Clinton Foundation Refuses to Reveal Donors but Sells List to Friends
by Matthew Vadum and Deborah Corey Barnes
Since leaving the White House in 2001, Bill Clinton has used philanthropy to stay in the public eye. His star power attracts widespread public attention and major donor contributions to the William J. Clinton Foundation, which supports his presidential library and funds many worthy charities. Drawing the very wealthy and the politically ambitious into his orbit, like moths to a flame, Clinton hopes to promote public policies he considers vital for America and the world—and his own new career as a philanthropic rainmaker.
And should Sen. Hillary Clinton become President, she will further boost the prospects of the Clinton Foundation. Bill Clinton’s “focus on humanitarian issues,” observes ABC News, “is in many ways the perfect balance to his wife’s political ambitions—and also repairs the damage done to his reputation by the Monica Lewinsky scandal during his presidency, helping to transform the former President’s legacy into one of an elder statesman dedicated to global issues” (“Bill Clinton’s Humanitarian Focus,” ABC News, Sept. 25, 2007).
Clinton is raising money to end poverty and create economic opportunity in poor countries. He wants to create awareness of threats to public health, whether from HIV/AIDS overseas or sugary soft drinks in local elementary schools. He has joined former Vice President Al Gore in the fight against global warming. Days after the 2004 Indian Ocean tsunami, Clinton and former President George H.W. Bush were everywhere on television, reassuring the world that philanthropy would provide relief.
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Out of office, Clinton remains a faithful liberal who continues to believe in the blessings of government assistance. But he says he has discovered that personal philanthropy can also do wonders: “I felt obligated to do it because of the wonderful, improbable life I’d been given by the American people and because politics, which consumed so much of my life, is a ‘getting business.’ You have to get ... votes, over and over again,” Clinton writes in his 240-page book, Giving, which became a bestseller when it went on sale last September.
Unfortunately, Clinton’s idea of giving includes supporting advocacy organizations that promote more government spending. In his book, Clinton explains how lobbying campaigns can push lawmakers to increase government healthcare spending. He urges his readers to contact the group Families USA, whose executive director, Ron Pollack, coordinated lobbying by outside groups in support of the Clinton Administration’s failed healthcare proposals. If readers are aged 50 or over, Clinton urges them to join AARP.
He commends the work of the Center for American Progress (CAP), a liberal think tank headed by his former White House chief of staff, John Podesta, and notes that CAP created the “Better Healthcare Together” coalition, an unlikely alliance of labor unions and corporations that are eager to push employee healthcare costs onto the taxpayers.
While Clinton lauds private citizens for giving to their places of worship and local charities, he says it’s not enough. Big Government remains the solution: “Many of the problems that bedevil both rich and poor nations in the modern world cannot be adequately addressed without more enlightened government policies, more competent and honest public administration and more investment of tax dollars.”
Public interest in what Bill Clinton has to say is sustaining the market’s demand for his speeches. Touring the world giving talks and wagging his famous finger has made him a wealthy man. Clinton gets six-figure fees for his paid speaking engagements, earning him some $31 million from 2001 through 2005.
Where Does the Money Go?
The William J. Clinton Foundation states that its mission is “to strengthen the capacity of people throughout the world to meet the challenges of global interdependence.” It focuses on four “critical areas”: “health security, economic empowerment, leadership development and citizen service, and racial, ethnic and religious reconciliation.” The foundation also runs the “Clinton Presidential Center” in Little Rock, Ark., which includes the Clinton Presidential Library and Museum and the Clinton School of Public Service.
The legal and financial relationships and responsibilities among these entities are complex. Like other presidential libraries, the Clinton Library is administered and funded by the National Archives. The Clinton School is a branch of the University of Arkansas. However, $165 million in privately-raised contributions funded construction costs for the Presidential Center—the library, museum, school and foundation offices—which was dedicated in November 2004.
Direct contributions are the source of almost all the foundation’s revenue, and they have risen rapidly each year. According to its Form 990 tax returns, the foundation took in a total of $49.5 million from 1998 to 2002. But in 2006 the yearly take was $135.8 million. As of Dec. 31, 2006, the total amount contributed to the foundation since 1998 was more than $367 million. Its net assets are $208.3 million.
Where does the money go? While the foundation paid the $165 million in construction costs for the library complex, it is now setting its sights on projects far beyond the Little Rock campus. The foundation reported $91.9 million in expenses in 2006 and $85.5 million of that was reported as spending on “program services” (with the remainder going to management and fundraising). In 2006, much of the foundation’s program consisted of grant-making, and most of that went to disaster relief. The foundation handed out $31.3 million in grants, of which $30.1 million went to the Bush-Clinton Katrina Fund to help victims of the 2005 hurricane. Other grant recipients included ACORN, the radical poverty group that originated in Arkansas. It received $250,000 to help Katrina victims apply for the federal earned income tax credit. The City College of New York received $49,114 for a program on “ethnic reconciliation” and $192,200 went to the University of Virginia’s Miller Center for an oral history project on the Clinton presidency.
However, the Clinton Foundation’s future projects are even more ambitious. The foundation has established a series of international “initiatives” intended to tackle a variety of world problems. These initiatives do not directly fund overseas programs. Instead, they team up (“partner”) needy non-profits and government agency officials around the world with wealthy donors looking for projects to assist. Perhaps even more importantly, the Clinton Foundation links up wealthy donors to one another. This is a rather novel concept of what a foundation is for: Grantors are incentivized to do good deeds because they get to bask in the approval of Bill Clinton.
The foundation-as-networker for the good and the great is a new institutional form. But with living tycoons such as Bill Gates’ assuming the role of philanthropist to solve global health problems and Clinton’s own Vice President dedicated to saving the planet’s environment, it is hardly conceivable that Bill Clinton would settle for less. Here are the principal Clinton Foundation initiatives:
l Clinton Foundation HIV/AIDS Initiative (CHAI) aims to increase the availability of AIDS care and treatment for the needy by “lowering the cost of treatment, providing strategic and targeted technical assistance where it is most needed.” The foundation’s first organized undertaking, CHAI serves as the model for the foundation’s signature style of linking donors to grantees. The initiative has successfully brokered price cuts by generic drug producers of AIDS drugs, organizing what is in effect a buying cooperative of more than 70 poor countries desperate to help those living with HIV/AIDS. CHAI’s management consultants are providing ill-equipped countries with the business strategies to create a more efficient healthcare market for HIV/AIDS treatment and education.
Ironically, the chairman of CHAI’s policy board is Ira Magaziner, who received poor notices in the 1990s when he was the organizer of Hillary Clinton’s healthcare task force.
l Clinton Global Initiative (CGI) was incorporated in 2005 as a separate 501©(3) non-profit. A self-described “catalyst for action,” it hosts yearly Clinton Global Summits that bring together left-leaning thinkers and activists with wealthy businesspeople and politicians to meet and mingle and ruminate on the world’s problems. The summit’s goal is to have wealthy CGI attendees “partner” with the leaders of aid and development groups by making financial pledges to their programs. During its last three meetings (2005-07) CGI has announced 600 pledges of more than $10 billion.
l Clinton Climate Initiative (CCI) created in 2006, it is yet another promoter of “partnerships” among heads of business, government and politics. CGI’s initial partner is the C40 Large Cities Climate Leadership Group, an association of city officials organized by London Mayor Ken Livingston (a.k.a. “Red Ken”). Representing some 40 of the world’s largest cities, the group is committed to making cities more environmentally friendly by securing various city commitments to adapt their traffic signals, water systems and waste dumps to reduce greenhouse gas emissions. Clinton’s program has persuaded five banks to provide $1 billion in financing for these projects.
l Alliance for a Healthier Generation fights childhood obesity. It’s a partnership between the Clinton Foundation and the American Heart Association—co-chaired by California Gov. Arnold Schwarzenegger.
l Clinton Hunter Development Initiative (CHDI) to encourage “sustainable economic growth in Africa” is a Clinton Foundation partnership with the Hunter Foundation. CHDI has a 10-year operating budget of $100 million, pledged by Sir Tom Hunter, the richest man in Scotland.
l Urban Enterprise Initiative (UEI) helps inner-city small business owners and entrepreneurs. It claims to have provided 65,000 hours of technical assistance (worth more than $14 million) to New York City entrepreneurs.
l Clinton Giustra Sustainable Growth Initiative (CGSGI) is the latest foundation partnership, created in 2007. Pledge money comes from three principal sources: Lundin for Africa, the philanthropic arm of Vancouver, Canada’s Lundin Group of Companies ($100 million); Mexican businessman Carlos Slim, the third-richest man in the world according to Forbes Magazine ($100 million); and Canadian mining financier Frank Giustra ($100 million). In a separate gift, Giustra gave the Clinton Foundation $31.3 million in 2006 through his Radcliffe Foundation.
Clinton Library Donations:
Secrecy or Disclosure?
Federal law does not require non-profit charities to disclose the identities of their contributors, and that applies to presidential foundations. Typically these foundations support the unique entity known as the presidential library. Presidential libraries have two parts: The library’s document collections are maintained by the National Archives and are open to all researchers of whatever political persuasion. But most tourists visit the library’s exhibition halls, conference center and museum store, which are administered by the presidential foundation. They invariably glorify their particular President. Costs are divided. The National Archives pays to maintain the collection of documents and library salaries, while donors, including corporations and foreign governments, may give unlimited amounts of money—even while a President is in office—to the presidential library foundation.
When it opened in 1997, the George H.W. Bush Presidential Library voluntarily disclosed the names of donors who gave more than $10,000. Only a few names were withheld at the request of individual donors. So when the drawing boards called for the Clinton Presidential Library to feature a wall naming its major donors, the move was applauded as an effort to bring greater transparency to the $165-million project.
The wall was never built. Last September, Clinton said his foundation doesn’t need to disclose its current and past donor identities, because, he said, “A lot of people gave me money with the understanding that they could give anonymously.”
But how anonymous is anonymous? ABCNews.com reported that a partial list of donors was sold to infoUSA, a direct marketing data company founded by major Clinton donor Vin Gupta. From June 2006 to May 2007, the company offered to sell a list of more than 38,000 Clinton presidential library donors to foundations and other non-profits. Perhaps it all depends on the meaning of the word “anonymous” (“Clinton Library Sells Secret Donor List,” Nov. 19, 2007). Under pressure, Clinton now promises to make public the names of all future donors to his foundation if his wife is elected to the White House.
Sheila Krumholz of the nonpartisan Center for Responsive Politics, which tracks the influence of money in politics, rejects this reasoning. “The fact that they’ve sold the list and then turned around and said that these names must be kept anonymous completely undercuts their argument,” she said. “The voters ought to have this information before the election, when it could still make a difference.… We really ought to find out who his donors are before the nomination is settled,” liberal commentator Matthew Yglesias wrote in an October 4 Los Angeles Times op-ed. “Because it’s presumed that big-dollar donors to the Clinton Foundation are gaining access to and some measure of influence with the foundation’s top dog, is it such a stretch to think that might extend to his White House-seeking wife as well?”
Asked to comment on the foundation’s policy at a presidential debate in September, Sen. Clinton punted. “Well, you’ll have to ask them,” she said, referring to Bill Clinton and his staff. In fact, the New York Times reported December 20 that the foundation’s first chief of staff, Karen Tramontano, has said Mrs. Clinton was deeply involved in deciding the foundation’s organization and scope of work: “She had a lot of ideas. All the papers that went to him went to her.”
Who’s on the donor list? Billionaires, Saudi royalty, Arab businessmen, the king of Morocco, the governments of Dubai, Kuwait, Qatar, Brunei, and Taiwan, and lots of Hollywood celebrities have donated to the Clinton Foundation. In 2004, the New York Sun reported on 57 donors who appear to have each given $1 million or more. The big donors included Gupta, former Mattel Inc. Chairman Bill Rollnick, Black Entertainment Television (BET) founder Robert L. Johnson (who is an outspoken supporter of Mrs. Clinton’s presidential candidacy), Hollywood director-producer Steven Spielberg and his actress wife Kate Capshaw, movie producer and Kerry 527 funder Stephen Bing, insurance magnate Peter B. Lewis, Gateway, Inc. co-founder Ted Waitt, shopping center developers Bren and Melvin Simon, and the Soros Foundation, which is the European arm of George Soros’s Open Society Institute. Denise Rich, ex-wife of Marc Rich, the fugitive whom Clinton granted a pardon hours before leaving office, gave the foundation $450,000 (“Saudis, Arabs Funneled Millions to President Clinton’s Library,” New York Sun, Nov. 22, 2004).
The New York Times also revealed that in the closing years of the Clinton Administration at least 97 donors donated or pledged a total of $69 million for the library. Although some of the $1-million donors were longstanding friends of the Clintons, others were pushing the Clinton Administration for policy changes. Two donors pledged $1 million each while they or their companies were undergoing Justice Department probes (“In Charity and Politics, Clinton Donors Overlap,” New York Times, Dec. 20, 2007).
Ties to Hillary’s Campaign?
The William J. Clinton Foundation proclaims that it is nonpartisan and denies coordinating its activities with Hillary Clinton’s presidential campaign. But considering its extensive ties to Democratic Party fundraisers and placeholders, it’s hard to believe the foundation isn’t at the very least marketing the Clinton Foundation to Hillary-for-President supporters.
Legendary money-man Terry McAuliffe, a close personal friend of the Clintons, is on the Clinton Foundation’s board of directors and is one of its top fundraisers. McAuliffe, who used to head the Democratic National Committee (DNC), is also managing Sen. Clinton’s presidential campaign and is its chief fundraiser. Other major donors to the Clinton Foundation who are among Hillary Clinton’s top fundraisers include DNC Finance Director Philip Murphy and New Jersey Gov. Jon Corzine, the former chairman of Goldman Sachs and a heavy-hitter in Democratic fundraising circles who was chairman of the Democratic Senatorial Campaign Committee (DSCC) from 2003 to 2005.
Then there’s Clinton Foundation CEO Bruce Lindsey, who was a senior advisor in the Clinton White House known for doggedly defending the President during the Whitewater and Monica Lewinsky scandals. The foundation paid him a salary of $254,000 in 2006. In November, after critics suggested Clinton was suppressing presidential documents to protect his wife, Lindsey said the former President “has not blocked the release of a single document.” But the New York Sun reported December 19 that the National Archives, which administers presidential libraries, is withholding about 2,600 pages of records at Bill Clinton’s request.
Another Clinton Foundation board member is lawyer Cheryl Mills. She also happens to be general counsel for Mrs. Clinton’s campaign and previously served as deputy White House counsel in the Clinton Administration.
Lastly, there is the well-connected Washington, D.C.-based fundraising and communications firm, O’Brien McConnell Pearson (OMP). It does work both for the foundation and Hillary Clinton’s presidential campaign. OMP’s other clients include the League of Conservation Voters, Southern Poverty Law Center, America Votes, ACLU, NAACP, Natural Resources Defense Council (NRDC), Planned Parenthood Federation of America, Democratic Congressional Campaign Committee (DCCC), DNC and Friends of Harry Reid.
The Clinton Global Initiative is studded with partisans who are sure to gain influence should Hillary Clinton win the White House. While its press releases proclaim CGI’s Global Summit a “nonpartisan event with an emphasis on results,” its agenda is prepared by committed advocates who are veterans of Washington’s trench warfare over public policy.
CGI’s Energy Working Group is chaired by Brookings Institution scholar David Sandalow, a senior environmental official in the Clinton Administration who was also executive vice president at the World Wildlife Fund. The working group’s advisory board includes: Frances Beinecke, president of the NRDC; Clinton-era EPA Administrator Carol Browner (also on the board of Al Gore’s Alliance for Climate Protection and John Podesta’s Center for American Progress); Eileen Claussen, president of the Pew Center on Global Climate Change; Fred Krupp, president of Environmental Defense; and Sun Microsystems co-founder Vinod Khosla, a venture capitalist heavily invested in ethanol and an outspoken backer of California’s failed Proposition 87, which would have imposed taxes on the state’s oil producers.
CGI’s other working groups are chaired by senior fellows at the Center for American Progress who previously served in the Clinton Administration. Gene Sperling chairs the education working group. He was Clinton’s national economic advisor and is the author of The Pro-Growth Progressive: An Economic Strategy for Shared Prosperity. Gayle Smith chairs the working group on poverty alleviation. She served in the Clinton National Security Council and the U.S. Agency for International Development (USAID). Thomas Kalil chairs the global health group. He was deputy director of the White House National Economic Council.
The Clinton Global Summit
On Sept. 26, 2007, Bill Clinton opened the third annual Global Summit of his foundation’s Clinton Global Initiative. For three days, the summit’s 1,300 invited guests gathered at events in the Sheraton hotel, Carnegie Hall and Lincoln Center in New York City to discuss the state of the world. They pledged themselves and their money to solve the world’s problems. Bill Clinton rounded up numerous attendees from the corporate world, including Wal-Mart CEO Lee Scott, PepsiCo’s Indra Nooyi, Duke Energy chairman Jim Rogers and now-deposed Starbucks CEO Jim Donald. Carnegie Corporation President Vartan Gregorian was there, as were NoVo Foundation Chairman Peter Buffett (Warren’s son), former Vice President Al Gore, UN climate change envoy Gro Harlem Brundtland, Archbishop Desmond Tutu and Rev. Jim Ball, president of the Evangelical Environmental Network and originator of the “What Would Jesus Drive?” campaign. Brad Pitt and Angelina Jolie turned heads. Britain’s Tony Blair, Afghan President Hamid Karzai and 50 other current or former heads of state greeted one another. Media magnate Rupert Murdoch and former Senate Majority Leader Bill Frist (R.-Tenn.) also accepted Clinton’s invitation. Cost to attend the Summit: $15,000 per person.
A “major underwriter” for the summit was Rochester, N.Y., businessman Tom Golisano, billionaire founder of Paychex, the payroll processing corporation. An alternative-energy booster, Golisano supports electricity-producing wind farms and has started a company, Empire State Wind Energy LLC, to show New York municipalities how they can structure deals to extract more revenue from commercial wind development. Golisano fulfilled his CGI pledge “Commitment to Action” by promising $10 million to the Rochester Institute of Technology to create a sustainability institute.
Of course much of the talk at the summit was about global health, poverty, children and education. But global warming was a major topic on everyone’s lips. “I see New Orleans as a microcosm for the global problem,” said Brad Pitt. “If there’s anyone who understands the repercussions of climate change, it’s the people of the Gulf Coast.” Said philanthropist Ted Turner: “Outside of a nuclear exchange, global warming is the greatest threat humanity has ever faced.”
Bill Clinton called for the rapid expansion of carbon markets to create price incentives to reduce greenhouse gas emissions. This position finds favor with anyone who can profit from it. For instance, summit participant Jim Rogers, chairman of Duke Energy, which generates electricity from “clean” coal and nuclear power, announced that his company’s “Commitment to Action” would consist of working to “overcome regulatory barriers that may discourage utility investment in energy efficiency today.” He called it the “Save a Watt” program. Environmental groups cynically suggested that might be a euphemism for lobbying politicians to let Duke Power raise its rates and win public subsidies for nuclear plant construction.
When we contacted CGI Director of Development Scott McDonald, he refused to explain what the requirements are for being a donor for the CGI Summit. “Whilst we do have levels of sponsorship, the ultimate outcome of a sponsor’s tailored engagement with CGI is the result of a dialogue,” he said in an e-mail.
In his book, Bill Clinton reports that the first CGI summit in 2005 led to more than $2.5 billion in pledges, while the second in 2006 secured pledges of more than $7 billion.
Bill Clinton and Giving
Many CGI pledges are definitely charitable and appear very worthwhile, notably those to the poorest countries in Africa. When these donors combine money with management expertise, they can make a difference, creating new markets that supply goods and services to meet a potential demand. Such philanthropy can produce long-term social progress and immediate help to the needy.
But CGI—and Bill Clinton’s notion of giving—also accentuates style over substance. By promoting social networking among the very wealthy, who are encouraged to find a project they want to help, the Clinton initiatives depend on the donor’s yearning for recognition, esteem and fame. That can lead to little more than high-class socializing and publicity seeking. It can also produce occasions for hidden but profitable deal-making and influence-buying.
Mr. Vadum is editor of Organization Trends.
Ms. Corey Barnes is a freelance writer and blogger for the Polireport in Washington, D.C.