Reply #62: Well there's charity...

[stillcool]

and there's charity. From the book "The Rich and the Super-Rich" by Ferdinand Lundberg 1968. Available for free download here: http://www.soilandhealth.org/03sov/0303critic/0303socialcriticism.html
because of it's copyright expiration...such a great book!

PHILANTHROPIC VISTAS:
THE TAX-EXEMPT
FOUNDATIONS

Puzzles of Philanthropy

As we are not engaged here in an embroidery upon journalistic fantasies we are confronted by a number of puzzles. To what extent are the wealthy giving their money away for good works if they are giving it away at all? This is somewhat similar to the question faced in the last chapter: To what extent are the wealthy being taxed out of existence? And, if they are not giving wealth away, what is it that they are really doing with their numerous foundations?

As many persons are involved in all this so-called philanthropy one must not, heeding the caveats of methodological vigilantes of the Establishment, impute motivations without warrant, although the very term philanthropy (to which the Establishment methodologists oddly do not object) does already unwarrantably impute motivations. What the individual motivations are of those thousands who now transfer money to foundations one cannot say one really knows. 1 But one can trace certain indubitable nonphilanthropic effects of such activities.

The first of these is the public relations effect. The founder may have been publicly disliked, like John D. Rockefeller I, or not very well liked, like Andrew Carnegie. But the forming of foundations had the effect of altering opinion in an unsophisticated population, turning the supposed bad guy into a supposed good guy.
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To have blotted out of popular consciousness largely by foundational activity this once prevalent estimate has been a notable achievement in public relations engineering.

* Another effect is the tax-saving benefit. Nearly all of the American foundations have come into view since the enactment of the income tax and estate tax laws: The foundations are completely exempt not only with respect to income taxes but also capital gains taxes. One does not know in each case that the founder sought to escape taxes, but common reason would indicate it. Many standard tax-advisory services explicitly point to these factors as attractive features of foundations. 2

* A third effect is the corporate-control effect. Corporate control, which would otherwise be undermined by the tax laws, is preserved to perpetuity by many foundations, permitting the hereditary transmission, tax free, of vast corporate power.

* A fourth effect is that the foundations extend the power of their founders very prominently into the cultural areas of education (and propaganda), science, the arts and social relations. While much that is done in these areas under foundation auspices meets judicious critical approval, it is a fact that these dispensations inevitably take the form of patronage, bestowed on approved projects, withheld from disapproved projects. Recipients of the money must be ideologically acceptable to the donors.

There is a positive record showing that by these means purely corporate elements are able to influence research and many university policies, particularly in selection of personnel. While the foundations are staunch supporters of the physical sciences, the findings of which have many profit-making applications in the corporate sphere, among the social disciplines their influence is to foster a prevailing scholastic formalism. By reason of the institutional controls that have been established, the social disciplines are largely empty or self-servingly propagandistic, as careful analyses have disclosed. 3

Whether or not these various effects were sought by the foundation creators, they are present, and the realistic observer must suppose they were what the realistic founders had in mind. (We must be particularly impressed by the frank analyses of their tax advisers.) Via the foundations they get more mileage out of their dollars--and retain more dollars.
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According to The Nation, the Brown Foundation, Inc., of Houston, established by the late Herman Brown and brother George R. Brown of the big government contractors, Brown and Root, channeled money into at least one Central Intelligence Agency conduit foundation and into at least one organization partly supported by the CIA. Brown and Root, incidentally, is politically close to President Johnson.

In 1963 the Brown Foundation gave $150,000 to the Vernon Fund and in 1964 it gave $100,000, these being the latest available figures. It gave $50,000 in 1963 to the American Friends of the Middle East and $150,000 in 1964. By no kind of elastic interpretation can these donations be regarded as in the cause of sweet charity.

There are now at least seven CIA-conduit foundations known to be operating in oil-lush Texas; the others are the San Jacinto Foundation, the Marshall Foundation, the Anderson Foundation, the Hoblitzelle Foundation, the Jones-O'Donnell Foundation and the Hobby Foundation. The latter was set up by Oveta Culp Hobby, former Secretary of Health, Education and Welfare under Eisenhower, and by her son William Hobby, Jr., executive editor of the Houston Post. Both Hobbys are close to President Johnson.

"In the eight months that have elapsed since the CIA was discovered to have polluted the world of the foundations," said The Nation, "neither the IRS nor Patman has shown any interest in discovering just how deeply the spies have penetrated the supposedly charitable organizations. Patman's investigations into charity, like charity itself, should begin at home. He might even tell us what good works have been supported lately by the Lyndon Johnson Foundation, established a few years ago by the President."