It is a great pleasure to visit the American Academy in Berlin and an honor to give the Stephen Kellen lecture.  Stephen and Anna-Maria have been close friends over the years through our mutual devotion to Parsons and the New School for Social Research.

I came to appreciate Berlin first through Stephen’s loving eyes, when we were here together in December 1984. We were celebrating the 50th anniversary of the New School’s “University in Exile,” the Graduate Faculty of Political and Social Science that took in more than 150 scholars forced out of Europe by the Nazi Regime.

Our topic, “Private Philanthropy and the Public Good,” would have appealed to Stephen.  He and Anna-Maria invested their time and resources in many institutions that make our lives more interesting and our society more just: Carnegie Hall, the New York Philharmonic, the National Gallery of Art, public television, the Interfaith Center of New York.  In this city, his legacy includes support for the Berlin Philharmonic and, of course, the American Academy.

Stephen’s boundless curiosity and restless intellect led him to ask probing questions about everything, including philanthropy. So as I prepared these remarks, I imagined Stephen and Anna-Maria sitting right there in the front row.

And I was drawn to Henry Arnhold’s observation that Stephen’s oft-repeated phrase, “I am cautiously optimistic,” summed up a life-long philosophy and the secret to his success. As Henry put it, these words reflected “[Stephen’s] willingness to spend time and resources to improve the odds that he would reach the right decision, and his perseverance to follow up.” [1]

I like that formulation. It rings true of the man I knew, but it also reflects qualities that I think should apply to the best philanthropists, including foundations. Keeping those words in mind, I want to begin tonight by reflecting on foundations generally and suggest what I think they are good for. Then I will spend most of my time illustrating these thoughts with examples from MacArthur’s work.

I should note right away that foundations come in all shapes and sizes.  In the United States, there are over 65,000 private foundations with over $475 billion in assets.[2] Some are small, private family foundations, often governed by a living donor or immediate family members, which work deeply in local communities. Others are operating foundations, which design and execute their own programs. Corporate foundations often align their giving to a company’s business interests and location. And then there are large, multi-purpose foundations like MacArthur, governed by an independent board of trustees, which have grant-making programs that span the globe

This diversity of form and function makes it difficult to generalize about foundations, much less about the good they do.  But we can start by stepping back for a moment and asking where foundations fit in a democratic society. How are they situated in relation to government and business? What are they good for? Kenneth Prewitt, long-time Vice President of the Rockefeller Foundation, has written a thoughtful article that posed the question this way: “What is it that foundations do or represent that earns them public acceptance and legitimacy?”

Prewitt conjures with four possibilities:  the redistribution of funds from the wealthy to those less well off; efficient delivery of services and conducting research; the stimulation of social change; and the promotion of pluralism – pluralism of ideas and innovative ways to seize opportunities for tackling the world’s problems.

Without rehearsing Prewitt’s arguments, let me cut right to his conclusion:  promoting pluralism of thought, action, and innovation is a central contribution that foundations make to society.  This runs counter to much current thinking in the United States and elsewhere, which believes that advocating for specific social, economic, and political changes is how foundations add value.

I agree with Prewitt.  Foundations are at their best when they take the long view, support basic research and experiment with models for change.  They work better through others, not directly, by giving creative individuals the freedom to pursue their own ideas and by building the institutions of civil society through which concerned citizens can come together unmediated by government.

A foundation’s reputational assets can be just as valuable as its money – the ability to bring people together who trust the foundation, if not each other; the capacity to confer legitimacy or at least seriousness of purpose on a new idea or an unknown individual with a grant; the credibility to support research or operations that are perceived as objective and open; and the possibility to raise the visibility of an issue by creating a blue ribbon commission to study it.

At MacArthur, we feel an obligation to search for uncommon opportunities and untrod pathways. I will begin with a short description of the Foundation and then illustrate my point with a few examples of recent work.

The MacArthur Foundation, worth $5 billion in assets, is one of the ten largest private foundations in the United States. It is completely independent, has no government affiliation, and does not embrace any ideology other than a commitment to free expression and reasoned discourse.

The money came from John D. MacArthur who was in the insurance and real estate business. The Foundation is governed by an independent Board of Trustees. When Mr. MacArthur died in 1978, he left only one instruction to them: “I made the money, now you figure out how to spend it.”  So, from the beginning, the Trustees have had complete discretion over the programs.

We make grants and program-related investments totaling over $200 million annually.   We are best known for the MacArthur Fellows program – the so-called “genius” awards – which each year bestows a $500,000, no-strings-attached grant on 25 creative individuals in the sciences, the arts, and public policy.

But that is only a small part of what we do.  MacArthur supports work in 60 countries and maintains offices in Russia, Nigeria, India, and Mexico.  Our international program focuses on four areas: biodiversity conservation and sustainable development; international peace and security - principally, on reducing the threat from weapons of mass destruction; population and reproductive health; human rights and the creation of an international system of justice.  And we have a growing interest in migration and the mobility of people worldwide.

In the United States, MacArthur has a long-term concern for building healthy urban neighborhoods, creating and preserving affordable housing, and using community development financial institutions to increase the access that poor people have to capital.  We also focus on system reform in public education, mental health, and juvenile justice.

Most of our national work has a strong presence in our home city of Chicago - we are investing in comprehensive neighborhood improvement in half of Chicago’s high poverty neighborhoods.  We also provide significant support for arts and culture organizations in the Chicago region -- 186 dance, theater, music, and art groups of all sizes.

MacArthur has a long standing interest in public radio and television, and in bringing international news to the United States.  Our commitment to nurturing new voices and shining the spotlight on neglected issues lead us to underwrite independent documentary films on such topics as nation-building in Afghanistan, the ecological impact of the Burma Road in the Eastern Himalaya region, the search for an AIDS vaccine, and high numbers of mentally-ill inmates in the US prison system.

While constructing this talk, I had to make a choice about how to proceed at this point: should I paint a picture of MacArthur’s broad portfolio, attempting to show how our philanthropy has made a difference in the areas we work, from biodiversity preservation abroad to affordable housing preservation at home?

Or should I offer some specific examples that illustrate my argument: foundations add their greatest value by fostering pluralism and nurturing new ideas and fresh approaches?

I chose the latter, but we can talk about the rest of MacArthur’s work in the question period.

My examples illustrate five ways a foundation can add value:

  • Exploring the implications of new ideas, phenomena, or scientific advances not well understood;
  • Stimulating new approaches to enduring problems;
  • Developing new norms that will guide responses to urgent issues;
  • Creating new institutions; and
  • Using a foundation’s neutral convening capacity to bring people into dialogue.

Let me start with a disclaimer: as helpful as they are, foundations are generally only one actor among many and sometimes play only a modest role.  History will have to judge how critical the Foundation’s contribution actually was – the vignettes that follow are only beginnings.

1) Exploring new phenomena not yet well understood.

MacArthur has long been concerned about weapons of mass destruction. During two decades, the Foundation has invested over $400 million in pursuing a more secure world. Much of that effort focused on the nuclear arms race between the US and the Soviet Union, but now our concerns have broadened to include biological warfare, weapons in space, and terrorism.

We have become interested in how to prevent the harmful exploitation of new biotechnologies without crippling scientific research.  The fundamental problem is that there are no uniform standards for the pursuit of “synthetic biological research” – genomic sequencing and genetic engineering, stem cell experimentation, biotechnology, nanoscience. The potential for remarkable breakthroughs and applications is great, but so is the danger of accident, contamination, or the creation of biological weapons by terrorist groups or rogue states.

Safeguards need to be put into place, but, if left to Congress or the courts, there is a risk of chilling innovation. The scientific community itself needs to propose some commonsense measures on which it can find consensus.

We have just made a grant to the University of California-Berkeley to develop protocols that reduce the dangers of accidental or intentional misuse of biotechnologies. These might include steps such as: the development of lab-dependant organisms that cannot live in uncontrolled environments; inventing molecular “locks” that would prevent replication or manipulation by unauthorized personnel; or using DNA “watermarks” that would help identify the original maker or recipient.

Ultimately, the project will propose a set of scientific standards and laboratory practices to be endorsed at the national meeting of synthetic biologists in Berkeley next June. 

2) Stimulating new approaches to enduring problems.

Let me stay with our work in international peace and security.

The amount of fissile material in the world is mind-boggling.  According to the latest estimates, there are more than 3,700 metric tons of plutonium and highly enriched uranium located in about 60 countries -- enough for hundreds of thousands of nuclear weapons.[3] That is a frightening fact because only about 150 pounds is needed to construct a crude nuclear device and many civilian energy and research facilities have inadequate security.

This is not a new problem and we actually know how to address it.  For example, the United States government’s Cooperative Threat Reduction (or “Nunn-Lugar”) program has deactivated or destroyed about 6,700 nuclear warheads in the former Soviet Union.  The programs have also secured 260 tons of nuclear bomb fuel.

Along with Germany and the other G-8 countries, the US is pursing a variety of programs to secure the remaining nuclear materials in Russia.  With increased funds, this could be accomplished more quickly, but it will take sustained, high-level political leadership to overcome bureaucratic obstacles and convince Moscow to act.

Likewise, both the public and policy makers need to feel more urgency about the threat of insecure nuclear materials around the world in places like Pakistan, India, North Korea, or China. Earlier this year, MacArthur helped fund a movie with the Nuclear Threat Initiative called Last Best Chance.  In dramatic fashion, it tells the story of fissile material stolen in Belarus, transported to South Africa for conversion into a weapon, and then smuggled into the United States via Canada.  The film was shown last month on national television in the United States, where it has caused quite a stir.

But the public and policy-makers also need to understand that the danger can be addressed.  Awareness of the problem needs to be combined with an understanding that these threats can be managed.

MacArthur has provided funds for an independent panel of experts led by Dr. Jose Goldemberg of the University of Sao Paolo and Dr. Frank von Hippel of Princeton University. They are creating an International Panel on Fissile Materials, made up of technical experts from all the nuclear weapons states, as well as countries with advanced civilian nuclear energy establishments. The Panel will monitor the amount, location, and status of nuclear-useable materials worldwide.  It will also issue an annual report tracking the progress worldwide: net reductions in the national and global stockpiles of fissile material, and the number of locations where weapon-sized quantities can be found.

This is a straight-forward idea that could have significant consequences. The success of the Intergovernmental Panel on Climate Change is the inspiration. That body has played a crucial role in forging a global scientific consensus on the consequences of increasing levels of carbon-dioxide and other greenhouse gases. This panel on fissile materials could have a similar effect by raising public awareness and reporting the facts on a global problem that is scientifically complex and politically sensitive.

3) Developing new norms to guide response on urgent issues.

MacArthur has had a longstanding focus on human security, human rights, and international justice. Our very first grant was to Amnesty International in 1978; since then, we have made almost $150 million in grants to over 500 individuals and organizations in the field of human rights.  

Although progress is being made worldwide, the genocide in Rwanda, the persistent civil war in the Congo, and the ethnic cleansing in Darfur remind us that large scale loss of life due to gross human rights violations is a current reality. In each of those situations, the tension between the need for international humanitarian intervention and claims of state sovereignty has stalled quick action to save lives. 

To address this impasse, a group of governments led by Canada created an international Blue Ribbon Commission in 2000, which issued a report called The Responsibility to Protect.  MacArthur was a funder, in part to underscore its independence.  The conclusion of the Report is simple and clear: when a state fails to protect its citizens, it yields its responsibility to the international community.

We all know that commission reports often gather dust on the shelf.  That is why MacArthur supported a world-wide consultation process during the Commission’s deliberations. We also assisted with follow-on activities like distributing the report; holding conferences to encourage acceptance of this new legal norm; and funding a network of civil society organizations that raised awareness about the Responsibility to Protect.

As a result of a well-focused report with contributions from leaders around  the world, the concept of the responsibility to protect caught on. At September’s UN summit, the General Assembly included a commitment to the "Responsibility to Protect," in its outcome document. For the first time, the UN has formally endorsed the duty of the international community to intervene, using force when necessary, to protect the lives of civilians when they are threatened by massive human rights abuses or genocide.

4) Creating New Institutions

For norms like the Responsibility to Protect to take root, they must be expressed through, and supported by, strong institutions that monitor their application.

Because it is hard to follow what the Security Council is doing on this or many other topics, MacArthur has partnered with the Rockefeller Foundation and the governments of Canada and Norway to establish a new institution called Security Council Report. 

SCR will issue monthly reports and longer analytical pieces on what the Security Council is or isn’t doing, and what is coming up on the agenda.  These will be available on the Internet to the public, including journalists. But it will be of special use to the Security Council’s elected members, who are often at a disadvantage because they lack data controlled by the Permanent-five.

SCR will track issues such as:

The status of the Council’s actions on unstable areas – places like Haiti, the Ivory Coast, Syria, and Lebanon;

Deliberations on whether to refer Iran for violations of the Nuclear Non-Proliferation Treaty;

The progress of the new UN Peacebuilding Commission;

Action under consideration in the sanctions committee;

What the Security Council is doing on topics like gender, peace, and security, and children in armed conflict.

5) Using a foundation’s convening capacity

Thus far, I have spoken almost entirely about the kinds of projects, organizations, and institutions a foundation funds. But foundations also often have significant “reputational assets” by virtue of their independence -- a public legitimacy and trust that may not be enjoyed by government or business. If they are willing to put in the effort, their independence can allow them to bring diverse, even opposing, views into conversation with one another.

MacArthur has had a deep interest in the creation of the new International Criminal Court.  We have been involved since the Rome conference in 1998, which produced the treaty creating the court.  We gave major support to the coalition of over 2000 non-governmental organizations working around the world to speed ratification by the requisite 60 countries – 99 have ratified to date. At the same time, we assisted organizations like Human Rights Watch and Global Rights to gather evidence leading to the first cases in Uganda, Eastern Congo, and Darfur.

The ICC is the most important new institution since the creation of the UN and it must succeed.  But how it handles its first cases will be critical and, as we have learned, complicated.

Just last month, the ICC’s first-ever arrest warrants were issued in northern Uganda. The long-running civil war waged by the Lord’s Resistance Army has claimed tens of thousands of lives and displaced a million and a half civilians during 18 years of conflict. Last year, an on-again, off-again peace process had raised hope for a resolution.  The Court’s natural allies in civil society questioned whether the indictments should go forward. They feared that ICC-action might undermine the intermittent peace talks.

Because of MacArthur’s work with the Court and our worldwide ties to NGOs, the Chief Prosecutor, Luis Moreno-Ocampo, asked me to convene a meeting with leading humanitarian organizations working in Northern Uganda.

The conversation helped the NGOs understand that the Prosecutor was only targeting the leaders. Moreno-Ocampo made it clear that the ICC would support national and traditional courts for the balance of the justice and reconciliation process. It think it also helped the Prosecutor appreciate the complexities of pursuing justice and pursuing peace, and made him more sensitive to the need to communicate clearly with local parties about the ICC and its actions.

Conclusion:

I fully realize that my comments tonight come out of an American context.  In Germany, foundations have long played an important role as sponsors of cutting-edge research and analysis.  But as I understand it, foundations here have traditionally played less of a role in the promotion of new norms and institutions.

This may be related to the fact that our countries understand the division of labor between government and civil society organizations differently.   It is perfectly natural that such differences exist between two countries with distinct historical traditions, each pursuing its own destiny within the family of democratic nations.  But it does seem to this outsider that the present moment in German political and economic life presents the foundation sector here with an important opportunity to take on a more robust role in exploring and promoting new solutions to vexing social problems.

I do not mean to be too proscriptive in these comments.  I respect foundations that strengthen cultural institutions, underwrite fellowship exchanges, and support scholars, hospitals, and social services.

The point of my vignettes about MacArthur is that foundations are also good instruments for exploring, surfacing, and encouraging new ways of thinking and new institutions to carry fresh ideas into practice.  Foundations can move more quickly than government, are less constrained than academic institutions, and can tolerate greater risks than most other sources of funding.  Most of all, to return to my opening point: foundations contribute to strong and open democratic societies by ensuring a pluralism of thought, participation, and action.

As I close, I hope and believe that Stephen Kellen would see something of his own philanthropy in this assertion. I would be delighted if it provoked his signature phrase, “I’m cautiously optimistic,” but I would expect him to follow immediately by posing the first skeptical question.

In his absence, the floor is open.

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[1] Henry Arnhold, “Friendship in Partnership,” The Berlin Journal, Number Eight, Spring 2004: 8.

[2]The Foundation Center, The Foundation Yearbook, 2005

[3] David Albright and Kimberly Kramer, “Fissile Material: Stockpiles Still Growing,” Bulletin of the Atomic Scientists, (60:6), November/December 2004, 14-16.