The Idea and the Uses of a Foundation, Part II

GUEST: Dr. Vartan Gregorian
AIR DATE: 12/10/2011
VTR: 11/03/2011

I’m Richard Heffner, your host on The Open Mind.

And this is the second of two programs about the very idea – and the uses – of foundations in American life.

It comes as my guest, historian Vartan Gregorian – formerly President of the New York Public Library, then of Brown University, and now of the prestigious Carnegie Corporation of New York, veritably a man for all intellectual seasons – celebrates Andrew Carnegie’s formative foundation gifts of a century ago.

And now I think, what we ought to do is go back to where we left off last time. Vartan, in the period between last week and this week, meaning in the last five minutes … you mentioned something that I, I hadn’t the faintest idea about … that there are so many Carnegie … not foundations … but Carnegie creations …


HEFFNER: How many? What are they?

GREGORIAN: Well, I guess over 22 … 22. You have Carnegie Endowment for International Peace, celebrate its Centennial. You have Carnegie Institution … science, in Washington, DC. You have Carnegie Mellon University. You have Carnegie Foundation for the Advancement of Teaching. You have Carnegie Council on Ethics, which is going to celebrate its Centennial in 2014. You have Carnegie Trust for Scottish universities. Carnegie Trust for UK universities. You have many Carnegie Heroes Funds … because Carnegie was one of the first to recognize that ordinary citizens with great acts of courage should be rewarded or set examples. And then you have … what did I forget … Carnegie Hall …

HEFFNER: Carnegie Hall as well?

GREGORIAN: Yes, yes. Carnegie Hall was created also by Andrew Carnegie. The only paying institution, in order to be self-sufficient. Actually in its inception Mrs. Carnegie has major role to play.

And then … what did I forget? I think we covered most … but most of them are Carnegie Heroes Funds … Carnegie Museum, of course, in Pittsburgh … one of great …

HEFFNER: And all separate institutions.

GREGORIAN: All separate institutions. One of the things we have done during this past 10 years, we celebrate … in order to celebrate the Carnegie Institute … we brought all organizations together … every two years we come together in order to celebrate Carnegie Medal of Philanthropy, which now has been given to many prominent philanthropists, both national and international level and this just … almost two weeks ago … time passes fast … we celebrated 10 individuals.

We celebrated Lauder family, we celebrate Pritzker family, we celebrated Crown family, we celebrated Pierre and Pamela Omidyar, founder of E-bay. We celebrated Danforth Foundation, Danforth family and Fiona and Stan Druckenmiller, a young, young couple who have done so much for brain science and so much other thing.

And then, of course, in doing all of this Fred Kavli we did not forget, the great Norwegian immigrant whose based … and one thing occurred to me as I was reading this … it was reinforced by Leonard Lauder … most of them are descendants of immigrants … first or second generation who have brought, again, faith in giving through philanthropy, their foundations reinvesting in America.

So Andrew Carnegie’s creation itself … private wealth … been emulated by many including the spirit … not exactly divide … give away all your wealth … but many are pledged to give at least half of their wealth while they’re alive. Which is remarkable.

As I mentioned in the previous section of this time …there will be $20 trillion dollars intergenerational wealth transfers in America in the next two decades.

HEFFNER: Yes, but now, Vartan, let me, let me … let me come down hard on a question …


HEFFNER: … I don’t want to be biting the hand that feeds …

GREGORIAN: Oh, that’s all … nobody’s eating, so don’t worry.

HEFFNER: (Laugh) … but what’s the rationale for however many Carnegie institutions … groups …


HEFFNER: … there are … for it to do all these things that are so important in our society. Aren’t you taking away from the sovereign power of our individual states? Or of the nation? Aren’t you doing things that one might say, “Now, that should be done by the Federal government. That should be done by the state of California or the state of New York.”

GREGORIAN: Yeah. Well, I’m glad you brought issue up, because I’m dying to tell you about … what else that is … As in your book on Alexis de Tocqueville … we’ve gone this route before … when he came to America in 1830’s and published … which is still today, still the classic book on American democracy … 1835 … still is most important book written on American democracy. Voluntarism was considered to be natural … government was considered artificial.

As a matter of fact you can see now whether it’s … “We’re the 99%” or the Tea Party … they all are talking about … not government, but people to being in charge of their own destiny … direct democracy. And that’s part of our tradition … that people have always been interested in solving their problems. Nothing … let government do it.

Of course, as I mentioned previously, two World Wars and being a Cold War and being in wars constantly and being super … only super power now and so forth … is a costly enterprise which we cannot do without either taxing or mobilizing forces.

And also the growth of our population … 300, 350 million now. It’s not “Mom and Pop” operation any more. It’s not a small town anymore. We’ve become urban, very complicated, multi-ethnic, multi-national, global society, is right here, miniature level in the United States.

So, giving is not a substitute for governing anymore. Giving is, in many ways, creating, trying to hold your own … satisfy your own local needs, while allowing government to do national needs … inter-highway and this … and the railways, and so forth. That was the concept of growing federally … opening the West …

One of the things we have discussed in the past … investing in the future was government’s also duty. And next year I hope we’ll have a chance to discuss Morrell Act, 150th anniversary of Morrell Act.

The year after we should discuss the National Academy of Sciences … in the middle of the tragic Civil War in this United States of America … where 650 thousand people, 600 thousand people perished in the 1860s … President Lincoln was thinking about the future of America, investing in land-grant universities, creating a National Academy of Sciences … try that to do any government now … any President to say we have to think in terms of 50 years from now … never mind taxes … never mind, I’m investing in this.

It was forward thinking of local and national governments can work hand-in-hand together by combining the best of America … what has to be national issues and what has to be local.

If the local … local is voluntary and giving … that is the foundation … of not taking away from government, but investing along side the government in order to be able to give the private individuals, private sector, initiatives that could benefit the totality.

HEFFNER: Yeah, but isn’t that idea of being used now … by political candidates to say “small government … not large …


HEFFNER: … our churches …


HEFFNER: … our foundations …


HEFFNER: … our good voluntarism …


HEFFNER: … that we have our voluntary associations can do this …

GREGORIAN: Is not enough. $300 … let’s take $350 billion dollars annually Americans contribute to charity … which is one time. And then philanthropic institution. If you use it as an endowment … let’s say 10% of it would be $35 billion, 5% would be $17.5 billion … it doesn’t make arithmetic error column of Federal budget.

HEFFNER: (Laugh)

GREGORIAN: It sounds nice and some areas … yes. But it’s not a solution, it’s … one is incubator demonstration … the other is, is institutionalizing and pursing it.

So, it’s … what I’m saying is we no longer … I mentioned before “Mom and Pop” local government. That’s why it’s remarkable that these two trends will continue in America. You don’t want to give up your autonomy … your volunteerism, right to volunteer action to government and the government at the same time cannot absorb all of this without eliminating creative elements in our society.

Look at all the orchestra we have. Look at all the museums we have. Most of them, primarily, with the exception of Washington-based, most of them are supported by private philanthropy.

Look, some of the major research done in our hospitals, or our universities … funded by private philanthropy.

Look at great universities we have … Stanford, Harvard, Yale, Princeton …

HEFFNER: Columbia.

GREGORIAN: Columbia … of course, Columbia …

HEFFNER: Please.

GREGORIAN: … Yes, Columbia and Cornell … I have to mention our Brown … all the Ivy League … once you started with … privately, created privately.

But so is MIT which started as land-grant university … people forget that. The MIT of the United States also is beneficiary of Lincoln’s legacy … so I’m saying this alliance or partnership between the private and the public … I hope always will continue because when public makes errors, private wants … can try to repair or demonstrate or pick up. And vice versa.

HEFFNER: Do you … which brings me to the question of the times when … if there are such times … when the government refuses to act or says “this action runs contrary to the public interest in this government’s opinion”.


HEFFNER: Do foundations find themselves in the position of picking up a position that the government refuses?

GREGORIAN: Well … foundations …

HEFFNER: Should they?

GREGORIAN: … yeah, foundations always have done … they’re not there as anti-government forces, they’re there as societal forces.

HEFFNER: I don’t understand that.

GREGORIAN: Well, the point is that foundations have the right to … right of assembly … right under the law … to form their own organizations to do what they think is good. But they’re not independent. We have agencies that are overlooking … the Attorney General in each state is to supervise the fact that you … when you filed for a charitable trust or organization … that you’re going to implement this … it’s not going to be self-serving. There are abuses … yes. We find sometimes certain foundations abuse by having husband as President, daughter as Vice President and so forth, so on.

But those abuses should not obscure the fact what a great role foundations … be it religious foundations, be it secular foundations … are doing to cement or to provide strength to our society’s creative talent.

It’s that creative talent … ideas … that emerge from the private sector. Because public sector can encourage, through National Endowment for Democracy and National Endowment for Health, National Institute of Health, and National Endowment for Arts and Humanities … can create some kind of pool for talent.

But private sector is also contributing alternative way of doing things, challenging. And also creating expertise. You know many of the people now serving in government have come from some of the think tanks that foundations have supported. We have conservative, liberal or independent.

So foundations are not on the margin, but rather are central to provide that kind of critical thought, critical element to come, otherwise all you have to do is have … accept governmental policies as given, without being able to criticize.

HEFFNER: Vartan, what happened to the, the anti-foundation sentiment in the Congress of a decade ago, perhaps?


HEFFNER: What happened there?

GREGORIAN: Well … well … it was 1969 … that foundations are accountable … they ought to be.


GREGORIAN: Keppel, one of Carnegie Presidents said, “Foundations must have glass pockets. Everybody should see what they are doing.” And I adhere to that completely.

Foundations are accountable because they’re tax exempt organizations. Foundations are accountable to their Boards and to supervising organizations, including responsible to the Attorney General of each state in order to implement what their mission is … honorably, honestly … and to be accounted for.

That sentiment is still there. There are abuses, yes, but abuse can be dealt with. But one of the things now in current situation … the one sector that keeps foundations giving … is religious institutions.

If government goes after foundations … it has by the same token to go after all the religious organizations. And they cannot afford to take all religious groups … so secular foundations, side by side with religious foundations are in the same business of trying to do good.

Not because of government alone … they are sanctioned. But because they like to serve the public, the nation and local communities as well as international communities from issues of peace, issues of disease, issues of culture, issues of education … all of this, which we need.

As I mentioned, there are 1.6 million non-profit or independent institutions. One out of 11 Americans now work for non-profits. There are more people working for higher education now than automobile, steel … whatever is left … textile, whatever is left of … all the industries combined.

HEFFNER: Now … this is good?

GREGORIAN: No. I wish more people were, were in the industrial thing. But I’m just saying, under the circumstances, the central globalization, it’s remarkable that we have … we’re investing still in knowledge, we investing still in health and culture and all the other organizations.

HEFFNER: What are the big problems that you see now? You’re celebrating and will be celebrating … for the next couple of years … the, the Centennial of the various Carnegie …


HEFFNER: … groups … creations. What do you see as the big problems … or problem areas for foundations in America?

GREGORIAN: Number one problem is we have to collaborate, as I mentioned. Cooperate and collaborate.

HEFFNER: It’s that … is that tough to get?

GREGORIAN: It’s tough to get, but it’s necessary, like everything else. Years ago, it was tough to collaborate one library … libraries. But the Internet has made that an irrelevant issue.

You know, if you don’t’ want to collaborate, the source is available from elsewhere. Second one is needs are growing in America … poverty … we have 50 million poor people.

The fact that we don’t use any … the word “poverty” … poor do not appear in our vocabulary … we all are middle class now. Rich are called there … what … job creators … they’re not rich people.

We have, we have middle class, but we don’t have upper class. We don’t have lower class and therefore we ignore … Appalachia report now … the position about poverty in America now will be equally … we have … we’re a nation in debt. We’re trying to do now do a lot more with less.

And that’s going to be the biggest challenge … foundations are under … how to do more with less. And as long as we don’t run out of less, we’ll do alright. So that’s another challenge.

Then, of course, education … education … education … is our greatest challenge. We cannot lose 50% of our youth to wasted from education system.

HEFFNER: Is that what the figure is?

GREGORIAN: 50% high school drop out. 25%, 25%, 30% college drop out. We need … we’re in the age of knowledge … we need investment in knowledge. And that’s biggest challenge for all the foundations … how to keep the fabric of American democracy vibrant. How to invest in talent in America … how to … not to allow infrastructure of our country to collapse. How to keep infrastructure of higher education alive.

Those are challenges and how to collaborate among institutions, not just foundations, among institutions.

HEFFNER: Would it be remiss of me to say that points the way to being political in your orientation because what you’re talking about is a need that seems to me to be met only on the level of the nation and of the government.

GREGORIAN: Well, nation or government are always there. I mean it’s every, every American is political. To be citizen is to be political. If you don’t care what’s happening to our nation you can be quiet … or I don’t like, by the way, the silent majority.

The silent majority in Ulysses refers to the dead. Dead … we don’t want a nation of non-participants. But we also want people to deal with facts … that’s another challenge for foundations and education institutions.

Facts are not relativistic. Opinions can be made relative … but facts have to be ascertained. We are in the 21st century, age of science … yet we have anti-science sentiments.

We are in an age where people love gadgets and technology, but they don’t like science.

And we have to educate our nation … in fields of science and math … plus English, so we can have the same vocabulary to understand each other. But most importantly, also we have to teach about America as a democracy.

It’s remarkable and I think it’s almost sinful to live in this nation without knowing its institutions, without knowing its Constitution, without knowing what does constitute to be a citizen of the United States.

What rights, but also what obligations one has. I was just last night hearing Matt … what’s … Matthews, Newburg on … Kennedy … that …

HEFFNER: Oh, right.

GREGORIAN: … yeah … well, evidently it’s attributed Kennedy’s famous saying to a headmaster of Choate. I don’t care where the words come … the problem is we have to see this nation not as a giver, but also we have to see ourselves as contributor.

Otherwise Andrew Carnegie’s words that aristocracy is like potatoes … the best part is underground … I don’t want America to become Museum of Capitalism, or Museum “How things were”. I want to always remember America “How things are going to be better for the people of the United States and citizens”.

Debates I don’t mind, arguments I don’t mind. But central issue, which is non-negotiable … is the future of our nation, future our people … with social justice, knowledge, knowledge, learning, learning, curiosity, curiosity, curiosity. And also to love this country for what it is … because of its Constitution and rights it has given to everybody … citizen and immigrant who have come here.

That’s, that’s what the essence is. If you don’t want to contribute, but don’t at least oppose. But when you oppose understand what the ramifications are. I think more than ever we need education of civics, science, as well as mathematics … our schools have to be places we learn, rather than places we store people and train people. It’s not age of training … it’s also going to be age of knowing.

HEFFNER: Vartan, do you think your feelings about this are related to your own status …

GREGORIAN: Absolutely.

HEFFNER: … as some one who came to this country.

GREGORIAN: Absolutely. When I became citizen of United States, I thought I was marrying this country. Really, it was … a religious ceremony where you are taking an oath to abandon and to adhere to, to choose. It was a very moving experience.

And when I went to Montecello to give a speech at Jefferson’s University … I mean … the residence, of house … monument. I was so moved to tears because here is … from all over the world, people are there … taking an oath to United States, with what it represents … you know, liberty, equality, and pursuit of happiness … all of this, plus a Constitution, plus a Bill of Rights … guaranteeing individual …

But individual, as we discussed before … from Alexis de Tocqueville … who coined the term “individualism” to describe American character. That individual … he was not selfishness … egotist … but rather had two components. One was public good … in mind and the other personal good … and trying to reconcile both elements under the cachet of individualism.

Now I find that balance is not right. Self-interest is not enough, but you also have to think of the community … you have to think of society … of … think of nation … not for the present alone, but the future … which everybody’s saying “We don’t’ want our grandchildren to be indebted” … but we don’t want our grandchildren also to be ignorant.

HEFFNER: Vartan I began to teach American history … I grant … 65 years ago. I think what you’ve just said would be un … have been understood by my student then … I don’t think it would be understood … widely … as widely … by my students today.

GREGORIAN: Well, then we as, we as professors, teachers … we’ve done a poor job. Because if the concept of citizen is the concept of what is good in America … that makes people loyal to America and keeps them … I never have stressed the money … making money, or making a living, making a profit … America as a place you become rich … America’s a place where you live free. You live honorably. And … under the law … not because … you’re not a subject, you’re a citizen.

HEFFNER: In the one minute sign I just will you tell me that the Carnegie Corporation of New York is investing its funds in citizenship education?

GREGORIAN: Yes, we’re investing in education, we’re investing in international peace, we’re investing in how to make immigrants who are here as … on a permanent resident to become citizens … because you cannot be spectator, you have to be participant in our democracy, especially now and we also investing in science … knowledge of science and K to 16 in order to educate as many Americans as well as we can, as well as we ought to.

HEFFNER: And that’s the perfect place to say Thank you very much for joining me again on the air.

GREGORIAN: Thank you for having me again.

HEFFNER: Ands thanks too, to you in the audience. I hope you join us again next time. Meanwhile, as another riend used to say, “Good night and good luck.”

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N.B. Every effort has been made to ensure the accuracy of this transcript. It may not, however, be a verbatim copy of the program.

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