Maybe just as well. It's turning out that Americans gave millions more than needed. And as dismay grows over how slowly the money raised by the American Red Cross and other agencies is reaching victims' families, we are learning again that it's much easier to give than to give well. With that in mind, I contacted several Wall Streeters who, like Lebenthal, have both money and experience in giving effectively.
They've all made mistakes. "The biggest is not doing the homework," said Jack Brennan, chairman of mutual-fund giant Vanguard Group. It's not just checking how efficiently a charity runs, but also weighing who needs money most. Doing that right now is especially hard, Brennan noted, as charities face bear markets, recession, and diversion of attention to September 11 relief--"the perfect storm for non-September 11-related charities."
This is why Brennan and his wife, Cathy, focus on a few causes, among them United Way, public broadcasting, and a couple of human-services agencies near their Main Line Philadelphia home. "You have a greater ability to make a difference if you're giving 10X rather than X," he said.
Giving big can backfire, though. Foster Friess, veteran manager of Brandywine Funds, recalls that he and his wife, Lynn, "wanted to back a church to start a drug-rehab center. We sent them a quarter-million bucks up front, and they wound up buying a building. They didn't have enough left over for staff."
Instead, Friess has learned to fund low-cost, "entrepreneurial" charities with measurable results. One was started by Thomas Scott, a Wilmington (Del.) physician who was near retirement when he began treating the indigent in a mobile clinic he set up in a van. On the success of that model, the Friesses have funded vans in six more cities, where local doctors donate services, with more to come. "We can get a report of how many earaches were attended to and see how many dollars were spent and what the return on that was," he said. "If you give $1,000 to a soup kitchen, you ought to know how many people got fed." Friess also knows to donate appreciated assets, when possible. In October, when he sold 51% of his firm for $241 million, $56 million went to three charities he earlier had given stock. That saved millions in capital-gains taxes.DELI HELP. Even Claude Rosenberg, a retired money manager with a second career as philanthropist and chairman of NewTithing Group, says he and his wife, Louise, erred a couple of years ago in giving a Berkeley (Calif.) music camp all it asked for. "They ran into a management problem, and I think we probably jumped too fast." At NewTithing, Rosenberg is devoted to showing well-off people that they can give much more and still be plenty rich.
The most recent study by NewTithing found the well-off can afford in 2001 to donate an extra $127 billion (table), even given a 25% drop in investment assets this year. NewTithing's model assumes the wealthy can comfortably donate 0.75% to 3% of assets, depending on wealth. For instance, it figures the average taxpayer with an adjusted gross income of $200,000 to $500,000 can afford to give 0.75% of assets.
Yet it need not be all about money. Although Lebenthal did not give to the September 11 Fund, she got busy when she saw the woes facing a nearby deli, Maxwell's Annex, that was kept closed weeks longer than other businesses because of its location. "I e-mailed every company that I knew in this building, other friends that I knew in the neighborhood, and said, `Hey, this guy after six weeks is only now dealing with what we all went through emotionally. On top of that, he's got this business to keep alive. Everybody, go eat there."' I asked the deli's owner, David Meyers, about this. He confirmed it. Then, his voice grew thick. He said: "She's a doll." By Robert Barker