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The rich give to the rich

Why do wealthy people give to well-endowed universities serving successful kids, instead of to nonprofits that help the truly needy? Nonprofit director Mark Redmond wonders.
/ Source: Forbes

When I read a few months ago about an anonymous $50 million donation to Middlebury College, followed by an additional $10 million, also anonymous, I wondered, "Why not Spectrum?"

Not that I have anything against Middlebury, which is in my home state of Vermont. It is a fine institution, one of the best liberal arts colleges in the country. It does a good job in fulfilling its mission. But I have to wonder: Why would someone wealthy enough to make such a donation give to a place that already has beautiful buildings, a golf course, a ski slope, a magnificent hockey rink, a first-class cafeteria/restaurant and one of the highest tuition rates in the U.S.?

Spectrum Youth & Family Services, where I serve as executive director, is 45 minutes from Middlebury. Our students are like Middlebury College students in age but unlike them in every other way. Our kids (2,500 last year) are runaways or are living on the streets. Many are high school dropouts. Many were abused, neglected or abandoned when they were younger and raised in the foster care system. Some are in trouble with the law or are addicted to drugs or suffer from mental health disorders.

Spectrum provides them with a place to live, food, health care, substance abuse counseling, education and job training. We find them mentors. We help them move on to college or permanent housing. It is no small challenge.

Our alumni, when successful, obtain high school diplomas and usually move on to community colleges or trade schools. And, believe me, we are thrilled when this happens. We view this as a tremendous victory. Just to get a kid off the streets, off drugs, away from negative peers and onto some kind of positive path is a big triumph. Spectrum and the hundreds of other organizations like it in this country do not have the kind of alumni that colleges like Middlebury produce.

Graduates of expensive private colleges move on to careers in law, medicine, advertising, architecture, engineering and business. Within a few years they are in a position to donate significant amounts of money to an alma mater. One recent issue of the Chronicle of Philanthropy mentions a $36 million donation to Princeton, $100 million to Brown, $100 million to the University of Michigan and $40 million to Rensselaer Polytechnic Institute, all from individuals, all alumni. Spectrum alumni are never going to be able to do that.

Spectrum has a $4.1 million budget (16% for administrative purposes). All comes from the government except for $49,000 in private donations and $82,000 from United Way. Our 86 workers earn an average annual wage of $27,300. I make less than $100,000.

This is what we could do with a larger budget: add more outreach workers to find and help the homeless kids who presently live in tents, boxcars or park benches; keep our health clinic open more days and hours per week; keep our drop-in center open on weekends and evenings so homeless kids could get hot meals and a shower more often; hire teachers who could help the kids congregating in downtown Burlington get a high school diploma or equivalent.

Americans are generous. They give $240 billion a year to charity, mostly churches, schools, hospitals, medical researchers and organizations that help the needy. They should be doing more in the last category.

It's admirable that Middlebury can admit poor kids on scholarship (38% of its students get full or partial need-based aid) and thus put them on an equal footing with the children of prosperous families. But if these scholarship winners are poor now, they aren't going to stay that way. They have the talents and energy that will make them successful no matter where they go to college.

At the moment the tax laws make no distinction between gifts to institutions that serve society's winners, like art museums and well-endowed universities, and institutions that serve the other half, like United Way. Perhaps that should change.