Philanthropy in America: A History by Olivier Zunz (review)

In this volume, Olivier Zunz presents a persuasive argument for the importance of philanthropy in American history. The philanthropic sector currently employs the third most people in the United States (after retail and manufacturing) and is poised to grow significantly in the coming years. It is a diverse sector including museums, colleges and universities, hospitals, homeless shelters, etc. Some non-profit organizations such as the United Way are household names throughout the United States (and abroad). While historians have been writing about aspects of this field for decades, few have tried to systematically examine the entire American philanthropic sector and none has done so as well as Zunz.

Zunz seeks to “tell the story of the convergence of big money philanthropy and mass giving that has sustained civil society initiatives over the long twentieth century” (p. 3). Building on his earlier work Why the American Century? Zunz analyzes the construction of the philanthropic sector both in terms of American exceptionalism as well as the interplay between elite ideologies and the growth of democracy through civil society. Given this emphasis, his narrative addresses the work of foundations (funded from a single source) as well as public charities (supported by mass philanthropy). His work, like many, has a bias toward foundations, which have more complete historical records. The book is organized chronologically, spanning the latter part of the nineteenth century to the near present. By adapting this approach, Zunz concentrates on the period of scientific philanthropy when reformers sought to attack root causes of inequity and create measurable solutions to societal problems. Zunz integrates social change into his narrative and does an admirable job covering the development of the philanthropic or nonprofit sector from a mainstream perspective.

The primary lens through which Zunz examines these developments is the relationship between government policy and philanthropic practice. This is a key element in the development of the nonprofit sector, which Zunz traces from the legal recognition of boards of trustees to define and redefine the mission of their trusts in the late nineteenth century through the creation of the tax code to regulate nonprofits in the twentieth century. Along the way, he shows how Herbert Hoover sought to use philanthropy to function as a “no cost” extension of the federal government, the inability of this system to deal with the exigencies of the Great Depression, the subsequent growth of federal programs through the New Deal in the 1930s and eventually the Great Society in the 1960s. In the process, philanthropies found themselves unable to compete with federal initiatives, despite previously unimaginable wealth being held by large foundations. This reality, combined with a political system in which conservatives worried about the power of these nonprofit organizations, initially led to a retrenchment and timidity in their programming.

Soon, nonprofits found new approaches turning to international development (in the context also in the Cold War context) and supporting advocacy to swing the government’s resources (primarily in support of civil rights). Both of these resulted in controversy. On the one hand, foundations became conduits for American foreign policy initiatives and received funds from the Central Intelligence Agency to support their international programs. While this collaboration eventually undermined trust in these foundations, the more immediate reaction came from advocacy, which to some in Congress seemed to represent meddling in the political process.

Zunz traces efforts to bring more transparency and accountability to the nonprofit sector in reaction to this “advocacy” role already in the 1930s, but it has its greatest impact in the 1960s with the landmark Tax Reform Act of 1969 that prevented direct payment to government officials, limited support of advocacy groups, and required dispersements of 5% of their assets. Finally, Zunz describes how thereafter foundations, public charities, government officials, and academics worked together to outline the parameters of the nonprofit sector remaining separate yet dependent on government funding in many key areas. Key changes again came through the legal system when the...