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A Discussion About Local Grantmaking in Silicon Valley

The Silicon Valley Community Foundation responds to a story from Pacific Standard partner site Capital & Main.
(Photo: Elizabeth Fladung)

(Photo: Elizabeth Fladung)

Editor's Note: On February 18, we cross-posted a piece from Capital & Main, a Pacific Standard partner site, about the Silicon Valley Community Foundation and, more generally, the state of philanthropy by Silicon Valley technology entrepreneurs. Below, we've decided to run a letter to the editor of Capital & Main from Sidney G. Griffin, SVCF's vice president of marketing and communications, as well as a response from Maria Bustillos, the author of "Silicon Valley: Wealth Redistribution, One-Percent Style."


To the editor of Capital & Main:

The post by Maria Bustillos on February 10 titled “Silicon Valley: Wealth Redistribution, One Percent-Style,” contains some inaccuracies about local grantmaking and public policy initiatives at Silicon Valley Community Foundation. But more importantly, Ms. Bustillos’ post represents a misunderstanding of the nature of charitable funds held at community foundations, and criticizes the idea of such giving at a time when it’s sorely needed.

Government funding has been insufficient to answer our region's growing income gap, affordable housing crisis, transportation woes, and troubled education systems, leading many to call on philanthropy to fill those gaps. And in fact last year Silicon Valley Community Foundation—through our approximately 1,700 individual and corporate donors—contributed $474 million in grants to non-profit organizations. This is more than any other community foundation awards.

Bay Area charities received $216 million of this total, more than they received from any other private or community foundation. While more giving is always needed, the generosity of our donors should be celebrated, not scorned.

SVCF makes $8 million to $10 million in strategic investments annually through its discretionary grantmaking programs to some of the most effective and innovative organizations in our region to solve challenging local problems. We have been outspoken on many public policy issues, not just the two mentioned in the blog post. In 2014 we continued our work to combat payday lending; worked to solve persistent inequities in how students of color are assigned to math courses in high school (“math misplacement”), a practice that derails students from the college track through no fault of their own; and shined a light on the very real problem of human trafficking in Silicon Valley. In addition, we helped more than 600 non-profits raise $8 million in a single day last May during SVGives.

Thousands of regular Americans use community foundations and other donor advised fund services to support causes they care about. The fact that they do not disburse their charitable funds all at once is strategic. Many, rightly, want to take time to decide what causes matter most to them, and where their funds can have the greatest impact. And long-term philanthropists want to reserve some of their resources for social problems and causes that will inevitably present themselves. Our country’s tax laws reflect the wisdom of this goal—and our communities are the beneficiaries, both today and tomorrow.

We hope that this letter will help give a fuller picture of the local grantmaking and initiatives underway at Silicon Valley Community Foundation than Ms. Bustillos offered in her piece.

Sidney G. Griffin
Vice President of Marketing and Communications
Silicon Valley Community Foundation


Dear Mr. Griffin:

If, as you correctly note, "[g]overnment funding has been insufficient" to answer the many problems facing your region, that is in no small part because corporations and individuals are shielding their wealth from fair taxation. Part of this shielding takes the form of payments to foundations such as SVCF. Given that these payments have been diverted from government to you, it is disingenuous to blame lack of government funding for the persistence of local problems. This is the wider background against which the effectiveness of modern philanthropy must be seen and judged.

To illustrate further: Around $2 trillion is currently held offshore by American corporations in avoidance of U.S. taxes. Last year, the International Business Times reported that Microsoft alone is holding in excess of $92 billion offshore in order to avoid taxation, representing an estimated $29 billion loss to the citizens of the United States.

To put that in perspective, the entire $474 million donated to non-profit organizations by your foundation last year amounts to about 1.6 percent of the amount that Microsoft, one single company, owes the rest of us.

And you know, though our readers may not, that a corporate vice president of Microsoft sits on your board of directors.

Disbursements from private foundations alone cannot mend systemic income inequality caused by a corporate culture that has lost all sense of responsibility to the people, not only of California, but of the United States. Only a rise in wages and benefits commensurate with GDP growth, combined with the prompt, fair, and responsible payment of taxes, can do that.

You write: "The generosity of our donors should be celebrated, not scorned." I am not scorning anyone's generosity: I scorn selfishness that clothes itself in the appearance of generosity, and expects to be congratulated in return.

Very truly yours,
Maria Bustillos