It’s time for philanthropy to dip into its pantries

Written by: Donna Schaper

Date: July 07, 2020

When the coronavirus first came to my consciousness, I went shopping. We made a plan: Don’t dip into our pantry until we need to.

And when we had to, we would replace it immediately with another 2 weeks stock. We’d live by the 2 by 2 rule of Noah and his ark.

We decided we would continue to live this French marketing way until we couldn’t anymore: The farmer’s market, the orchards in season, the small bodegas and Costco for staples constituted our little French circle.

We haven’t touched the pantry (yet) and, likewise, it appears the crisis of COVID-19 will last much longer than we had imagined.

Our endowment remains untouchable because it is kind of unthinkable to touch it. The best reason not to spend an endowment is that things might get worse – and then we wouldn’t even have our back up.

On the other hand, maybe spending an endowment could make things better. It might even restore people’s hope in foundations. Or maybe just restore their hope. Now that uprising has joined pandemic, many of us have misplaced our hope.

Foundations also have a pantry kind of plan. Many spend earnings and not capital. Certainly, many nonprofits and religious institutions have a plan: Never dip into your endowments, no matter what.

Before crises, one can shop the French way. One can pick and choose the boutique programs, the fresh idea, the short-lived idea.

During a crisis, we are forced to think long. When will we end police abuse of their power or the way people of color suffer more no matter what happens? Repair? Reparation? Unfund the abuse of power and release power to people? What good ideas for a pantry.

Philanthropy must change its practices and increase funding

We have to do both the work of mercy and justice at the same time. When 20 million jobs disappear in one month, people get legitimately nervous.

It could be a very good time to invest in a very good future, one where instead of using nature up, we sustain her long.

The Skoll Foundation recently doubled the money it is going to give away.

New money is a great approach to avoid spending investments, but it is unlikely to resolve the preexisting conditions that make all of us comorbid with this virus. 

We need to change our habits with our pantries, not just spend more money in the old ways we spent it.

Rep. Alexandria Ocasio-Cortez said: “The virus is like pouring gasoline on an already existing fire. We shouldn’t be surprised that we are all burning.”

The virus turns a spotlight on multiple and multiplying perennial catastrophes.  They are the slow drip of cruelty that keeps foundations in business.

A small pantry is likely a good one; a huge pantry is not. Why? It stagnates money and human energy – and keeps the good times of justice and fairness far away.

Why not bring the good times near? Ocasio-Cortez’s metaphor is a fire burning hard; mine is a pantry, getting empty and emptier because it can’t stand being rich while others aren’t.

I wonder what would happen if Pope Frances decided to spend down some of the Roman Catholic holdings and just send everyone a check. Regularly.

Until a new world appeared on the horizon, where people felt good about God again. He can keep 2 weeks worth, but keeping more looks like you are counting on the pandemic, the fires, to keep going.

What happens when an endowment is spent

I saw a religious institution spend from its endowment once, and it proved very useful, both to the parent institution and the community. The Coral Gables Congregational Church in Florida had an endowment of $13 million when I signed the paperwork to become their next pastor. In the time I signed, and then arrived, the endowment doubled because its source, UPS, went public. 

That amount of endowment is just too much for a congregation. It diminishes stewardship, causes the pastor to work without the congregation’s approval — because she really works for the endowment and doesn’t need the congregation — and makes the congregation look rich when its mission consistency and mission centrality is universal, not divisive. 

If a church doesn’t think all people are important, who does? If a church doesn’t understand a virus, and its way of scaring each other of each other, then who does?

The church made a plan to leverage its endowment. The first year it matched the Annie E. Casey Foundation and the Knight Foundation with a million-dollar challenge. 

Each foundation put in another $1 million and that $3 million launched Accion International’s first U.S. location in Miami. Last year Accion in Miami issued $13 million in loans, 96% of which were repaid. Leverage, leveraged. 

The second year the congregation gave $100,000 each in “MacArthur grants” to high achieving nonprofit leaders in the city. Those entrepreneurs went on to add major value to each of their institutions. 

The third year, as arts programs were cut in public school’s city wide, the church funded arts and music in those schools within its nearby zip codes. The artists who performed in the church’s jazz ministry taught the kids in school.

Spending the endowment bought ministry and mission. The church increased in members and credibility and the self-governance of an important institution was not threatened. 

The best thing to do with power and money are to give them away. Sustaining gifts or guaranteeing incomes is not something you do transactionally. Because doing so is genuinely good, it ends up giving back.

Foundations are often like my pantry strategy. We think short term. We don’t see how long term the damage is to our communities and how long it will take to put the fires out. 

We pick and choose from boutique programs instead of building capacity locally for our people so we can get out of the way. We shop the French way, which is daily, instead of the smart way, which is longer term.

What could foundations do now that would make them look good and actually use philanthropic money for the purposes for which we provided tax relief? 

  • Start a national service program, where people unlearn racism and sexism early enough to be different the rest of their lives. Innovate strategies and its development for such a program.
  • Get colleges and universities and museums to model the program’s eventual development by the feds. Start arts and repair projects like the government did under President Franklin Roosevelt. We are desperate for a Works Progress Administration.
  • Establish reparations. Fully acknowledge the damage racism has done, over generations. Give the pantry away because too many people never had one in the first place.
  • Put women in charge of giving away the money.
  • Don’t send anyone to college until they are 25 and know how to drink alcohol responsibly.

Do something so long term that it outlasts the current crisis. Match the government in innovative ways to run these programs. Guarantee incomes quickly and get money circulating.

Then when we have a robust and strong long-term economy again, start rebuilding your endowment so you have enough to give away in the next crisis.

Donna Schaper is senior minister at Judson Memorial Church in New York City.