Mother's Milk.

A Gift of Freedom: How the John M. Olin Foundation Changed America, by John J. Miller (Encounter, 232 pp., $25.95)

THERE are two groups of people who should read NATIONAL REVIEW political reporter John J. Miller's crisply written, authoritative history of the John M. Olin Foundation: conservatives wishing to reflect happily on some of the major intellectual accomplishments of the conservative movement over recent decades, and liberals desperately seeking to duplicate conservatives' success.

No conservative foundation in America received a greater return on its investment in the right ideas, and in the right men and women capable of advancing them, than the John M. Olin Foundation. It devoted about $68 million to the crucial study of how laws influence economic behavior; one recipient of its support was Ronald Coase, the 1991 Nobel Prize winner in economics, who remarked that without the foundation's help "it is doubtful whether the importance of my work would have been recognized."

The foundation also supported conservative college newspapers--starting with a student publication at the University of Chicago in 1980 and developing into the nationwide Collegiate Network, which has nearly 100 publications, including some on the country's most prestigious campuses. But Miller suggests that the single most important grant in the foundation's history was its support of a 1982 conference of law students and professors that was "the springboard for the creation of the Federalist Society," which has played an essential role in altering the nation's legal culture from the university to the Supreme Court.

One of the most spirited debates of the post-Cold War era occurred between Francis Fukuyama, who argued in his lecture "The End of History?" that democracy and free enterprise had triumphed, and Samuel Huntington, who countered in his book The Clash of Civilizations that most of the Muslim world had so far resisted democracy, and that China's expansionism showed that Communism itself might not be dead. Fukuyama delivered his "End of History" lecture at the John M. Olin Center at the University of Chicago, and then published it in The National Interest, a journal underwritten by the foundation; Huntington led the John M. Olin Institute for Strategic Studies at Harvard.

This was part of a pattern: The foundation displayed a remarkable ability to identify conservative intellectuals with paradigmatic ideas. Among others who benefited from Olin largesse were Charles Murray, author of the landmark study on welfare, Losing Ground; John E. Chubb and Terry M. Moe, authors of the pioneering work on school choice, Politics, Markets, and America's Schools; Dinesh D'Souza, with his groundbreaking bestseller, Illiberal Education; and--perhaps most famously--Allan Bloom, whose Closing of the American Mind sold more than a million copies.

Bloom was able to write his book on "how higher education has failed democracy and impoverished the souls of today's students" because he was the co-director of the John M. Olin Center for Inquiry into the Theory and Practice of Democracy, which had received more than $9 million from the foundation.

The keys to the foundation's extraordinary success, Miller writes, were its dedicated officers and directors; its fidelity to John M. Olin's philosophy of free enterprise, limited government, and individual freedom; and its willingness to spend the principal as well as the interest of its money to create a conservative counter-intelligentsia of scholars, think tanks, and publications.

Undergirding the foundation's activities was the entrepreneurial spirit of Olin, who built one of America's great corporate empires and then devoted the last years of his life to determining how best to give away the fortune he had accumulated. His most controversial request was that his foundation not outlive him by more than a generation. His reasoning was that "enemies of free enterprise" might seize control of the foundation's assets and use them against the original objective. (This is in fact what happened to the John D. MacArthur Foundation, and other grant-giving institutions too numerous to mention.) He felt strongly that the intellectual defense of capitalism, in Miller's words, "needed all the help it could get as soon as it could get it"; as a result, although the foundation's assets never rose above $117 million, it disbursed funds at an annual rate attained only by foundations five times as large.

Almost as important a figure in the foundation's success was former Treasury secretary William E. Simon, who was its president from 1977 until his death in 2000. Simon had three exemplary executive directors--Frank O'Connell, Michael Joyce, and James Piereson, who presided over the closing of the foundation in 2005. These men and their small but efficient staff turned the foundation into what Miller calls "a venture capital fund for the conservative movement," reinvesting constantly in recipients who were successful. Olin was patient, understanding that it can take a long time for even the best of ideas to have consequences. It worked closely with about a dozen other conservative foundations, leveraging grants to counter effectively the liberal foundations that often outspent conservatives by 10 to 1.

I can personally attest that writing an institutional history like The Gift of Freedom is not easy. There are questions of access to confidential documents, editorial independence, judgments about those still living. There is the temptation to offer only the thinnest of narratives and simply provide long lists of laudable accomplishments and worthy individuals. Miller has resisted the temptation, crafting a highly readable and honest portrayal of the foundation and its people. He does not gloss over Bill Simon's "ferocious temper" or the foundation's favoring of neoconservatives over paleos. (It was not, however, a captive of the neos, as some paleos have charged; it gave generous help to such traditional conservatives as William F. Buckley Jr. and Robert P. George, and organizations including the Heritage Foundation and the Intercollegiate Studies Institute.)

John J. Miller's admirable and concise study demonstrates that the assessment of Nathan Tarcov, of the Olin Center at the University of Chicago, was correct: "Future generations will look back at the history of our time with profound gratitude that the John M. Olin Foundation was here so long and knew so well how to get it right."

Mr. Edwards is a fellow of the Heritage Foundation, and his many books include histories of that institution and the Intercollegiate Studies Institute.