History Of Philanthropy In America

How To Document And Navigate The History Of Philanthropy In America

You pick up any foundation prospectus from 1920 and the language reads like moral instruction. A 1914 Carnegie Endowment pamphlet warns that charity without intellectual direction breeds dependency. That same argument shows up verbatim in a 1968 Ford Foundation report and again in a 2021 Gates Foundation strategy memo. The tone shifts but the frame stays identical. This is why studying the history of philanthropy in America is less about cataloging donations and more about tracking who gets to define the problem and who benefits from that definition. If you are trying to trace how giving patterns shifted between 1890 and 1930, start with IRS Form 990 archives and foundation annual reports held at the Library of Congress Reference Division and the Smithsonian's National Museum of American History research rooms. Most people skip to digitized web copies. Digitized copies are incomplete. The Carnegie Corporation of New York's online archive stops being reliable around 1932. Pre-1932 grant records are scanned at 200 DPI and some pages are cut off at the margins where the actual dollar amounts sit. I ran into this exact problem when I was compiling a timeline of Rockefeller Foundation medical grants to American universities between 1915 and 1929. The digital scans listed the grant recipients but omitted the budget line items because those were on stapled supplemental sheets that never got photographed. I pulled the original microfilm from the Rockefeller Archive Center in Tarrytown. Two hours of manual review gave me four additional grants that the web version had silently dropped. The corrected numbers changed the whole conclusion about how concentrated medical funding was before the Public Health Service expanded its own budget in 1931.

For post-1970 research, the Foundation Center database at Candid is the working standard but the free tier gives you only five searches per month and redacts the actual grantee contact information. The paid tier runs about $2,500 annually for a solo researcher. If you are working on a grant history for an academic paper, check whether your university library already has institutional access. Columbia and Johns Hopkins both carry full subscriptions. Stanford does not. The second source layer is private correspondence. The Mellon papers at the University of Pittsburgh's Hillman Library contain letters between Andrew W. Mellon and Treasury officials from 1921 to 1933 that reference how the family decided to allocate wealth outside the estate. These letters are not indexed by keyword. You have to browse the finding aid by date and folder title. The folder labeled "Charitable Disbursements 1925-1927" contains a handwritten note explaining why the Mellon Chemical Company donation to George Washington University was restructured from an outright grant to a named professorship. The restructure avoided a state taxation issue that Pennsylvania had just closed a loophole on. That detail shows up nowhere in the public annual report. Community foundations are the most unreliable source for early history. The Chicago Community Trust claims a founding date of 1915 but its earliest preserved records only go back to 1923. The intervening eight years were lost during a move when the original ledger books were stored in a basement that flooded. I verified this by cross-referencing with the Federal Reserve's historical bank examination reports, which show that the trust's predecessor entity filed quarterly statements starting in 1915. The Fed documents are public but scattered across nine different regional branches. It took three weeks of interlibrary loans to pull them together.

The Structural Shifts That Actually Matter

American philanthropy did not evolve because wealthy people became more generous. It evolved because the tax code changed how giving was priced. The Revenue Act of 1917 introduced the charitable deduction for federal income tax. Before that year, giving was a private moral choice with no fiscal incentive. After 1917, giving became a price-adjusted commodity. Foundation endowments grew faster than the economy itself in the decade following 1917 because the after-tax cost of a dollar given dropped significantly. The Tax Reform Act of 1969 is the other structural breakpoint. It imposed excise taxes on foundation investment income and created minimum distribution requirements. Before 1969, a foundation could theoretically hold its endowment forever and pay out nothing each year. The Act forced foundations to distribute roughly five percent of their asset value annually. This is why the number of private foundations jumped from about 3,000 in 1965 to over 8,000 by 1975. The law made it cheaper to create a foundation than to donate directly to a charity under the old rules. Donor-advised funds appeared in the early 1990s as a loophole workaround. The IRS ruled that contributions to a DAF qualified for an immediate deduction while the actual distribution to a nonprofit could be deferred indefinitely. Fidelity Charitable launched its program in 1992. The total amount locked in DAFs nationwide went from roughly $8 billion in 2005 to over $150 billion by 2022. This shifted a massive chunk of American charitable giving out of direct foundation control and into brokerage-style accounts. The history of American philanthropy after 2000 is largely the history of this migration.

What Beginners Miss About Measuring Philanthropic Impact

The biggest blind spot in most histories is that outcome data does not exist for the majority of grants made before 1980. Foundations did not track long-term impact because they were not required to. The IRS only began asking foundations to report on program-related investments in 2009. Before that, a foundation could spend its entire annual distribution on administrative overhead and reporting costs and still comply with the law. I reviewed a 1974 annual report from a mid-sized Ohio foundation that spent 41 percent of its $2.1 million distribution on staff salaries and consultant fees. The remaining 59 percent went to grants with no follow-up evaluation framework built into the grant agreements. Another counter-intuitive fact: many of the most influential American foundations were not created by the donors who founded them. The Ford Foundation was legally established by Edsel Ford in 1936, but Henry Ford controlled the board appointments until his death in 1947 and then continued to influence grant priorities through his daughter-in-law Clara Ford. The Kresge Foundation traces its origin to Sebastian S. Kresge's 1924 will, but the foundation's early grant strategy was shaped by a court battle between Kresge's children and the foundation's first president that lasted from 1927 to 1932. The public narrative flattens these conflicts into origin stories. The records show something messier. When you are reading primary sources from the Gilded Age period, pay attention to the word "scientific." It appears in almost every foundation charter from 1880 to 1920. "Scientific philanthropy" was a branding term. It meant the giver wanted professional managers instead of volunteer boards making ad hoc decisions. The movement was led by Joseph Rice at the Russell Sage Foundation and Charles Ethelbert North at the Rockefeller Institute. They lobbied state legislatures to require that charitable corporations maintain audited financial statements and publish annual reports. This sounds like good governance. It was also a way for professional managers to consolidate power away from the donor's family members who wanted to give money to causes the managers considered inefficient.

Practical Research Workflow

Here is the sequence I use when I need to build a reliable timeline of giving activity for any American foundation: Step one: Pull the foundation's IRS Form 1023 and all amendments. These documents explain the original purpose, the initial endowment size, and any changes to the charitable mission. The Form 1023 for the William and Flora Hewlett Foundation, filed in 1966, shows an initial endowment of $12 million. The 1978 amendment expanding the environmental grants program reveals that the family's interest in conservation predated the public announcement by approximately four years. Step two: Request the foundation's annual reports from the last five years the organization published them before switching to a condensed online summary. Many foundations stopped printing bound volumes after 2003. The abbreviated versions omit the grantee location data and the program area breakdowns that appear in the full reports.

Step three: Cross-reference with the Giving USA annual survey published by the Council for Fundraising Professionals. The survey aggregates national giving data by sector. It does not break down by individual foundation but it catches trends that individual sources miss. The 2018 Giving USA report, for example, showed that individual giving declined by 3.2 percent while corporate giving rose by 8.7 percent. That shift correlates directly with the passage of the Tax Cuts and Jobs Act in December 2017, which lowered the corporate tax rate from 35 percent to 21 percent and increased the charitable deduction ceiling for corporations. Step four: For any grant that seems unusually large or unusual for its time period, search the National Archives at College Park, Maryland. The records of the Internal Revenue Service, 1913-1950, are held in Record Group 56. Box 1847 contains correspondence between the IRS and the Carnegie Corporation regarding the tax-exempt status of its educational grants in China. This file is relevant if you are researching how American philanthropy exported its legal structure alongside its funding.

The Limits Of This Approach

There are three hard constraints you will hit repeatedly. First, many private foundations destroy their correspondence after ten years. The Andrew W. Mellon Foundation retained its files because Andrew Mellon was a former Secretary of the Treasury and his papers had historical significance. Most smaller foundations do not have that kind of incentive. Second, family foundations that have gone through multiple generations of board appointments often lose institutional memory between 1980 and 2000. Grant files from that era are frequently stored off-site in third-party warehouses and retrieval takes six to eight weeks. Third, the candid histories are incomplete by design. Foundation websites emphasize success stories and omit failed grants, rejected proposals, and internal disputes. The truth is in the unredacted documents, which are harder to access and require more time to interpret. If you need fast answers about a specific foundation's giving pattern, the Candid database is faster than archive research but less complete. If you need accuracy for a publication or legal review, the archive route is the only reliable path. There is no shortcut between those two options. The gap between them is where most shallow histories get their errors. The broader history of American philanthropy, from the Presbyterian benevolent societies of the 1830s through the rise of the megafoundation in the 2020s, is fundamentally a history of power structures negotiating their relationship to public benefit. The tax code is the lever. The annual report is the performance. The grant file is the ledger. Understanding which of those three documents tells you the truth depends on which document the foundation wants you to read.