The Capital Research Center, which is to objective research what most congressional election campaigns are to truth in advertising, has released some new "research" on corporate philanthropy. We should not be "shocked, shocked" that CRC has determined corporate foundations to be the secret tools of Castro and Kim Jong Il.

In the world of real academic research, most study is conducted by bringing together all the evidence and allowing such evidence to determine the thesis that is put forward. In CRC's case, the process seems to be just the opposite.

The authors of the subtly titled article detailing the research, "Funding Liberalism with Blue-Chip Profits: Fortune 100 Foundations Back Leftist Causes," are thoroughly perplexed that corporate foundations would rather give dollars to environmental organizations that may have some appeal to soccer moms concerned about their kids' breathing soot from a nearby smokestack than to think tanks trying to rescue America from a descent into socialism.

CRC neatly arranged the recipient organizations of the corporate foundations it examined into "left" and "right." In CRC's world, there is no "center." Not surprisingly, CRC offers a very very partial list of the organizations and their categorizations. On the left are the Brookings Institution [which just published a book, written by a Republican, extolling the virtues of welfare reform legislation passed in the '90s], and those evil, aged communists at the AARP Foundation. On the right are the Cato Institute [which just published a book titled, Buck Wild: How Republicans Broke the Bank and Became the Party of Big Government], and [correctly] James Dobson's Focus on the Family. It offers a convoluted explanation of what constitutes "right" and what constitutes "left," saying "we also put on the right groups that defend traditional values..." Now, that's objective.

Perhaps the most glaring inadequecy of CRC's research is that it only examined the foundations of Fortune 100 corporations. Corporations give boatloads of money away directly, sometimes much more than they do through their established foundations. Using this limited sample to determine political intent is like trying to determine the annual beer consumption of Americans while excluding Budweiser and Miller.

Also playing a role in the liberal corporate philanthropy conspiracy, according to the article, are matching gifts programs, which allow employees to give to their favorite charities while having their employers provide a match. As evidence the article offers up a single $300 and a single $50 matching gift processed through the Bank of America Foundation. The $300 gift went to the Sea Sheperd Conservation Society, which CRC accuses of sinking fishing vessels, and the $50 went to International A.N.S.W.E.R., the leaders for which CRC accuses of "supporting the communist dictatorships of Cuba and North Korea" [note: this may be true].

The point is, $350 does not a conspiracy make. But when you're trying to prove a point ...

Lucy Bernholz on regulatory improvements for foundations:

Second, the regulatory system for organized philanthropy (foundations) relies heavily on penalties (see the post hoc note above). The problem with this is that no one really suffers from penalties on foundations. No CEO loses his/her job, staff aren’t docked salary, and the donor has already given over the funds to the organization so the money isn’t coming out of her pocket. The only ones who might suffer are potential grantees. Once the penalty fee is assessed the likely response is to decrease the grants budget (not cut salaries or jobs at the Foundation). So the community suffers, but these organizations have no power vis-à-vis the foundation to begin with so their pain is not a very effective deterrent.

While I'm not sure I agree that the suits in Washington can implement regulations that make foundations behave, I think Lucy is exactly right. Foundation executives are like NCAA coaches who commit recruiting violations. They don't lose their jobs, but the kids involved get booted off their teams. The only way a coach loses his or her job is if the university's students, faculty and/or community put pressure on the administration.

Perhaps an imprecise analogy, but I think communities can do a better job keeping foundations in line than any regulations on the books. The problem, of course, is that people or organizations that criticize foundations greatly decrease their chances of getting funding from the foundations they criticize. Unfortunately, it's the way the game is played.