Privacy as a Philanthropic Pillar
When pop musician George Michael passed away at the end of 2016, the early media coverage focused on his two Grammy awards, his activism on behalf of AIDS prevention, and the sometimes-lurid details of his personal life. But within a few days of his death, a range of beneficiaries began to reveal another side of the man: His charitable generosity—most of it hidden from the public. The singer made anonymous donations totaling many millions to a charity serving abused children, for cancer-patient support, and to myriad individuals in distress. He also volunteered regularly at a homeless shelter.
And he did these things in strict privacy. “He really wanted to keep his help secret,” reported the founder of the nonprofit Childline. She described his gifts as “intensely personal.”
One recipient states that Michael didn’t want his contributions to overshadow the good work being done by the charity’s volunteers and staff. In a 1993 interview, Michael suggested that the public dislikes “celebrities patting each other on the back saying how generous they are being. And they are right to.” Having lived on a stage for most of his life, perhaps he simply wanted to protect the sincerity of his philanthropy by acting without the weight of his public persona.
“It’s difficult to pin down exactly why he chose to keep this side of his life private,” comments Sean Parnell of The Philanthropy Roundtable. “But we know this: Among individuals who donate wealth for public benefit, the impulse to do so without visibility is very common.”
Indeed, quiet, humble, inconspicuous giving has been a norm in America since our founding. The father of our nation, George Washington, was a devoted patron, but rarely a visible one. It was important to his sense of modesty that many of his contributions to charities, churches, schools, and needy individuals be made without notice.
In the first half of the 1800s, New Orleans merchant Judah Touro gave away the modern equivalent of $2 billion to patriotic, religious, and medical causes. Most of his gifts were made unattributed, out of natural humility. When his identity as patron of a memorial to fallen soldiers at Bunker Hill was revealed against his wishes, he nearly withdrew the grant.
Arthur Tappan—patron saint of the religious revival known as America’s Second Great Awakening, and the many social improvements that grew out of it—often used anonymous gifts to stimulate matching grants from others. He also found that putting up his money in quiet ways could help heal fractious social rifts. For instance, when the American Bible Society was about to splinter over denominational differences, Tappan made a large anonymous gift that got members excited about the prospect of supplying a Bible to every family in America. This mystery intervention and the work it challenged the charity to undertake quickly united the group.
Many of J. P. Morgan’s benefactions were also off the record. He often launched new projects at the American Museum of Natural History by putting up unnamed lead gifts, placing the focus of public attention on the new venture, rather than its financier.
George Eastman, the founder of Kodak, gave away more money than anyone of his era except John Rockefeller and Andrew Carnegie, yet few people realize that, because the self-effacing Eastman offered many of his contributions on the quiet. One of his large gifts was a half-billion dollars (in current terms) that he provided to transform a sleepy little commuter school called Boston Tech into today’s MIT. Before he acted, the college was so unstable its president tried to save it by merging it into Harvard as that university’s engineering department. Eastman’s unsolicited gift paid huge dividends to all of humanity, via the technological upsurge subsequently powered by his beneficiary. Yet the very private Eastman insisted that his offering not be acknowledged. So for years MIT students belted out songs thanking the anonymous “Mr. Smith” for making their alma mater great.
Another generous philanthropist who occasionally operated out of sight for practical reasons was Jacob Schiff. The decades of pioneering medical care and social work he funded among miserable tenement dwellers in lower Manhattan were carried out by a younger unmarried female nurse named Lillian Wald. Because the mores of the day looked askance at male-female professional partnerships, Schiff ’s financing and close collaboration with Wald was kept private until her papers became public decades later.
Herbert Hoover’s Quaker faith motivated him to be a generous giver. That faith also prompted him to do much of it quietly. Once he became a public figure, he and his wife had additional prudent reasons to remain anonymous in their many extensions of assistance to needy people.
Their contemporary William Volker was a self-made businessman who used his fortune for two purposes: building up his adopted hometown of Kansas City, and creating an intellectual movement in the U.S. in support of market economics and individual freedom. Volker was a devout Christian, and wanted to avoid stirring up feelings of obligation, obsequiousness, or superiority via his giving. So he labored, especially in his local work, to follow the Biblical encouragement to make alms in secret. By the end of his life Volker was known as “Mr. Anonymous.”
Edward Harkness stewarded Standard Oil money he inherited from his father into an even tidier sum, then gave it to education, medicine, and the arts through some very intelligent philanthropy. He transformed Yale and Harvard through gifts that pushed them sharply in the direction of broad learning and intimate instruction on the British model, rather than the narrower scholarship of German universities. It was only Harkness’s “passion for anonymity” that gave him a lower profile than other givers of the Roaring ’20s.
Starting in 1937, drugmaker Eli Lilly built a mighty private philanthropy in Indiana. He very often gave in private and without attribution. Self-effacing to the end, he even requested that there be no eulogy at his funeral.
Another modest Midwesterner who favored anonymity in the deepest way was Margaret Cargill. During her lifetime she disbursed more than $200 million from her family’s grain-trading fortune, always on the condition of anonymity. She believed that attention should be focused on the people carrying out charitable work, not on those giving the money. Even at the most literal level, Cargill didn’t want to be recognized
When she would visit charities that she supported, she would have the director of her foundation introduce her as her aunt or mother. Living a quiet life and sharing her money without claptrap or acclaim made it easier to experience the true joy of giving, Cargill believed.
The continuing prominence of the anonymous
Skewering the undeniable vanity of some patrons has become a kind of parlor sport for critics of philanthropy. Yet faceless giving remains alive and well in twenty-first-century America. Consider just a few prominent examples of recent anonymous gifts:
Not long into the Afghanistan and Iraq wars, a financial trader placed $243 million of his own money in an account at the California Community Foundation and asked that it be channeled to servicemembers and veterans. And he did this anonymously. When leakers later revealed the donor to be David Gelbaum, a soft-spoken mathematician turned hedge-funder, he explained, “I don’t think that if you…give away a lot of money, you should get a lot of recognition. You shouldn’t be able to buy that.”
A mix of religious motivation and desire to educate the poor drove a catalytic anonymous gift that opened the doors of nine Catholic schools in Memphis, Tennessee. Most of those schools had been shuttered for many years for lack of funds, until two unnamed donors put up $12 million, sparking follow-up giving that eventually totaled $60 million. The revived schools now serve 1,500 poor children every year. “If these schools were a monument to certain adult benefactors, they’d be far less effective than when they are properly viewed as belonging to each individual church and neighborhood,” wrote the secret donors in an e-mail. “It is about the children, not the benefactors.”
In 2007, an anonymous gift of $100 million made it dramatically easier for low- and middle-income students to attend the University of Chicago without accruing heavy debt. A quarter of all undergraduates got improved financial aid packages as a result. Without a revealed donor identity, all the reporting on the large gift focused on the remarkable scholarships themselves, which quickly became an iconic part of campus culture.
At about that same time, another anonymous donor (or group of donors) put up a similar amount of money—more than $100 million—to increase financial aid at 20 large universities where many attendees are the first in their family to reach college. They were institutions like Michigan State, Binghamton University, Purdue, Montclair State, Southern Miss. The lawyers delivering the checks declined to explain the motivation behind this generosity, but one additional priority of the anonymous donor was apparent: all 20 recipient colleges had female presidents.
Just as those secret checks were being delivered, another donor gave a $50 million anonymous gift to Wycliffe Bible Translators, so they could create versions of Scripture in the last remaining 2,000 languages lacking a translation in their own tongue. The arrival of a version of the Bible in an obscure language often spurs a burst of literacy and social progress, and this anonymous gift helped speed Wycliffe’s linguistic progress from 20 new translations per year to more than 100.
Another recent gift prominently made off the record is the $275 million given to biotech research in San Diego in 2014. It propelled the San Diego area to the forefront of international biomedical science.
Why? Modesty and preference for a low profile
One of today’s premier practitioners of unproclaimed philanthropy is Chuck Feeney. An inventor of the duty-free shopping business, Feeney has given away $8 billion. He kept only $2 million of the vast fortune he earned so he could live quietly with his wife in a rented apartment in their old age. That means he donated 99.98 percent of his money.
And Feeney, who hates the idea of “blowing your own horn,” did all of this invisibly. For many years, no one even knew who had put all of the money into his Atlantic Philanthropies foundation. “I try to live a normal life, the way I grew up” in blue-collar New Jersey, he says. “I set out to work hard, not to get rich.” If someone does get rich, he thinks, the best way to keep your head screwed on straight is to “use your wealth to help people” while living simply, like a normal citizen.
Feeney is an enthusiast for bricks-and-mortar philanthropy; more than 40 percent of the billions he gave away went to erecting buildings for charities. Yet not one of the thousand structures he funded has his name on it. Even at Cornell—where Feeney donated more than a billion dollars after attending on the G.I. Bill—he has kept his name off every edifice and program.
Though his total giving to Stanford University comes to $135 million, Feeney has also remained wholly off the record there. The campus biomedical center was named for James Clark, but Feeney silently buttressed the project with $60 million. Similarly, the new library at Queens University in Belfast, Ireland, is named for Sir Anthony O’Reilly, who provided £4 million toward construction. Feeney gave £10 million to the same building.
Though he (like other anonymous donors) has surrendered lasting visibility and acclaim, Feeney relishes his ability to walk streets unnoticed, fly coach, and otherwise enjoy a private middle-American life. By giving anonymously he dodged all the disruptions that would have come with letting his identity be broadcast. Only after decades, when transactions at his businesses and foundation made it impossible for him to remain out of the public eye, did Feeney’s donations eventually become known
Journalists love to mock “philanthro-me” and “egonomics.” But the truth is, peacock donors are not the norm. Many generous donors are quite reserved and reticent. “Humility is far more common in the top tiers of philanthropy than egotism,” acknowledges philanthropy watchdog David Callahan. “Our writers at Inside Philanthropy have come across innumerable donors who are engaged in high-level giving, with barely a peep. They issue no press releases about their gifts, maintain no website, turn down all media inquiries, and otherwise stay mum about great acts of generosity.”
A common pattern is captured in this donor interview by philanthropy expert Paul Schervish: “We had six children and wanted a simple lifestyle…. From the very start we decided that the money we had inherited would be used for philanthropic purposes. We set up a foundation, but—this is very important—we gave the foundation an anonymous name which doesn’t relate to our family. And we have used the foundation not only for providing funds but for providing anonymity. And it is not known in the community that we provide funds for various things…. Confidentiality is terribly important to us. We live in a very low profile here, and our children in an even lower profile.”
The desire for a quiet life needn’t reflect pure modesty on the donor’s part. Sometimes a donor just doesn’t want to be harried by the flood of requests for money that can come with renown. Some donors want to give, without chastisement, to causes that family members may not understand or appreciate. Others want to help organizations that are controversial. Occasionally philanthropists choose to make a high-risk gift, discreetly, to a project they know could fail. Givers of all types and sizes and stages of life prize the right to work off the radar in these sorts of ways.
Why? Religious motivations
Moral and religious scruples motivate some people to avoid attention while giving. “Anonymous philanthropy is a form of moral identity in addition to a mode of practical action,” summarizes Schervish out of 130 interviews conducted with donors. “Remaining hidden helps donors transcend the corrupting lures of wealth and philanthropy”—things like “publicity, self-aggrandizement, and control.”
As one Catholic philanthropist recently explained to me, anonymous giving “is virtuous and respectful, in that it removes pride and servility from the transaction.” Donors told Schervish they believed that leaving their names off of gifts could “counter any feelings of superiority by the donor,” “shield the recipient from embarrassment,” “reduce obligations of gratitude,” “de-emphasize the importance of recognition and other rewards,” and forestall the unhealthy “proclivity to highlight the giver rather than the gift.”
There are direct religious injunctions against showy benefactions. In his Sermon on the Mount, Jesus urged: “Be careful not to do your acts of righteousness before men, to be seen by them…. When you give to the needy, do not announce it with trumpets, as the hypocrites do in the synagogues and on the streets, to be honored by men…. When you give to the needy, do not let your left hand know what your right hand is doing, so that your giving may be in secret.”
During the Protestant Reformation, Christian leaders re-emphasized the importance of pure motives and behavior when helping others. Martin Luther praised anonymity as a charitable method because “giving alms in secret means that the heart is not ostentatious, but is moved to contribute freely whether it makes an impression and gains the praise of the people or whether everyone despises or profanes it.”
Describing anonymous giving as “one of the most ancient and esteemed philanthropic practices,” historian James Smith cites a rabbi from the time of Herod who rebuked a wealthy man for giving a large coin to a poor man. Better not to share at all than to give in such a way that puts the recipient to shame, advises the teacher. A famous text by the medieval Jewish scholar Maimonides establishes a hierarchy of eight types of charity, with various forms of undercover giving hovering up at the top. The Koran likewise counsels that if donors can give zakat to the poor without revealing themselves, “that is best.”
Many American donors have anonymized their altruism for religious reasons. For instance, Dave Weyerhaeuser of timber fortune was a major Christian donor during the last half of the twentieth century, giving away more than $100 million starting in 1947. He considered it Biblically sound to do this without putting his name on any projects.
Stephen Adams was also spurred to give off the record by religious principle. After great success in private-equity investments he began playing piano and developed a deep love for classical music. He eventually gave $110 million, anonymously, to the Yale School of Music so that all future students could attend tuition-free. When he was later revealed in published reports, Adams explained that “my wife and I are Christians, and the Bible speaks of giving in secret.”
After one of my recent lectures on philanthropic history I received a letter from an anonymous giver who explained his method and motivation, and that of other Christian donors:
I have given hundreds of thousands of dollars over the last three decades to people in need. I deal with people one-on-one in a clinical situation. When I identify situations that can be solved with my intervention, I steer the person to the proper medical facility and make arrangements directly with the health professional. When the patient arrives, they find the treatment has been fully funded by an anonymous source. I chose my profession to be in a position to do this kind of work and fund this activity. I endeavor to follow the wisdom of a man who spoke on a mountainside two millennia ago. His advice has worked well for over 30 years, and I have been found out only once. These funds go directly to medical providers and are not deducted from my taxes as contributions, much to the chagrin of my accountant. The only people who know about this are my wife, my accountant, and God. Currently, none of them are talking.
Why? Practical reasons
There are also many practical reasons why donors sometimes prefer anonymity. Personal security is one concern. Gert Boyle, who earned her fortune at Columbia Sportswear, made many multimillion-dollar gifts publicly before shifting to an anonymous strategy after she was attacked inside her home by robbers. Giving by Charles and David Koch has brought them egregious threats to their security, as described later in this article. Rather than risk safety and peace of mind, some givers prefer to simply drop out of sight.
There are also instrumental advantages to anonymity. It can be a useful veil that helps donors observe recipients without fawning or ostentation. “Aunt Margaret” Cargill’s many quiet site visits helped inform and refine her philanthropy. Chuck Feeney was another billionaire who was often able to “kick the tires” at projects, as he put it, because his lack of prominence allowed him to wander about unescorted.
Donors often have managerial insights that can make charities more successful, but only if the person is able to gather reliable information and make critical observations from an unobtrusive vantage point. Schervish describes a faculty couple at Columbia University who managed to fine-tune their gifts for financial aid by assessing involved students and university managers in person without revealing that they were the source of the gifts.
Another goal of many anonymous angels is to reverse the charitable spotlight so the beam shines on those in the trenches. “We don’t like attaching our names to things,” says Laurene Jobs, an energetic distributor of the fortune her late husband Steve Jobs accumulated at Apple Computer. Her preferred alternative is “amplifying the great work of others in every way that we can.” Indeed, the giving vehicle Jobs uses to distribute her money, the Emerson Collective, is set up as a limited-liability corporation rather than a 501c3 because an LLC doesn’t have to publicly report grants and thus can operate much more quietly.
“Laurene is a private person, they are a humble family, and they have certainly been generous,” observed Ted Mitchell back when he was receiving Jobs support while running the NewSchools Venture Fund. More than modesty is at work here. By not splashing her name around as a benefactor, Jobs believes, she helps keep public focus on the actual work of the charities she admires.
Many donors agree that shifting attention to charities and causes rather than funders can help speed good results. From his interviews on this subject, Paul Schervish summarizes that “concealing one’s identity allows recipients to concentrate on their responsibilities instead of constantly looking over their shoulder at the presumed intentions of the donor. Arnold Kaviti explains that being anonymous, or at least ‘less visible,’ can ‘lessen the impact of your gift’ as a form of constraint and ‘increase the impact of your gift’ as a form of empowerment.”
Even philanthropists who don’t practice full-blown anonymity often see the value of keeping their profile as low as possible. The great Chicago donor Julius Rosenwald (who built Sears, Roebuck & Co. into a juggernaut) did not believe in giving in secret. He found that his public gifts often lent a credibility to the receiving charity that could be even more valuable to them than his cash. Yet Rosenwald often fought aggressively to keep his name off of buildings and projects. In addition to his genuine humility this reflected his view that if donors could convince a community, and fellow givers, to take ownership of a project and become emotionally invested in making it their own—instead of thinking of it as some rich person’s plaything—the undertaking would be much more likely to succeed over the long haul.
A prime successful example of Rosenwald’s method would be the Chicago Museum of Science and Industry. He almost singlehandedly willed it into existence, but refused to attach his name because he thought “If no name is used, it will belong to the people.” The institution was indeed enthusiastically embraced by Chicagoans once it opened as a non-named community fixture.
Home Depot co-founder Bernie Marcus made the same calculation when he declined to let his name be used on what was ultimately called the Georgia Aquarium. Though Marcus publicly propelled the project from beginning to end, and put up $250 million of his own money to get it built, he wanted the people of the state who had made his Home Depot chain a success to view the aquarium as their own prize possession.
Melinda Gates reports she got similar advice from Jimmy Carter (who became a very successful philanthropist after leaving the White House). “No matter what program you do,” he urged her, “you better make sure at the end of the day the community thinks it’s theirs, not yours. Let them own it.”
One businessman who has been a large-scale anonymous donor his whole life explained to Philanthropy how he executed a $15 million gift to build up character in young people with no personal visibility. He wanted to see more kids outside, not only to support the childhood joy and health that all such adventures encourage, but also to build Jewish identity in the participating youngsters. His money paid for camp scholarships and marketing. And he stretched his donation all the way across the country by asking philanthropists in more than
40 cities to match his donations 1:1.
This very private donor stipulated that he would stay entirely in the background and let his local matching givers get all the credit. In this way, he got a whole cadre of community donors excited about making public commitments, and strengthened the movement to the point where it now serves more than 70,000 youngsters at 155 sites across the U.S., under the oversight of 10,000 counselors who weave Jewish traditions into youthful fun.
Oklahoma oil and banking mogul George Kaiser has applied the same trick throughout his philanthropy (to which he devotes fully half of his time). He allows almost nothing to be named for himself. Instead, he approaches potential allies and offers them the public prominence if they will be at least as generous as his anonymous gift.
Putting the tech in Texas
Two of the great practitioners of anonymity as a technique for spurring parallel gifts are Peter and Edith O’Donnell. This Dallas couple relied entirely on invisible gifts in their remarkable effort to put the tech in Texas.
Back in the early 1980s, Peter studied data on the two businesses that had built Texas to that point—oil and gas, and agriculture and ranching—and concluded that those fields alone could not keep the state economy healthy in the future. He decided his home state needed to foster high-tech industry.
So he approached the president of the University of Texas at Austin, and offered to endow 32 new faculty positions in fields like computer engineering, microelectronics, physics, mathematics, computer-assisted design, and material engineering. The O’Donnells eventually created at the University of Texas more than 156 separate endowments—with market values that now approach half a billion dollars—to support science, engineering, and technology. And they did all this anonymously.
When announcing the gift in 1984, the college president explained that “our anonymous donor believes that the future of Texas and the United States depends on building our research and development capabilities, and he sees strong programs in science and engineering education as critical.” Over the next three decades, the O’Donnells funded faculty chairs, scholarships for technology students, and labs and buildings. And in nearly all cases, their many gifts carried the exact same condition: Anyone matching their anonymous donation would get the right to put his or her name on the faculty chair, or program, or facility that was created.
After almost exactly 30 years of privacy, the University of Texas convinced the O’Donnells that their method had succeeded wildly, and that they should shed their anonymity so the lessons of this savvy philanthropic strategy could be shared.
This secret giving by the O’Donnells made huge ripples across Texas, and our nation. Stepping into the shadows and offering the limelight to partners turned their nine figures of giving into several times that much, all of it channeled to science and technology infrastructure. Scores and scores of new professor slots, fellowships for talented graduate students, science labs, and computer facilities were created.
The O’Donnells’ faceless gifts built up a critical research mass in their home state, and the University of Texas became an incubator of some of the nation’s top minds and tech projects. “No one in history has had a greater impact on science and engineering in Texas than Peter O’Donnell,” says leading computer-science educator Tinsley Oden.
And turning Texas into a hotbed for engineering, electronics, computer science, and technology has had important effects on the wider American economy. Texas has become the most thriving and diversified economy in the U.S., the home of more technology-industry jobs than any state except California, the home of more IT firms than any state except California, our country’s powerhouse for exports, the top state for medical research, as well as for high-tech energy extraction, one of the business start-up hubs of America, plus a leader in patents, and in Internet connectivity. Much of this was fueled by the undisclosed giving of one humble Dallas couple.
The danger of forced disclosure of donors
Earlier in our history, a group of patriotic Americans concluded that our nation was not providing the full measure of freedom and justice that we aspire to. Some of these citizens were progressive humanists. Most were religious evangelicals. All were anxious to see the country realize its founding principles. So they did what residents of these shores have done since our beginning: they organized themselves, volunteered time, and gave money to charitable associations aimed at educating, cajoling, and rallying fellow citizens—with the ultimate intention of changing society.
That’s how America’s first Anti-Slavery Societies were formed. The backers of these new charities were viewed as fanatics by the establishment press, the Democratic Party, and most of polite society. There were quasi-official efforts to intimidate the donors and shut down their organizations. Just a few months after formation of the national umbrella charity backing abolition, a backlash crested. Opponents whipped up destructive mobs that targeted supporters.
The lead philanthropists—brothers who were relentlessly excoriated by status quo politicians and reporters—had several close calls with attackers. One had his dwelling and all of his family’s possessions destroyed by politically organized thugs. The family business was also assaulted. Those offended by the charitable priorities of the brothers next organized a multi-year boycott of the company, pressuring fellow businesses, customers, attorneys, and other professionals to refuse to work with them.
When the American Anti-Slavery Society expanded its advocacy campaign with speaking tours, fresh publications, new local chapters, and enough donated cash to mail out one million printed pieces presenting their point of view, an even more formidable enemy lashed out at the donors. The President of the United States called for these “incendiary” mailings to be interdicted before they reached the public. He pressed the U.S. Postmaster General to expose the subscribers and funders of this persuasive operation, so they could be subjected to social pressure and ridicule. Andrew Jackson also asked Congress to pass a national censorship law that would uncover and punish the backers of politically colored charitable efforts like these. Philanthropists across the country faced additional vigilante attacks, break-ins, beatings, and death threats.
It was with actual history like this in mind that the U.S. Supreme Court ruled in 1958 that government should not—cannot—force exposure of the identities of charitable donors. Unhappy with activities the NAACP was conducting in his state, the attorney general of Alabama had demanded that the charity reveal the identities of its individual supporters. The NAACP argued that this was an attempt to intimidate and scare away backers, violating their freedom of speech and assembly as guaranteed by the U.S. Constitution.
The court decreed, unanimously, that state action to identify donors would leave them vulnerable to “economic reprisal, loss of employment, threat of physical coercion, and other manifestations of public hostility.” Anonymity “may in many circumstances be indispensable to preservation of freedom of association, particularly where a group espouses dissident beliefs.” The fundamental American right to advance dissident ideas in association with others would be violated by “state scrutiny of…membership lists.”
The fact is, anonymity has been closely intertwined with free expression since the founding of our country. Much of the argumentation that fueled the American Revolution itself was produced without attribution (like Common Sense—the most widely circulated polemic in U.S. history, which was only later identified with Thomas Paine). The Federalist Papers (and many retorts) were also published anonymously as our Constitution was created, so they would be judged on their merits, rather than discounted or promoted based on who was behind the effort.
U.S. judges have repeatedly knocked down governmental efforts that interfere with anonymous voluntary action. “Anonymity is a shield from the tyranny of the majority,” warned the Supreme Court in McIntyre v. Ohio Elections Commission in 1995. It protects “individuals from retaliation, and their ideas from suppression.” Whether the flash point was trying to force small groups to disclose their donors (Brown v. Socialist Workers, 1982), or requiring advocates to publicly register before going door-to-door (Watchtower Society v. Village of Stratton, 2002), our courts have rebuffed authorities over and over for demanding the names and addresses of inconvenient activists.
Right up to the present moment, donors continue to prize anonymity. One branch of philanthropy that illustrates this is gay advocacy. From 1970 to 2010, far more money was contributed to charities promoting gay causes by anonymous donors than by any named individual or foundation. Today, anonymous givers continue to provide more funding for gay rights than even the biggest public supporters like the Ford Foundation.
Is it paranoid for givers to think they still need anonymity to protect themselves from critical scrutiny of their charitable gifts? Perhaps the houndings of philanthropists backing abolition, civil rights, religious freedom, and contested policy reforms are things of the past. Would forced disclosure really expose donors to risks?
Alas, continuing events show quite clearly that there is nothing paranoid or outdated about zealously defending privacy protections for givers. Prominent education, arts, medical, and policy philanthropists Charles and David Koch now receive more than 150 death threats annually. The lawyer responsible for monitoring menaces against the Kochs filed a court deposition in 2014 documenting 43 recent threats against the philanthropists, their family members, their company, and the charities they support. Some examples: “My friend Dan would literally shoot a Koch brother in the skull if he got the right angle.” “Can someone assassinate the Koch family already? What’s taking so long?” “Seriously, no joke, find them, kill them, be done with it. Simple. Legal. Justified.” “I hope both of them get cancer and suffer in pain for years.
The Americans for Prosperity Foundation and other charities supported by the Kochs regularly suffer aggressive protests at their public events. Attendees were injured when a 2011 meeting in the Washington Convention Center, for instance, was stormed by violent opponents. At one of the charity’s gatherings in Michigan, saboteurs sliced tent ropes with knives and box cutters, collapsing the heavy structure on those gathered inside. In his ruling supporting the right of the AFP Foundation to protect the anonymity of its donors, federal judge Manuel Real, an LBJ appointee, stated that “This court is not prepared to wait until an AFP opponent carries out one of the numerous death threats made against its members.”
Serious donor harassment and bullying is a continuing risk. Many Americans thus believe that preserving the option of anonymous giving remains vital to safeguarding charitable action and freedom.
The coming battle over donor privacy
The fraction of all U.S. gifts made anonymously is not large. But it will always be a very chunky minority. Duke University philanthropy expert Joel Fleishman estimates that around 10 percent of all individual gifts are currently made without attribution. That’s tens of billions of dollars every year.
Look over a recent decade of large gifts (a million dollars or more), and you’ll find that anonymous grants are more numerous than those of any other philanthropist except Bill and Melinda Gates. And in terms of total dollars handed over during that decade, the anonymous exceed everyone except the Gates family and Warren Buffett.
In 2016, 89 anonymous gifts of at least a million dollars were made—10 percent of all donations of that magnitude. That ratio has fluctuated as high as 19 percent in recent years. So charitable action carried out in privacy remains as popular as ever, and maybe more so.
Whether motivated by shyness, practical desires to limit visibility, concerns about security, religious motivations, or other factors, it’s clear the demand for anonymous alternatives will not be expunged from philanthropy. Indeed, the explosive growth of donor-advised funds at community foundations and private investment firms over the last decade is being driven partly by the ease with which DAF donations can be made nameless. Many contemporary donors use direct giving or personal foundations for a portion of their giving, and turn to DAFs (which do not have to disclose their grants) specifically when they desire to have their privacy honored.
The off-the-record option is clearly something generous Americans value and will go to great lengths to protect from government banishment. Indeed, there are cultural observers who believe privacy is needed more than ever today. We live in an era where any personal action or decision can end up on the Internet—and often does. Meanwhile partisans increasingly proclaim themselves insulted or injured by the opinions or behaviors of others, demand retribution, and try to ban actions they find off-putting. In this stormy environment, the deeply American right to act, argue, assist, and advocate through financial gifts to legitimate nonprofits—quietly, privately, without public pressure, censure, or reputational attacks—is a cultural bulwark in need of reinforcement.
Chris Anderson, who runs the nonprofit behind today’s popular TED talks, recently announced a new project responding to today’s pressures on individual expression and liberty. TED has just started creating completely anonymous talks on vital topics of the day. In announcing this venture Anderson asked, “How many people have an important message but refrain from ‘going public’ out of fear of losing their jobs or hurting loved ones? How many ideas worth spreading remain hidden because some speakers simply can’t publicly be associated with the very thing the world needs to hear? Our best guess? A lot.” The new TED program is called Sincerely, X.
Despite the obvious stakes in protecting privacy of personal action within a democracy, despite the many reasons donors cherish anonymity, and the multiple ways they employ it, despite the long train of U.S. judicial slaps at people who have tried to expose philanthropic reformers, still government regulators keep trying to chisel away at donor privacy. (See sidebar at the bottom of the page.) Pretty clearly, a showdown is coming.
Crusaders bent on influencing personal donations through the glare of forced exposure are going to run headlong into Americans who view the option of giving anonymously as a valuable liberty. The right to offer financial support without attribution is cherished for a wide range of reasons. But millions of citizens agree on one thing: Donor privacy is something worth defending against opponents, in the most vigorous ways.
The Philanthropy Roundtable’s Karl Zinsmeister is author of The Almanac of American Philanthropy, and What Comes Next? How private givers can rescue America in an era of political frustration.
- Philanthropic Freedom
The mission of the Alliance for Charitable Reform is the protection of philanthropic freedom—the right of Americans to choose how and where to spend their charitable assets. A project of The Philanthropy Roundtable, ACR educates legislators and policymakers about the central role of private charitable giving in American life and the dangers of legislative or political measures that would weaken or constrain the philanthropic freedom that makes such giving possible.