Philanthropy at Midcentury: “Timid Billions”?
By the middle of the twentieth century, Americans had created a large philanthropic enterprise that was part of the fabric of their daily lives. It included an impressively diverse set of institutions, ranging from local community chests to national health organizations, from small family foundations to wealthy general-purpose foundations. By 1938, there were still only 188 foundations in the United States, but for the first time a significant number of them were located outside of the North-east. During the war years, the number of charitable foundations more than doubled, to 505, and this figure would nearly triple by 1955, when the number was estimated at 1,488.1 Characterized by a mix of secular and religious purposes, the nonprofit sector as a whole provided a medium through which Americans channeled their excess income to help the poor, to enhance children’s education, to promote cultural activities, to fund science, and to initiate agricultural reform in poor countries.
Concurrently, huge federal outlays in welfare as a response to the Great Depression, in big science for the country at war, and in education for veterans boosted fields heretofore in the province of philanthropy. In reporting these new government outlays (at all levels of government), some postwar economists at the National Bureau of Economic Research invented a new expenditure category they called “public” philanthropy, which accounted for 9 percent of a $482-billion GNP in 1959. Philanthropy, by contrast, claimed the equivalent of a little over 3 percent of GNP (and that included money raised by churches). Adding an estimated value for volunteer work would have raised philanthropy’s percentage of GNP to 5 percent.2
The inherent variety of philanthropic endeavor, as well as competition with the state in science, welfare, and education placed it at the crux of key arguments over the makeup of the American political economy at midcentury. Philanthropists adopted different strategies of giving, depending upon where they stood politically within these debates. Liberal donors, who assented to big government, underwrote a large secular educational and scientific establishment that was both empirical and pragmatic in essence. Their conservative counterparts championed a smaller government, saw secularism as a threat that degraded American life, and resented America’s entanglement in foreign affairs. The two groups of philanthropists openly opposed one another, and their feud, exacerbated by Senator McCarthy’s anti-communist campaign, became a battle for the future of the country.
Philanthropy at Midcentury
During the New Deal, Roosevelt and Morgenthau had launched investigations into the finances of a few “economic royalists,” as the president called them, carefully chosen from among his political opponents, who had seemingly used the charitable exemption as a means of tax evasion or taken advantage of other loopholes in income and estate taxes. It is easy to dismiss these prosecutions as politically motivated, because indeed they were. But in conducting his war against “the forces of selfishness,” Roosevelt had not so much departed from traditional tolerance of inequality as insisted that the rich should return part of their wealth to the society that made it possible for them to acquire it in the first place.3 His selective enforcement of tax laws gave the country the National Gallery of Art and a few other philanthropic institutions that came to life in the postwar years.
The president and his treasury secretary most famously targeted Pittsburgh banker Andrew Mellon (Morgenthau’s predecessor in the previous administration). Mellon had masterminded vast investments in steel and chemicals in the Allegheny region and had created the monopolistic Aluminum Company of America. Throughout his public career as Harding’s, Coolidge’s, and Hoover’s treasury secretary, Mellon continued to manage his private affairs, and suspicions had arisen that he was using his position for the advantage of his companies. In 1924, Senator James Couzens from Michigan denounced Mellon on the Senate floor for conflict of interest and launched an investigation into the workings of the Internal Revenue Service.4
Influenced by another Pittsburgh businessman, Carnegie’s associate Henry Frick, Mellon had begun acquiring European masters in the 1910s. His buying reached a climax in 1930 after Josef Stalin authorized the secret sale of some of the Hermitage treasures to help finance the Soviet five-year plan. With the assistance of a clever London art dealer, one of America’s greatest capitalists in the course of a single year purchased twenty masterpieces from the world’s greatest communist, including works by Frans Hals, Rembrandt, Van Dyck, Velazquez, Botticelli, and Raphael. As these were secret purchases, the treasury secretary stored the paintings in the basement of the Corcoran Gallery in Washington, D.C., and also in an apartment below his residence, where only he and a few close associates had access.
Mellon transferred some of his paintings to the Andrew W. Mellon Charitable and Educational Trust he had created in 1930 for the “furtherance of the public welfare” and “to promote the well-doing or well-being of mankind.” As Mellon gave the paintings to the trust, he took the tax deduction that the law afforded for such gifts, but in effect he kept the paintings in his private possession. He intended, he claimed later, to have the trust transfer the collection to the U.S. government to form the nucleus of a national gallery of art in Washington, D.C.
That this was in fact his intent is certainly plausible. As treasury secretary, Mellon had the task of overseeing the long-delayed beautification of the Washington Mall. The 1902 McMillan report commissioned by Congress—a classic document of the City Beautiful Movement—had recommended transforming the Mall from a jumble of commercial stands and railroad lines into a monumental space. Mellon oversaw the construction of the Federal Triangle and of John Russell Pope’s National Archives.
Roosevelt and Morgenthau started the offensive in 1934. Whether Mellon had resolved early on to build a national gallery of art, and if so how firm his commitment was, we will never know for sure. Only after Mellon was charged with misusing the charitable deduction did he recruit Pope to be the architect for the gallery, and only at the end of 1936 did he begin negotiating infrastructure and design. Mellon died in 1937 at age 82. The Board of Tax Appeal exonerated him posthumously due to a lack of sufficient evidence, but Roosevelt clearly savored a victory on inaugurating the National Gallery in 1941. Having forced Mellon’s hand, he now praised him as “a giver who has stipulated that the gallery shall be known not by his name but by the nation’s.”5
There had been no fiscal incentive for setting up philanthropic foundations in the early twentieth century (chapter 1), but that changed dramatically after the creation of the income tax in 1913. The New Deal administration broadened its probe by exposing the rich who evaded taxes, and the results were tangible for philanthropy. At congressional hearings in 1937, Treasury leaked the names of sixty-seven wealthy Americans who had lowered their income tax by transferring large personal revenues to holding companies after Congress reduced taxes on such enterprises. In addition to Mellon, the likes of banker Thomas Lamont, industrialist Pierre du Pont and his close associate John Raskob, newspaper owner William Randolph Hearst, and General Motors president Alfred P. Sloan (all personal foes of Roosevelt), had used this perfectly legal if objectionable device to lessen their obligations to the state.6
Sloan had invested in a yacht and incorporated it as a holding company (an “incorporated pocketbook,” Morgenthau called it). When publicly exposed, Sloan argued he had not meant to evade taxes, only the liability associated with operating the sailboat. The bad publicity generated by this incident tarnished Sloan’s public image, and he attempted to restore his reputation by accelerating giving to a philanthropic foundation he and his wife had created three years before, albeit one initially dedicated to promoting an alternative to the New Deal programs for the country.7 The foundation would later play an important role in worldwide research on cancer.
The New Deal inheritance tax was directly responsible as well for the creation and vast expansion of the biggest American philanthropic institution of the postwar era—the Ford Foundation. In December 1934, Morgenthau proposed to the White House a graduated inheritance tax (on heirs’ individual shares) in addition to the existing estate tax (upon the entire estate).8 Creating the new tax turned out to be too complicated, but Congress instead raised the estate tax dramatically to a maximum of 70 percent for fortunes above 50 million.9 Opponents denounced the measure as the “soak the rich” tax act.
The Ford case and its impact on American industry was heavily debated on the Senate floor. What would happen to the family-owned company if the Fords were forced to sell their shares to pay the increased estate tax (estimated at half the stock value—itself a matter of speculation since the company was not held publicly)? In going to Ford’s rescue, Senator Arthur Vandenberg of Michigan prophesized the end of the great industrial empire: Under “this proposed tax confiscation … it will be driven into the hands of Wall Street, or its equivalent; and the money-changers, who have striven vainly in years past to achieve this end and whom the administration says it proposes to drive from the temple, will have been handed the dominion which in no other manner could be obtained.”10
Vandenberg’s protests were to no avail. The act went into effect on January 1, 1936. The same month, Henry and his wife Clara, and their son Edsel incorporated the Ford Foundation as a benevolent corporation under the laws of Michigan, in part to consolidate administration of the family’s good works in and around Detroit.11 More importantly, the foundation gave the Fords the means simultaneously to avoid the huge inheritance tax and to pass on the company to the next generation without losing control of it. Their decision to resort to a perfectly legal mechanism ultimately proved to be a turning point in the history of the nonprofit sector. In February 1936, Henry Ford willed most of his stock not to his son but to the foundation; Edsel did the same.12
Edsel died first, of cancer in 1943, three years before his father. With the two men’s estates being settled at about the same time in 1947, the foundation received about 90 percent of the non-voting stock in the company. By this means the Ford family avoided much of the tax burden and Henry II, Edsel’s son, kept full control over the ailing automobile company his grandfather was leaving behind. If it had not been for the foundation, Henry II and his two brothers would have paid an estimated federal estate tax of $321,000,000 and lost control of the company.13 This was also how the Fords not-so-consciously created the largest foundation in the United States in a single stroke. Hence the commonly heard charge that the leading American foundation of the 1950s began as a tax-dodge.
Although foundation dollars never accounted for more than 10 percent of overall giving, the large foundation became better established in these years. In 1930, Frederick Keppel, head of the Carnegie Corporation, had reflected on the foundation as a “factor in American progress.”14 At midcentury, a handful of big foundations constituted a sub-sector of their own, one of great wealth and consequent influence over the worlds of knowledge and policy. Four foundations (Ford, Rockefeller, Carnegie, and Duke) had assets of over $100 million in the 1950s; fifty or sixty more had assets exceeding $10 million. By the end of the 1950s, the Ford Foundation’s estimated resources were at least twice the size of Harvard’s, the wealthiest university in the country. In fact, Ford’s $3.6 billion endowment was the equivalent of 67 percent of the estimated total endowment for all American colleges and universities.15
It was also during the New Deal that corporate foundations began to appear. These were yet another variant of the foundation idea, in which the funding came from current corporate revenue rather than from a separate endowment income.16 Badly in need of money during the Depression, community chests lobbied Congress for a corporate tax exemption, so that they could more easily entice local corporate contributions. Despite opposition from both President Roosevelt and Treasury Secretary Morgenthau, the Revenue Act of 1935 exempted charitable contributions for corporations of up to 5 percent of net corporate income.17 This should have provided corporations the required incentive to give, but enlarging philanthropy at the expense of stockholders’ returns involved considerable legal wrangling. Following the accepted wisdom that only stockholders owned corporate profits and that management was not free to distribute even a small percentage to charity, most state corporate charters had no clause authorizing such disbursements.
During the 1930s and 1940s, several states responded positively to pressures from community chests and enacted legislation allowing corporate contributions. By 1956 three quarters of the states had such laws on the books.18 The corporation’s right to give away stockholders’ profits was tested in the New Jersey Supreme Court in A. P. Smith Manufacturing Company v. Barlow in 1953, after stockholders in this company manufacturing equipment for gas and water industries had successfully blocked a small donation to Princeton University. Frank Abrams, of the Standard Oil Company of New Jersey, who wanted to develop corporate philanthropy, joined by the Ford Foundation in its own effort to expand the boundaries of the nonprofit sector, funded a successful appeal where the court upheld the contribution to the university, clearing the way for a broad-based corporate philanthropy.19
Even though the 5 percent maximum donation authorized was rarely met, the Korean War tax on excess profits spurred corporate donations. College administrators naturally sought out their many alumni in positions of responsibility across corporate America. Prominent among them, AT&T public relations executive Arthur W. Page devoted considerable skills to attracting corporate gifts to Harvard.20
Another reason that the philanthropic sector grew was the successive revisions of the tax code, which made it increasingly cheaper for Americans in the middle and higher tax brackets to give money away by reporting charitable contributions along with the other allowed deductions itemized on the long-form tax return. In 1949, depending on the giver’s income, a $1,000 gift translated into a tax savings of between $228 and $765.21 Both community foundations and community chests benefited. Community foundations had fallen on hard times in the early years of the Depression, but they grew again as donors wanted to lower their inheritance tax but insisted their gifts be used locally. From total capital assets of just about $54 million in 1941, the estimated resources of community trusts climbed to just over $100 million in 1949.22
Taxpayers became ever more familiar with the mechanisms by which they might secure tax credits by engaging in philanthropy. Local lawyers and numerous manuals instructed potential donors on how to create their own foundations to trade charitable contributions for considerable tax advantages.23 In 1952, Treasury raised the allowable charitable deduction from 15 to 20 percent of income.24 Among wealthy taxpayers, an increasing number turned to the family foundation as a more effective way to shelter dollars than contributing to an existing charity. Instead of giving to local community chests, museums, libraries, colleges, or other fundraisers, they gave to their own foundation, and this allowed them maximum flexibility. They could accumulate money for several years before making gifts while sheltering the donated income from taxes, or they could give only in good years. As these small funds greatly augmented philanthropic dollars, chambers of commerce and local charities endorsed them. The majority of foundations created at midcentury were small family foundations—over 5,000 existed by the mid 1950s—and had no big plans and no staff to carry them out.25 They were products of American capitalism and the tax code. A good many were scrutinized by the IRS for various forms of self-dealing and delayed disbursements.
The mass philanthropy that had come of age during the previous half century dramatically expanded in the 1950s, engaging in a dizzying array of overlapping charitable campaigns, involving both fundraising and volunteer work. America now entered the golden age of mass fundraising. To enlarge the pool of donors, mass philanthropies perfected fundraising techniques they had pioneered during the war. National health organizations and community chests canvassed American neighborhoods in annual drives. In addition to door-to-door collections, bake sales, and even barn dances helped raise money.
Modest contributions from ordinary Americans provided the backbone of this form of giving. In 1950 one analyst for the Russell Sage Foundation estimated that Americans with incomes below $3,000 accounted for 60.4 percent of all charitable contributions; the figure jumped to 80 percent when incomes under $5,000 a year were considered. Beginning in 1944, all taxpayers filing a short form could claim a standard deduction on their tax returns, whether they made donations or not. Some in the nonprofit sector feared such a deduction for all would hurt charitable donations, but it became clear that Americans’ charitable giving was not motivated solely by tax incentives.26 In fact, donors in the lowest tax brackets remained among the most generous of Americans.27 By 1950, 1,318 chests (up from a mere thirty-nine chests in 1920) received contributions from 57 percent of the U.S. population.28 In Indianapolis, community chest leaders, who prided themselves in promoting the “goodness of people,” recommended that wage earners give four or six, or even up to eight hour’s pay per annum to the chest.29
Community chests continued to coordinate local efforts through federated fundraising drives, and they apportioned the money raised. A signal event was Detroit’s United Foundation-Torch Drive in 1949, which collected over $9 million, a year after local businessman Walter C. Laidlaw merged the community chest and other Detroit charities into the United Foundation. Henry Ford II, as well as UAW’s Walter Reuther, helped organize the campaign. That same year, federated charities in Boston recruited 35,000 volunteers, a “veritable army of solicitors,” many of them among lower-middle-class housewives.30 A great many United Funds across the country eventually came under the aegis of a national governing body known since 1970 as the United Way. Such national offices of charities often called on experienced professional fundraisers in these years to oversee their campaigns and to ensure that local agencies adhered to the best fundraising practices.31
Mass philanthropy penetrated not only American neighborhoods but also factories and offices, where payroll deductions helped expand collections. New Deal tax withholding had generalized the method. The charitable payroll deductions enabled corporations to manage solicitations more effectively, siphoning donations to federated charities and away from individual charities. In addition, after the passage of the Taft-Hartley Act, management saw the payroll check-off as a way to prevent union personnel from engaging in ancillary union activities on the shop floor.32 For its part, labor used its promotion of philanthropy to strengthen its community-leadership position. In 1941, Ford became the first major automaker to agree to a check-off of UAW union dues. Dues were deducted automatically from paychecks, and a charitable contribution could be added to this deduction. About 40 percent of all labor agreements provided for such charitable withholdings by 1946.33 In 1949 in Detroit, the federated campaign suggested that hourly employees make an annual donation equivalent to five hours of pay and that executives give from 0.5 to 2 percent of their annual salary.34
Americans naturally continued to give vast sums to religious institutions, but the portion of those gifts that went to philanthropy is difficult to evaluate, as churches have no reporting requirements. The bulk of the money collected from parishioners went to church maintenance. One of the few reliable estimates available comes from a 1957 survey conducted by the National Council of Churches of fifty-two Protestant and Eastern Orthodox churches in the United States. These churches spent 81.1 per cent of the money they collected for local congregational expenses and a significant 18.9 percent on benevolences, including foreign missions and relief abroad.35
Despite the American population’s intense level of commitment to philanthropy at midcentury, some insiders expressed worries that regardless of their wealth, philanthropic organizations were not responding to the new circumstances of state competition with ambitious enough goals. They felt the challenge of “public philanthropy.” Edwin Embree, a veteran of both the Rockefeller Foundation and the Rosenwald Fund, feared that, with the first generation of institution builders gone, the big foundations were spending only “timid billions.” The largest foundations had become bureaucratic organizations in their own right, with well-connected boards of trustees and a professional staff to distribute the money. “In spite of the increasing number of funds and the desperate needs of the world,” Embree wrote in a 1949 Harper’s article, “there is an ominous absence of that social pioneering that is the essential business of foundations.” Embree denounced the lack of “creative attacks on basic problems.” He recalled Frederick Gates’s warning against a “scatteration” of philanthropic resources, “the sprinkling of little grants over a multiplicity of causes and institutions,” and projects too “narrowly defined.” Quoting a study critical of philanthropic practice by sociologist Eduard C. Lindeman, Embree expressed fears that there were too many conservative bankers and lawyers “and friends of the founder” among trustees, and that they all wanted to play it safe. He urged the new generation of leaders to “turn these great social forces” to “fresh attacks” “on social frontiers.”36
Identifying such problems in the face of the huge investments of public philanthropy posed a challenge. The military’s large-scale venture into science had brought the state into research fields that foundations had funded in the 1920s and 1930s. The Rockefeller Foundation had been at the forefront of advances in physics worldwide, for example. Now John D. Rockefeller III struggled to “make the peaks higher” at the family foundation.37 With defense R&D in World War II and the Cold War, scientists had come to depend on a level of funding that only the state could provide. The same was true of advances in biology and medicine. In 1938, the Federal government spent only $42,430,000 funding natural science and technology research; in 1940 the figure was $770,120,000.38 One foundation official complained in 1949: “We raised three million dollars for cancer research and then read that the government proposes to appropriate thirty million to the same cause; it’s very discouraging.”39 Moreover, by sending veterans to school and paying their tuition, the GI Bill of 1944 put more resources at the disposal of American universities than all foundations combined. In 1950, the creation of the National Science Foundation—the brainchild of Vannevar Bush’s wartime National Defense Research Council and the Office of Scientific Research and Development—led many to believe that science might no longer need philanthropic funding. A decade later a quarter of the annual income of Harvard University (fully 57 percent in the medical school) came from one or another federal agency.40
Mass philanthropy faced a similar dilemma when it came to social welfare services. In a typical year during the 1950s, state and federal governments covered about 73 percent of such services, ranging from school lunches to veterans’ programs, and up to 95 percent of the cost of assistance to the elderly. This forced a great many charities to rethink their mission. Some found niches in such social services as family counseling and juvenile delinquency.41 In Indianapolis the Family Welfare Association became the Family Service Association and its program “changed from one of serving only the economically disadvantaged to one of providing casework service, no longer just to the poor but to any person in the community who might request it, regardless of economic and social status.”42 All residents seeking services became eligible irrespective of their personal resources. In Wilmington, Delaware, the Family Society shed its welfare past to focus on therapy, including marriage counseling.43
Philanthropic leaders found themselves operating in a world where every program they put forth competed with a federal program. Anxious about a big government takeover, they argued before congressional panels and in public debates that philanthropic dollars ought to be spent as “venture capital,” a term they used repeatedly to mean that they would engage in experimental projects too risky for tax dollars (most often without explaining what exactly they had in mind).44 At the Russell Sage Foundation, the leading philanthropy in social work, trustees invested their resources in the new behavioral and social sciences.45 Officers of the Kellogg Foundation, which had focused its energy on fostering community around rural Battle Creek, Michigan, began thinking of problems affecting metropolitan and industrialized areas.46 But it was at the Ford Foundation that a few executives came together to write the postwar textbook for a liberal internationalist program for philanthropy.
Liberal Philanthropy at Midcentury
Henry Ford II brought considerable managerial ability to the foundation. He had been still in his twenties when he revitalized the automobile company by hiring able managers away from GM, as well as Harvard-trained “whiz kids,” Robert McNamara among them. Together they retooled the production line and returned the company to profitability. Henry II turned next to the foundation. He was well aware that all potential beneficiaries (including the IRS), who could claim a share of the bounty, would closely watch this new giant of philanthropy. Cultural critic Dwight Macdonald later derided the Ford Foundation in the New Yorker as “a large body of money completely surrounded by people who want some.”47
Henry sought advice from one of the foundation’s trustees, physicist and MIT president Karl Compton, on how to get “the best thought available in the United States” so that he could “most effectively and intelligently” put the foundation’s enlarged resources to work for “human welfare.”48 Compton recommended enlisting the services of a young lawyer by the name of H. Rowan Gaither, Jr., who had distinguished himself as assistant director of MIT’s Radiation Laboratory during the war and had since gained visibility by overseeing the RAND Corporation’s conversion from Air Force-sponsored to civilian think tank.49 He was chairman of its board when Henry Ford II contacted him in 1948 about the foundation.
Gaither was swayed by Ford’s commitment to an organization that was independent of family control and that possessed vast resources. Both conditions were equally important to develop a program capable of energizing the foundation. While there was still some uncertainty about what the foundation’s assets might be worth on the market, Ford was essentially asking Gaither to dream up ways in which he could use a large endowment for the betterment of humanity, and fast. He estimated that the Ford Foundation would have $10–15 million to spend in 1949, and perhaps as much as $40 million by 1952. John Gardner from the Carnegie Corporation expressed the hope that 98 percent of the foundation’s funds could be allocated to the solution of critical problems. Others believed that was much too ambitious considering overhead expenses. A 50 percent efficiency after five years was perhaps more realistic.50
In 1948, then, Gaither brought together eleven men with experience in public policy and academia. Although none rose to lasting prominence, they were among the brightest of the generation that reached major positions of responsibility in the war. Together they brought to the task of reinventing the foundation much knowledge of their own, as well as an extensive scientific and academic network on which they could rely. Some were Gaither’s friends from his University of California days; others, he had met through war work. Like Gaither, they had been involved in national defense but were now committed to world peace, greater American participation in world affairs, and the United Nations as the privileged medium through which to negotiate international tensions.51 Although the Cold War would eventually force them to reconsider this hopeful vision, together they defined a liberal internationalist program for the foundation. This was the most influential philanthropic program of the postwar years, emblematic of how liberal and educated members of the generation perceived their future.
Donald G. Marquis, department chair in psychology at the University of Michigan and president of the American Psychological Association, represented the social sciences. Marquis had served on the Research and Development Board of the National Military Establishment—the immediate successor to the War Department and forerunner to the Department of Defense—and it was there that Gaither had first heard of him. Gaither also called on Peter H. Odegard, who had written on interest-group politics and become chair of Berkeley’s political science department, and on Thomas H. Carroll II, a friend from undergraduate days at Berkeley, now dean of the University of North Carolina’s business school. William C. DeVane, a dean at Yale recognized for curricular innovations integrating science, the arts, and international affairs, represented the humanities. For education, Gaither brought in Francis T. Spaulding, a former dean of the Harvard Graduate School of Education and a trustee of the Rockefeller’s General Education Board, now serving as the New York State Commissioner of Education.
For the sciences, Gaither relied on Danish-born Charles C. Lauritsen, a pioneer in nuclear physics and a contributor to Vannevar Bush’s National Defense Research Committee. Lauritsen, who had spent much of the war developing rockets and proximity fuses, was a staunch opponent of the development of the H-bomb. The hope for lasting peace shaped his participation in the study committee. Finally from medicine came Thomas Duckett Jones, a graduate of the University of Virginia’s medical school who had become research director at Boston’s Good Samaritan Hospital.
Gaither recruited four more men to staff the planning team. William McPeak had worked for the Association for the Aid of Crippled Children and the American Heart Association, where he had acquired experience in mass philanthropy. Don K. Price, Jr., like McPeak a Southerner, had helped draft the legislation establishing the National Science Foundation; he was especially interested in mediation between politicians and scientists over research policy, the topic of his 1954 book, Government and Science. The other two staffers were again friends from California days, Dyke Brown, a partner in Gaither’s San Francisco law firm, and Paul Bixler, a cofounder of the Antioch Review.52
While early-twentieth-century philanthropists who established foundations had left few detailed blueprints, this group deliberately defined one generation’s main philanthropic agenda. They answered Embree’s call for big ideas. Their proposal was to recognize the “interdependence” of human actors, and then turn all manner of social interaction into productive events and sources of happiness.
That the Gaither committee intended to speak in the name of a much larger group of philanthropic leaders, civil servants, professionals, and academics is clear from the way they went about preparing their blueprint for reform. The team consulted experts nationwide and supplemented expert testimony with opinion polls revealing what had caused Americans distress and what, in the years ahead, might add most to their enjoyment of life. In all, they traveled an estimated 250,000 miles, interviewed over 1,000 specialists, and wrote twenty-two interim reports before completing their final document, which was published in 1949.53
Imbued with the optimistic postwar spirit and steeped in the grand philanthropic tradition of working for the good of mankind, the Gaither team targeted nothing less than providing “each human being optimum spiritual and political freedom, opportunity, sense of responsibility, and happiness.”54 Throughout the Gaither report, a call for respect for human dignity—rather than specific plans—dominated discussions of the political process, labor-management relations, racial inequality, and international relations.
Inspired by America’s new place in the world, the committee insisted on the vital connections between international and domestic situations. It was not enough to insure peace; what was needed was a peace that would “assure the ever-increasing realization of democratic ideals.” Only we Americans could lead the world in this direction, they concluded, and only if the country maintained “internal strength, stability, and vitality in our political, social, and economic institutions, and in our people themselves.”55
With its emphasis on a new behavioral science of social interaction, the committee grouped its proposal under five program areas. It did not feel constrained by the federal government’s competition but instead stressed overlapping goals in each area. A program for “the establishment of peace” was grounded in the realization that the United States was then “the only country able to provide even a part of the urgently needed assistance”; “the strengthening of democracy” was meant to insure that “a fair share of our national talent is attracted to those enterprises which serve the common good”;56 “strengthening the economy” was designed to help realize a combination of high output and full employment; a program for “education in a democratic society” promoted equal opportunity in a fluid society; and, finally, a program in “individual behavior and human relations” proposed understanding “interdependence” as the “realization of common interests, common efforts, common humanity, and common fate.”57 The proposed areas of support theoretically encompassed the entire breadth of the social and behavioral sciences. The hope was to provide “a rational basis for planning and responsible decision making” through “an understanding of human behavior” that was necessary to “maintain the democratic nature of such planning and control.”58
Although the Gaither report was not intended to provide specific disbursement guidelines, the expanded foundation committed resources to the social sciences on a level never envisioned before. In the 1920s, under Beardsley Ruml, the Laura Spelman Rockefeller Memorial (later the social science division of the Rockefeller Foundation) had paved the way with significant funding for the social sciences.59 More recently the Carnegie Corporation had taken the lead in exposing segregation, commissioning Gunnar Myrdal’s American Dilemma, the landmark study that revealed the distance between the American creed of equality and the American conduct of segregation. Carnegie had also commissioned a comprehensive survey of The American Soldier.60 But these were only the beginnings of a new initiative into which Ford was now infusing major resources.
The field of social science application, Ford suggested, was immense, encompassing the homes, schools, factories and offices where Americans lived and worked. Research at educational institutions had an enormous role to play, and Ford gave it top priority in outlining the program. This was of course in line with traditional philanthropic support of higher education. But in behavioral and social research, teamwork would now replace the lone scholar. And teamwork required funding strategies and programmatic skills that the lone scholar of the past did not have. As Harvard president Nathan Pusey remarked in 1953, research that had been a kind of “professorial avocation,” turned now into a major enterprise.61
The proposed study of human behavior was the most innovative of the Gaither proposals (although it would have only limited application in the early years of the foundation) and stands out as a major new insight into improving human relations, one with broad policy implications. The Gaither team argued that the problem could no longer be evaded. Too many Americans were having trouble adjusting to modern life. The world’s biggest philanthropy should therefore help them understand that they needed to adapt their habits and lifestyles to one another if they were to live at peace with themselves and find happiness. The shift from rural to urban living, from an agricultural to an industrial economy, from a local to a mass society, combined with racial and religious conflicts, tended to create a society of maladjusted individuals.62 Too little was known about the motivations and processes that explained individual behavior and human relations, and to the members of the committee, this knowledge seemed especially crucial if democracy was to be strengthened. Adjustment to modern life was the new frontier, for “men live together whether they want to or not; all are thrust, from birth, into an immense network of political, economic and social relationships. This interdependence can be the most abrasive of conditions in societies where men are enslaved as tools of other men or of a state machine; it can be the source of greatest satisfaction if it means the enrichment of personal life by the sharing of the best by the most.”63
In working on this report, the Gaither team attempted to clarify key concepts so as to render them operational at a practical level. Critic Dwight Macdonald later mocked the document for lapsing into a jargon he called “foundationese,” and this was certainly true.64 Nonetheless, the Gaither team clearly focused on where the foundation had a chance to innovate, and it is for this reason that Dyke Brown insisted on distinguishing foundation programs from “conventional fields of interest.”65
The foundation declined to commit funds to fields that were already adequately covered by public and private philanthropy. Thus it would not engage in traditional welfare activities. It could not be a private WPA or a super community chest.66 Funds were dedicated instead to one form or another of adjustment to modern life. That Ford wanted to make an original contribution is also clear from the decision not to go into the natural sciences.67 The team consulted broadly before leaving the health sciences out as well. Thomas Jones’s committee of doctors recommended that the foundation refrain from assigning top priority to the medical field because of the considerable resources (including those of mass philanthropies such as the American Cancer Society and the March of Dimes) that were already available. Ford had no desire to become a new General Education Board (which had poured $82 million into medical education between 1910 and 1925) or to compete with the expanded National Institute of Health, any more than with the National Science Foundation.68
The Gaither blueprint was a textbook for postwar liberal venture philanthropy, but applying its lessons turned out to be a different matter altogether. With the report complete, Henry Ford II asked Marshall Plan administrator Paul Hoffman to become foundation president. Hoffman seemed the ideal choice—a very good mind and proven leader (see chapter 5). When he was struggling to bring Studebaker back during the Depression, he had willingly engaged in collective bargaining, opened the books for union leaders, and avoided strikes. A supporter of conservative unionism, he had tried to moderate Taft-Hartley in 1946. He saw the Marshall Plan, which he ran successfully, not only as a check against communism but as a way to secure American prosperity. He defended American free enterprise while supporting Keynesianism as a means to raise the standard of living for average Americans. The trustees were so eager to have him when they appointed him in November 1950, that they let him run the foundation from Pasadena, California, where his wife preferred to live. Hoffman brought in Robert Hutchins as second-in-command. Hutchins was a thirty-year-old law professor when he was selected president of the University of Chicago in 1929. He remained in that post until 1945, thereafter serving as chancellor until 1951, when Hoffman (a University of Chicago trustee) brought him to Ford.
All of Hoffman and Hutchins’s talents did not, however, suffice for turning Gaither’s ideas into actual programs. Egos caused delays while accumulated funds needed to be spent to meet IRS requirement. Personality clashes and conflicting policies undermined Gaither’s lofty goal of promoting adjustment to modern life. Hoffman pushed the international program hard (chapter 5). Hutchins prompted the trustees to create two separate funds. The Fund for the Advancement of Education supported professional development for high school and college teachers. Conservative in his views on curriculum—Hutchins loved great books and hated vocational education—he got a cold reception from most teachers, who took instead their cues from John Dewey and believed in learning by doing. Hutchins established a Fund for Adult Education, which supported pioneering work in public television as the means to break down social and religious barriers and help Americans understand one another.69 The Fund took the lead in pushing for educational channels—a move supported by a broad constituency from Protestant churches to organized labor.70
Henry Ford and Paul Hoffman realized they did not see eye to eye almost as soon as they got down to working together. The conflict between the two came to a head when Hoffman, who feared Robert Taft’s isolationism, requested time off to run Ike’s campaign in April 1952. The trustees, already irritated by his independence and the lack of results, reluctantly granted him a three-month leave of absence. At the end of the year, Hoffman convinced the trustees to create the Fund for the Republic, which would have as its mission defending civil liberties. With Senator McCarthy quite active, and an investigation of foundations led by Senator Eugene Cox under way, the separate institution was to take the measure of the international communist menace while combating restrictions upon academic freedom; defending due process and equal protection of the laws; protecting minority rights; stopping censorship, boycotting and blacklisting activities; and fighting the principle of guilt by association.71
The Fund for the Republic was incorporated in December 1952, with former Republican Congressman Clifford Case of New Jersey (an Eisenhower Republican endorsed by both the AFL-CIO and Americans for Democratic Action) as its first president. It attempted without much success to appease Southern segregationists by fostering a biracial dialogue. The more immediate result is that Henry Ford II heard much grumbling from Ford dealers throughout the South about the Fund’s liberal stands. The complaints did not help Hoffman’s case with the trustees, and the creation of this Fund turned out to be Hoffman’s severance pay. The “young ignoramus,” as Hoffman not so kindly referred to Henry Ford II (although Hoffman had not graduated from college either), delivered the bad news at Ike’s inauguration.72 Hoffman, let go, resumed his presidency of Studebaker.
Gaither returned as foundation president from 1953 to 1956, but, impaired by ill health and not much of an administrator, he was unable to jumpstart the program he had not, after all, clearly defined. To disburse the necessary foundation funds, Gaither made a huge grant to hundreds of private colleges in 1955 to raise their faculty salaries in response to state governments investing much of their postwar tax revenues in building their own state systems.73 The foundation also established the Center for Advanced Study in the Behavioral Sciences at Stanford, but the larger behavioral program lagged behind. Understanding interdependency was left to the future.
So were civil rights. The Gaither team had proposed a universal program with “no distinction of race, religion, class or nationality.” But in the section of the report on education, Dean Spaulding still advocated local autonomy for schools, which assured segregation.74 Gaither as foundation president did not challenge established patterns of race hierarchy. Following Gaither in that position was Henry Heald, president of New York University. Heald disliked reform. He ended the foundation program in behavioral sciences as well as mental health. He considered black spokesmen Roy Wilkins and Martin Luther King, Jr., “propagandist politicians,” and he turned down a request for funds from Whitney Young of the Urban League.75 The Ford Foundation did not come out in favor of racial integration until the 1960s. For the time being, the promise of scientific inquiry served only to mask a timid policy.
The Conservative Reaction
Despite the issues that kept it from realizing its ambitious goals, the big foundations’ hopeful visions for a different kind of future succeeded in stimulating opposition. A conservative alliance challenged the liberal establishment. Opposition came from those Americans the report had neglected to take into account. Some noted that the Gaither team had traveled thousands of miles to put together their report without interviewing a single clergyman. By and large, the Study Committee saw religion more as a source of social conflict than of spiritual fulfillment. Instead, the committee had placed its hopes for the advancement of human welfare in economic prosperity (and socioeconomic mobility), civic engagement, lifelong education, political and civil rights, peace, and the notion of “adjustment,” advocated from within the behavioral sciences. They showed no concern for the spiritual life and values that many Americans held dear.
To ensure the place of spirituality at the center of American life, conservatives countered the liberal philanthropic program with philanthropic means of their own, including the tools of mass philanthropy. Their alternative philanthropy promoted religious values and a political economy that would be truly free because unencumbered by state regulation and social programs. One of the leaders of this effort to extract piety from individualism and free market values was an oilman from Pennsylvania, J. Howard Pew, one of the ten wealthiest Americans and a devout Presbyterian. Pew’s ire was initially drawn by the collectivism of the church. He spoke for many conservatives in denouncing the Social Gospel as a way to take the religious out of religion. In addition, he felt that the Social Gospel threatened individualism, and that it was a form of communism. Not surprisingly, Pew brought a distinctly evangelical tone to philanthropy. In his hands, philanthropy was neither about good works nor science. It was nothing less than the arena in which the battle for eternal salvation was fought.
Born in 1882, Howard Pew was the son of Joseph N. Pew, Sr., founder of the Philadelphia-based Sun Oil Company. After attending the small religious evangelical Grove City College in Pennsylvania that his father supported and doing some graduate work at MIT, Howard joined the company in 1901. He became president in 1912 at age thirty after his father’s death. Under the second generation of Pews (with his twenty-six-year-old brother Joseph as vice president), Sun Oil flourished. In addition to its oil and gas interests, the company invested in shipbuilding during World War I, and by 1941 it had become the largest manufacturer of oil tankers in the U.S. The company integrated vertically even further by developing an extensive retail business. It opened its first automobile filling station in Ardmore, Pennsylvania, in 1920.
The Pews’ experience with the federal government during the New Deal provides a taste of the way Howard Pew pursued the merger of politics and religion through philanthropic means. They initially cooperated with the National Recovery Administration to explore guidelines for prices and wages in the oil industry as the legislation required, but they quickly parted ways with the administration when it came to fixing prices. The Pews joined the Du Ponts in the Liberty League in vehement opposition to the New Deal. Such opposition often took a religious cast. In 1936 Pew worked closely with the League and Irénée du Pont to help an enterprising minister produce and distribute a film defending private property against New Deal collectivizing. The minister had the idea of depicting the U.S. Constitution as a work based on the Ten Commandments, especially “thou shall not steal.”76
These efforts to use philanthropic resources to challenge the welfare state were not isolated. In the 1940s a number of conservative interest groups—including the National Economic Council, American Action, and the Committee for Constitutional Government—carried on extensive lobbying and propaganda campaigns modeled after the Liberty League. Funded by the Du Ponts and their allies, these groups railed against “collectivist” ideologies.77
In attacking the pernicious effect of collectivism on the American political economy, Pew drew inspiration from economist F. A. Hayek’s 1944 work, The Road to Serfdom, which argued that the growth of the state in the U.S. and other Western countries augured the rise of totalitarian regimes akin to Nazi Germany or the Soviet Union. Pew regularly attended the meetings of the Mont Pelerin Society (named after the village in Switzerland where Hayek assembled a conclave of conservative economists).78 This association gave a degree of philosophical rigor to Pew’s fight against “Socialism, Welfare-state-ism, Marxism, Fascism and any other like forms of government intervention … antithetical to the teachings of Jesus, to our American way of life and to the dignity of the individual.”79
Pew’s main challenge was to communicate his message to a large number of Americans. While the liberal foundations were spreading their version of the common good by funding the new social sciences in the elite universities of the nation, dispensing millions on schools, launching public TV stations with educational programs, and so on, Pew’s lone effort at communication, namely the funding of conservative seminaries, did not reach very far. He was in fact preaching to the converted. The money he invested in theology programs across the country to counter social Christianity failed to have the multiplier effect he was hoping for. In order to realign the American political economy with God’s design, Pew soon realized, he first needed a vehicle to advertise his views.
This Pew tried to do quite early by supporting Reverend Norman Vincent Peale’s publication Guideposts in 1945. As the pastor of the Fifth Avenue Marble Collegiate Church wrote to Pew, “All we need to do is to state our case” and “keep driving it home. It will win its own way, I am sure, because it is the truth.”80 Peale eventually published a toned-down version of the ideas he shared with Pew in his 1952 best seller The Power of Positive Thinking, in which he hit upon the right mix of pietism and mass psychology to sell millions of copies. Pew also supported the Los Angeles “Spiritual Mobilization,” a spiritual movement against “state-ism” that numbered Peale and physicist Robert Millikan among its directors.81
In closer geographic proximity to Pew was his close personal friend Jasper Crane, a Dupont executive and the main organizer of the federated philanthropic movement in the Mid-Atlantic States. Crane and Pew shared the same goal. As Crane wrote to John Foster Dulles, freedom explicitly entailed “self-reliance” and the rejection of all forms of dependency. “The mollusk is secure as he clings to his rock, but he isn’t free. Self-reliance is a tough doctrine but it is the only way for the spread of the Kingdom of God.”82 Crane rejected the program of the liberal foundations. In 1947, eleven years after helping found the Wilmington Community Chest and Council as well as the Wilmington Community Foundation, Crane attracted twenty welfare and “character building” institutions to participate in a United Community Fund of Northern Delaware.83 He saw locally centered drives as “really a test of the American way of voluntary cooperation. If some of these institutions are not supported by this cooperative effort of individuals,” he wrote Eugene du Pont, “the government will take over some of the functions of some of them. Then their activities become extended beyond reason, costs go up, and more taxes ensue.”84 Crane was also wary of dangerous influences on the federation movement. He was kept informed of all of the details when the Wilmington YWCA welcomed W.E.B. Du Bois, whom he considered a dangerous communist, to deliver an address in 1947.85
In 1948, the Pews created the Pew Memorial Trust in honor of their father. In contrast to the liberal foundations seeking social change, it supported traditional causes. The first grant went to the Pennsylvania chapter of the Red Cross, and it was made anonymously, again as a conscious rejection of the ostentatious secular giving of the day. As Pew recorded then, quoting Matthew, 6:3, “when thou doest alms, let not thy left hand know what thy right hand doeth.”86
As a way to mobilize people to a cause, anonymity is not very effective. Soon, however, the occasion for conservatives to go public against liberal and secular foundations presented itself in a big way. The country was following Senator McCarthy in his relentless denunciation of communism as the fifth column destroying America. Pew, who did not want the government to intervene in his affairs, did not object at all when the same government harassed those he believed to be enemies of the “American way.” Congressional hearings into foundations were a real opportunity for conservatives to go after their liberal enemies and nail them down. Pew seized the opportunity to advocate that the IRS selectively remove some tax exemptions so that the government would cease subsidizing subversive organizations.
Eugene Cox, a U.S. senator from Georgia, launched in 1952 an investigation of “educational and philanthropic foundations and other comparable organizations” for possible “un-American” or “subversive” activities of a “socialistic nature.” Cox felt that foundations, which were “all creations of capitalism,” “had in many instances operated to bring the system into disrepute.” The Cox hearings—a public encounter between liberal and conservative philanthropies—were a disappointment, however. The communists were more accurate in their denunciations of liberal foundations for funding CIA spies (see chapter 5) than the Mc-Carthyites were in their claims that tax-exempt institutions harbored and funded communists.87
Cox was keen on investigating the Carnegie Endowment for International Peace’s support of the United Nations. By the time he launched his committee, the endowment’s former president Alger Hiss had already been in jail for two years. Cox nonetheless called the two former chairs of the endowment who were responsible for Hiss’s appointment. John W. Davis (the Democratic nominee for the presidency in 1924, but best remembered as the lawyer who defended segregation in Brown
v. Board of Education) was his irenic self in standing by his choice of a suspected Soviet spy.88 Future Secretary of State John Foster Dulles declined to appear, referring the committee to his lengthy testimony before Senator McCarran’s Committee on internal security.
Cox had other big foundations in his sights as well. He pointed his finger at the Rockefeller Foundation for its support of Owen Lattimore, a distinguished China specialist whom McCarthy had accused of being a Soviet spy at the Institute of Pacific Relations. As a southerner, Cox was displeased by the Carnegie Corporation’s funding of Gunnar Myrdal’s An American Dilemma. As an isolationist, he objected to Carnegie’s funding for area studies programs—an endeavor in which Ford had joined. When the two foundations were asked to defend their support for Russian studies centers at Harvard and Columbia, they pointed to the obvious distinction, which Eisenhower himself had made at Columbia, between training communists and teaching about communism.89
On the stand, Robert Hutchins of Ford was as usual unrepentant, brilliant, and polarizing. Hutchins was genuinely liberal in his politics and had zero tolerance for any challenge to academic freedom. In 1944, he had stated his position rather concisely: “No faculty member can ever be fired except for rape or murder committed in broad daylight before three witnesses.”90 To the committee, he reasserted his position in defense of academic freedom with the proposition that “there is no necessary correlation between political sagacity and scientific eminence.”91 Despite rubbing the committee the wrong way, the investigated withstood the investigation well. In the end, the Cox committee (after the untimely death of its chair) cleared the foundations of wrongdoing, except in a few minor instances.
This disappointing outcome did not frustrate opponents of the liberal foundations for long. Tennessee Congressman B. Carroll Reece—a former chairman of the Republican National Committee and a supporter of isolationist Robert Taft—engineered a second round of investigations, which Congress authorized in July 1953.92 As Reece put it on the floor of the House: “Some of these institutions support efforts to overthrow our government and to undermine our American way of life. These activities urgently require investigation. Here lies the story of how communism and socialism are financed in the United States, where they get their money. It is the story of who pays the bill.”93
Behind Reece stood a number of influential conservatives, among them Howard Pew. Pew saw in the congressional investigation an opportunity not only to support the right wing of the Republican Party (Joseph Pew, Howard’s younger brother, was a staunch supporter of then junior senator Goldwater), but also to launch a counteroffensive of his own and to push his program of saving the country from the Social Gospel. In a letter to Reece in spring 1953, Pew equated the social commitments of the large foundations with communism. He wrote that “there are certain subversive activities which have been developed with foundation money which should be studied by such a committee with great care,” His target was the Rockefeller Foundation-backed report “Basic Christian Principles and Assumptions for Economic Life,” an expression of the Social Gospel.94 While Reece rehashed old charges about grants provided by Rockefeller and Carnegie to the communist-infiltrated Institute of Pacific Relations, Pew instead attacked Rockefeller for the National Council of Churches’ newly released book Goals of Economic Life (1953). The authors (Reinhold Niebuhr among them) clearly stated their commitment not to take “ethics into the stratosphere and separate it from practical economic concerns.”95 Pew, who felt religion was only about faith, not at all about social issues, called it “a subversive book.” Six other “subversive” volumes were in the works and already announced.
Pew’s real nemesis was Niebuhr, not Khrushchev. But it seemed to him that the two battles ought to be joined. Putting a stop to the Social Gospel at home would be the first step. “Ways and means must be provided to stop just that kind of thing,” an enraged Pew wrote to the leader of Spiritual Mobilization in Los Angeles, denouncing the Rockefeller Foundation’s funding of Niebuhr and informing him of Reece’s plans.96
Reece’s timing was poor. McCarthyism was losing its momentum, and in the end Reece only succeeded in discrediting himself by articulating an imagined liberal conspiracy of fantastic proportions. He alleged that the foundations and established scholarly organizations (the American Historical Association, the American Council of Learned Societies, and the Social Science Research Council among them) had worked in tandem since the early 1900s to indoctrinate the American public to accept internationalism and collectivism (as exemplified by the New Deal). Hutchins was again a major target of the congressional ire, but this time for his new role as president of the Fund for the Republic, where Hoffman had appointed him as a parting shot at the Ford Foundation. Hutchins had broadened the Fund’s investigation into the federal loyalty program and blacklisting in the entertainment industry.97
The Cox and Reece congressional investigations failed to convict the liberal foundations, but they put them on alert. In response to the Reece investigation, the Carnegie Corporation joined with other foundations to create the Foundation Library Center, which collected data on budgets and procedures and brought a degree of transparency to the field. The (renamed) Foundation Center was the first sector-wide institution.98 Others would emerge in the next two decades. Although few were still listening in 1954, the Reece Committee recommended that the tax statute be further broadened to provide for “the complete exclusion of political activity” by tax-exempt organizations. Ironically, Congressman Reece and his Republican colleagues, and Pew and his allies, got what they wanted by a strange accident of history. Liberal Senator Lyndon Johnson, unexpectedly and without any prodding, orchestrated the change. What motivated him?
Only recently the Texas senator had worked on behalf of American Jews to save their tax-exempt donations to Israel from any interference by the Eisenhower administration (see chapter 5). But now, Texan politics caused Johnson to switch positions. In 1954, a young, wealthy oilman and state senator named Dudley Dougherty challenged Johnson in the Democratic primary—which at the time effectively served as the general election in an all-Democratic South. Dallas millionaire H. L. Hunt’s Facts Forum, as well as newspaper magnate Frank Gannett’s Committee for Constitutional Government backed Dougherty. Dougherty, who had a track record as a McCarthyite, denounced Johnson for being too liberal.
Johnson easily won the primary but remained incensed that two tax-exempt foundations had contributed to his rough treatment. In retaliation, he single-handedly managed, without debate, to write an amendment into the internal revenue code in July of 1954, strengthening rules prohibiting tax-exempt foundations from influencing legislation (as it had since 1934, with some rephrasing in 1950). His amendment denied them permission to “participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of any candidate for public office.”99 Johnson’s move pushed political activism off limits, but it did not serve as an absolute deterrent.
For his part, Howard Pew had made it clear that losing the tax exemption would not prevent him from funding his favored conservative causes. A year after his family consolidated their three hundred trusts, pension funds and investment accounts into the Glenmede Trust Company (named after their estate in Bryn Mawr), Pew created, in 1957, the J. Howard Pew Freedom Trust (by transferring 5,000 shares of Sun Oil Co to the Glenmede Trust) for reaching the “hearts and minds” of Americans by promoting “the true concepts of individual liberty and freedom.”100
The trust promoted a “limited form of government,” “the values of a free market,” and “the philosophy that we must first have faith in God before we can enjoy the blessings of liberty.”101 Pew had definite opinions about social programs. As he put it, setting aside in one sentence the entire program of social justice advocated by the likes of Gaither at the Ford Foundation, “Communism, crime and delinquency are not caused by poverty, unequal distribution of wealth, bad laws, poor housing, or any other economic, social and political condition. They are caused by sin.”102 The connections Pew had established with Peale as well as Crane gave him confidence that he could dramatically broaden his message if only he could find the right man to deliver it. It was not long before he found the perfect messenger.
A well-known radio preacher of the 1940s, the Reverend Billy Graham was also able to attract large crowds at personal appearances. In 1944, 30,000 people came to hear him speak at Soldier’s Field in Chicago. Graham gained an even broader national audience when the Hearst newspapers chose to “puff” Graham’s Youths for Christ, and he received similarly favorable coverage in publications like Time, Life, and Newsweek.103 He represented a convergence of political and religious convictions that Pew found congenial. He saw the Cold War as an evangelical crusade, and like Pew, he applied the communist label very broadly to secularists, unbelievers, and Marxist-Leninists alike. “There are communists everywhere. Here too for that matter,” Graham said in a speech in North Carolina in 1947. During a sermon in Los Angeles in 1948, he added, “Communism is not only an economic interpretation of life—Communism is a religion that is inspired, directed, and motivated by the Devil himself who has declared war against Almighty God.”
Graham campaigned for Eisenhower in the final stages of the 1952 presidential campaign, because he had sensed in Eisenhower “a dependence upon God” and had the conviction that “the Christian people of America” should “not sit idly by.” Closer to the center and in search of a national consensus, Eisenhower promoted a religious nation rather than a Protestant nation, but Graham was determined that Protestants were “going to vote as a bloc for the man with the strongest moral and spiritual platform.” A moderate on race, Graham invited Martin Luther King, Jr., to say a common prayer at his New York crusade. He also insisted that his Southern revivals not be segregated by race. Furthermore, despite a 1948 sermon entitled “The Sin of Tolerance,” he did not engage in anti-Catholicism or anti-Semitism.
Pew first contacted Graham in 1954.104 Although some of Graham’s pro-Israel remarks had actually irritated him, Pew saw in Graham an opportunity to put in front of a broad public his vision of a scripturally sound political economy.105 Graham was the best hope he had and certainly the one person who was already taking an important part of the message to larger crowds. Pew began funding Graham that year—at first concealing his gifts from the public eye through anonymous donations—providing support to Graham’s evangelical association as well its key publications like Christianity Today, which was enjoying a growing circulation.106
By aiding Graham, Pew masterminded a highly successful partnership with the larger evangelical movement and also, it turned out, with mass philanthropy. Since Graham had already established himself as a successful mass evangelist, he provided the Freedom Trust with a ready-made medium through which to connect with a great many Americans and return the practice of American democracy to what Pew saw as its Christian underpinnings. The genius of working with Graham lay in Pew’s ability now to advocate a political agenda as part of God’s design for America. That Graham had already moved away from his early more extremist positions also helped in reaching a mass audience, and this was something Pew understood. Broadening the message would entail, eventually, a softening of his own political position.
The high point of Pew’s relationship with Graham came during Graham’s 1957 summer interdenominational crusade in New York, in which 2 million people participated (and 1,500 churches). The crusade staff kept Pew informed of how the gatherings proceeded and the numbers of conversions or, as Graham called them, “decisions for Christ.” Graham’s secretary wrote Pew, “On Wednesday night, the [Madison Square] Garden was filled and there were 704 decisions for Christ. On Thursday night there were 13,000 persons in attendance, with 550 decisions. The impact of the Crusade is already tremendous.”107 The crusade, which started on May 15, was extended into July (100,000 people gathered at Yankee Stadium on July 20), then to September 1. On that last day, Graham claimed up to 200,000 supporters on Broadway. The Protestant liberals carefully avoided Graham. Reinhold Niebuhr turned down Graham’s request for a meeting and ridiculed his crusade as “an obscurantist version of the Christian faith” sold to the public with “all the high pressure techniques of modern salesmanship.”108
Pew’s seed money to fund Graham’s Crusades for Christ acted as a kind of providential multiplier. Conservative philanthropy countered liberal philanthropy by engineering a connection with mass philanthropy. It would not be long before a flock of converts would in turn contribute their own dollars to the evangelical cause. The postwar effort to build a more Christian America thus rested on the convergence of big money and mass giving.
If Graham’s crusade did not convey quite the full message of the Freedom Trust, Pew’s friend Robert Welch took care of the rest in launching the John Birch Society in 1958. Pew, who denied having been a member, was listed on the editorial Advisory Board of the society’s publication, American Opinion, and as a stockholder of Robert Welch, Inc., the society’s publishing arm.109 But the association with Graham, who had moved away from initially extreme positions to the evangelical “center,” was an incredible success for Pew. For Graham provided a genuine alternative to the liberals’ program expressly addressed to ordinary Americans.
To help Graham reach beyond the crowds gathered at revival meetings, Pew, after some hesitation, (anonymously) funded Graham’s first television appearances—four one-hour live broadcasts direct from Madison Square Garden.110 Graham saw the potential of the new media as a tool for education and civic engagement. He promised Pew “some of the largest television audiences in the history of television,” followed by a “great spiritual outpouring, such as this generation has not yet experienced.”111 The program was successful, and viewers sent in small contributions. With his canny blending of elite and grassroots philanthropy, the evangelist had raised almost $3 million by the end of the New York crusade and ended up with a cash reserve.112 The crusade had acquired a broad legitimacy from its depth of support within American society. TV was on board, and so were Eisenhower supporters, even-handed John D. Rockefeller III as well as “hard drinking, poker playing” Texas’s oil millionaire Sid Richardson.113 This mass-based evangelical campaign had made its way closer than ever before to the political center. Meanwhile, tax-exempt philanthropy, forbidden by law to carry on propaganda or attempt to influence legislation, had turned a blind eye on these restrictions and engaged the full spectrum of political activity. Philanthropy was “timid” no more.