Dark Money – The Rise of Charitable Foundations

In Dark Money’s Chapter Two, “The Hidden Hand: Richard Mellon Scaife,” Jane Mayer gives readers a thorough discussion of the rise of thousands of right-wing charitable foundations that have been secretly funding libertarian political campaigns and policies.

The index to Dark Money, copyrighted in 2016, obviously does not link Betsy DeVos’ family foundations to what is happening right now in 2018, but this post will. Because this is the week our entire judicial system may be “reformed” by the deep “anti-state” she is part of.

How did we get here?

Anyone who has watched an American PBS television channel has seen a long list of big donors to these popular TV programs.

Those who watch PBS are grateful to these mostly left-wing donors and corporations who bring us shows we love, whether news, mysteries, or other educational programs.

Who knew the Corporation for Public Broadcasting was a private non-profit organization that was begun in 1967 through an Act of Congress?

Although private, the financing of public TV and radio in the U.S. is public – Wikipedia spells out where its funds come from and go.

Recently PBS, the Public Broadcasting System has become a target of libertarians.

Just like Rick Perry, Republican candidate for President called for elimination of the Departments of “Commerce, Education, and um”…”  with Republican candidate Ron Paul adding “the Environmental Protection Agency” in the 2012 primaries, Donald Trump, candidate for President in 2016, has called repeatedly for the end of funding for PBS stations.

This is how far the libertarian right has carried us –  In the House the Freedom Caucus, a core group of 35 Republican Congressional Representatives who are identified as libertarians have won control.

If they continue to get their way, we won’t even be able to watch British mysteries let alone educational shows one can’t find elsewhere on television— while we keep having to pay taxes to fund the wealthy to grow richer.

What NPR Has to Say

Fortunately, one writer at NPR (National Public Radio), as is the American way, is fighting back.

In her article “DeVos Family Money is All Over the News Right Now,” Anya Kamenetz makes it clear that the attacks against funding our Public Broadcasting System (PBS) and many values that Americans have held dear, are coming from far right libertarians.

Betsy DeVos, a wealthy libertarian and the current Secretary of Education appointed by Donald Trump, is being called out by Kamenetz.

Kamenetz notes that Betsy DeVos is connected with multiple extreme right-wing charitable foundations. 

For example, Betsy’s parents funded the Edgar and Elsa Prince Foundation. Kamenetz points out that this foundation is on record refusing many anti-LBGT groups funding. 

Betsy DeVos has denied making any decisions for that foundation even though she was listed as a board member for 17 years. DeVos claims there was a clerical error.

DeVos and her husband now control the Dick and Betsy Devos Family Foundation and the DeVos Urban Leadership Initiative Foundation. According to Kamenetz they mainly give money to “free-market conservative organizations,” i.e., libertarian political causes.

Kamenetz’s article provides a few examples of DeVos family money connections with political causes that the DeVos’ favor: opt-out clauses for labor unions; Trump’s policy of family separations; anti-abortion “crisis pregnancy centers”; the gay wedding cake court battle; and the recent nomination of Brett Kavanaugh. 

I would add that Betsy DeVos also clearly favors for-profit colleges and non-tax-based private schools called “charter schools”.

Charter schools are a libertarian strategy that historian, Nancy MacLean, asserts in her book, Democracy in Chains, arose in the South back when Brown v. Board of Education’s passage into law for de-segregation of public schools became a cause celebre for white supremacist libertarians to oppose.

The politicization of foundations

Kamenetz quotes Lonnie Scott member of a progressive group that keeps track of the DeVos family giving, as saying “conservatives have been more aggressive than liberals in promoting favored [political] policies through philanthropic giving”.

In Chapter Two of Dark Money, Jane Mayer confirms this opinion and notes that charitable giving by the wealthy allows them to have their cake and eat it too. 

Mayer points out that charitable foundations are tax dodges while allowing the wealthy to support causes that go far beyond Sunday evening TV entertainments. 

For example, Richard Mellon Scaife’s mother created a charitable trust for Richard and his sister as a way of avoiding estate taxes. For twenty years any income from the trust had to be donated to charity and then her children got $50 million—tax free. 

The first U.S. foundation in the U.S. was created by Rockefellers in 1909, but until 1917 wealthy people were limited in what they could fund and they had to pay taxes on their foundations! Fast forward to nearly a century later…

By 2013 there were 100,000 foundations in the US giving away $800 billion dollars. Along with these tax-exempt foundations came tax-exempt think tanks.

Often given vague, or even deceptive names, many libertarian charities are able to fund all kinds of political activities through think tanks or political front groups that carry vague names containing  buzz words like “freedom” or “liberty”.

Libertarian groups often use names of  the Founding Fathers or early American values that libertarians claim are theirs alone. 

According to Jane Mayer, author of Dark Money, because wealthy libertarians and their supporters are so secretive, there is no way to trace how much money these politicized foundations or think tanks have gotten.

Nor do we know how much they have provided to wealthy libertarians’ desire to deprive others of government services while sparing themselves from what they feel is onerous taxation.

In the last century, after wealthy libertarians created charitable foundations and secretly funded front groups to buy politicians and took economist Friedrich Hayek’s advice to start think tanks to promulgate libertarian ends, it was just a short step to infiltrating academia itself starting in the late 1970s and early 1980s. 

The goal of the Kochs and other libertarian scions who inherited immense wealth and set up charitable foundations has now expanded to include subverting our entire judicial system by teaching judges as well as law students their right-wing brand of free-market economics. 

For more, see my next post, “Dark Money – Libertarian Influence in Academia”