Reaction to my column reviewing the books Leap of Reason and Give Smart generated a range of responses. I appreciated the positive comments I received, but want to focus on addressing some of the concerns that were raised.
Phil Buchanan of the Center for Effective Philanthropy via Twitter argued that I should not be singling out philanthropy’s “natural state of underperformance” as being unique from business and government. Yet then argued that in fact philanthropy is harder than business or government. [Update: Phil thinks I made too much of his tweets and clarified his view here].
Since my column was a review of two books on top of which I layered my own point of view, I want to be clear that the phrase “natural state of underperformance” is from the book Give Smart. Since I don’t want to put words in the authors’ mouths, please take my writing on the topic here as my own point of view.
I agree with Phil that philanthropy is harder than business or government. My take on the idea that philanthropy’s state of underperformance is unique is based on the idea that business and government both have functional feedback loops that force some level of achievement. Politicians can be voted out of office and customers can stop buying from a business. Philanthropy faces no such external accountability, which gives it both highly valuable freedom but also makes self-discipline and self-accountability critical to success.
But this doesn’t suggest that business and government exist in some sort of “natural state of excellence”. Bill Schambra of the Hudson Institute captured the distinction well in an email to me when he wrote:
“…, the modern market place, politics, and philanthropy are indeed, as Phil Buchanan suggests, all shaped and governed not by rigorous standards of excellence… the point is that modern politics and markets do not have a mechanism to insure excellence but they do have a mechanism to insure moderate achievement.
…The unique feature of philanthropy, I think Tierney is saying, is that not only are there no forces therein that push toward excellence, but there isn’t even a force that pushes toward adequacy. As he puts it, foundations are living on the Galapagos Islands, with no natural predators. Predators don’t insure excellence, but they do insure a certain level of adequate performance. You may not be the fastest critter in the flock, but you’re fast enough to outrun the bear. There is no bear in philanthropy.
There is no level of performance (speaking of programs, not investments, of course) beneath which a foundation can sink and find itself imperiled.”
My column is not a criticism of philanthropy, but a recognition that philanthropy operates without the force of competition that eliminates poor performers in business and government. As Bill memorably puts it, “there is no bear in philanthropy”. This fact gives great benefits to philanthropy, but with this freedom comes the necessity to draw on deep self-discipline and self-accountability to strive towards excellency.
Another critique came from one of my most generous and kind readers Christine Egger, whose comments on my blog are almost always supportive. But Christine took issue with my recent post writing:
“My first, second, and third response upon reading this post was an uncharacteristic, “Meh.” And sadness. I’m not really fully sure where the sadness came from, but I think it has to do with the way this sentence ends:
“The only path to results, for both donors and nonprofits, is to dig deep into the wellspring of passion that drives their giving and their work to find the determination and discipline they need to be accountable to themselves.”
It would read so very differently if the last word, “themselves”, was replaced with “those they serve.”
And if “determination and discipline” were replaced with “courage and humility.””
I agree that courage and humility are needed to engage in effective philanthropy. Many attributes are needed. In this column I sought simply to tease out some of the arguments made in Give Smart and Leap of Reason and highlight the especially important roles of self-discipline and self-accountability in a field that lacks a “natural predator”.
I think Christine second point, about being accountable to “those we serve” instead of “ourselves” is more problematic. I wrote a column a year ago on the idea that grantmakers’ fiduciary duties should be to their beneficiaries rather than to the preservation of their foundations. So I agree with Christine that philanthropists’ goal should be to best support “those they serve”. But unlike voters or customers, beneficiaries of philanthropic efforts have no mechanism by which to hold philanthropists accountable.
Philanthropists goal should be benefit those they serve, but they must hold themselves accountable to achieving those results because no one else can do it for them.