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Teresa Odendahl
Teresa Odendahl
Charity Begins at Home
ISBN: 0465009611
Charity Begins at Home
Author Teresa Odendahl makes a controversial premise in her book. She says that philanthropy better serves the rich than the poor. In her book, entitled "Charity begins at Home: Generosity and Self-Interest Among the Philanthropic Elite," argues that most rich people assume their charitable contributions benefit the needy and deserving, when in fact most of their donations end up underwriting activities controlled by the upper classes, particularly elite preparatory schools and colleges. She concludes that instead of relieving and balancing inequities in society, philanthropy actually exacerbates it.
Charity Begins at Home
Program Air Date: July 22, 1990

BRIAN LAMB, HOST: Teresa Odendahl, author of "Charity Begins at Home: Generosity and Self-Interest Among the Philanthropic Elite." Why do we need a book like this?
TERESA ODENDAHL, AUTHOR, "CHARITY BEGINS AT HOME": Well, several reasons. One, I think in the last decade the two conservative administrations have been cutting back on the provision of basic human services and saying that the private sector is going to take over the provision of these services through philanthropy and charity and so on. And so I decided to interview some multimillionaires and find out what it is that they give their money to. And, in fact, I found out that they tend to support the types of institutions that benefit them and their class to a much greater extent than programs that serve the needy. So I'm calling the government to task on their assumption and President Bush's rhetoric about 1,000 points of light and how this will make up for government lack.
LAMB: Where do you come from?
ODENDAHL:San Diego, California.
LAMB: How did you get to this point? Where have you been since birth?
ODENDAHL:Well, I worked at -- I don't know if you want to go all the way back to my birth, but I worked at two different foundations. And through working at the first foundation, the Business & Professional Women's Foundation, which is here in Washington, DC, I was drawn into the kind of arena of non-profit organizations and foundations, in particular, and I attended professional conferences where I met trustees of foundations and wealthy people and so on. So that sort of brought me into researching this field. And then I was recruited to Yale -- after I got my PhD, I was recruited to Yale University to head up a project in which we studied the health of foundations, in general, across the country. And out of that project, the idea for this book emerged, although it's a very separate project.
LAMB: Where did you go to school?
ODENDAHL:The University of Colorado at Boulder.
LAMB: You got all your schooling from there?
ODENDAHL:No. I went to San Diego State College and then the University of Colorado. And I'm an anthropologist.
LAMB: And I noticed in your past that you have been supported, from time to time, by foundations. How often and what foundations?
ODENDAHL:The foundations that supported the project at Yale were the Charles Stewart Mott Foundation, the Andrew Mellon Foundation and the Kellogg Foundations. And this was a very large study. I was the project manager, but we had a team of seven other researchers on it. Prior to that, I did a study of foundation career patterns, and the foundations that supported that project were the Russell Sage Foundation and the John Hay Whitney Foundation. So I've gotten a lot of support from foundations. At the point, though, that my analysis began to become more critical of philanthropy in general, I began taking a little heat for the direction that my research was taking -- both because of that and, also, I made a personal decision not to take any more philanthropic funds. So this book was actually written without any funds, although much of the research was done on other projects that were funded by foundations.
LAMB: The people that are mad at you, are they from the right or the left?
ODENDAHL:I seem to be hearing sounds from both sides. In other words, people on the left say to me, “We always knew this, what's new about this particular issue?” People on the right, I would say, though, are more angry than people on the left.
LAMB: What is a foundation?
ODENDAHL:There are many types of foundations, but, generally, it's an endowed institution that makes grants, primarily out of interest income. These are the so-called independent foundations or family foundations around the country.
LAMB: OK. Let's go back to the word “endowed.” What does that mean?
ODENDAHL:Endowed means that a corpus of capital is put aside, is invested, makes more money out of itself. An endowment is established -- for example, major institutions, universities, have endowments and so on. It's the same as those type of endowments, except foundations make their grants out of the interest that is made off of the endowment from the investments.
LAMB: How many millionaires did you interview?
ODENDAHL:I interviewed 140 multimillionaires. And then I also interviewed 100 additional advisers to the very wealthy.
LAMB: Can you make any general statement about a millionaire or multimillionaire?
ODENDAHL:They have a lot of money. No, in fact, I can't. It was very interesting. As the study proceeded, I found that people from -- with all different kinds of personalities, with all different types of politics find themselves with lots of money. I would say there were a few characteristics I noticed. One is most of these people tend to be private. They don't want much to be known about their wealth because they're afraid that they'll be inundated with requests for funding and so on.
LAMB: You go to some lengths to talk about the methodology, including the fact that most of your multimillionaires that you interviewed gave you an hour time.
ODENDAHL:Generally, that was about the average time that I spent with them. Sometimes I spent a full day; sometimes I spent only 20 minutes.
LAMB: Tell the story about the 20-minute interview.
ODENDAHL:All right. This was a very wealthy man, a self-made entrepreneur, who told me that he could give me 20 minutes of his time and he kept very strictly to that. He looked at his watch when I came into his office. We were interrupted by a phone call, which I believe was from his wife. He told me that later. He timed the phone call so that he could tell me exactly how much time I had remaining. He was extremely brusque, but to the point. And I felt, although I only had 20 minutes, that he told me a good deal.
LAMB: Did you tape-record the interviews?
ODENDAHL:I tape-recorded all the interviews where I was allowed to do so. Most -- the vast bulk of these people wanted confidentiality, and some people felt uncomfortable, even with the promise of confidentiality, even having the interview taped.
LAMB: Who did not want confidentiality, or ask for it, that you name in your book that you can talk about?
ODENDAHL:Well, there's one person that I name in my book, a young woman, Tracy Gary. I interviewed her once, and she wanted confidentiality, and then I chose to interview her again. I wanted some additional information. And during that interview, which was about two years later, she agreed to let me use her name publicly, and this was because she had made some personal decisions about being forthright concerning her philanthropy. So that's an example. Most of the people I name in the book, however, I may or may not have interviewed them. The information that's associated with their name comes strictly from public records -- either published records or records that would be readily available to almost anyone -- newspaper accounts, magazine articles, so on.
LAMB: Is public policy good to people that have money?
ODENDAHL:Extremely good to people that have money. In fact, my findings seem to indicate that -- it depends on what kind of public policy you're talking about. I'd like to keep myself within the arena of charity and philanthropy and nonprofit organizations. But the tax code, in general, both the income tax code and the estate tax system, are extremely helpful to wealthy individuals.
LAMB: Can you give us an example of how?
ODENDAHL:Sure. The more money you give away, the more you can deduct from income tax, up to a certain limit. Also, in terms of estate planning -- and I won't get too complicated here, but essentially you can give almost all of your fortune to your heirs tax-free if you set up certain instruments, with good tax attorneys, that allow -- wherein you give a certain amount of interest income to certain charities. These can be charities you choose yourself. And once that interest income has been given away, then the bulk of the fortune can be passed on to heirs.
LAMB: Millionaires -- -- money that they have left over, do they like to give it on to their heirs?
ODENDAHL:Well, let me clarify that the people I interviewed tend to be the most generous millionaires. In other words, these are people who give a good deal of money to philanthropy, so if anything, my study is somewhat biased toward the most generous multimillionaires. And I estimate that only about half of the very richest people in the country give vast sums of money away. So just to sort of set the context there, if that's helpful. And you'll have to repeat your question, I'm sorry; I got away with myself.
LAMB: No. The question was -- what do millionaires think about giving money to heirs?
ODENDAHL:Yes, that's right. Then, of the most generous people, most people want to pass money on to their heirs. A few people are like, Carnegie, for example, and they don't believe their heirs should get anything. But almost everyone I talked with has a desire to pass their fortune on, also has a desire to do some good with the money during their lifetime and after their death.
LAMB: You saw a bias in your study about where people like to give their philanthropic money.
LAMB: Where was that?
ODENDAHL:Well, I found that, among elite philanthropists, among these multimillionaires, they primarily tend to fund the kinds of institutions that they've been personally involved with their whole lives. So these would be the prep schools that they attended, the private colleges and universities from which they graduated. On the whole, these are Ivy League universities or very prestigious institutions -- what I call the high arts -- that is, ballet, opera, the symphony, art museums, things of this sort. They tend to fund cultural events. They don't, on the whole, tend to give very large grants to programs that serve the needy, the poor, the bulk of the population. So my basic argument here is the government is cutting back, but wealthy people, at least, are not going to find it in their interests to begin providing for the kinds of things that the government has stopped doing.
LAMB: You think the government ought to make it easy for a wealthy person to give money to art?
ODENDAHL:Yes, I do. I'm not at all opposed to the incentives for giving to art. In fact, I think the current controversy revolving around the National Endowment for the Arts is something that we need to take a close look at, because a lot of philanthropic money has supported the arts. I'm not saying that philanthropy shouldn't be a matter of choice for the individual. I'm saying that the federal government should be providing for certain programs so that philanthropy can play a different role; so that philanthropy can be innovative; so that people can make choices about where they want to put their money and so on -- so that experimental programs can be funded -- so that advocacy organizations can do their work.
LAMB: Can you give us your ideal -- I mean, maybe you can name a person in your study that would be your ideal multimillionaire?
ODENDAHL:Just my own personal ideal multimillionaire.
LAMB: Yes, just your personal ideal.
ODENDAHL:So you're asking me to make a value judgment. Well, that's very difficult because, you know, all of these people are individuals with their good qualities, and possibly their flaws. But I'm going to name Tracy Gary again, only because this is an example of a woman who has given at least half of her fortune away to charity; who has tried to direct the money to a certain extent through women's foundations. She helped to establish the Women's Foundation in San Francisco. She served on the board -- oh no, I don't believe she ever served on the board, but she was key in getting it started. And then she let a board that was a more representative board make decisions about where the money actually went, instead of as an individual or with her advisers making all the decisions about where the money should be disbursed.

I guess I admire the group of individuals who often are called the "rich kids." They inherited their wealth. They're three or four generations removed from the source of the fortune. They're in about my age range. They grew up in the '60s. And they feel uneasy about the kind of the noblesse oblige that their parents and grandparents were involved in. And they're trying to give over some of their privilege, some of their power -- the power that's bestowed within philanthropy -- to a more representative group of people.
LAMB: Give us an example of one that you -- I don't want to put words in your mouth -- one that you don't admire; one that -- the opposite of ...
ODENDAHL:Well, the opposite would be someone like Donald Trump, who, by the way, didn't let me interview him, and who we could characterize as not being among the philanthropic elite. In other words, he's a self-made millionaire, or he -- it's questionable how self-made he is -- this is just reading from published documents. I understand his father owned a great deal of real estate as well. But he's one of these people who wants to have, and does have, the biggest yacht in the world, his own private jet, the biggest penthouse at the top of Trump Tower, the biggest mansions, and so on.

He represents the other end of the spectrum. Most of the people with whom I talked do not live ostentatiously. They live relatively simply, although they're, you know, not lacking anything materially. It would be difficult to tell them apart from the middle class, for example -- from professionals, in terms of most of the houses that most of them live in, the cars that most of them drive. They choose to give conspicuously rather than to live conspicuously. I don't know. Do you want -- is that what you were looking for?
LAMB: Yeah. Well, you just mentioned something -- I'm looking at a footnote here in the back under your notes: “During the course of this research I observed cars of almost every make parked outside of rich people's homes.”
LAMB: Why did you make that note?
ODENDAHL:Well, I think we make a lot of assumptions about wealthy people, you know, that they're all driving Rolls-Royces, or they're all driving Mercedes. And, in fact, I found it quite interesting that it was difficult to tell immediately what the net worth of these people was. I tried to do so through public records. Very often, these people don't even think of themselves as wealthy, and they don't live the kind of lifestyle that you'd see, for example, depicted on "Lifestyles of the Rich & Famous," or a television program of that type. So cars were just one way to give the reader a sense of that. Another very interesting example that one millionairesses, who had inherited her wealth, told me is that she considered herself a Volvo liberal, rather than Cadillac liberal. And I tried to understand what it was she was getting at. And it's humorous in a way, because I actually called some car dealerships and found out that Volvos and Cadillacs are virtually comparable in terms of their price. But she had an image of a Volvo as being a more middle-class kind of car: less showy, possibly more dependable. Cars are one way in which we judge people's status in the world -- what kinds of cars they drive; what kinds of houses they live in; whether or not they wear designer clothes.
LAMB: What's the difference between old money and new money?
ODENDAHL:Well, most of the people that I inherited, two-thirds of them came from old money. That is ...
LAMB: That you interviewed.
ODENDAHL:That I interviewed.
LAMB: You said “inherited.” I want to make sure that ...
ODENDAHL:Oh, I beg your pardon.
LAMB: That's all right.
ODENDAHL:Most of this money had been made at the turn of the century by the so-called robber barons and others who were associated with them, and had been in the family for several generations. That's old money. It's very difficult to tell where old money begins and ends. New money, of course, is money that's made -- I try to do it by generations in the book, as an easy shorthand way. New money is first-generation money. It's money that's made by the individual themselves. I identified, during the course of this research, what I called a culture of philanthropy. In other words, these people find meaning in their lives through their giving to non-profit organizations and through their volunteering with these types of groups. And that culture is very much a part of the family tradition of people with so-called old money. So it's old-money people who sort of set the standards, establish the cultural mores and so on, that then the additional third of the new millionaires that I interviewed choose to follow, choose to learn, choose to live by.
LAMB: Statistics. One percent of the American people have 26-point-something percent of the wealth?
ODENDAHL:Yes. It's simply a statistic about how great the concentration of wealth is in the United States, and that's from a government study, as a matter of fact -- and the concentration of wealth is increasing in the United States.
LAMB: What is the other statistics? It's 68 percent of the wealth in this country is held by 10 percent of the population?
ODENDAHL:Right. Right. So it's kind of like an inverted pyramid, if you ...
LAMB: Do you have any chance, if you don't have money today, of getting in that 10 percent or that 1 percent?
ODENDAHL:Well, of course, you have a chance. And I'm not an expert on that, because I simply interviewed people who had money. But you have much less of a chance. What I found is that fortunes grow once you have them. If you have, at least, a little bit of capital, then you're able to make that capital grow and grow and grow, especially if you're a member of some of these old-money families that I talked about that made the decision, a generation or so ago, to invest the money in common, almost as a corporation, to keep the family money together, instead of breaking it up. Is this the line of reasoning that you wanted me to pursue here?
LAMB: Yeah.
ODENDAHL:OK. If the decision is to pass the fortune on -- let's say one individual has three children. A self-made millionaire has three children and he -- excuse the sexist language, but on the whole the individuals making the money were men -- he passes it on to his three children, and then they have three children each. That's nine children by the third generation. That money can have started to disappear and be much smaller. On the other hand, if the decision was made in the first or second generation to keep the family money together, possibly to invest it out of a family office -- that's often what it's called, a "family office" -- then I found, with those that I interviewed and from the public records that I investigated, that the fortunes tend to grow. The Mellon family, for example, is a good illustration of that, and I portray them in the chapter on people with old money.
LAMB: Statistic: “There are 25,000 -- nearly 25,000 private foundations in the United States.” What's the difference between a private foundation and a public foundation?
ODENDAHL:A private foundation is controlled by a board of directors that has no particular constraints upon it, although it's a board of directors. Generally, most of these 25,000 private foundations are family-controlled. The people serving on the board are family members, friends of family members or advisers to family members. In comparison or contrast, a public foundation is a foundation wherein the board is somehow representative of the community. Now a community foundation, for example, is a public foundation. And very often, community foundations have businessmen in the community on them. And I would question how truly representative even many community foundations are. But, by law, a public foundation has to have a different kind of government structure, which is more democratic than a private foundation.
LAMB: And most of your millionaires, multimillionaires, when they create a foundation, create a private foundation?
ODENDAHL:A private foundation, that's right. And ...
LAMB: What's the largest in the country, do you happen to know?
ODENDAHL:The largest private ...
LAMB: Private foundation?
ODENDAHL:The Ford Foundation. Now I want to caution you that the Ford Foundation is a foundation we all think about because it is the largest, because it gives so many grants. It's rare, though, in comparison to many other foundations, which are like charitable checkbooks of the wealthy family. The Ford Foundation is a truly "independent foundation." It has a board of directors that no longer has any association whatsoever with the Ford family. Another example of a foundation which will be among the largest -- is to be among the largest, is the Packard Foundation, established by David Packard and his wife, Lucille. And that is a private foundation in which, at this time, it's almost totally family-controlled -- that is, family members serve on the board. And it's also a large foundation.
LAMB: David Packard. We've seen a lot of him. He was the Deputy Secretary of Defense.
LAMB: He headed up the Packard Commission. Who is he and why did he -- how did he make so much money?
ODENDAHL:Well, he's one of the co-founders, co-creators of the Hewlett-Packard Corporation, which, as most of you know, is a high-technology corporation, builds a lot of computers. I believe the bulk of his money was made through his company. At some point in his life, he -- and from the records that I was able to pull out, it seems his wife had a great deal of influence -- decided to put much of that money into a foundation, a private foundation, which they established, which serves communities in the Northern California area, where the Packard family lives, where Mr. Packard lives presently.
LAMB: You open up chapter six by saying, “In the spring of 1988, 75-year-old David Packard, the co-founder of Hewlett-Packard, a leading computer and electronics firm, announced that he would donate $2 billion of his fortune to the David and Lucille Packard Foundation.”
ODENDAHL:Right. And I chose to open the chapter on self-made millionaires this way because it was timely; he had just made the announcement; there was a lot of public information about the Packards. The Packards fund a lot of interesting projects but, on the whole, I found that they -- like other individuals who I actually interviewed -- in the cases where I name people, I might not necessarily have interviewed them, so it's only the materials that are available to me that I could go on. Anyway, he and his family tend to fund the sorts of projects that interest them, the sorts of projects in which they are very involved. For example, his wife before her death was quite involved in a number of projects supporting the arts, supporting a children's hospital. He is -- both of them, I believe are alumni of Stanford University; they've contributed huge amounts of money to Stanford University. An example of the type of university -- although not technically an Ivy League institution -- Stanford is the type of university that most of the individuals I interviewed would give their largest donations to.
LAMB: What do they want from the money they give to these universities?
ODENDAHL:Well, it varies. I describe it as a spectrum. Some wealthy individuals simply want to choose where their money goes. They'd rather make the decision rather than paying the money in taxes and somehow having the government make the decision about where the money goes. And they get certain self-satisfaction out of their donations. They give to things they believe in and they think they're doing good in this way. So that's one end of the spectrum. The other end of the spectrum are individuals who want control over the organizations that they fund. They're willing to give possibly, let's say, $10 million to an institution, but they want to have something to say about how the institution uses the money and so on.

Someplace in the middle of that spectrum are where most people fall -- most of these wealthy individuals fall. They want the self-satisfaction, they want their name associated with a wing of the hospital or, in the case of universities, the library or a building or an endowed professorship. But they're not necessarily going to say the money should only go to this. On the other hand, just coming back to Packard to make the example more concrete, a good deal of this -- of these funds -- have gone to support programs in the sciences at Stanford, programs in engineering at Stanford. Now we can readily understand why this happened. I believe I have my facts right that David Packard, himself, has a degree in engineering from Stanford and he wants to support his alma mater, just as you and I would want to support our alma mater. The difference is, I argue, that he gets a large tax break for his contribution -- let's move away from him in particular, but multimillionaires get large tax breaks both on income tax and in their estate plan -- on inheritance taxes for giving to the institutions that they choose.
LAMB: Well, let's just go to the core of the matter. When you see somebody that's just given -- I think Walter Annenberg just gave $50 million to the United Negro Colleges -- I may have the wrong title there. Are we supposed to ooh and ahh and say what a terrific thing he's done or are we supposed to say, “Well, if you really look at it, this is a tax break'?
ODENDAHL:Well, I think we should do both. Mr. Annenberg made this contribution since the book was already written, so it's not included in the book. I think we should ooh and ahh. I think it was a good decision on his part. I think it's a somewhat exceptional grant in that it didn't go to his own alma mater, but he obviously had given a great deal of thinking to what kinds of institutions he wanted to bolster up and he chose black colleges and universities.

What I think we need to do is scrutinize the giving of the wealthy much more closely. We need to not make the assumption that it's always doing good. We're all very proud in the United States of philanthropy, of the so-called non-profit sector of charity in general. And what I call for in this book is a reassessment of how does charity actually function in our society? Is it truly charity? I think most of us would think charity was assisting the needy. And yet I found that most wealthy people don't actually assist the needy with their charity. So I suppose we could make the distinction between charity and philanthropy there.
LAMB: Is there a time in your past where a light bulb went off and you say, “This really makes me mad. I'm going to do something about it and I'm going to write this book”?
ODENDAHL:Yes. It was during the course of the study, late in the study, at about my third year at Yale. The interviews ...
LAMB: What year?
ODENDAHL:That would be 1986. And I was completing the study of the health of the foundation field and I was beginning to write up results and working with the research team; we worked very collaboratively. And I would write something that my other team members -- fellow researchers -- would call me on. I would say things like, “Foundations help to perpetuate the status quo in the United States,” and they'd say, “Well, you can't write something like that.” And I'd say, “Well, why not? It's here in the data.” And I began to see that, even as researchers, they had profound reservations about calling to task something that we consider to be almost "holy" within our society.

In other words, we think of these kinds of activities as being such good activities, and especially given the political climate when people like President Bush are saying, “Our problems will be solved by the 1,000 points of light.” It wasn't very politically popular. Anyway, this is the time period -- '86, about four years ago -- that I began really seriously thinking these things through in a different way, kind of looking at it differently. And I began presenting some papers also, just on my own, which presented my own analysis and interpretation of the data. And I received hostile receptions to these papers.
LAMB: Where'd you present them?
ODENDAHL:Now if the papers were presented to a group of strictly academics, there was no problem at all. The academics listened attentively, asked good questions. But if I were to present the paper to an audience of grant-makers -- that is, people who either work for a foundation or are wealthy themselves and give funds away to non-profit organizations -- there are a number of professional organizations of this sort -- or to the kinds of organizations that represent non-profit groups in this country -- perhaps lobby for non-profit groups and so on -- then the reception would be almost cold, and people weren't even willing to listen to me. It was as if I was saying, “The emperor has no clothes.”

At one particular conference, the keynote speaker chose to point me out and say, “Yes, Teresa, there is no Santa Claus.” And I gave a lot of thought, “What did he mean, ‘There is no Santa Claus’?” This was Dick Lyman, by the way, who was the former president of the Rockefeller Foundation. And I don't know how consciously he chose his metaphor, but it seems to me that he was saying that I was revealing -- everybody knows there is no Santa Claus, but we shouldn't be revealing it because Santa Claus is good, because we think of Santa Claus fondly.

Anyway, I'm going on at some length. But then I did have another experience which more or less confirmed for me what I had begun to suspect from the interviews and from my work with the interviews and my additional conversations with the wealthy, and that is that I was employed as the first executive director of the Women's Foundation of Colorado. This is one of several new foundations that are springing up around the country, created by women, funded by women to serve women's causes. And in the course of that employment, which turned out to be rather brief, I became a participant observer with -- at least with the wealthy women who had helped to establish the foundation, and began to see that -- and I don't mean to single them out because, in a way, I am singling them out but they're not that different from any other type of enterprise of this sort -- which is that they were just as interested in creating the foundation to establish their own power base, to increase their own influence, as they were to provide for other women, to improve the status of women in the state of Colorado.
LAMB: Did you do all the work on this by yourself?
ODENDAHL:On this particular book I did. I didn't do all the interviews myself. There was a team of interviewers. However, I listened to every tape again and read every transcript again and reanalyzed all of the interviews since the Yale study ended, so that the book is a work of a single person.
LAMB: Dedication: for Michael Bernstein. Who is he?
ODENDAHL:He's my partner, the father of my daughter, an economic historian at the University of California at San Diego. And he was a great support to me throughout the whole project, both literally and figuratively.
LAMB: You also mention -- let's see if I can find it; I had it underlined here in the beginning -- a couple of other Odendahls.
ODENDAHL:Right. My parents.
LAMB: An Eric and a Mary.
ODENDAHL:Those are my parents. My father painstakingly edited the entire manuscript and commented on it for me -- he's a journalist, and he teaches at San Diego State University. And my mother, who works for the Presbyterian Conference of San Diego, also read the manuscript and commented on it. A lot of friends and family supported me in this project.
LAMB: When did you finish it?
ODENDAHL:Well, the book literally came out less than a month ago, so I guess that's what you'd call actually finishing it. It was in press almost a year, however, so I finished it just about a year ago.
LAMB: A couple of things I underlined: “I have tried to be honest about my biases.”
ODENDAHL:Right. And my ...
LAMB: Was it hard?
ODENDAHL:Well, I think very often social scientists like to present themselves as if their research is value-free, as if they're methodology somehow -- they've erased any of their own biases because they've used a statistical methodology or whatever. And I just wanted to make the point, especially since these were personal interviews, since they're open to a great deal of interpretation, that -- right at the beginning I wanted to let the reader know what my overall arguments were and what my biases might be.
LAMB: Another ...
ODENDAHL:Everyone has biases. I'm not sure that everyone admits to them, that's all.
LAMB: Another note here: “I am not a member of the class I describe.”
ODENDAHL:Right. I'm not wealthy. I grew up sort of solidly middle-class and I've never wanted for anything in my life, but actually, until these interviews, I'm not certain that I really was ever personally acquainted with any multimillionaires before.
LAMB: Quote, your comments: "It is the burden of my argument that the rich do not find it in their interest to fund or provide social programs on a sufficient scale."
ODENDAHL:Right. I am not trying to say that the wealthy individuals should be putting all their money into programs that serve the needy. I'm rather saying that we have a structural situation in which the federal government is not providing what you could call a basic federal safety net. We can see it all around us with more homeless people on the streets and so on. I'm not trying to show how that safety net can be provided; I'm simply trying to show how the particular role that this group of wealthy individuals play in supporting a structural situation that may, in many senses, exacerbate inequality instead of helping to redistribute wealth.
LAMB: Go back to that chapter -- first generation men and their families. Another person that you mention in here is George Klepper. Real name?
ODENDAHL:No, that's a pseudonym, and actually, George Klepper is, I believe, five individuals. And what I had to do in order to protect the confidentiality of the people we interviewed was to take individuals who were all of the same gender, who were all of the same generation from wealth -- in this case, Mr. Klepper was a first-generation millionaire who generally were just about the same age. He was an older man. I think he was, in fact, over 60 years of age. So all five of these individuals had those traits. In addition to having those demographical, personal traits, they all said very similar things in their interviews, so that I collapsed them together, formed a composite and then was able to present material that didn't identify any one of the five of them through this one individual.
LAMB: This is a question of no substance. Where did you invent the name George Klepper?
ODENDAHL:I don't know; I think I just made it up.
ODENDAHL:I do know other names -- where they came from -- sort of people I once had known and I picked up on that name or people's friends had known -- I was asking friends what names I should use. I did try to avoid any actual names. In other words, if I knew that there was a wealthy person who had the name Klepper, then I wouldn't have used the name Klepper. In fact, I think I had invented a name Paul Mitchell. It was just a pseudonym for one of the self-made millionaires that I feature, and then I realized that there was this line of products that are called Paul Mitchell products, so I had to change that name.
LAMB: I want to read you what you said under the George Klepper part of this chapter. You quote him as saying -- or this composite -- "We have about 80 guys working on our income taxes."
LAMB: "Eighty guys working on our income taxes." The income taxes of the family?
ODENDAHL:I think he's talking about the trusts that he established. This individual and the other individuals that make up the composite had decided to establish -- to put all their money into trusts and, in fact, the corporation, I believe, was in the form of a trust. And what he was saying was that it took 80 individuals to actually -- it was so complicated, the trust arrangements, that it took this many government employees to actually check out their tax situation.
LAMB: How much was he worth?
ODENDAHL:I don't recall, although all of the individuals who were included in the 140 -- the count of 140 -- by the way, I did interview other people who didn't quite make the 140, but who supplemented my general characterization. They had at least $5 million of net worth. His particular corporation -- I may have mentioned it there -- it's quite a large corporation, though, and I believe that if it isn't him there are some others who would qualify to be on the Forbes list of the 400 wealthiest people in the country.
LAMB: You say he is one of the 400.
ODENDAHL:OK. I wasn't sure whether that individual was. So he's incredibly wealthy.
LAMB: OK. Let me read you a little more here. "We have five members of the United States government who do nothing but check us.”
LAMB: Five members of the United States government.
ODENDAHL:Right. That's a direct quote. On the whole, I decided to treat the statements made to me as truth.
LAMB: Let me just read a little more so I can complete this. “To check us through the whole year, they sit and work on us. We had to rent another place for them.”
LAMB: For the government.
LAMB: When you hear that, does that make you feel good, that there are five people that work for the government that have to spend ...
ODENDAHL:No, it doesn't make me feel one way or another. This isn't a question of how I feel. The point I was trying to make, though, in that particular vignette, is that this individual, and the other individuals whom he represents, are very against taxation -- and this is the case with almost all of the millionaires that I interviewed. It's one of the reasons that he set up the trust instruments, so that he could avoid taxation. And then what happened in his trying to avoid taxation is that he made more work for these officials as well.
LAMB: “Brian Dolan owns a large construction and land development firm in Chicago endowing non-profits, not the next generation.” You quote him here as saying, "The kids are well taken care of and too much money will kill you just like liquor."
LAMB: What's Brian Dolan's story?
ODENDAHL:Well, he's ...
LAMB: A composite again, by the way?
ODENDAHL:A composite again. he is an individual who said that he didn't want to pass the bulk of his fortune on to his children, that he would rather give the bulk of his fortune to non-profit organizations. I think he betrays himself, however, in that particular quotation, by saying “The kids are well taken care of,” and then later he tells me that he has actually already passed some money on to his kids. He's used some charitable trust instruments. But he is an individual who is very committed to giving to non-profit organizations. In his case, he is a graduate of Harvard University, as I recall, or institutions like Harvard ...
LAMB: It's Harvard.
ODENDAHL:... and he's given a good deal of money to Harvard University. And that's quite typical of the individuals that I interviewed.
LAMB: By the way, let me stop there at the university thing. And I may be wrong about this, but I think I read recently -- because they did an article here in town about all the universities and their endowments -- when the president of American University had to quit in a controversy, that they had something like an endowment of $20 million -- American University.
LAMB: And I just read that Harvard University has an endowment of $5 billion.
ODENDAHL:Billion dollars. That's right. Harvard has the largest endowment of any educational institution.
LAMB: How does one university get $5 billion and another well-known university $20 million?
ODENDAHL:Well, Harvard University has a much more elite reputation than American University. Harvard University has graduated many more individuals in hat I would put in the "philanthropic elite," although they're both private universities. Harvard University is, in a sense, the personification of the kinds of things I'm talking about here. This is the kind of institution that wealthy people are going to tend to fund. Now a self-made millionaire who might have graduated -- who might have been more likely to have graduated from American University, let's say, could very well decide to give quite a large sum of money into American University's endowment, but, simply by virtue of the fact that people with old money have attended these institutions, very often generation after generation, and generation after generation have supported these institutions and have given funds into their endowments, means that the endowments of the Harvards, the Yales, the Princetons, the Stanfords are going to be much larger than the endowments of other kinds of organizations.
LAMB: Talking about the book "Charity Begins at Home," and here's another chapter. I want to ask you -- -- I think it's chapter seven. Why a chapter titled “Elite Jewish Giving”?
ODENDAHL:Well, as I said, we did interviews throughout the United States, mostly in metropolitan areas, and every major metropolitan area that we visited, when we were asked, “Who are the leading philanthropists in this city?” we were given at least several names of Jewish philanthropists. Part of the way in which I was able to arrange these interviews was that one individual who would allow me to establish rapport with them and interview them would introduce me to another individual, and so on. So we discovered -- and this had not been something that I anticipated -- that Jews are quite active in philanthropy in much greater numbers and proportion than their percentage in the population.

I believe that there are many -- fewer than 10 percent of the total population is Jewish, and yet I found that we actually interviewed 40 out of 140 Jewish philanthropists. There's also a separate chapter on Jewish giving, as there is on people with old money, people with new money and women philanthropists. Jewish philanthropy is the fourth category that I established, because Jews have a different -- you might call it style of giving as well, and I felt there were enough differences between this group and the other groups to highlight them. One of them is that the fund-raising practices of many Jews are different from that of non-Jews, such as the practice of card calling.

I don't know if you're familiar with that. That would be at a social function, generally honoring someone who is quite a generous giver. That giver would announce what his gift is going to be this particular year to the institution that he's choosing to make a donation to. Generally, the gift is going to be larger than the gift he made last year. He's going to publicly announce that gift, and he's essentially going to call off cards in which everyone else in the room -- their contribution last year is going to be mentioned, and they're going to be embarrassed into raising their contribution in basically the same proportion of his contribution -- a very successful fund-raising technique that would never go over in the WASP community as a fund-raising strategy.

In fact, among the old-moneyed people, talking about money is taboo. People will talk about their sex lives more readily than they'll talk about money. So that's one thing, fund-raising techniques. Also, I felt that Jews, getting back onto the subject at hand, walk a very fine line -- these are wealthy Jews -- between maintaining their Jewish identity and also being accepted into high society, into the culture of philanthropy that I describe throughout the book. And they want both. They want to continue to think of themselves as Jews, and they also want to be accepted. So one of the strategies that, either consciously or not so consciously, both Jews and self-made millionaires have developed is to give into the high arts, to give to the same kinds of institutions that other members of the culture of philanthropy does. Tthis helps them to become members of that culture. In the case of Jews, they also give, in general, about half of their charity to specifically Jewish causes -- either Jewish social services within the United States or projects in Israel or to their synagogues and so on.
LAMB: Alright. You say you have this large -- or you have this small Jewish group that give lots of money, and you talked about WASP. Is there any other segment of our society that has the unique habit that they -- how they deal with money and becoming multimillionaires?
ODENDAHL:Well, I talked -- I also have a separate chapter on women, and I think that women are very important -- in fact, central -- to the culture of philanthropy, because in many respects they bring their families into the culture. Now women are in a somewhat curious position, in that they don't have -- even wealthy women do not have as much status as the men of their class, but they certainly have more power and influence than both men and women in other classes. And so they have power, and one of the ways in which they exercise it is through their philanthropy.

On the whole, women are much more involved on a day-to-day basis with volunteering, with being involved in non-profit organizations, with putting on charity balls, with serving on non-profit boards at the community level than are men. Now elite men would tend to either serve on or head up the boards of national organizations, whereas elite women would head up the boards of local organizations. At any rate, I found that women play a key role in non-profit and also in socializing their children to accept this kind of culture, to become members of the culture, to live by the values of the culture.

And also it's the case -- this is the case with women who inherit wealth or marry into wealth, and it's also the case with women who may be married to self-made millionaires. They may actually bring their families into the culture of philanthropy through their involvement in non-profit endeavors, while their husbands are still helping their fortunes to grow, making money. And then only later in life does the husband normally become as involved with philanthropy.
LAMB: We talked some early about some of the people you remember the most that you interviewed. Other than the 20-minute interview, who were some of -- you probably don't have names of most of these. What are some of the other types of instances that you had when you went to interview that you'll always remember?
ODENDAHL:A couple of things. One, there was quite an elderly woman who spent the whole day with me, and wanted me -- in fact, there were a number of elderly women -- and this relates to the earlier topic we were discussing -- who were basically giving me an oral history of their life, and we spent all day talking about what they'd done and their involvement and so on. There was also an elderly man who had me -- for some reason, the interviews were much more memorable if the individuals had me to their homes to conduct the interview than if they had me to their offices. Now on the whole, it was either very young people or very old people who had me to their homes, and also it tended to be more women than men. But he had me to his home, and he described a situation when he was very young in which he'd had to have bodyguards and so on because the family had been so scared of the possibility of kidnapping, because the family was wealthy and so on. So those were memorable interviews as well.
LAMB: Did you ever find any strange situations where you showed up at a multimillionaire's house and they had 35 cats or something like that?
ODENDAHL:No, I didn't find any situations like that. There is a situation that I detail in the first chapter, which is somewhat exceptional in that it was one of the few mansions that I actually visited. And I came -- and it was also the first interview that I conducted. I came to the front door and I was greeted by the woman herself, who had invited me to her home, and she told me that she was going to show me through the formal part of the home, which was the downstairs of the mansion. And there was almost no furniture, as if this area was meant for parties, was meant for crowds of people, although there were some very exotic flower arrangements placed on exquisite pieces of furniture in different places.

She took me into a room which she said was the large dining room, and this was a massive dining room with a huge dining table. And then she said, “The big kitchen is over in this direction,” although she didn't take me into it. And she took me into another room which she called the music room, and there was a grand piano at the end of the room and then plenty of space for an audience to perhaps listen to a recital. And it became clear from her description that this was the part of the house that was used for public and charitable events. And then she took me upstairs for the actual interview, and it was almost as if the upstairs of the house was like any other kind of middle-class home that you might enter into.

The furniture was, you know, quite tasteful, but modest. And this is where she had me interview her. And she didn't show me around here; this was the private part of the house. This was her home. This was where she and her family lived. But it seemed to me that, for some psychological reason, she and her family chose every day to remind themselves of their wealth by walking through this very public area. So that was a little different, because most people just live in -- I mean, you know, possibly they live in five-bedroom houses, but other than that, they aren't huge mansions.

Let me think of some other instances that seemed interesting. I think some of the people that are often called "rich kids" were interesting. These are the young people who grew up in the '60s and inherited their wealth and live extremely modestly, some of them even in poor parts of town, and I might have interviewed them there. But you notice on the inside of their apartments, even, they display art. Many of these people have, both in their business setting and in their home setting -- have much more art than you would typically find in a middle-class home in ...
LAMB: In the few remaining moments, where do you live now?
ODENDAHL:I live in San Diego, California.
LAMB: What next?
ODENDAHL:Well, I'm not sure. I have a general idea about the non-profit sector and the way in which -- you could even consider it an exploitive sector, in that people tend to be paid less in this sector. Many more women work in this sector, both for less pay and as volunteers than do men -- a different way of looking at the whole endeavor of charity, not just wealthy people and their philanthropy.
LAMB: And this book -- has it caused enough of a controversy in your life that it's hard for you to get another job?
ODENDAHL:Well, I am currently unemployed, and I do think that working on this book has had a bearing on that. I think that if I'd chosen a very standard career path and a less controversial topic, that I might have a job at the moment. I can't blame it all on the book, though. I think that I've made untraditional types of decisions in my life as well, and I always seem to make those hard choices and probably will continue to.
LAMB: When it comes to the controversy, what is it that most people do? I mean, why do they react so strongly about something like this? And oes it say something about the country?
ODENDAHL:I think because it is our giving and volunteering which -- in the United State -- which is always touted as making us different from other countries, you know. And Alex de Tocqueville is, almost without exception, quoted as saying, "These people are constantly forming voluntary associations" and so on. It's something we really believe. It's a kind of an ideology about our life and our way of providing services that, in a sense, I'm taking to task. Now I'm not the only one who is taking a very serious, scholarly look at these issues; others have, as well. But it's beginning to question the assumption about charity and particularly the charity of elite, that it's all doing good.
LAMB: This is the name of the book: "Charity Begins at Home." Teresa Odendahl is our guest. And thank you for joining us.
ODENDAHL:Thank you very much. It was my pleasure.
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