September is the month when sports fans get reacquainted with the United Way. They recognize the charity as the sponsor of those fuzzy commercials during National Football League telecasts, where gridiron greats like Reggie White and John Elway, surrounded by throngs of smiling children, extol the value of community.
The United Way of America is smiling, too, these days, having all but recovered from the terrible period five years ago when William Aramony almost ran the organization into the ground. Aramony, the group's longtime president, was caught using its money to pay for a playboy lifestyle of exotic trips, gourmet meals, and young girlfriends. In the months after the scandal broke in February 1992, contributions to the United Way plummeted, as did donors' confidence in the once proud philanthropy.
While the memory of Aramony lingers in the back of the public consciousness, the United Way has worked mightily to remake its image. Rather than continue to be perceived as a distant distributor of funds to member agencies, the United Way has endeavored to become itself an "agent of social change." To this end, local chapters have embarked on a program of diversity and multiculturalism that is threatening to alter the face of American philanthropy. While the spread of the PC. agenda through academia has been tirelessly documented, its impact on philanthropy has gone all but unnoticed. Because much charity is strictly a local affair, no one has yet examined what this trend means nationwide.
The inner workings of the United Way, as of many charities, are distinctly arcane. The organization grew out of the system of private giving that developed in the early 20th century, when charitably minded people in a city would collect money for a "United Fund" supporting the major local charities - - the YMCA, Catholic Charities, the Salvation Army, the Boy Scouts, and so on. The money was distributed according to a formula. The system prevented the member charities from getting into messy fights by soliciting the same donors, and it helped them raise larger sums by combining their efforts. Eventually, in 1918, these local organizations banded together to found the United Way of America, today a kind of service organization and policy-coordinating body for its 2,100 local chapters. This structure survived essentially intact until the the Aramony crisis.
In June 1995, with fund-raising still sluggish, the United Way decided to alter its mode of operation. The board named a Strategic Planning Committee, which urged it to "heighten the role of United Way in setting public policy at all levels." United Way chapters should "identify priority needs" and " embrace only 'those who truly represent community.'" Guided by that new philosophy, United Way branches started to change the way they doled out funds. First, they began allowing donors to dictate where their contributions would go -- including to charities not affiliated with the United Way. Second, they offered donors the opportunity to give to one of several "priority" areas designated by the local chapter. Meanwhile, the United Way of America launched Project Blueprint, the linchpin of its nationwide effort to place " ethnically diverse leadership" on the boards of its member charities.
These initiatives reflect the twin obsessions of many of the new generation of charitable givers, the baby boomers. On the one hand, they manifest the " do your own thing" mentality of the 1960s. On the other, they have enough PC. flavor to make your average fortysomething money manager or insurance clerk feel like he's acting on good Woodstock values.
One of the first United Way chapters to get in tune with the new thinking was in Houston, America's fourth largest city. The Texas Gulf Coast United Way made "diversity and inclusiveness" its cornerstone more than two years ago, then spread the word to its member agencies. To help get the diversity agenda out, the Houston United Way formed its own Multicultural Committee. This body acts as a kind of political commissar overseeing Houston's charities, on the lookout for violators of its new policies. Three times in recent years, United Way officials have asked one of its beneficiaries, the Jewish Community Center of Houston, to create a more diverse board -- that is, to include minorities or "people of color." The difficulty for the JCC is that its charter requires it to have a Jewish board, though the activities and services it sponsors -- like those at a YMCA -- are open to all comers.
The Houston JCC neither complied nor lost all United Way funding. Indeed, the Houston United Way denies that it dictates to its members and argues that its income has risen $ 2 million since the new policies were put in place. Nevertheless, all new or increased grants the charity is giving out end up going to minority communities. Although this generally works against traditional United Way agencies, the Bayou City United Way's makeover has thrilled the national organization. A little more than a year ago the Houston branch won the United Way's first Championing Diversity Award for its " cutting-edge role in cultivating a multicultural environment." The Multicultural Committee had done its job.
The new policies began to catch on. Moribund United Way branches learned at conferences and through newsletters how they too could become more active. Soon United Ways in cities such as St. Paul, Minnesota, and Columbus, Ohio, were going through their own internal changes, aided by local polling firms that told them their communities wanted these changes. Many established " diversity plans" or "pluralism plans" to guide member charities' progress. Since 1995, for example, the St. Paul United Way has required prospective grantees to describe "the proposed client population... including generalized demographic characteristics such as race and age" and has tracked grant recipients' success at serving these communities.
These new policies are playing out in strange ways. The Catholic Charities- Diocese of Dallas generally gears its programs to largely Catholic Hispanics, who tend to turn to the church when they need help. During the funding process, United Way volunteers asked Catholic Charities why it didn't serve more blacks. Then they tried to prescribe the share of the charity's clientele that should be black. "They were trying to force some kind of quota system on us," says Catholic Charities associate director Joseph Brogdan, who would have had to cut services to existing patrons in order to abide by the new rules. "They just asked us to come up with a plan to increase the service levels within the African-American community, and we resented it." Ultimately, the United Way backed off.
Many of United Way's traditional partners -- the very charities that helped establish the organization in the first place -- are unhappy with its new approach. The problem was so severe for Jewish charities that the Council of Jewish Federations conducted a study to advise its members on how to confront it. Issued last year, the study reported that local United Ways had gone so far as to ask "agencies to change their names (e.g., take Jewish out of the name.)." One response some organizations have adopted is to strive for intra- Jewish diversity -- that is, to make sure boards include Russian and Orthodox and low-income Jews. Still, dissatisfaction with the new United Way has been relatively muffled, partly because many of those affected by the changes hope to continue to benefit from grants. Right now, good economic times are masking the pain of the United Way's restructuring. When times inevitably turn bad, the situation is likely to explode.
There's another reason, too, why so little has been heard about these changes. Explains Bert Goldberg, executive vice president of the national Association of Jewish Family & Children's Agencies: "Everybody's afraid to speak out because it's not politically correct. It sounds like I'm speaking against minority groups." Goldberg argues that the new ways are hurting a charitable structure that worked. And once the new policies are implemented, there will be no hope of rolling it back or repairing the damage that's been done.
The new policies are making their mark. Even a charity as vital as the American Red Cross is feeling the heat. The American Red Cross of Greater St. Paul has lost $ 350,000 in United Way money in recent years, money used to teach CPR, water safety, and swimming and to help people after disasters. Unfortunately for the St. Paul Red Cross, those services don't meet a " priority" need or serve an ethnic community. Instead, explains the group's executive director, Charles Moertel, "These are programs that serve everybody and make people safe. They're principally directed at kids."
Here and there, member agencies are starting to get fed up and to sever their relationships with the United Way. This past June the leaders of the Family YMCA of Easton, Phillipsburg and Vicinity, in Pennsylvania, went public with their dispute with the local United Way. The two had differed, it seems, over how to best serve a group of low-income children who participated in a YMCA summer program. In the last few years, the United Way had cut its funding for the program but was evasive about why. Finally the United Way informed the Y that more than half of the children in the program would have to be low income. When the Y's executive director, Nicholas Ciambrone, asked how he could comply, the United Way suggested that a separate program be created for the low-income students in the poor part of town -- in effect segregating them. The Y's leaders were infuriated and ended their 30-year relationship with the United Way.
Local branches of the Salvation Army have also been at odds with the United Way. Washington, D.C.'s Salvation Army has severed its connection with the United Way, as has Springfield, Illinois's. While a national spokesman for the Salvation Army downplayed the difficulties, evidence from around the country suggests that the problems are growing. The Salvation Army, which for so long has helped the worst-off in society, is an old fashioned charity, one that the new whiz-bang United Way seems to have trouble dealing with. It is a Christian organization and still refers to its leaders by military rank. Lieutenant David Luft of the Salvation Army in Springfield announced his branch's disaffiliation with the local United Way this summer. His organization had lost more than $ 100,000 in United Way funding since 1991, but Luft maintains that no one at the United Way ever explained what the problem was. Now he is determined to raise enough money on his own to make up the shortfall -- which points to a problem that is likely to grow: As more and more of the original United Way founders drop out over the new policies, they will end up in direct competition for donations with one another and with the United Way.
To be sure, some groups are flourishing in the new environment. The Girl Scouts, for example, determined several years ago that it had to become more relevant to the 1990s. Thus, the Girl Scout Council of Greater St. Louis launched a program that has become a darling of both the media and the United Way, Girl Scouts Behind Bars. Under this program, the Girl Scouts arranged for some 16 female prison inmates to serve as leaders for 26 girl scouts, including in some cases their own daughters. The program won the Girl Scouts a special United Way grant of $ 40,000 in "critical issues funding." Theresa Loveless, executive director of the Girl Scout Council of Greater St. Louis, explains that the idea of the program is to "forge a bond between mothers and daughters so when the mothers get out of prison they might have some parenting skills."
Increasingly, the charitable establishment caters to certain segments of the population and neglects others. At times it seems actually to promote racial and ethnic separatism or shows a willingness almost offhandedly to damage well-established charities that work. Defenders of the United Way argue that times have changed and a host of new nonprofit organizations demands that the old partners take a back seat. Certainly, the United Way should strive to be responsive to donors and to avoid the lax oversight that allowed the Aramony debacle. But the new approach seems to be eroding the core strengths of a system that brought Christians and Jews, Lutherans and Catholics, together for the good of the community.
As the world of philanthropy changes, so do those ubiquitous TV ads. The United Way of Middle Tennessee recently unveiled an aggressive new ad campaign. In one commercial, a man introduces himself by saying, "My son was killed in a drive-by shooting." When NFL Sunday viewers see that ad, they'll be looking at evidence that something else has died, too -- the traditional United Way.
Seth Gitell is the national editor of the Forward newspaper in New York.