Unlikely Partners: Philanthropic Foundations and the Labor Movement

Published by H-Business@eh.net and EH.Net (December, 1998)

Richard Magat. Unlikely

Partners: Philanthropic Foundations and the Labor Movement. Ithaca and

London: Cornell University Press, 1999. x + 242 pp. Photographs, notes,

bibliography, and index. $39.95 (cloth), ISBN 0-8014-3552-8.

Reviewed for H-Business and EH.Net by Milt on Goldin ,

National Coalition of Independent Scholars (NCIS)

In this first, well-written assessment of past and present relationships

between foundations and labor unions, Richard Magat tells us that within a

hundred years after the

Republic’s founding, workers came to a belief that captains of industry might

not be trustworthy. A Gilded Age expression of this understanding appeared in

the National Labor Tribune: “Oh, most adorable [Andrew] Carnegie, we love

thee, because thou are

the almighty iron and steel king of the world…. We thank thee…for all the

free gifts you have given the public at the expense of your [wage] slaves” (p.

33).

A hundred years after the Gilded Age, not much has changed in how workers

regard the rich bearing philanthropic gifts, or, for that matter, how the rich

regard union chiefs bearing demands.

An “academic friend” advised Magat, “There’s no research because there’s no

there there. Organized labor relations with foundations? An oxymoron” (p. vii

i).

Magat nonetheless persisted in a search for “there there,”

despite the handicap that being an initial investigator necessitates much time

spent simply locating and evaluating sources. On the other hand, such

exercises, besides delivering information on what evidence exists, almost

mandate evaluations of conventional wisdom. Among Magat’s most useful

observations is that labor’s distrust has had much to recommend it. Another

useful observation is that labor chiefs have frequently hurt their own ca use

with depressing examples of corruption. On the bright side, however, late

twentieth century concerns about societal rifts may finally persuade

foundations and unions that cooperation could be useful.

Not that the road ahead can possibly be easy to travel, given what Magat tells

us about the past. Academics as well as capitalists have seen workers less as

people than as disposable commodities. Charles W. Eliot of Harvard, a

confidant of John D. Rockefeller, hailed scabs as “19th-century heroes” (p.

34)

and announced himself unalterably opposed to the closed shop–as did Nicholas

Murray Butler of Columbia. Rockefeller was “so bitter against the way the

unions had acted he would not have a union man on his estate” (p. 33), and he

lamented that

“professors” favored “socialism and even some forms of Bolshevism” above

capitalism (p. 34).

It irked the titan that “professors” would “not have had their opportunities

for education but for the funds contributed gratuitously [sic] by the people

whom they se em so readily to assail” (p. 34). Ungrateful academics had, in

effect, used grant money from his foundations to prepare attacks on him and

possibly to excite the masses to misgivings about capitalism.

Rockefeller even considered ringing his Pocantico Hills, New York, estate with

barbed wire.

Nor are enlightened views widely prevalent, today. The Heritage Foundation,

which favors “caring conservatism” over the welfare state, argues against

legislation requiring businesses to notify workers, unions, and state

governments of intentions to close plants. Marvin Olasky has come out flatly

for churches, synagogues, and local nonprofits to disburse funds to the poor,

which is what they have been doing since Lyndon B. Johnson began a Great

Society, in the mid-1960s.

And, as if the foundation-union historical record doesn’t offer enough

discouragements, there remains the question of how to interpret the purposes

and results of Congressional investigations of both foundations and unions.

Looking into foundations, in 1913, Congress suspected that robber barons

intended such agencies as nothing but devices to bamboozle the public into

thinking that men such as Rockefeller were plain charitable folk, just

extraordinarily rich. During the next forty years, Congressmen suspected that

communists had infiltrated foundations and unions; in the 1950s, Washington

could hardly decide which was worse, the Ford Foundation or the American

Federation of Labor-Congress of Industrial Organizations.

Magat includes in his opening pages descriptions of the few foundations

operative during the early years of the twentieth century interested in social

issues and of a remarkable woman named Mary Van Kleek, who headed the Russell

Sage Foundation.

(In this context, it is useful to note that 82 percent of foundations

currently operative came into being after World War II.) The Sage Foundation,

created by the financier’s widow, Margaret Olivia Sage, was the first

foundation to address labor conditions and

call for “scientific philanthropy.”

Sage had been a convicted felon, who found his true genius in gouging the stock

market and leaving behind windrows of ruined investors. Still, he was

optimistic about future relations between capital and labor, declaring, “I fail

to see the dangers arising from wealth that the demagogues make such a hue and

cry about. If such danger does exit…there never was a day when capital and

labor were so near together as now” (p. 12).

Unlike Sage, Van Kleek had a firm grounding in the Social Gospel

–her father had been a minister–and a more realistic view of conditions in

the everyday world. She accepted that “It is true that all Foundations must

meet the criticism that, as they represent the benefactions of the rich, they

are expected to be defenders of the present order….” (pp. 13-14). But when

she went on to champion the labor movement, conservatives accused her of

communist sympathies.

Van Kleek did not have long to wait after her appointment for an issue that

would bring her interests to

public attention.

During the infamous Ludlow massacre in April 1914, state militia killed

strikers at the Colorado Fuel and Iron Company, along with eleven children and

two women who suffocated to death when one of the tents in which strikers lived

caught fire. The company was part of the Rockefeller industrial empire, and

John D., Jr., genuinely shocked by events, mounted a public relations campaign

to solve the problem of labor strife.

The best idea that he could deliver, company unions, turned out not to appeal

to workers. After this, Rockefeller family interests shifted back to areas in

which the family felt more comfortable, such as health care. During the

remainder of the twentieth century, the Ford Foundation would take the lead in

“social issues,” especially during McGeorge Bundy’s tenure as president,

between 1966 and 1979. Magat served that organization as a staff member, he

knew key players, and his comments are valuable guides to outlooks that

determined thinking on memorable development s, including the foundation’s

conflicts with the New York City teachers’ union over school decentralization,

an evaluation of a coal-mine shift reorganization involving a mining company

and the United Mine Workers, and voter registration in Cleveland, whi ch

especially irritated a Texas populist with an ingrained distrust of the rich,

Representative C. Wright Patman of Texas.

What the book does not provide (hopefully, Magat will address the subject in

future writings) is a full account of what impelled this particular

foundation’s board and senior officers to approve huge investments of time and

money in “social issues”

to begin with. Henry Ford’s response to the United Auto Workers had been

thugs; grandson Henry II, whose management saved the Ford family his

grandfather’s estate taxes through the donation of Ford Motor Company Class A

non-voting stock to the foundation

(the family retained voting shares), settled with workers and required no

special public relations campaigns to bring peace to the auto

industry.

But what to do with a foundation that began its life with assets of $417

million and no clear mission?[1] Education and behavioral science grants were

stylish in the 1950s; on the face of it, these early areas of Ford Foundation

concentration appeared safe from Congressional attack. That is, until

right-wing members suspected that Henry II, a congenial sort but no heavyweight

thinker, had been duped into supporting Robert Hutchins, whose liberalism very

nearly caused collective cardiac arrest

among conservatives whenever they gathered to think of him.

The furor did not amuse Henry II, who is said to have wondered

(accounts differ), “Why can’t we be a nice foundation, like Rockefeller?” In

the 1960s, the foundation shifted its focus to the arts, in which Henry II had

scant interest, but to which he is also said not to have had any objections.

Henry II was in no way prepared for the advent of Bundy, who came fresh from

advising Lyndon B. Johnson how to deal with the Vietnam War, and brought with

him absolute, limitless confidence that the best and brightest (including him)

would set the world right–if not in a former French colony, then in an America

beset by problems.

Bundy developed a liberal agenda that accomplished, among other things,

driving Henry II to resign as the foundation’s chairman,

in 1976.

In his book’s penultimate page, Magat quotes a 1996 statement by a foundation

staff member that suggests the extent to which Bundy’s philosophy survives his

departure:

For we [that is,

grantmakers] are blessed with the rare

ability to invest resources that can make a difference in how

problems are understood and solved; how the debate is framed

and undertaken; and how communities respond (p. 192).

The question is this: In the past hundred years, the number of philanthropic

foundations has gone from eight to something over 42,000. American society is

increasingly characterized by captains of industry who annually earn more than

entire communities, and who, bluntly put, appear chintzy in their charitable

outlooks. Labor union corruption occurs so often it often goes unremarked in

the media. Given these realities, to what can we look forward in

foundation-union relationships during the next hundred years?

Note

[1]. For a

brief discussion of the dilemma, see Sutton, Francis X. “The Ford Foundation:

The Early Years,” Daedalus 116

(1987): 41-91.