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The Funding Exchange: Building “Alternative” Community Foundations

The Funding Exchange: Building “Alternative” Community Foundations

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Published by James Dellinger
At a time when liberal ideas
are unpopular among voters the Funding
Exchange offers a different leftwing
strategy for achieving political and social
change. It links radical activists to
wealthy donors to create a unique
network of community foundations.
At a time when liberal ideas
are unpopular among voters the Funding
Exchange offers a different leftwing
strategy for achieving political and social
change. It links radical activists to
wealthy donors to create a unique
network of community foundations.

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Categories:Types, Research
Published by: James Dellinger on Jun 14, 2013
Copyright:Attribution Non-commercial


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his month leftwing donors will meetat the Berkeley Marina conferencecenter on San Francisco Bay to dis-cuss where their money will do the mostgood. “Momentum 2006” is co-sponsored by seven groups that are trying to show rich people how to work effectively with radicalsocial activists. The groups are an interest-ing mix. They include one hundred membersof the Women Donors Network, the ThirdWave Foundation, which supports feministgirls and women aged 15 to 30, the ResourceGeneration, which works with 750 “young people with financial wealth,” and the TidesFoundation, which has famously revolution-ized how money can be bundled and chan-neled from big grantmaking foundations totiny groups of rabble-rousers (see December 2003
 Foundation Watch
). Yet another at-tendee is the New York City-based FundingExchange. It has carved out its own uniqueniche in the universe of leftwing donor groups by coordinating the work of “alternative”community foundations.Community foundations have had an hon-ored place in the history of American philan-thropy. In a community foundation donorsagree to pool their gifts for the betterment of their local communities. Instead of creating a private foundation, the donor lets the com-
April 2006
The Funding Exchange
Page 1
Philanthropy Notes
Page 8
Radical entertainer Harry Belafonte and Ellen Gurzinsky,executive director of the Funding Exchange.
: At a time when liberal ideasare unpopular among voters the Funding  Exchange offers a different leftwing  strategy for achieving political and social change. It links radical activists towealthy donors to create a uniquenetwork of community foundations.
The Funding Exchange
 Building “Alternative” Community Foundations
By James Dellinger 
munity foundation’s trustees allocate fundsaccording to their best judgment of commu-nity needs. However, donors also may advisethe trustees on how to use their contribu-tions. The first community foundation wasestablished in Cleveland in 1916 and there areover five hundred in the U.S. today.The Funding Exchange takes the idea in anew direction. It works closely with a groupof community foundations unlike most oth-ers. These organizations do not limit their work to a specific city or region and they donot focus on traditional forms of charity.Instead the foundations promote radical po-litical and social activism. “The communityfoundations who join the Funding Exchangenetwork are part of a growing movement toexpand progressive philanthropy,” saysFunding Exchange executive director EllenGurzinsky. “Our network shares technicalassistance information and best practices, political education programs on cutting-edgeissues, skill development in every arena, andsolidarity in the support of social justice andhuman dignity.”
2April 2006
Terrence Scanlon
Foundation Watch 
is published by
Capital ResearchCenter 
, a non-partisan education andresearch organization, classified bythe IRS as a 501(c)(3) public charity.
1513 16th Street, N.W.Washington, DC 20036-1480
(202) 483-6900
(800) 459-3950
E-mail Address:
Web Site:
are available for $2.50prepaid to Capital Research Center.
In many respects, the Funding Ex-change is but another example of theLeft’s current preoccupation with net-working and infrastructure-building. Ittries to locate the most radical commu-nity programs and projects acrossAmerica and link them to wealthy do-nors, thereby leveraging private wealthto achieve egalitarian and collectivist political and social goals.Although it has left-wing aims, theFunding Exchange owes much to theconcept of venture philanthropy. Ven-ture philanthropy is a somewhat opaquenotion that seeks to apply the conceptof venture capitalism to charitable giv-ing. Venture philanthropists try to helpcharities meet their goals by activelymonitoring their gifts and demandingthat charities produce measurable re-sults. The strategy is that donorsshould use the act of giving to improve theefficiency and effectiveness of charities.The Funding Exchange re-directs thisoutcomes-oriented strategy: It wants to fundthe growth of effective organizations whosemission is leftwing social activism. It alsowants to build a network of activist philan-thropists.Gurzinsky has observed that communityfoundations joining the Funding Exchange“are at the forefront of virtually every contem- porary movement for social change. They provide essential resources for both urbanand rural organizing. They fund the arts andculture as organizing tools. They directlysupport efforts to stave off the erosion of hard-won gains in affirmative action and immi-gration policies. And they respond to emer-gency issues as well as contribute to the long-term infrastructure needs of their grassrootsgrantees.”Large private foundations and wealthyindividual donors—think Ford, think Soros— have few misgivings about supporting radicalactivists. However, most traditional commu-nity foundations hesitate to support activistgroups whose goal is creating communityturmoil. That’s what makes the Funding Ex-change so unusual and significant.According to Andy Robinson, author of 
Grassroots Grants: An Activist’s Guide to Proposal Writing 
, the Funding Exchangehas profoundly influenced so-called “pro-gressive philanthropy”: “What seemed at thetime a radical idea—activists giving outgrants—has since become almost common- place as more and more mainstream foundations hire organizers and hell-raisers as pro-gram officers. The face of philanthropy ischanging—slowly, but irrevocably...” Thisamazing transformation is happening with-out public notice but with increasing supportfrom the foundation world.
FEX’s Gilded and Guilt-Ridden Heirs
The Funding Exchange (FEX) was set upin 1979 by six foundations in Philadelphia,Boston, New York, San Francisco, Los Ange-les and Portland/Eugene, Oregon. They hopedto coordinate their activities in order to, asthey say, “create change.” FEX expandedover the next two decades to include sixteenfoundations, all of which aggressively pro-mote community-based advocacy. To maxi-mize their impact the member foundationsfocus their donor dollars and manpower onhot-button causes. However, the FEX na-tionwide network of donors and activistsallows the foundations to move their resourcesfrom city to city in rapid response to immedi-ate demands (e.g., when priorities changefrom, say, a fight over living-wage laws inSanta Fe, New Mexico to anti-war protest inthe Washington D.C.). Says June Makela,FEX executive director from 1980-1991, “TheFunding Exchange’s role was to ‘organize’ progressive philanthropy through this model.
George Pillsbury, co-founder of the Boston-based Haymarket People’s Fund, anoriginal founder of the Funding Exchange.
3April 2006
For frequent updates on environmental groups,nonprofits, foundations, and labor unions, check out theCRC-Greenwatch Blog at
The goal was to connect wealthy individualswith progressive values to the important, butoften invisible, work going on in their owncommunities and also around the country.”The FEX self-described mission is “changenot charity”; its agenda is “structural eco-nomic change.” Leftwing politics, not philan-thropy, inspires its leadership.FEX members are located in liberal citiessuch as San Francisco and Boston and col-lege towns like Madison, Wisconsin. How-ever, there are also FEX member groups in places not known for radical activism: Knox-ville, Tennessee, has the Appalachian Com-munity Fund and the Fund for Santa Barbarais in a wealthy California coastal resort town.In size the foundations range from the LibertyHill Foundation in Los Angeles, which had2004 assets of $7 million and revenues of almost $5.7 million, and the Headwaters Foun-dation for Justice in Minneapolis with 2005revenues of $2.1 million, to the $254,000 re-ceived in 2003 by the Three Rivers Commu-nity Foundation of Pittsburgh.While their funding priorities differ, thefoundations endorse similar political goals,including coercive environmental regulation,single-payer health care, anti-war protest,opposition to the Administration’s “war onterror,” opposition to free trade and restric-tions on immigration, support for abolition of the death penalty, abortion rights, and“GLBT” (gay, lesbian, bisexual, andtransgender) advocacy.The foundations also share a commonrhetoric emphasizing the claim that, to quoteone activist, “Wealth disparity in the U.S.,the history of exploiting human and naturalresources, and the undue influence of wealthon our political system, perpetuate andstrengthen a destructive dynamic within our country and abroad.” That “destructive dy-namic” is what mainstream America cel-ebrates as economic liberty and individualrights.Because FEX members insist thatAmerica’s wealth is the product of exploita-tion and the abuse of privilege, one wouldexpect them to have a low opinion of philan-thropy. After all, the old Marxist Left de-spised philanthropy; it considered charity away for the rich to salve their consciencesabout human misery and avoid facing its rolein creating economic inequality. But the oldLeft has collapsed. These days radicals needhelp wherever they can find it, and they arewilling to rehabilitate the idle rich if they willuse their wealth for activist ends. That’s the point of 
 Robin Hood was Right: A Guide toGiving Your Money for Social Change
, a book published by the Vanguard Public Foun-dation, the FEX foundation in San Francisco.
Robin Hood was Right 
raises the issuethis way:During the last decade, blackshave become beautiful, gays havecome out, women have becomeliberated—but who could imag-ine publicly celebrating inheritedwealth? Its very existence was proof of injustice...In other words, heirs as a group are typi-cally depicted as young, idle and irrespon-sible. They live off their wealth, contributingnothing to society. How can anyone cel-ebrate inherited wealth?The Funding Exchange answers that evenheirs can be liberated, and the book 
 Robin Hood was Righ
is their manifesto. It is “acollection of anonymous anecdotes docu-menting the alienation that resulted when achildhood of wealth collided with the idealis-tic, egalitarian world view circa 1970s activ-ism”—i.e. when poor little rich boys and girlshated their parents and wanted to do good.
The Funding Exchangelinks radical projectswith wealthy donors,leveraging privatewealth to achieveegalitarian and collectivist  political and social goals.

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