What's Next?

How will terror change philanthropy?

The September 11th tragedies in New York and Washington should prompt us to think not only of the disaster relief and victim assistance programs that emerged in the hideous wake of the hijackings, but the long term philanthropic implications. What should people of charitable intent do? What should institutions of charitable purpose now do differently, if anything, in the post-terrorist environment? The ensuing weeks and months will be a time to check the pulse of philanthropy.

This is written less than a week - after the devastation, prior to the initiation of any retaliatory action by the U.S. government and its allies, everything is speculation. One thing we know is clear. The outpouring of charity and philanthropy, from volunteers searching the rubble of the World Trade Center to unprecedented donations to the Red Cross and other relief groups, has been amazing and overwhelmingly altruistic.

The breadth of the philanthropic response - September 11th funds established by mainstream institutions such as the New York Community Trust and the United Way to progressive philanthropies such as the Tides Foundation and the Union Community Fund - says something powerful and positive about the character of our nation in times of humanitarian crisis.

Hopefully, the fact that nearly every entity with a public persona has established a September 11th fund will not simply add up to a mass of charitable confusion despite the best of intentions.

But long term, what will and should philanthropy do?

The Washington Post has begun reporting on entirely predictable retaliatory spate of hate crimes, noting a few incidents already where people have attacked Sikhs instead, the perpetrators' image of Arabs shaped by the turbaned malefactors in old Popeye cartoons.

Our nation's palpable ignorance of other cultures and other peoples may be one important target for philanthropy, to better understand and appreciate the vibrant mix of cultures and religions that constitute our world-and our own nation. Moreover, to help appreciate the fact that terrorists using the mantle of Islam do not make Islam the villain. Foundations and corporate grantmakers ought to make racial and ethnic understanding and appreciation of America's multiculturalism a renewed philanthropic priority.

The correspondence of September 11, 2001 to December 7, 1941 should make us pause, given our nation's terrible internment of more than 100,000 Japanese-Americans in the wake of Pearl Harbor. all paid reparations, too little and too late, to Japanese-Americans in the 1980s. Without racial understanding and perhaps without leadership from the philanthropic sector, we could be subject to repeating that scenario with America's Muslim population. This nation need not emulate its enemies in its attempt to eliminate them.

It isn't just racial and ethnic understanding that's needed. The phenomenon of certain religious leaders sharing their take, blaming gays, lesbians, pro-choice advocates, and the American Civil Liberties Union, indicates that there are lots of opportunities for philanthropy to ratchet up its commitment to fostering tolerance against such rampant ignorance.

Probably equally as significant is our nation's solipsistic view of the world and international events. Do most of us know anything more about the political currents in the Middle East than the portrayal of Arabs in Arnold Schwartzenegger's aptly named True Lies?

Perhaps an intense commitment toward better understanding of other nations and more direct engagement around issues of democracy would be a philanthropic initiative worth pursuing. It is a different philanthropic imperative than the efforts of some U.S. nonprofit infrastructure organizations to export our models of philanthropy, replete with the latest proposals for establishing for-profit technical assistance units to help people in other nations learn up-to-date techniques of proposal writing and direct mail fundraising.

While we might be well advised to spend time on promoting democracy rather than chasing phantasms as a superior means of combating terrorism, philanthropy might want to do the same at home. How many people turned to community-based institutions as their bulwarks for solace and support against the attack on the American psyche?

One need not become a blind Robert Putnam acolyte to recognize the importance of community and community organizations as the mix of columns and girders that make our society stronger and more resilient than skyscrapers.

Organized philanthropy typically turns with the alacrity and agility of a glacier. Undermining possibilities of change will be not only the inertia of most foundations, but the likely economic events emanating from the terrorism. While there might be a "patriot's rally" in the stock market and probably heroic governmental efforts to prop up financial exchanges around the world, terrorism and the ensuing uncertainties could make an emerging global recession longer and deeper.

The U.S. economy has been carried for years by the spending of consumers, whose confidence might be shaken by recent and prospective events. Airlines, travel, tourism could be hit. The stock market could plunge even more than what it did the Monday it reopened.

The challenges for nonprofits will only skyrocket. The $40 billion Congressional appropriation for the military and relief actions is only the first step and does not include the off-budget appropriations that will likely flow into the nation's intelligence apparatus. The overall cost will be mammoth. Domestic spending and nonprofit functions will be undermined. The economy and the federal budget will be a double hit on the nonprofit sector.

Will charity and philanthropy hang in against a buffeted economy? It may seem petty in light of the human dimension of the tragedy, but there are economic consequences to terrorism. Our nation's philanthropic resolve will be tested.

While the altruism of corporate responses to September 11th is real, corporate philanthropy will probably not be in the game for the long term on the big issues. Corporate philanthropy right now is down to 1.2 percent of pretax income and with some exceptions is unlikely to take the lead in combating racial and religious hatred.

Large individual givers are notoriously skittish in economic downturns. Most individual charitable donations do not go near issues of racial/ethnic understanding or the promotion of democracy, the bulk devoted to religion but not necessarily religious understanding, a huge proportion going to university endowments and professorial chairs.

But, foundations might not have to succumb to the markets the way corporations and wealthy donors might. Currently, their giving fluctuates with their stock market performance; the merest hint of a downturn in 2000 had foundations warning of retrenchment in their grantmaking. But unlike corporations and individual donors, foundations have a tax exempt, public purpose mission. They do not have to curtail their spending like pensioners nursing their retirement nest eggs.

Times of economic uncertainty or downturns might be exactly when foundations should increase their grantmaking and perhaps engage critical issues more forthrightly. If there were any time for foundation functioning based on mission and public purposes rather than watching the barometer of stock market performance, the challenges underscored by the events in New York City and Washington, this is it.

The agenda of racial and cultural understanding, promotion of democracy, facilitation of international understanding, and maintenance of the nation' s nonprofit and community infrastructure will fall to the foundations to lead. I am quite convinced that American foundations will live up to their mission and more. We have only to wait to see which foundation leaders will take the bully pulpit to exhort their colleagues to meet the challenge.

Rick Cohen is president of the National Committee For Responsive Philanthropy in Washington, D.C.