Philanthropy and the U.S. Constitution

Susan Borgman and Newell Grant

Definition

For over 225 years, The Constitution of the United Stateshas been at the center of all political structure in the United States. According to the American Heritage Dictionary from 1981, it was first adopted in 1787 and put into effect in 1789, it is the document on which the system of fundamental laws and principles that prescribes the nature, functions and limits of the government of the United States is recorded.

Constitutional principles are the rule of law, separation of powers, representative government, checks and balances, individual rights, freedom of religion, federalism, and civilian military control (Center for Civic Education).

Philanthropy includes voluntary and active efforts to promote human welfare and well-being. The origin of the word philanthropy is Greek and means love for mankind. Philanthropy is usually expressed by efforts to enhance the common good and well-beingof humanity through personal acts of practical kindness or by financial support of a cause or causes. Philanthropy comprises any effort to improve quality of life or relieve human suffering (American Heritage Dictionary 1981) (Nonprofit Good Practice Guide) (Google).The common good involves individual citizens working together for the greater benefit of all and to promote community welfare (Learning to Give).

Historic Roots

Regulation and encouragement of charity had been anticipated by the earliest state constitutions (Clotfelter and Ehrlich 2001).All charitable bodies, initially informal organizations acting through churches or as the responsibility of leading citizens, were seen as public services whose value to the state was acknowledged by exemption of the property of donors from taxation. If the service was needed by citizens, provision of it by private citizens with their own funds had value the state could afford to reward.

These values were carried forward into the new country’s national Constitution. Yet the Constitution’s implied emphasis on the authority of states and local communities to control education—the oldest of policy issues with which philanthropy deals—and social welfare makes the federal role a fragile one (Clotfelter and Ehrlich 2001).The government of the United States of America under the Constitution became fully operative February 2, 1790, when the Supreme Court organized and held its first session (U.S. National Archives & Records Administration) (3).

Importance

Core democratic values are the fundamental beliefs and constitutional principles of American society expressed in the Declaration of Independence, the United States Constitution and other significant documents, speeches and writings of the nation (Kurland and Lerner 1987).Fundamental American beliefs include the right to life, liberty, economic freedom and pursuit of happiness.

The purpose of government is to protect these rights and it may not place unfair or unreasonable restraints on their exercise. In addition to basic rights, America shares belief in the common good, justice, equality, religious freedom, diversity, truth, popular sovereignty and patriotism (Center for Civic Education).The Constitution guarantees the rights and liberties of the people of the United States by making them part of the fundamental laws and principles of the United Statesgovernment.Article I, Section 8 of the Constitution affords Congress power to “lay and collect taxes” [ ] “for the common defense and general welfare of the United States”(U.S. National Archives & Records Administration) (2).

All United States laws, executive actions and judicial decisions must conform to the Constitution.Article VI, cl.2 of the Constitution states, “This Constitution, and the laws of the United States which shall be made in pursuance thereof, and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding” (U.S. Constitution).Under federal law, philanthropic gifts made to religious and nonprofit organizations for charitable purposes are exempt from taxation (Council on Foundations).
 

Ties to the Philanthropic Sector

Philanthropy has strong roots in religious beliefs, the history of mutual assistance, democratic principles of civic participation, group approaches to problem solving and American traditions of individual autonomy and limited government (ibid.).

The Constitution’s philanthropic ties are summarized in its preamble which reads: “We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America” (U.S. National Archives & Records Administration) (2).

Although the United States Constitution does not specifically address philanthropy, philanthropic values are rooted in the core values and beliefs of America’s Founding Fathers who participated in drafting these fundamental principles of American government.

Constitutional Amendment I, contained in The Bill of Rights, extends Constitutional protections to religious organizations, many of which also operate charities on behalf of the public and public welfare, by affirming that “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof” (U.S. National Archives and Record Administration) (4).

Key Related Ideas

Hardshipsfaced by early settlers to North America, where government was weak and distant, forced people to join together to govern themselves, help each other and undertake community activities such as building schools andchurches and fighting fires. Out of these experiences grew a tradition of citizen initiatives and individual efforts to promote the public welfare. Religious leaders also encouraged their members to give to the poor and to charitable works of churches (Council on Foundations).

Until a more defined system of tracking philanthropic organizations and donations became necessary for financial purposes, American philanthropic efforts were informal and not officially classified under early American law.Tax designations and codesnow regulate exempt and nonexemptcharitable giving and define organizations and foundations conducting philanthropic activity in the United States.

Afoundationis an entity established as a nonprofit corporation or a charitable trust,with a principal purpose of making grants to unrelated organizations or institutions or to individuals for scientific, educational, cultural, religious, or other charitable purposes (Foundation Center). This broad definition encompasses two types of foundations.Inprivate foundations, funds come from one source, whether an individual, a family, or a corporation.Public foundationsnormally receive assets from multiple sources, which may include private foundations, individuals, government agencies, and fees for service (Council on Foundations).

Important People Related to the Topic

• ​Benjamin Franklin (1706-1799): Franklin, as its oldest member at age 81, was called the “Sage of the Constitutional Convention.”He achieved financial independence as a printer and publisher with his most successful literary venture the annual Poor Richard’s Almanac.Franklin gained recognition for his philanthropy and the stimulus he provided by donating part of his wealth to provide and support civic causes including libraries, schools, and hospitals. He also pursued interests in science and politics serving multiple municipal colonial government roles. For fifteen years, Franklin resided in England where he became a celebrated spokesman for American rights, returning to Philadelphia in 1775 to become a distinguished member of the Continental Congress (U.S. National Archives & Records Administration) (1).
• John Marshall (1755-1835): Marshall, appointed by President John Adams as fourth Chief Justice of the Supreme Court, had a significant and lasting impact on the Court and the United States during his 34 years on the Court. He expressed the challenge in maintaining free government by noting, “We must never forget that it is a constitution we are expounding...intended to endure for ages to come, and consequently, to be adapted to the various crises of human affairs” (Dixon 1997) (Supreme Court of the United States).
• George Washington (1732-1799):  Washington represented Virginia at the first and second Continental Congresses.  He served with distinction in the militia and, in 1775, was appointed Commander in Chief of the Continental Army. Washington was unanimously chosen to preside over the Constitutional Convention and as first President of the United States of America. He provided stability and authority to the emergent nation and gave substance to the Constitution, whose success was immeasurably influenced by his presence and dignity. As President, Washington appointed the six original Justices of the Supreme Court andbefore the end of his second term, appointed another four Justices (U.S. National Archives & Records Administration) (1).

 Related Nonprofit Organizations

• The Center for Civic Education specializes in civic/citizenship education, law-related education, and international educational exchange programs for developing democracies. The Center administers curricular, teacher-training, and community-based programs focusing on the U.S. Constitution and Bill of Rights; American political traditions and institutions at the federal, state, and local levels; constitutionalism; civic participation; and the rights and responsibilities of citizens (http://www.civiced.org).
• The National Constitution Center (NCC) was established by the Constitution Heritage Act of 1988 for the purpose of increasing public understanding of, and appreciation for, the Constitution, its history, and its contemporary relevance sponsors (http://www.constitutioncenter.org).
• The Supreme Court Historical Society conducts educational programs, supports historical research, publishes books, journals, and electronic materials, and collects antiques and artifacts related to the Supreme Court's history. The society’s mission is to increase public awareness of the United States Supreme Court contributions to our nation's constitutional heritage (http://www.supremecourthistory.org).

Bibliography 

• Center for Civic Education. Civitas: A Framework for Civic Education Executive Summary. 
• Citizen’s Action Coalition. Constitution of the United States.  
• Clotfelter, Charles T., Thomas Ehrlich, ed. Philanthropy and the Nonprofit Sector in a Changing America. The American Assembly, Columbia University. Indiana University Press, 1999. ISBN: 0253335213.
• Council on Foundations. An Abbreviated History of the Philanthropic Tradition in the United States. 
• Dixon, Richard. “John Marshall Biography”. (1997) From Revolution to Reconstruction and what happened afterward - an .HTML project. Department of AlfaInformatica, University of Groningen (The Netherlands). 
• The Foundation Center. Frequently Asked Questions:  What is a foundation?   
• Kurland, Philip B., and Ralph Lerner., eds. The Founders Constitution. Web edition. 1987. The University of Chicago. University of Chicago Press. A
• Nonprofit Good Practice Guide.  Complete Glossary.  
• Supreme Court of the United States. The Court and Constitutional Interpretation. Supreme Court Historical Society Booklet. 
• Supreme Court of the United States. The Court as an Institution. Supreme Court Historical Society Booklet. 
• U.S. National Archives and Record Administration. (1). America’s Founding Fathers: Delegates to the Constitutional Convention. 
• U.S. National Archives and Record Administration. (2). Constitution of the United States. 
• U.S. National Archives and Record Administration. (3). Constitution of the United States Questions and Answers excerpted from The Story of the Constitution by Sol Bloom, Washington, DC : National Archives and Record Administration, 1986, c1937. 
• U.S. National Archives and Record Administration. (4).  The Bill of Rights.