This episode provides a prime example of how a decidedly nondemocratic foundation can act in an imaginative and courageous manner.

Mark Dowie is a talented writer and polemicist whose book is likely to attract significant attention. He is widely known for a writing career that has taken aim at notable public issues (e.g. trafficking in human organs and the waning of the environmental movement), and his new book on foundations is published by one of the nation's prestigious university presses: The MIT Press. Surely, the growth in the number of American foundations and the increases in their assets will attract increasing public scrutiny, along with calls for greater sunshine and accountability. Mark Dowie's book, however, is flawed by factual overstatements, contradictions, and most importantly, by the lack of a convincing case that foundations are uniquely failing to serve the public interest. In particular, the charge that foundations are "nondemocratic institutions" applies broadly throughout the religious and nonprofit sectors. While he documents specific instances of foundation ineptitude in a range of fields and insensitivity to the needs of various constituents, these are often offset by compelling examples of the opposite.

The best element of Mark Dowie's book is the numerous case examples, covering more than 100 years of history, of attempts by foundations to intervene in significant matters of public interest. These examples were assembled from interviews with more than 200 individuals (including the author of this review), many of them veterans of major American foundations. Ultimately, however, the book does not make the case for Mr. Dowie's advocated reforms. A C-minus may not be a great grade, but in most schools it is still a passing mark.

reviewed by John Kreidler, Cultural Initiatives Silicon Valley