Claire Gaudiani discusses her Times Books study of philanthropy.
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GUEST: Claire Gaudiani
I’m Richard Heffner, your host on The Open Mind. And I first met today’s guest a number of years ago at a Moscow Conference on The Anatomy of Hate organized by Elie Wiesel.
Claire Gaudiani was President of Connecticut College, and her comments about the pursuit of global civic virtues as a goal of American higher education were quite compelling.
Well, now Dr. Gaudiani is at the NYU Center for Philanthropy and Fundraising, and our conversation today originates in The Greater Good, her Times Books study of how philanthropy drives the American economy.
Indeed, Dr. Gaudiani writes that citizen philanthropy has “saved” capitalism in America, and not just at some one moment in our history when it needed rescue … but rather that citizen generosity has done so, as she writes, “over many, many decades, like a smart, kind friend watches out for a somewhat intemperate but gifted colleague, advising him throughout his life on the need for self-restraint and better judgment.”
However, I gather my guest fears that today Americans’ giving at large is not quite up to that task, despite the examples set by such extraordinary individuals as Warren Buffet and Bill Gates. But I should ask if I’m reading her right. Am I?
GAUDIANI: Yes, Dick. I think the reason I feel this way is because when you look at the statistics, over, let’s just say the last thirty years, giving, by all entities … that is individuals, foundations and corporations has remained at approximately 2% of gross domestic product. But when you look at how much wealth has grown in the US economy, it should be that we should be increasing that percentage because after all, each of us can only consume so much. So if we’re making two and three and four times what we made decades ago, there should be more growth, as there’s growth in the expansion of wealth, there should be more growth in the expansion of philanthropy. So we’re giving more dollars, but we’re not giving more dollars as a percentage of the dollars available.
HEFFNER: And we’re certainly not tithing.
GAUDIANI: We’re certainly not tithing. And there are very substantial percentages at each income level who don’t give at all. And that’s worrisome. Or who give such small amounts that it’s trivial.
Another interesting, but kind of worrisome number is that of the income quintiles, if you think about the income distribution in the United States in five slices … the top slice is the most wealthy people. And then the next slice down, the fourth quintile is the second and third and the fifth is the, the least wealthy. That is the poorest.
The people who give the most as a percentage of what they have are the middle and the next to the bottom. They give a larger percentage of what they have than the other, higher, wealthier people.
HEFFNER: Okay. What’s happening to us?
GAUDIANI: Well, I’ve thought about this a great deal, because I consult with families and family foundations and corporations and a great deal with young people who ask the same question … “what are you guys in your fifties and sixties and older doing, you know that we’re not solving some of the nation’s problems more effectively through citizen action?”
And I think a number of things are happening. I think people are more sequestered with their income group. So there are more gated communities and more sequestered lifestyles where people have multiple homes and they sort of go from place to place at these upper, upper levels. And so they’re not seeing need as a part of life. They’re just separated from all of that.
There’s a sense of busyness and preoccupation so we only have time for our concerns. And they might get very, very interested in gorillas or Faberge eggs or one particular thing, but they’re not seeing need more broadly. And maybe there’s also been a kind of a loss of what I would call patriotism.
GAUDIANI: Patriotism. People in earlier decades, may I say, centuries … thought about … particularly wealthy people … thought about their wealth as something that they needed to express gratitude and patriotism with.
For instance, there was a time, as you well know, in our nation’s history when there was slavery. And we in the … particularly those of us in the Northeast think that the North east, of course, was out of that terrible issue pretty early.
But the truth is in the early thirties, 1830 in Boston … it became clearer and clearer to the people in, in some families that slavery was un-, unpatriotic … it didn’t represent the words in our Declaration of Independence, which, of course it didn’t … and the signers knew that. And a couple families got together and decided to make a big push for abolition on behalf of the nation and because they felt so blessed with what they had.
And one of those families was the Chapmans. And a perfectly lovely, bouncy young woman named Maria Weston married into that family and was given things to read by her in-laws and quickly became very compelled by the fact that slavery was not an expression of American life and therefore it was unpatriotic, it was going to hurt the nation and that it was unjust and immoral.
And she had four children. Her husband lived 12 or 15 years into their marriage and then died of an illness. But Maria Weston Chapman in the true spirit of American entrepreneurial patriotism committed herself to ending slavery … in 1830. And she did this by deciding to have very elegant fairs … and there had never been such a thing as a church fair or a county fair, or any of those things. She really invented this as a fund raising approach.
She got her wealthy friends to go into their cupboards and bring out the things that they weren’t using … the china tea set from France and other elegant things. And dresses and laces and all kinds of elegant things and, together, she and her friends put price tags on these items and they decided to conduct a fair and they also decided to tell their husbands which of the things that belonged to their close friends they would like their husbands to get them for Christmas, at a great price.
So they had the fair and their husbands had been clued in as to what they were supposed to buy and these gentlemen arrived … very wealthy men; this was all the wealthy people in Boston and the place was beautifully decorated and all of these wonderful items were priced at quite a high price and the men brought home that lovely tea set to his wife, having purchased it from, of course, another woman. And all that money was put together and it was put to the use of newspapers and, and contributions to abolition.
And Maria’s work went on for 18 years. Year after year after year. Not only were there hundreds and hundreds of thousands of dollars in that century … that time frame … raised to work against slavery. But the idea of anti-slavery fairs moved all across the Northeast and then into the Midwest and women took this up with great energy and women who didn’t have so much to give away from their wedding gifts, etc. … things they weren’t using. Maria got them involved by asking them to knit and sew things that could be sold like pot holders that they called “anti-slave holders”. And they would be embroidered with sayings against slavery. And they were sold at the fair and went home to witness to how terrible slavery was and what an immoral way to live this was.
And those items went home. Little scarves were embroidered and napkins, etc. So that even women without wealth, but with willingness to spend time, could participate. That was a patriotic gesture that was citizen activity to move wealth into moral entrepreneurship.
HEFFNER: But the question, Claire, is why don’t we find that citizen movement today? You can’t say that we don’t know.
GAUDIANI: No. We do know. And of course many people are doing wonderful things. But we’re not doing enough wonderful things, or as Peter Singer outlined in his wonderful essay a couple of weeks ago in The New York Times, we would be able to address the global … the millennial challenge of global poverty four times over with a relatively modest increase in giving in America. But we’re not doing that.
Now I know there are people who are going to think I’m just terrible because I’m not acknowledging that, you know, last year Americans gave over two hundred and fifty billion dollars to philanthropic causes. And it’s not that I’m not conscious of that. It’s just that I also read The Wall Street Journal. And the business pages of The Times and I see how much money we are making and we are not giving away at that robust increase level. And so it’s been my task to say that when we do this, we make the country stronger and we make our economy grow.
HEFFNER: Maybe Claire you’re looking at the wrong end of this. Maybe it is because what you see when you look at the Wall Street Journal. Maybe it is because we are making so much, so very, very much that, as a consequence, our awareness of others needs …
HEFFNER: … and of the needs of the nation is decreased.
GAUDIANI: Well, of course, that’s what I worry about when I talk about living in more sequestered communities …
GAUDIANI: … it’s not only physically in sequestered communities, but it’s also mentally and spiritually. Giving is associated with greater attendance at religious services. And belonging to religious communities. And in general in the states those numbers are diminishing.
HEFFNER: Which numbers?
GAUDIANI: The numbers of people attending religious services on a consistent basis.
HEFFNER: But I thought it was the reverse. I thought we were increasing our involvement in formal religious observance.
GAUDIANI: We are still the most observant country in the … let’s say among the G-7 nations.
GAUDIANI: … but the areas where there’s an increase has tended to be these mega-churches and fundamentalist churches where the giving tends to be to the churches.
We’ve had … not a great increase for instance in human service giving. Giving to alleviate poverty. People have begun to feel … those who already give … a kind of a pull between giving to the arts and giving to poverty. But we’re just beginning to feel that pull and, of course, nobody wants to feel that we’re not going to be funding the symphony and instead we’re going to be funding health programs for children.
But, in fact, the answer is we all have to be giving more. And we have to be willing to make sacrifices. My father’s generation was the “greatest” generation. He was a P-51 fighter pilot over Japan, shot down, taken prisoner, had a very bad time.
But his generation lived a willingness to make sacrifices for the nation and I want our colleagues on Wall Street and all of these young people making extraordinary amounts of money in … whether it’s in one area of industry or another … to say, “I’m not being called to do that, we have a volunteer Army, how am I going to make a sacrifice for my country? Well, you know, this year I can afford to give 20% of my income …”
HEFFNER: Claire, is there any indication that any segment of our society … your statistic is so interesting that it is the middle income people and lower income …
HEFFNER: … people who have not drastically lowered the percentage of, of the total pot …
HEFFNER: … that they give. Is there any indication of something … anything going on in this country, that looks like a reversal of the trend you describe or that it could become such a reversal?
GAUDIANI: Well, it won’t surprise you because you know about my life as a college president, that the most hopeful space I see is in the very young people
This generation of people under 32 have spent more time in volunteer service in the United States than any other generation in the country’s history. And I’m talking going all the way back to 1630, which is when my research into the greater good really starts.
This generation has spent time in high school and in college doing serious volunteer projects. My students at Connecticut College lived in the projects in New London in the summer with poor people and they came to understand the life that traps people and cuts them off from hope and entrepreneurship.
And that group is looking for leadership, much as my generation was when we looked for leadership in a dashing young President who called us to make sacrifices for our country; to be willing to give not just from the crumbs on the table, but rather, you know, give so that you’re conscious of the commitment you made to someone else’s needs. And my generation went off to … well all over the country … ah, to Peace Corps and to other efforts to really be good Americans.
HEFFNER: Aren’t we now …
GAUDIANI: And these young people are looking for this kind of leadership among …
HEFFNER: Aren’t they now the young people in Wall Street? Who are not doing what you want them to?
GAUDIANI: Well, it’s very … you know, there are splits, just as there are splits with the Reds and the Blues, there are splits with these young people.
I get calls every week from young people who were at Connecticut College when I was President and they want to talk about how they can … and this is literally … in how they could start a foundation because now they’ve been on Wall Street x number of years, but they’re just at the beginning and they’re not able to make a big impact yet.
Another one, a young Black man called to say, “You know, I made a substantial amount of money at the beginning of my career and I’m now at a point where I could go back to my community and really try to change things. Will you talk to me?” So that’s where I see little bits of hope. And I, I don’t want to be depressing about it, I’m just saying we need to engender those and develop them.
HEFFNER: Claire, your sub-title for The Greater Good is How Philanthropy Drives the American Economy and Can Save Capitalism. Tell me for … you know … in, in a few paragraphs what, what you mean by that. Because you seem to be saying, “if you’re not going to do it for the right purposes, do it because it will save what you have and what you’re getting more and more of.”
GAUDIANI: Right. That’s exactly right and your introductory statement was very eloquent and right on point.
My research shows that our nation from the very beginning was more committed to generosity than it was to freedom. That’s wild because we think of the United States as, you know, coming together because of a commitment to freedom. But in point of fact before the Declaration of Independence was written, one hundred and forty years before that … the first leader of the Massachusetts Bay Colony, John Winthrop wrote, what I call The Declaration of Interdependence.
He said, in what’s really called The Sermon on the Arabella, “In this new land we must work as one man. And those of us with superfluities [more than we need] … must be willing to share until all have met their necessities.”
And, of course, that was the call to generosity. And people immediately got involved in barn raisings … it wasn’t, you know, every man, you know, for himself. Every family make do. It was “we’ll help each other, we’ll get this underway, we’ll take care of each other”. And six years after they landed in Salem, Massachusetts, they started the first college.
And, of course, seven or eight years later the Trustees realized that only the sons of … the wealthy colonists were sending their kids to Harvard. And so they approached a wealthy woman and they explained the problem to her that there were able sons of farmers and blacksmiths who didn’t have the money for tuition. And they asked her, as she was childless, whether she would endow scholarships. And she said, “Yes.”
And in 1636 Harvard was founded … by 1641 the first scholarships were permitting the able sons of poor people to attend.
And out of that came an energetic economy that involved looking for talent everywhere and making sure it could come to the surface. 1651, less than a decade later, farmers and blacksmiths decided to express gratitude for being in, in a community with that kind of leadership generosity.
Now they didn’t have money to give to the college, but they said, “Well give what we have, which is grain and we’ll ship the grain in the blacksmiths’ wagons.”
So this cycle, what I call a virtuous cycle got implanted in this country even before the Industrial Revolution and before American capital market economy got started at the economic level, there was this virtuous cycle of generosity where low income people gave what they had and wealthy people made sure that capacity in low income families got brought to the surface, which created our ladder of upward mobility.
So the very core of why our capital market system is so distinct from England’s or France’s or Italy’s comes from this structure of generosity. And it continues to create energy all through the three hundred and seventy years since 1630.
HEFFNER: What … what … you’re saying now frightens me because it makes me think of a question I ask a good many guests and have asked over the past 50 plus years. And that is, when discussing, as we have been discussing something that’s rather unpleasant, a downside of American life … not what you’ve just described but rather what you started off describing … the fact that we aren’t doing that as a people that much any more.
When we’re off the air and I say, “Oh my god, how do we change this?” What I hear and it’s almost as if you were speaking … we need a giant struggle again. We need a war or a depression to bring us back to the need that you described and that we met.
GAUDIANI: Right. That we’re motivated by crisis. And I would tell you the same thing except what I’d like to believe is that our generation … that is, let’s say people over 55 … could be smart enough, having seen, at the far end of that … of this group of people I’m talking about … having seen the Depression and at the younger end having been born in some connection to the war where our daddies, you know, came home … or didn’t.
That we would understand what needs to be done in the nation and that it would be stupid to wait for a crisis. That we can look and see before a crisis comes. We’ve had the privilege of raising children with extraordinary resources.
We have had the privilege of having our heads bonked a bit in the late fifties and early sixties by a young preacher from Atlanta, who put one hand in the hand of Thomas Jefferson and the other hand in the hand of the prophet of Deuteronomy and read our texts to us about how the nation needed to change before there was a cataclysm of a racial sort …
HEFFNER: And we killed …
GAUDIANI: … sort …
HEFFNER: … and we assassinated him.
GAUDIANI: And he was assassinated. But his message was so powerful that it changed the nation and we look at this country now and say that our … if you read Orlando Patterson superb pieces in the New York Times recently … we say, “this is a different place.”
So, there wasn’t a crisis when he rose to the fore and when Viola Gregg Liuzzo and the three young men when down to Mississippi and did their work. They didn’t see a crisis, they saw an opportunity.
And I want you and me and the thousands of our colleagues in this 55 and older range to say, “This generation, before we hang up our spurs and go home to god, we are going to declare a change. That is not Red or Blue, Conservative or Liberal. It has nothing to do with that. It is American.”
None of us could have acquired the assets we have without the levels of comity, without the rule of law and without the history and tradition of generosity that this country gave us.
HEFFNER: Claire you are so wonderfully articulate. And the spirituality that you express is so moving. It doesn’t quite correspond to this notion of the greater good as it has been practically observed. You’re talking about “the greater good” you’re not talking about …
GAUDIANI: I am.
HEFFNER: … the practicalities. You’re not talking about those Wall Street Journal stories …
HEFFNER: … that you’re reading about bonuses.
GAUDIANI: Right. Well, in fact, if a group of us got together and we sat down and said, “what could this level of people do? And that and the next.”
And one thing we could all decide to do, those of us who have assets above a certain level would be to say, “We’re going to go to the government and say, we won’t take our Social Security, we will immediately put it into a pool to match the savings of the unbanked and induce them to develop an appropriate banking relationship that we’ll help to set up and we’ll match their savings. So that the bottom quintile in the United States over the next 20 years would be living at a different level.
And there are other, very practical examples like that of things we can do with what we have. A whole set of us could say, “Every year, as long as we can, we’re going to give one percent of our wealth.” That would be extraordinary. Most of us give out of our annual salary. Our income.
HEFFNER: Claire, and I have nothing more to give because they’re telling me to “get off the air” … our time is up.
GAUDIANI: (Laughter) It was a great pleasure.
HEFFNER: Thank you so much for joining me again today.
GAUDIANI: Great pleasure, Dick, thank you.
HEFFNER: And thanks, too, to you in the audience. I hope you join us again next time, and if you would like a transcript of today’s program, please send $4.00 in check or money order to The Open Mind, P. O. Box 7977, FDR Station, New York, New York 10150.
Meanwhile, as an old friend used to say, “Good night and good luck.”
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.