cc  >> I'm going to encourage  everybody to grab a seat.  I think there are still some  left.  This is such a marvelous turnout  tonight.  Very pleased to welcome you all  to our UW Center for Non-Profits  inaugural program and  Communiversity session.  I'm Jeanan Yasiri.  I have the privilege of serving  as executive director of the  Center for Non-Profits.  And I'm going to be providing  just a brief update on the  progress that we've been making  over the last several months  regarding our center.  But first, I would just like to  say I am so personally delighted  to see such a marvelous cross  section of our community here  today, our campus community, our  Dane County non-profit  community.  We have executives and  volunteers, and other  stakeholders, certainly a lot of  students, faculty and staff,  all interested in the work  associated with non-profits.  Rich knowledge base and  experience that we were hoping  that would be willing to convene  for the purpose of  Communiversity sessions. 

 And you've proven this right,  for sure.  For those of you who are not  familiar with the origins of how  we began, I'll offer that  the UW Center for Non-Profits  officially became a center in  May of this year.  The Center was initially  explored in partnership with  tremendous support from  community and campus colleagues  that convened first in 2006 to  determine whether or not there  would actually be interest in  developing a center that was  devoted to the nonprofit sector  here at the UW.  That initial feasibility study,  and ultimately the bridge  funding that allowed us to  launch as a center, was made  possible by generous and quite  engaged in marvelous support by  the Oscar Rennebohm Foundation.  And we are quite pleased to be  able to welcome our friends from  the Rennebohm Foundation, the  president, Steve Skolaski, and  board member, Mary Gulbrandson.  And please join me in thanking  them for all they've done for  us.  (applause)  Our Center has three foci.  We are committed to education,  which certainly includes  advancing both undergraduate and  graduate majors in nonprofit  studies here at UW.  Research and dissemination of  that research.  And that would begin with two  new faculty positions that are  our faculty director and a team  of folks involved are currently  recruiting. 

 And the professional connections  piece, which includes forums  like this one, as well as many  others that are under  development as we speak.  As I previously noted, our  Center enjoys an administrative  home in the School of Human  Ecology here on campus.  But we have engaged staff,  faculty, students, from really,  across campus.  In fact, there isn't a corner of  campus that hasn't in some way  reached out to us and indicated  an interest in what we're doing.  Our undergraduate degree program  is currently going through the  final phases of development and  adoption.  And we are also working with  those cross disciplinary  colleagues on developing a  nonprofit studies PhD program.  Very excited about this, as it  will be one of the first in the  nation.  And certainly, no better place  to have that than the University  of Wisconsin.  It is an imperative of ours that  our Center really think  interdisciplinarily.  And in fact, that is a word. 

 We do use it here at UW.  But that interdisciplinary  engagement for a degree program,  is really something that will  differentiate us and certainly  make us strong.  One of our other imperatives as  we've been moving through this  year and moving forward, is  looking for those across campus  that have synergies who we can  partner with, who have, in some  way, already developed some kind  of connection to the nonprofit  community.  And together, we may be able to  build a more robust  collaborative strength on behalf  of nonprofits here at UW.  As an example, I know our forum  today certainly includes, as I  mentioned, folks from across  campus.  We have friends from the Law  School here, the College of  Agriculture and Life Sciences,  Letters and Sciences, as well as  the Business School.  And I have to mention, we have  contingent of a half a dozen  medical students, who very  recently founded the Healthy  Classrooms Foundation, and  reached out to our Center for  counsel.  We were happy to provide that to  them.  In the area of engagement here  on campus, the Morgridge Center  for Public Service, a national  leader in service learning, as  many of you know, and our Center  for Nonprofits have been working  very closely on establishing an  alignment.  And we'll be working on  formalizing that alignment in  the months to come. 

 We will certainly keep you  apprised of the development in  that area.  And of course, our students, our  core competency of our Center.  And we're very pleased to have  launched a student organization  this year that also is cross  disciplinary on campus.  In fact, when we were talking  with students who came to our  first meeting, and asked them  what their majors were, many  said, accounting.  Some said medicine.  Others were from, again, the  College of Agriculture.  And a variety of other areas,  including the classics.  We have a community organization  that we want to reach out and  thank today for helping in  supporting, financially and  otherwise, this new student  organization, associated with  the Association for Fundraising  Professionals.  And I know we have Christy  Shepard and her AFP colleagues  here today.  So we thank you very much for  the help that you've provided  for our student organization. 

 As part of the programming that  we're developing, I've been  particularly excited to lead a  new course that is funded by the  Kaufman Foundation.  It's called Entrepreneurialism  In Society.  It hosts over 100 students, and  explores the variety of areas  where innovative ideas can make  a difference for consumers, for  communities, and certainly for  the social sector.  We're very pleased to work  cooperatively with our partners  on this effort, the College of  Engineering, who provides us  with marvelous space and  technical support, the Office of  Corporate Relations, and our  friends at Wisconsin Public  Television, who actually tape  each of these lectures, as they  will tonight, and then put that  up on the University Place  channel, so that not just our  campus-based learners, but  lifelong learners across the  state are able to take advantage  of that class.  I should mention that many of  the students in that class are  here this evening.  And tonight, of course, as I  mentioned, we are launching our  Communiversity series.  These bring campus and community  colleagues together to discuss  important issues in the  nonprofit sector.  We are so appreciative to have  received generous funding from  the Alliant Energy Foundation  for this important and first  professional connection piece  that we're offering.  I know that the executive  director of that foundation is  with us today.  We want to thank you so much for  making this possible for all of  us. 

 (applause)  The nonprofit sector is really  generating a lot of buzz among a  lot of different people.  And in fact, we have been  particularly interested to know  that a lot of media have been  contacting us to learn more  about our efforts, and how they  can certainly enhance the  sector.  There is a copy of the Wisconsin  Week article that is available  to you outside.  You can take a look at it, and  it certainly provides our  contact information.  I heard from the Wisconsin State  Journal earlier today that a  story on our Center and sector  will be running later this week,  as will information on the  Center will be in Business  magazine, in their November  issue.  That includes information on the  business of nonprofits.  So let me offer, that in  addition to seeking campus  colleagues who have interest in  helping us to develop our  graduate program, we're  extending an invitation, really,  to any interested, campus or  community colleague who has  interest in affiliating with our  center.  As our program continues to  build, affiliates will be asked  to participate in shared  learning experiences with other  practitioners and researchers  affiliated with our Center for  Nonprofits.  And as funds become available,  certainly, research grants and  publications will be developed.  And this will become a venue for  affiliates to be competing for  those grants, and working  together on advancing those  research efforts. 

 So, if you have interests in  being an affiliate, or know  somebody who does, feel free to  contact me or my colleague, who  you are about to meet.  We are very happy to outline for  you the benefits, as well as  opportunities associated with  affiliating with our Center.  With that, let me introduce my  terrific colleague who serves as  our faculty director.  He will introduce our guest  speaker.  (applause)  >> Thank you.  I have a good job here,  introducing Barry Gaberman.  And Barry has a fascinating life  and career.  He was born in Shanghai in 1949.  He moved with his family to  Israel.  He later immigrated to the  United States, settling here in  Wisconsin, and was here as a  student in the 1960s. 

 So Barry sort of travels where  the action is actually  happening.  And then, after serving--  Actually, I got it wrong,  because he also was in  the US Army before coming here,  in West Berlin, during  the Cold War.  Then he returned to Madison to  complete his undergraduate and  masters degree here at the UW.  Barry joined the Ford Foundation  in 1971.  At the Foundation, he held a  number of important assignments,  with a lot of focus on Indonesia  and Indonesian affairs.  He was also chief of program  related investments, where his  duties included the management  of a $50 million revolving  capital investment plan.  After doing all of that, Barry  Gaberman became the senior vice  president of the Ford  Foundation.  He held that position until  2007.  During this time, Barry wasn't  just working and traveling, he  was also volunteering.  He serves on numerous boards,  too many to mention. 

 And the national ones are the  Council on Foundations, and  Independent Sector Board.  Since leaving the Ford  Foundation, Barry has been a  senior advisor to the Foundation  Center.  He also keeps up his traveling.  He's a distinguished visiting  professor at the American  University in Cairo, where he  teaches on philanthropy and on  civic engagement.  I do have to say that Barry has  been a great friend to the  Center over the past year.  He's helped us in a lot of ways.  We're very thrilled that he's  here with us today to help  launch the Communiversity  speaking series.  So please join me in welcoming  Barry Gaberman back to his alma  mater.  (applause)  >> I actually had no idea this  was the inaugural talk.  That adds just a little bit of  pressure. 

 It really is a pleasure for me  to be back in Madison.  Madison is my home.  At the risk of being a little  bit redundant, let me make a  small digression.    I arrived in the United States  in 1951 with my father.  We were both immigrants.  I was ten.  He was 42.  Our total net worth was $500.  He had that in cash.  And a couple of suitcases filled  with old clothing, primarily. 

 It was the end of a journey that  had begun in 1949 in Shanghai.  Our intent was to make our way  to California.  But on the way, we stopped in  Madison to visit our sponsor to  the United States.  My father met him when he was a  young ensign, serving in the  Navy, and stationed in China,  after the second World War.  He was now at the University of  Wisconsin, completing his PhD.  He had originally helped my  father get a job as a civilian  employee of the US Navy.   And he now helped my father get  a job in Madison.  So we put down roots, and I  became the quintessential  townie, going through grade  school, junior high school, and  high school in Madison.  In fact, after a stint in the  Army, I returned to Madison, and  enrolled in the University of  Wisconsin as a 22-year-old  freshman.  I completed my undergraduate  degree here, and went on to  graduate school in political  science, specializing in  governments and politics of  southeast Asia, and area in the  limelight since the Vietnam War  was going on at that time. 

 I thought of myself has having a  fairly straightforward career, a  career path that would have me  as a teacher.  But a funny thing happened on my  way to the classroom.  The Ford Foundation called and  asked if I'd like to work in  their field office in Indonesia.  That was 1971.  And 35 years later, in 2006, I  retired from the Ford  Foundation.  I think I had one of the best  and most rewarding jobs around.  But as I find my way back into  the classroom, I'm also aware of  what I missed.  Now what I'd like to do with you  today, is first layout the  context of civil society, and  why I think it's so important.  Having done that, I'd like to  talk about the philanthropic  slice of civil society,  particularly organized  philanthropy.  And suggest what the attributes  of organized philanthropy are  and what its primary mission  should be. 

 Then, I'd like to present what  philanthropy does under the  headings of charity, strategic  philanthropy, innovation, and  entrepreneurship with an example  or two in each category.  Finally, I'd like to end with a  few comments about the current  economic crisis, and what it  might mean for civil society and  for philanthropy.  I realize that there are a  number of you here who are in  the midst of taking a course on  entrepreneurship.  So let me put my bias up front.  I do not believe entrepreneurs,  just as I don't believe good  managers, are the product of the  for-profit sector of society.  In my years at the Ford  Foundation, I've seen many  examples of creativity,  innovation and entrepreneurship  in the public sector and the  nonprofit sector.  I'm not sure if entrepreneurs  are born or made, but I am sure  that they exist in all sectors  of society.  And that is my jumping off  point.  Not so long ago, we essentially  thought of society as split into  two sections, two sectors.  A for-profit sector for business  and a public sector or  government. 

 We knew there were a bunch of  organizations that didn't fit  into either category, but they  seemed to be a diverse cluster  of organizations without much in  common.  Over the past few decades, we  have begun to think of them as a  sector in their own right.  At first, we called them  not-for-profit organizations and  non-governmental organizations.  Labeling them by what they were  not, rather than by what they  were.  In time, we began to refer to  these organizations as the third  sector, the independent sector.  And more recently, the term that  seems to have caught on globally  is civil society.  It's not a new term.  And it has been used by thinkers  from Plato to Putnam.  The problem is, they all use the  term differently.  But while we may have trouble  defining civil society, we do  know what organizations in civil  society look like. 

 And we know them when we see  them.  These are organizations that  provide services, often to the  neediest in our society.  These are organizations that do  advocacy to make sure the voice  of all, and particularly those  voices seldom heard, are  listened to.  These are organizations that  conduct impendent public policy  analysis to make sure our  leaders feet are held to the  fire.  These are organizations that  educate us throughout our lives.  And these are organizations that  enhance our identity and  enjoyment through artistic and  cultural activities.  Now, while this is an intuitive  functional description of what  civil society organizations do,  it would be unfair to say no one  has attempted a true definition.  Lester Solomon at Johns Hopkins  offers a structural definition,  consisting of five features.  These are institutions that are  organized, he said.  They have some structure and  regularity to their operations,  whether they are formally  constituted or legally  registered. 

 And here, he's talking about not  just the one and a half to two  million not-for-profit  organizations that are legally  constituted, but that seven and  a half million-plus associations  that don't have a legal identity  that often tend to fly under the  radar.  He also says these are  institutions that are private,  not part of the state apparatus,  although they may receive  support from the public sector.  These are institutions that are  not profit distributing.  These are institutions that are  self-governing.  And these are institutions that    are voluntary.  Membership or participation is  not legally required or  otherwise compulsory.  The problem with both my  functional description and  Lester's structural definition  is that it lacks soul.  It's a bit like a sex manual  that's all technique and no  love.  What happened to the normative  dimension of civil society?  I realize that such a scientists  often have difficulty dealing  with normative issues.  But to many, this is what counts  about civil society  organizations. 

 They're seen as places that are  inclusive, tolerant,  participatory, and  values-driven.  Now the problem is we can all  point to organizations that  don't embody these attributes at  all.  What are we to do then?  Let me suggest a possible way  out of this dilemma that some of  you might see as a sleight of  hand.  What I would like to suggest it  that all civil society  organizations are part of the  not-for-profit sector.  But not all not-for-profits are  part of civil society, only  those that build social capital.  My first foray into teaching,  after retirement from the Ford  Foundation, was at American  University in Cairo, where I  helped design a course on the  role of philanthropy in society.  When I presented this sleight of  hand to my class, one of the  students raised his hand and  asked me whether I considered  Hamas a civil society  organization.  I might have been new to  teaching, but I knew enough to  use an old teacher's trick, and  to turn the question around and  ask him what he thought.  He said he thought it was,  because it delivered services  effectively and had popular  support.  But then he persisted and asked  me again what I thought. 

 I said I didn't think so,  because it didn't renounce  violence, and I had a hard time  squaring that with building  social capital.  Now I'm not sure if there is a  right or a wrong answer to his  question.  But I am sure that the sleight  of hand provided us a chance to  debate in a way that enhanced  our insight.  Most people think of the  instrumental functions of civil  society from the safer ones,  like health, education and the  arts, to the edgier ones, like  community organizing, climate  control, public policy and  advocacy.  But there's another important  dimension of civil society.  And that is, its generic  function.  If you think of the transitions  from authoritarian regimes to  more open and participatory  regimes, that took place in  Latin America in the 1970s, in  eastern and central Europe in  the late 1980s, and in Asia and  Africa in the 1990s and the new  millennium, it is tempting to  ask what is to prevent a  regression to those more  authoritarian forms  of government, as we have had  in the past.  To many, the answer lies in the  layer of civil society  organizations that are out  there.  Now to be sure, these  organizations have always been  there.  But what makes this historical  period different is that there  are many more of them. 

 They're aware of each other.  And they're being part of a  sector.  And they are increasingly linked  in self-supporting global  networks that enhance the soft  power of their influence.  We live in complex times where  the issues are multifaceted.  At times like this, the  traditional division of  government and the judicial,  legislative and executive  functions may not be enough to  guard against the concentration  and abuse of power.  The addition of an independent  press as a fourth estate helps  to guard against this abuse of  power.  But it is not enough.  I would suggest to you that the  generic function of civil  society organizations is another  layer that helps guard against  the abuse of power.  In this sense, civil society is  an important fifth estate of the  polity that helps build the  common good.  Having tried to make the case  for civil society, and why it is  important, let me know shift to  the philanthropic slice of civil  society. 

 Perhaps a definition of  philanthropy is in order.  There are many of them out  there, historical, linguistic,  religious.  By and large, I find these  interesting, but of very little  practical utility.  I prefer a straightforward  definition.  Philanthropy is the voluntary  capture of private wealth for  public benefit.  This includes individual  philanthropy, organized  philanthropy, and corporate  philanthropy.  But my main concentration will  be on organized private  philanthropy.  I've used the word voluntary  here, because after all, the  state also captures private  wealth.  But the last time I looked, it  was hardly voluntary.  Years ago, when we talked about  organized philanthropy, we were  talking, essentially, about  independent foundations, family  foundations and a handful of  community foundations. 

 Today, the number of  philanthropic models has  increased, as has the operating  style of these philanthropic  actors.  We have venture philanthropy.  A re-invigoration of giving  circles.  Diaspora philanthropy.  And what many people see as the  democratization of philanthropy,  Internet giving.  Where once the operating model  was to build and endowment in  perpetuity, today we have  pass-through efforts,  foundations with explicit sunset  provisions.  And a lively give while you live  movement.  Now there's a tendency in this  field to be unnecessarily  critical of each other's models.  The traditionalist's moan that  all this is really old wine in  new bottles.  The new players insist they will  stay focused on root causes,  avoid creating dependency, and  never become the slow,  over-bureaucratized institutions  of the past. 

 My own take on this is that we  have much more important work to  do than to engage in this kind  of divisive behavior.  If you will recall the  definition of philanthropy that  we started with, it seems  reasonable to me that the  broader the menu of models, the  greater the chance that people  will find a vehicle that  resonates with them through  which to conduct their  philanthropy.  Organized philanthropy has a  number of attributes that make  it valuable to society.  Among them are its ability to  take on risk in a way that the  for-profit sector cannot,  because it is under the tyranny  of the bottom line.  In other words, it can afford to  fail.  Organized philanthropy can also  take on politically sensitive  issues that the public sector  tends to stay away from.  This was the case with early  development of contraceptive  technology.  It can also support activities  that while they may have streams  of earned income, need a measure  of subsidy in order to continue  operating.  Organized philanthropy can stay  in the game for the long haul,  and it is particularly well  suited to supporting pilot and  demonstration projects.  Organized philanthropy can  support the demands of a  particular segment of society,  where the consensus to make  those demands a public priority  doesn't exist. 

 This is particularly useful in  diverse society.  Finally, perhaps not an  attribute, but a mission of  organized philanthropy, and  perhaps its primary mission is  to support the institutions of  civil society.  It is, after all, primarily  through these institutions that  organized philanthropy carries  out its program objectives.  One hazard here that has become  all too common in recent years,  is for civil society to think of  itself as an alternative to  government.  It's a dangerous arrogance.  If you want to sustain change on  a large scale over time, there  simply is no alternative to the  public sector in its ability to  extract resources through  taxation.  The point is that each of the  three sectors has a set of  attributes that give it a  comparative advantage at some  things.  And the task is to craft policy  and programs that play to the  comparative advantage of each of  the three sectors.  Earlier, I mentioned the  divisive dialogue among  proponents of various models of  organized philanthropy.  One of its manifestations is in  the debate over charity versus  strategic philanthropy. 

 Simply stated, the critique is  that charity deals with the  symptoms of the problem while  strategic philanthropy deals  with the root causes.  But organized philanthropy  consists of almost 75,000  foundations and only 4,000 of  them have any staff at all.  If only 50 of them are  institutions that have assets  of a billion dollars or more,  and only 500 have assets of $100  million or more, then strategic  philanthropy is the province of  only about 1,000 of the largest  institutions of organized  philanthropy.  Is this to suggest that there's  a linear progression from  charity to strategic  philanthropy?  The closer you are to the  charity side of the continuum,  the lower you are in the food  chain.  I think this is an unfortunate  occurrence, and it stems from  the fact that we don't have a  language that adequately  describes the charity side of  the continuum.  It seems to me that a working  hypothesis might be that all  those philanthropic  organizations that support  charity might do more to build  social capital in society than  all the strategic philanthropy  put together.  Perhaps we should call this  social capital philanthropy,  which at least doesn't sound  pejorative.  Let me take an example of  charity.  One of my favorites is DC  Kitchens.  And it's always dangerous to  talk about something when you  know someone in the audience  knows a great deal more about it  than you will ever know. 

 Now, the founder of DC Kitchens  that Washington, DC, with its  many embassy affairs, as well as  other gala affairs, much food  was going uneaten and wasted,  while many in the district were  going hungry.  By working with the caterers and  others, he was able to set up a  system that collected the  uneaten food, repackaged it, and  provided it to the hungry.  Today, DC Kitchens feeds 10,000  a day.  Is it a charity?  Sure, it is, because it deals  with a symptom and not a root  cause.  Those hungry today will still be  hungry tomorrow.  But who could argue that it is  creative and professionally run?  I particularly like this example  because the initial success has  led to a second effort.  That effort is to take the  unemployed, and to teach them  the business of food  preparation.  And here we have an example of  where charity leads to dealing  with root causes, for some.  A step toward strategic  philanthropy.  Now let me give you an example  of strategic philanthropy. 

 A number of years ago, the Ford  Foundation decided to work with  the problem of a loss of  teachers of color, particularly  male, in primary and secondary  education.  We felt that it was important  for young people to have these  role models in the classroom.  We noticed that many men of  color were leaving the military  after 20 years, but they were  still fairly young, with  pensions.  We identified this cohort of  achievers for second careers in  education.  And set up programs in the  vicinity of military bases to  attract them to an educational  program that would qualify them  as teachers.  The strategy was powerful and  strategic, but the program  failed.  It failed for the simple reason  that these men were so valued by  industry that we could not offer  them the pay as teachers that  they could get in other places.  But to identify a strategy, to  try it out, and to risk failure,  is exactly what foundations  ought to be doing.  Let me move from charity and  strategic philanthropy to  innovation and entrepreneurship.  When Franklin Thomas became the  president of the Ford  Foundation, he was specifically  concerned about the failure of  inner city high schools. 

 He charged us with crafting a  program to deal with this issue.  We reviewed several research and  operational activity, but none  seemed likely to strike new  territory.  And then, one program officer  suggested we study success  rather than failure.  He reasoned that there were,  here or there, inner city high  schools that were successful.  The demographics, their  resources and their teacher core  were no different.  But they were successful.  Why?  This line of reasoning led to  the inner city high school  recognition program, a program  of research and awards that was  targeted on understanding  success.  The innovation in this case, was  the simple program strategy of  asking the counter intuitive    question rather than the obvious  question.  Let's not study failure.  Let's study success. 

 Often, this results in a blind  alley.  But every now and then, it pays  off.  The key finding, incidentally,  from the inner city high school  recognition program was that the  most important variable is the  principal.  The right principal gets rid of  the teaching deadwood, brings  the community back into  involvement with the school, and  turns the environment in the  school from one focused on  security to one focused on  learning.  Finally, let me say a few words  about entrepreneurship.  By looking at Microcredit and  the story of a bank in  Bangladesh.  When Muhammad Yunus returned to  Bangladesh after having earned  his PhD in economics in the  United States, he was faced with  the issue of very poor, largely  landless people, who had no  collateral, but who needed to  borrow money to engage in a  number of basic economic  activities, like husking rice,  or raising a cow for market.  And their only recourse were the  exorbitant rates of the money  lender.  It seemed that nothing he had  learned prepared him to deal  with this problem.  He borrowed from the traditional  self-help methods and formed  potential borrowers into groups. 

 Using his own money at first, he  made loans to individual  borrowers, but made the group  responsible for the repayment.  A default on the part of an  individual meant the group lost  its ability to secure loans for  its individual members.  The experiment was promising,  and he approached the Ford  Foundation for a grant to expand  it.  The Ford Foundation gave him a  whopping grant of $25,000.  And as he expanded the program,  it continued to show impressive  results as far as loan  repayment.  Several more grants followed.  And each allowed a further  expansion of the program with  continuing remarkable results.  Muhammad Yunus had hit the  big time when he was offered  a $3 million soft loan  for his program.  The catch was that they wanted  the first ten percent of losses  to be guaranteed.  At this point, the Ford  Foundation guaranteed the first  two percent of the losses  through a recoverable grant, and  the next eight percent through a  program related investments. 

 We never had to pay a penny.  And in the future, others were  willing to provide soft loans  without a guarantee.  To date, hundreds of thousands  of poor Bangladeshis, most of  them women, have secured loans.  And in fact, the Grameen Bank  has outgrown its initial funder.  There was a tendency to try to  dramatize what Muhammad Yunus  did by making it much more  complicated than it was.  In reality, what he did was  substitute group discipline for  collateral.  And it worked.  This is a particularly exciting  program, because it shows  entrepreneurship at two levels.  The level of the Grameen Bank  itself, and the level of the  individual borrower who put the  funds to work by engaging in  economic activity.  Now, almost every significant  success is subject to  revisionist thinking. 

 This was the case with the green  revolution started by the  Rockefeller Foundation, and the  Ford Foundation, in the 1950s.  It dramatically increased the  yields of crops, such as rice,  wheat and maize.  Yet the unintended consequences  were that it exacerbated income  and inequality because it was  the better off farmers that  could afford  the necessary inputs.  And it may have caused both  ecological and genetic problems  for the future.  All this is true with the  benefit of hindsight.  But we must remember that in the  1950s, our estimates of  population increase suggested  there might be 30 billion people  or more people on the planet,  not the 11 to 13 billion we  expect now.  Given this, how to feed the  planet was a primary concern.  Microcredit also has its share  of revisionist thinking.  The main critique is that it  might be a way of adding an  increment to the livelihood of a  poor person, but it is not a way  out of poverty.  Alleviating hunger was a primary  issue of the recent past. 

 Alleviating poverty is a primary  issue of today.  What then, is a primary issue of  the future?  And is philanthropy ready to  respond?  I would suggest it just might be  climate control.  And the recent commitments of  $500 million by the Packard  Foundation, $200 million from  the McKnight Foundation, and  $100 million from the Hewlett  Foundation, suggests that  philanthropy will step up to  this plate.  Let me end by turning to the  current economic crisis.  What does it mean for civil  society and philanthropy?  My answer is that it may be a  bit cloudier, but the sky isn't  falling.  Everyone loves to moan about a  crisis.  Meltdown and tsunami are  frequently heard descriptions of  the current situation.  We are prone to take the most  dire situation facing an NGO we  are familiar with, and  extrapolate from the particular  to the general.  So it comes with a bit of  relief, if not a dash of  disappointment, when the data  doesn't uphold the doom and the  gloom.  Given the USA has looked at the  data over the past 40 years, a  period of time that has included  economic slowdowns, short  recessions, and long recessions,  those of eight months or more in  a given calendar year. 

 When giving is segmented into  three categories of individual  giving, foundation giving, and  corporate giving, it is hard in  the aggregate to see what all  the fuss is about.  Total giving, adjusted  for inflation, averaged 2.8%  growth across the 40-year period  1967-2007.  In slowdown years, that average  dropped to .8%, but it was still  growth.  During short recessions, the  average was a decline of 1%.  And during longer recessions,  it was 2.7%.  These figures were not  significantly different for  individual philanthropy, for  foundations, or surprisingly,  for corporations.  Now, if you want to argue that  this economic downturn is  structurally different than  those of the past, something we  are inclined to do, but with the  benefit of history and  hindsight, usually turns out to  be wrong, then all the bets are  off.  But it's not something I'm  inclined to do, at least not  yet.  As always, with aggregate data,  the devil is in the details.  So here are a few issues to  watch that require  disaggregation and more study. 

 The first is, will the economic  downturn affect specific  subsectors like health,  education, arts, religion, and  those edgier issues like human  rights, community organizing,  and climate control differently?  The second stems from the fact  that organized philanthropy is  represented by a greater  diversity of giving models and  styles than ever before.  What would the effect of the  economic downturn on Internet  giving, venture philanthropy,  remittances from Diaspora  communities, and those who have  put sunset provisions on their  organization's life, or are part  of the give while you live  movement?  The third issue is what will be  the consequence of the growing  number of global corporate  mergers and acquisitions on  their giving programs?  Will it mean less staff giving  away less money?  Or is the increasing cache of  global corporate responsibility  strong enough to buck this  trend?  Finally, who are the NGOs that  come into vogue in bad times?  The ones that are counter  cyclical.  Foundations are wired to think  of substance rather than  function.  But does function come into its  own in troubled times?  And here, I'm thinking of the  many NGO support organizations  that work on fund raising,  strategic communication and  governance.  Nonprofit organizations, for the  most part, operate on small  margins, where unrestricted  funds are meager, and working  reserves almost unheard of.  So even a small decline in  giving can mean being  unsustainable.  After all, a colleague of mine  once quipped that we have the  nonprofit sector, because no one  has figured out how to make  money out of what we do.  Given this reality, I would  suggest a few principles to help  guide organization leaders.  The first is don't panic.  And be particularly attentive to  the anxiety of your staff during  these times. 

 The second, is put yourself  through a contingency planning  exercise with a series of best  and worse case scenarios.  The third, is think  strategically about what you do  and how you do it, and make  necessary adjustments.  The fourth, is engage in a bit  of high touch with your most  important supporters and  partners.  Finally, this is the time to be  vigilant about your mission.  When facing a belt tightening,  funders are more likely to be  focused on how you perform that  mission.  Even at the bleakest of times,  there are opportunities to those  that can fight off the tendency  to become immortalized, or chase  funding for activities  regardless of how it aligns with  their mission.  It may be unpopular to say so,  but a periodic shakeout is not  all bad.  It helps reduce redundancy, and  unsustainable efforts.  On the positive side, it  presents new possibilities for  strategic alliances that play to  the strength of all.  In a peculiar way, the changing  priorities of organized  philanthropy may be more of a  threat than a downturn in the  economy, especially if the  changes are precipitous and not  handled responsibly and with  sensitivity. 

 I thank you very much.  I'm willing to listen to  comments and short speeches, and  to take questions, as long as no  one asks me whether Hamas is a  civil society organization.  >> Thank you, Barry.  (applause)  Because we are taping this  session, we want to make sure  that we actually capture your  questions through the mic.  So my colleague is in the back  in the center.  So, if you've got a question,  just kind of put your hand up.  Jenna will watch that side of  the room and I will watch this  side of the room.  We'll be very happy to pass the  mic to you for questions to  Barry.  As we're watching for your hands  to go up, Barry, you've been  doing a lot of work overseas.  Obviously, you mentioned that  you're teaching at American  University in Cairo, and also in  the next few months going to be  going to Paris. 

 We've actually at the Center,  recently heard from a movement  that is advancing philanthropy  in Europe.  And it's sounding like a very,  very new model, just a new  concept for Europeans.  I'm wondering if you'd like to  reflect on how philanthropy is  different overseas, particularly  in the European nations.  >> Well, philanthropy isn't new  in Europe.  There are lots of foundations.  But there are some differences.  For example, many fewer  foundations in the European  setting tend to look across  borders and to fund either in  the greater Europe, or beyond  that.  So you have quite a difference  between US foundations, where  something on the order of 11% of  the funding is for international  activities, and European  foundations.  That seems to be changing.  And organizations like the  European Foundation Center, the  analog of a council of  foundations in the United  States, is bringing that to  fruition. 

 One of the things that's also  quite different in Europe is  that for most European  countries, they don't have a  payout requirement for their  foundations in the same way that  we do in the United States.  So let me give you the most  egregious example of this.  On the one hand, the Gates  Foundation, at $35 billion plus  or minus, I haven't looked at  the market lately.  At $35 billion, it gives away  about a billion and a half  dollars a year.  That doesn't include the  pass-through Buffet gift.  The Ikea Foundation, roughly the  same size, and housed and  incorporated in Holland, gives  away $5 million.  And it gives it away for design.  Now, it is very hard at times  like this to see a justification  for the exempt status of a  foundation based on the fact  that it's going to contribute  something meaningful for public  benefit.  And in fact, the Dutch  legislature is now starting to  look at that.  It is clear to me that Ikea  Foundation exists for the  purpose of providing a poisoned  pill to prevent the takeover of  Ikea, and not for any  philanthropic purpose at all. 

 I don't want to paint all of  European foundations by any  means like that.  I once had an argument with  someone at a German foundation  about the whole point of payout,  and the fact that it seemed to  me that the foundation's payout  was rather modest.  In fact, by law, they were only  required to give 75% of the  dividends they received from the  corporation.  And of course, the corporation  can control what it does in  terms of giving.  And he turned around and said to  me, well, that's because you  live in the United States.  And you've never gone through  the hyper-inflation of a place  like Germany, where jobs are the  most important thing.  And what we do is see this as a  way of stabilizing the economy.  So there are different takes on  all of that.  I suspect that in the future,  you're going to hear more and  more about European foundations.  There are now a whole cluster of  Italian foundations that are in  the $5 billion to $8 billion  category. 

 And they're beginning to  experiment with overseas grant  making.  >> One of the criticisms of this  civil society is its  fragmentation, and that there  can be great ideas that are  never taken to scale, like in  education or healthcare.  I wonder if you could speak  about the efforts of  organizations that are trying to  address this issue of  fragmentation.  >> I guess I start out from a  different place on that.  And I'm not sure that I think  the fragmentation is necessarily  all that detrimental.  I like the fact that there are  lots of actors out there doing  things.  And it seems to me that  diversity is a strength of civil  society, just as it's the  strength of organized  philanthropy.  Having said that, it is clear  that some ability to create more  strategic alliances among  organizations.  You know, civil society  organizations very seldom go out  of business.  Even when we thought this was  all going to happen after 9/11,  not much of it really happened. 

 And now, we're talking about the  fact that many of the  organizations will go out of  business.  And sure, a few of them will.  But in fact, they have a  persistent way of hanging on.  And the famous case of something  like the March of Dimes, you  know, when it solves the issue  it was set out to do, it doesn't  go out of business.  It just turns its mission to  something else.  So there is a sort of  interesting persistence about  civil society organizations that  allows them to ride out a rough  time.  There's another comment that I'd  like to make.  And it has to do with pilot  projects and demonstration  projects.  After all, that's what civil  society does an awful lot of.  And if you take a look and track  the history of many, many pilot  and demonstration projects, what  you find out is that they seldom  get beyond a pilot project or a  demonstration project. 

 And I'm not sure if the blame  for that is to be put at the  foot of civil society, rather  than at the foot of large,  multilateral and bilateral  programs, that when they see a  very interesting pilot project  that looks like it's promising,  have a tendency of almost  immediately jumping in, trying  to replicate it in 40 different  places, with a ton of money.  It takes away all of the  original controls that one had  in place, that allowed for the  success.  So the failure of those, I'm not  sure necessarily sits with the  civil society organization or  its fragmentation.  >> Thank you so much for your  explanation of charity and how  it relates to the strategic  philanthropy, and the spectrum.  It was very clear, very concise  and, at least for me, well  understood.  But do you have a sense of where  the weighting or value of  dollars exists out there between  the two?  Is it 80/20 one way or the  other?   >> I'm sorry?  >> When you spoke of charity.  >> Yes.  >> And you spoke of its  relationship or how strategic  philanthropy, which goes after  root causes on the other end of  the spectrum, and you used a  couple of examples, and you  spoke of how both have their  place, both are good, what is  the sense of the volume of  dollars that is going into civil  society, or going into  philanthropy, the weighting  between those two?  Do you have a feel for that?  >> My sense is that it's  probably fairly evenly split.  And the reason for that is while  the vast majority of  institutions themselves might  engage in activities that are  more on the charitable side of  the continuum, they really do  represent a much, much smaller  amount of the dollars.  For example, the Council on  Foundations has, oh, about 2,500  members right now. 

 That's 2,500 out of 75,000  foundations in this country.  But those 2,500 members account  for 95% of the resources that  organized foundations have.  So I think when you look at it  in terms of dollars, it probably  comes out fairly evenly split.  And that's giving a little bit  of the benefit of the doubt to  larger foundations, who might  think they're engaged in  strategic philanthropy, and we  might as good observers and  reviewers want to question that.  >> You talked just a minute ago  about entrepreneurship.  Banks fund entrepreneurs not at  all.  Entrepreneurs are funded by  friends, family and fools.  Banks fund existing businesses.  Foundations fund start-ups and  they like the start-up.  They like the start, but they  aren't there for the long haul. 

 How do we address this issue,  because sustainability, in my  experience, is the most  difficult part of working with  nonprofits, especially with  foundation money.  >> You're absolutely right.  I had a throw away line in the  talk, in which I said that  foundations have as one of their  attributes the fact that they  can stay the course for the long  haul.  But the fact is that  unfortunately, too often,  foundations stay away from  sensitive issues, aren't willing  to take risks, and run to  whatever the new fad is, rather  than staying the course.  It just seems to me that's such  a shame given the fact that  these are institutions that  really have the sort of  authority structure that allows  them to be able to stay the  course.  The only thing I can give you is  it just takes education, changes  perhaps at board levels and  governance, and places like that  to try to get foundations.  And many of them, you know, do  stay the course.  But you're right, it's a  problem.  It's an attribute they have.  It's an attribute that's  under-utilized by foundations. 

 >> We're going to offer one last  question here from our friend  Kathleen Paris.  We have a reception that's going  to follow, immediately after.  And we'll give you some details  on that.  Kathleen.  >> Thank you for your suggestion  not to push the panic button.  We all appreciated that.  But a couple times you mentioned  climate control organizations as  being edgy.  And I was just curious what you  meant by that.  >> Well, it's not an area that  really is something that I've  been terribly involved in.  But when I was teaching the  course at AUC, one of the  students said to me, well, these  are all fine. 

 But where do foundations stand  with the really important  societal issues of the day.  And it made me think that, you  know, historically, when we all  thought that slavery was a  natural order, foundations were  an important funding source for  the movement that began to build  against that abominable  practice.  It struck me that when we  thought we couldn't feed the  planet, foundations stepped up.  When I looked at what was  happening in the realm of social  justice and human rights, so  often it was foundations that  were funding those things.  And the Microcredit movement,  another case in point.  What I was just trying to do was  to say, okay, what is it that's  the particular issue that's  before us.  I suppose I could've picked  conflict resolution as an issue  that we have.  I might have suggested that the  continuing of poverty  alleviation.  But it seemed to me that the  issue that more and more was  grabbing the attention of people  was climate control.  And you know, with the  interesting recent development  of China now becoming on par  with the United States in terms  of its effect on the  environment, and other things,  that that might be the one issue  that we needed to get together  in the next decade or two,  before things became  irreversible. 

 And I ask myself, if that's the  case, when I'm going to be  argued down about that, so what  are foundations doing?  And much to my surprise, even in  a bad time, you have three  foundations that have stepped  up, quite boldly, and  collectively said they put in  $.8 billion to look at  that set of issues.  I don't know if they're going to  look at a sort of scientific and  technical fix, or a behavioral  fix in this.  But I was just trying to give an  example of what might be an  issue for the future, that  foundations might step up for,  because there's a certain  exhilaration in knowing that  you've done, you know, your  piece of what's really  important.  >> I know everybody joins me in  thanking Barry for his comments  and his insights today.  (applause)  One of the goals of our  Communiversity sessions is to in  fact bring our campus community  and our nonprofit community  together.  And we have a reception that is  right outside of the room, just  to the right.  If you're not signed up for our  listserv, you have an  opportunity to do that, as well  as pick up the handouts that I  mentioned, right outside of the  room.  And I'm also supposed to  mention, as a student just  handed me a note, that the  student chapter that I mentioned  earlier, the AFP collegiate  chapter, will be meeting in room  2349 following the reception.  Thank you all so very much for  joining us.