Role of Foundations

The nation's 40,000 foundations distributed more than $12 billion in grants in 1996 to support philanthropic causes ranging from the arts to health care for the poor. But critics say that many foundations only give away the legal minimum each year because they are more concerned with preserving their endowments than doing good works. In addition, some critics charge, foundations provide too much support for dubious academic research projects that have little social value. Foundation supporters counter that foundations keep a tight rein on their funding not because they are stingy but because they must be able to make grants in lean times. Moreover, supporters argue, foundations must take risks and fund programs that government is unwilling to help.