Former OMB Executive Steps In to Run September 11th Fund

The morning of September 11 found Joshua Gotbaum preparing to drive to New York from his Washington home.

His family wanted to support his stepmother, Betsy F. Gotbaum, in her primary race for city public advocate.

“We were gathering all the kids in the car to drive up to New York to help Grandma Betsy get out the vote,” he says.

But before the family could leave, Mr. Gotbaum turned on the television and watched with horror the attack on the World Trade Center, which transformed his infrequent trips to New York into a weekly commute as director of the September 11th Fund.

As the first head of the fund, established by the New York Community Trust and the United Way of New York City just hours after the twin towers fell, Mr. Gotbaum says his job is a temporary one. He is in charge of distributing the more than $350-million that the fund has raised from celebrity telethons, concerts, and donations nationwide, and expects to have a full plan on how all the money should be doled out, pending approval by the charity’s 22-member board, in six to nine months.

Mr. Gotbaum does not have a background in philanthropy, but has spent most of his time on Wall Street or in government. During the Clinton administration, he worked for the Office of Management and Budget, where he coordinated federal relief efforts for disasters and learned how to say no to good project proposals because of limited resources — a skill he says he will need in his new position.

In an interview, Mr. Gotbaum explained how he sees his work for the fund as public service and the challenges he faces as its director.

What makes you qualified to run the September 11th Fund?

At the Office of Management and Budget, I spent a very considerable amount of time essentially figuring out how, with limited resources, the federal government could accomplish a variety of goals. For example, after Hurricane Mitch hit Central America [in 1998], I ran the team that figured out how the federal government should help with [the departments of] Defense, State, and Agriculture. I did the same job for counterterrorism budgeting and other things. So my experience at OMB is analogous to the task facing the September 11th Fund. Even though the September 11th Fund has raised a very substantial sum of money, those funds are still nowhere near enough to deal with all of the needs of all of the victims. Therefore the task is to figure out how best to work with government agencies and other nonprofits to address the needs of all the victims, whether they’re financial security, counseling, or job training, or whatever. While $300-million is a great deal of money, it’s a long way from the amount that all the victims of this disaster will need to rebuild their lives.

How else has your background in government prepared you for this position?

Working at the federal budget office is constantly an exercise in using limited resources to meet unlimited demands. So I was constantly in the position of saying to people who are trying to do very good things, ‘I can’t fund all of these good things that you’re trying to do.’

You cannot say yes to everyone, even though the vast majority of people are making proposals that are unquestionably helpful, unquestionably well motivated, and unquestionably good for the victims of September 11.

Why did you decide to take this job?

For the same reason millions of people reached out to help after September 11. Some made contributions, others volunteered their time. We had folks traveling across the country to help out. So I thought taking a period of time to get the September 11th Fund started and to figure out how to use its resources to help people was a form of public service.

What is the fund’s biggest challenge?

The biggest challenge is working with all of the institutions that want to help to fashion an effective program of relief for the victims. [The challenge is] working with the institutions that want to be helpful in a way so that they jointly help people rather than step on each other’s toes. We know the federal government has been exceedingly generous [with its victims’ compensation fund] and many other philanthropic institutions also want to be helpful — Red Cross, Salvation Army, and others. The task is making sure that everyone works together so the help is additive, not duplicative.

Has assistance been getting out to families of attack victims quickly and efficiently?

The first point is that you have to attend to emergency needs and the priority has to be on meeting the needs rather than worrying about every accounting rule and consideration. It takes more time to address long-term needs, which you must coordinate with other institutions. For example, the federal government is being very generous but it has yet to write a single check. And that’s the reason why there’s a role for philanthropy. While people are waiting for the government, Safe Horizons [a New York nonprofit group supported by the September 11th Fund] will write a check on the spot to cover mortgage payments, tuitions, or whatever. It does take time to coordinate on the long-term issues with government and other charities; that is why it is especially important that you know you are meeting emergency needs for anyone who expresses them.

In the first three months after the Oklahoma City disaster [in 1995], which has a lot of similarities to September 11 except the fact that 20 times as many people died, all of the charities expended 20 percent of their total [contributions]. That was in a much smaller disaster, and so when someone says, ‘Is money getting out there fast enough?’ I think that depends on whether or not people’s emergency needs are being met, which they are.

The Red Cross has been criticized for some of its recent decisions, such as using its September 11 disaster fund for future needs. What are your thoughts on its situation?

Because the Red Cross had a disaster fund on September 11, it was able to provide help immediately in a way other institutions could not. If it were clear that some of the contributions to the Red Cross after September 11 were intended to replenish the disaster fund so that the Red Cross could provide help for the next disaster, then I think people would think their contributions were well made. To maintain good relations with the public, the Red Cross should keep doing what it’s doing, which is providing help with thousands of volunteers to thousands of people.

ABOUT JOSHUA GOTBAUM, CHIEF EXECUTIVE OF THE SEPTEMBER 11TH FUND

Education: Mr. Gotbaum graduated from Harvard Law School and the John F. Kennedy School of Government, at Harvard University, in 1978. He earned his bachelor’s degree from Stanford University in 1973.

Previous Employment: During the Clinton administration, Mr. Gotbaum worked as the associate director and controller for the White House’s Office of Management and Budget, the assistant secretary for economic policy at the Treasury Department, and assistant secretary for economic security at the Defense Department. He has also worked as general partner at Lazard Freres & Company, an asset-management company in New York.

Charitable interests: Mr. Gotbaum has donated to Catholic Charities, the American Red Cross, the Center on Budget and Policy Priorities, and the Food Research and Action Center. He serves on the board of the Dance Theater Workshop, in New York.

Hobbies: Mr. Gotbaum sings show tunes and cabaret songs, and is learning to fly airplanes.

Personal life: Married with three children, ages 9, 7, and 6. His stepmother is the newly elected public advocate of New York.