Rethinking Global Giving
Trade protests are prompting a review of grant-making policies
By STEPHEN G. GREENE
As the crowds of activists who descended on Washington last week made
clear, financial institutions like the World Bank and International Monetary
Fund face increasingly vociferous challenges to their structures and
practices.
When tens of thousands of demonstrators clogged the streets of Seattle last
fall to protest international trade agreements, many Americans were taken
by surprise.
Few observers had predicted that the arcane rules governing global market
transactions would have generated so large and diverse an assemblage of
critics: union workers, environmental activists, farmers, college students,
nuns and clerics, human-rights workers, and ordinary citizens from across
the country and around the world.
Fewer still understood that the weeklong demonstration -- far from a
spontaneous outburst by a motley band of naysayers and quixotic dreamers
-- was part of a methodical campaign undertaken during the past decade by
a handful of charities engaged in policy analysis and grassroots organizing --
and financed by a small number of grant makers.
Ever since the "Battle in Seattle" last fall, however, a growing number of
foundations, large and small, are taking an interest in reevaluating their grant
making, in light of the concerns raised by protesters about the system of
global trade and its effects on societies everywhere.
More than 70 foundations have expressed interest in a new group formed
to raise awareness among grant makers about the relevance of those issues
to philanthropy. Last month's conference of the National Network of
Grantmakers drew some 350 participants to Boston to discuss why
philanthropies should care about globalization. And some foundation
officials are collaborating with each other, and with colleagues in other
countries, in new programs that reflect a newly emerging global perspective.
The global trade system was intended to lead to greater prosperity
everywhere by lowering international-trade barriers, making cross-border
transactions more uniform and predictable. Its proponents say free trade --
as outlined by the General Agreement on Tariffs and Trade (GATT,
established in 1948) and by the World Trade Organization (W.T.O.,
created in 1995), as well as by pacts between regional trading partners --
promises to "lift all boats" by improving living standards worldwide.
International trade and the accompanying globalization of the market has
benefited many people around the world in countless ways, the argument
goes, providing better jobs, improved crops, advances in health care, and
greater access to more consumer goods and services.
But a growing chorus of critics contends that globalization has primarily
lifted the yachts and swamped many of the rowboats, widening the gap
between rich and poor and eroding the political power of ordinary citizens
and democratic governments to govern their own affairs. The W.T.O.
serves primarily to meet the needs of powerful transnational corporations,
the critics argue, pointing to what they see as serious adverse effects of
trade liberalization in agriculture, environmental protection, food safety,
human rights, labor standards, and public health.
They contend that trade treaties have forced nations into a "race to the
bottom" in terms of labor and environmental standards, disproportionately
harming the world's poorest and weakest citizens, who have no voice in
determining how such agreements are negotiated.
The World Trade Organization, which deliberates in closed sessions, can
require the governments of its 135 member countries to nullify any social or
environmental standards, including national laws, that are deemed to infringe
upon free trade, or else risk large financial penalties. In a single stroke, the
organization's critics declare, it can reverse victories that have taken many
years to achieve. International treaties and domestic laws in areas as varied
as child labor and climate change can be challenged under W.T.O. rules as
being unfair restrictions on free trade.
"Foundations are beginning to realize that whatever issues they're involved
with are intricately connected to globalization policies," says Jerry Mander,
program director at the Foundation for Deep Ecology, in San Francisco,
and president of the International Forum on Globalization, a think tank that
opposes economic globalization. "Every foundation, whether it's
environmentally or socially oriented, ought to be putting this on their front
burner. And once it's on the front burner, I don't see how they could take it
off."
A handful of grant makers besides Mr. Mander have focused on the issue
for years. Roxanne Turnage, executive director of the C. S. Fund, in
Freestone, Calif., says her eyes were opened at a briefing she attended
nearly a decade ago. "I came away blown away by the idea that this thing
called GATT had a potential to undermine everything all the rest of our
grantees had worked for two decades to achieve," she recalls.
The C.S. Fund and the Foundation for Deep Ecology were among the first
grant makers to support the work of principal groups that have long been
involved with issues of globalization, including the Institute for Agriculture
and Trade Policy, in Minneapolis, and Public Citizen, in Washington, which
participated in the briefing that Ms. Turnage attended.
"Many funders have been working on these issues for years," says John
Harvey, associate director of Grassroots International, in Boston, which
supports groups in Brazil, Eritrea, Haiti, Mexico, and elsewhere. "Primarily
since Seattle, a new vocabulary has emerged, and a new desire to
understand the structural basis for what's taking place."
Grant makers vary widely in their approach to globalization. Some focus on
the policy end, underwriting research papers and conferences or helping to
publicize the issue more widely. Others assist with grassroots activists'
efforts to mobilize broader support, travel to other countries, and reassess
local activities in light of what's happening around the globe.
While many grant makers believe that the regulations and institutions that
govern the global economy should be changed, there is no consensus about
what should be done. At one end are critics like Mr. Mander -- co-editor
of the book The Case Against the Global Economy -- who says the
system is "based upon an export-oriented model of economic development
that is going to destroy the earth," and should be dismantled.
But others hold far different views. "Everyone has criticisms of the W.T.O.,
but we need to find ways to reform it, not just blow it up," says Michael
Northrop, a program officer at the Rockefeller Brothers Fund, in New
York. He and many others favor overhauling global institutions, but
primarily to make them less secretive and more democratic in their
deliberations, and to draft agreements that take effects on the environment
and society more into account.
To help foundations sort through such issues, several dozen grant makers,
who met last fall during the Seattle protests, agreed to form the Funders
Network on Trade and Globalization, to promote awareness among
foundations of the relevance of such issues to their grant making.
The network, which is operated from the offices of the Environmental
Grantmakers Association, in New York, is holding briefings for foundation
staff officers to discuss globalization issues. The first briefing was held in
New York in February; additional briefings are scheduled for April 26, in
Chicago, and May 8, in San Francisco.
"Everyone has an abstract idea that globalization is something they should
be concerned about, but many of them don't have a clear way of thinking
through what its various aspects are, which can lead to hasty conclusions,"
says Carolyn Deere, the network's coordinator.
The funders' network plans to put up a World Wide Web site and is
preparing a briefing book for grant makers that it hopes to publish in July.
The book will summarize the varied roles that foundations see themselves
playing in the debate over globalization and trade.
In addition, three grant makers -- the French American Charitable Trust,
the Solidago Foundation, and the Unitarian Universalist Veatch Program at
Shelter Rock -- have jointly commissioned a national survey of officials of
their grantees and other non-profit groups to determine what efforts are
already under way in terms of globalization issues, and what other projects
or approaches might be useful as well. The three foundations will use the
findings to guide their grant making.
"It's going to take a long time to turn this around," says Deborah Holder, a
program officer at Veatch. "It's a big challenge for grant makers. But there
doesn't seem to be any way our limited dollars will ever compensate for the
gaps we see in all our communities. So it's in our best interests to look at
systemic causes."
Some foundations seek primarily to expand participation in discussions
about changing the way the World Trade Organization operates, to include
groups of people who are now excluded from participating in its decision
making.
"Civil society does need to have a place at the table," says William S.
White, president of the Charles Stewart Mott Foundation, in Flint, Mich.
"As a foundation, we don't necessarily have our own politically correct idea
about what we should be doing -- but we will say, Make sure the citizens of
your country have good information, access to your parliament, and the
other tools they need to make good decisions."
About 45 percent of the $7-million that Mott spends each year on
international-trade issues goes to groups based outside the United States,
says Ed Miller, a program officer. "For us, globalization isn't just one thing,"
he says. Rather, it includes the cross-border flows of private and
government capital and the lending policies of institutions like the World
Bank and the International Monetary Fund, along with international trade
agreements.
Mott's view, he says, is that "globalization is happening, but the rules
through which it is implemented can be defined in ways so that the
environment, workers' rights, and social concerns can be protected."
Many foundation officials point out that one way to help secure such
protections is to make grants to local groups dealing with issues that result
from the globalization of trade.
Ann Bastian, director of the Phoenix Fund for Workers and Communities,
in New York, cites the efforts of U.S. groups hoping to clean up rivers and
bays polluted by the many maquiladoras, the Mexican factories near the
U.S. border that assemble goods for U.S. companies but pay lower wages
and operate with fewer restrictions than they would in the United States.
"You can spend a lifetime trying to clean up the New River in California,"
Ms. Bastian says, "but if you don't deal with the maquiladora that's dumping
upstream in Mexico, you'll never solve the problem."
The Phoenix Fund is a collaboration of grant makers that wants to help
low-wage workers organize to improve the lives of their families and
communities. The fund expects to spend more than $325,000 this year on
organizing and linking workers and building the resources of organizations in
the United States and Mexico that work on labor and human-rights issues.
Supporters of the Phoenix Fund say the best way to protect U.S. jobs and
labor standards against the "race to the bottom" created by global
competition is to improve wages and working conditions in other countries
where corporations are thinking of moving.
Closer to home, adopting a global outlook can affect how organizations
operate within individual neighborhoods. "We need to help activists
understand that environmental victories here can have negative
consequences elsewhere," says Marjorie Fine, executive director of the
Veatch program."If pollution ends up in someone else's river, we haven't
solved the problem, we've just moved it." When U.S. corporations are
stymied in their plans to build toxic-waste incinerators in the United States,
for example, they sometimes turn to countries with weaker environmental
regulations or less-organized opposition.
Overseas collaborations among activists have resulted in some significant
successes for critics of the global trading system. In Philadelphia, the Bread
and Roses Community Fund has supported efforts of the local chapter of
the AIDS organization ACT-UP to lift trade restrictions that prevent generic
versions of AIDS medicines from being produced and sold in developing
countries. Pharmaceutical companies had refused to grant the licenses
needed to permit generic versions of their drugs to be distributed, even in
countries where the companies had no market because so few people could
afford to buy the brand-name versions.
ACT-UP played a key role in a coalition of health, environmental,
consumer, and human-rights organizations that forged links with their
counterparts in South Africa and elsewhere, and successfully lobbied the
White House to secure a change in that policy last fall. The $7,000 donated
by Bread and Roses to the effort was money well spent, says Christie
Balka, the fund's executive director. "This relatively small grant had an
enormous impact, far beyond what we could have imagined at the beginning
of the process."
Many foundations, while flush with earnings from the global marketplace,
face challenges that can make grant making for globalization issues
problematic.
"This issue is difficult, because much of it either is or feels very critical of
corporations or even of capitalism," says Christine Roessler, managing
director of the French American Charitable Trust, in San Francisco. "So it's
very tricky how you present this work to boards," which often include
corporate executives.
Indeed, notes Mr. Mander, of the Foundation for Deep Ecology, "one of
the things that has restricted some foundations from doing this is that you
can scarcely get involved and not talk about the role of global
corporations."
But many grant makers point out that what they seek is fair trade, rather
than no trade, and that their goal is not to destroy corporations but to
ensure that the global economic system is set up to benefit the world's entire
population, and that everyone affected by trade agreements has a voice in
how they are structured.
Participants at last month's meeting of the National Network of
Grantmakers discussed globalization and international trade for four days.
Maude Barlow, who chairs a public-interest charity called the Council of
Canadians, described what she says are social imbalances.
"The W.T.O. has become the most dominant institution on earth," she
declared, because it can force governments to abandon policies that conflict
with its provisions that exalt unfettered trade.
But citizens around the world are mobilizing to oppose the more pernicious
aspects of global trade, she said. "We're building the most powerful
civil-society movement that has ever existed. This is the new politics of the
21st century."