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J. D. B. News Letter

January 9, 1929
See Original Daily Bulletin From This Date

Julius Rosenwald, famous as a financial genius and a philanthropist, is being prominently mentioned by business leaders as the logical pilot for the new drive to write thrift into Chicago’s Government. Mr. Rosenwald is being considered as the man to head the proposed Civic Board of Business Leaders, because his vast administrative experience in the business world has been coupled with practical experience and interest in governmental problems. Not only has he proved his organization and mettle in the upbuilding of Sears Roebuck and Company and in the careful administration of the millions he has given to charitable and educational institutions, he has also been the guiding spirit in the Bureau of Municipal Efficiency, which has been studying the lack of business tactics in local government, leaders of the new movement declared.

His views on philanthropoy are outlined by Mr. Rosenwald in an article appearing in the current issue of “The Saturday Evening Post.” Under the title “The Burden of Wealth,” Mr. Rosenwald states his views to Elias Tobenkin.

“I am not, as some would have it, at war with philanthropy. On the contrary, I am often called a philanthropist. I am not opposed to foundations for the transaction of large-scale benevolence. I have myself established such a foundation-the Julius Rosenwald Fund, incorporated in 1917 with a capital of $10,000,000 and since increased in value to $35,000,000. I serve also on the boards of trustees of other foundations,” Mr. Rosenwald states.

“My differences are not with philanthropy, but with certain of its methods or tenets. In fact, my chief quarrel is with only one of these tenets: the principle of perpetuity endowment. I am emphatically opposed to neverending endowments.

“We know what the needs of today are and we may take a reasonable guess at what the needs of our children will be. From the standpoint of both social morality and business efficiency I hold, therefore, that the fortunes which men have made in this day and age should be employed by them in the support of such educational, benevolent or humanitarian enterprises as will benefit their contemporaries-them and their children; no more. I unqualifiedly disapprove of the efforts made by certain benevolent trusts and foundations to perpetuate themselves by restricting their enterprises and expenditures to the interest on the invested capital, and not only leaving the principal untouched but even adding from time to time to it from unused income.

“I am opposed to the principle of storing up large sums of money for philanthropic uses centuries hence, for two reasons: First, it directly implies a certain lack of confidence with regard to the future, which I do not share. I feel confident that the generations that will follow us will be every bit as humane and enlightened, energetic and able, as we are, and that the needs of the future can safely be left to be met by the generations of the future. Second, I am against any program that would inject the great fortunes of today into the affairs of the nation five hundred or a thousand years hence. Like the manna of the Bible, which melted at the close of each day, I believe that philanthropic (Continued on Page 4)

“These views are not mere intellectual speculations with me. They are the basis of the program for public welfare for which I stand sponsor and which provides for the spending of a sum, in round figures, both capital and interest, of at least seventy-five million dollars. I have made them the warp and woof of the Julius Rosenwald Fund.

“Some months ago, while making an additional gift to the fund, I apprised the trustees of my conviction in the matter. They were in full and sympathetic accord with me, and the stipulation was made and adopted that as much of the fund be used within the present generation as is consistent with economic and constructive spending. The final disposition of the fund was set for a period not longer than twenty-five years from the date of my death. It is my unalterable desire that by that time every cent of the fund, both income and principal, shail have been expended.

“I am well aware that the devising of gifts in perpetuity for charitable purposes has long been considered a worthy dedication of wealth. It has history and precedent back of it, both in England and in this country. Before breaking with the past by totally eliminating the perpetuity feature from my philanthropic program, I not only gave the matter much thought but have also had an investigation of the subject made for my guidance by experts in the field. The findings of these investigators were discouraging in the extreme.

“The history of endowments abounds in illustrations of the paradoxical axiom that while charity tends to do good, perpetual charities tend to do evil, blessing neither him that gives nor him that takes.

“Endowments in all countries present such a disheartening chronicle of misuse, disuse and abuse as to give a man pause before he contemplates founding one. It is not so much that the administrators mismanage the funds left in their keeping-though that is by no means unimportant-as it is that human conditions are changing to rapidly that a project which today is entirely commendable may be not only useless but vicious tomorrow.

“An outstanding development in American civilization during the past two or three decades is the shift of philanthropy from a metaphysical to a social basis. Carnegie’s real or apocryphal statement about the crime of dying rich’ has echoed and reechoed in the past twenty years until it has become almost a tradition that the province of great wealth is the well-being of mankind.

“Within a period of fifteen years recently passed, $2,500,000,000 was presented to capitalized public welfare in the United States-a sum equal to the entire wealth of the country a century ago. Scarely a week passes without the announcement of a bequest of some large private fortune to educational, social or artistic endeavor. Though formerly such bequests commanded columns of space in the press they have today become so little of novelty that the newspapers dismiss them with a few paragraphs.

“Fifty of the largest foundations in the United States, whose aggregate sums reach a total of nearly $1,000,000,000 devote themselves very largely to the support of institutions having as them aim the alleviation of human suffering Individuals or groups who have come to grief in the social organization and helped to rehabilitate themselves. Modern philanthropy searches out the sunspots of civilization and tries to make them whole,” Mr. Rosenwald declared.

“The Nation,” in its current issue lists a number of Americans who during the past year distinguished themselves from the liberal point of view in various fields. Included in this list and Julius Rosenwald, “for this magnifices gift of $5,000,000 to help settle Jewish colonists in the Crimea and the Ukraine”; Sidney Hillman, “for the extension of collective bargaining in the men’s clothing industry”; Walter Danrosch. “for his pioneer work in creating a public raste for serious music in means of the radio”; Morris L. Eras and William Scagle, “for their thoroughly documented and intelligent study of censorship. To the Pure.”

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