Walter Annenberg’s Aim: Give It All Away

Walter H. Annenberg is fearful of leaving his multibillion-dollar fortune to philanthropic professionals who might squander it. But he acknowledges that his foundation may still end up with more than $1-billion after his death.

The 85-year-old publishing magnate is doing his best, however, to give away a lot of his money while he is still alive.

“I don’t want to take a chance,” he said in an interview with The Chronicle of Philanthropy. “I want to know where the assets are going, and I want to dispense them along the lines that I happen to believe are in the best interests of the citizens of the United States.”

Last year alone Mr. Annenberg committed $865-million in two highly publicized sets of gifts, in addition to many smaller donations.

At a White House ceremony with President Clinton last month, he promised $500-million from the Annenberg Foundation to improve the nation’s public schools. In June, he announced that his fund was giving $100-million to the Peddie School, the New Jersey private institution he attended, and $265-million to three universities. He thinks it is a good bet that he will be able to distribute most of the Annenberg Foundation’s assets, now about $1.45-billion, before he dies; he pointed out to a visitor that his great-grandmother lived to be 108. But he made it clear in the interview, at his lush 250-acre desert oasis here, that in the back of his mind he realizes he will eventually have to give up his distrust of foundations and professional grant makers.

He said he was considering leaving all of his personal fortune — except for 53 pieces of art he has promised to the Metropolitan Museum of Art in New York — to the foundation. After the Met gets his paintings — worth about $1-billion, the amount a Japanese collector offered for them — Mr. Annenberg should have $1.1-billion left. Such an infusion to his foundation would mean that, even if he had spent all of the fund’s current assets, it would still be one of the nation’s biggest philanthropies.

“It’s conceivable that the rest of my assets may be given to the Annenberg Foundation,” he said. His daughter, Wallis, his only living child, will inherit a sizable sum from Mr. Annenberg’s father’s estate — enough to allow her to live quite comfortably.

Influencing Other Philanthropists

As he deliberates how best to give away his billions, Mr. Annenberg is making it clear that he plans to devote most of his future giving to elementary and secondary education and, more generally, to solving the problems of young people. His new focus marks a sharp shift from his previous donations, which were directed to colleges, arts and cultural institutions, and, to a lesser extent, hospitals and health-research organizations.

Mr. Annenberg is also trying to make donations that will not only do good, but that will influence other philanthropists. At last month’s White House announcement, he made it clear that he intended his $500-million commitment to be viewed as a challenge to other donors — not as a lump-sum gift that could be expected, by itself, to cure the most serious problems plaguing the nation’s schools.

“Everybody has to get involved, especially the people who control means that might be available for support, to get behind this developing program for the betterment of our country,” he told The Chronicle.

He has no plans to engage in fund raising himself, however. “I’m a giver, not a solicitor, at this stage in my life,” he said. “But I like to know who’s shaping up and who isn’t shaping up.”

Early indications are, however, that Mr. Annenberg’s challenge may not do much to influence giving by other wealthy people. A new survey of 193 big donors with liquid assets of $1-million or more found that while most of them were aware of Mr. Annenberg’s gift, none planned to make contributions to educational reform as a result of it.

A similar survey of 209 wealthy people who do not now give much to charity found that fewer than 4 per cent were inspired by Mr. Annenberg to put money into school improvement. Both surveys were conducted for The Chronicle of Philanthropy by Prince & Associates in Stratford, Conn.

Foundation officials were enthusiastic about Mr. Annenberg’s commitment to public education, but they said it was too early to predict if their giving patterns will change because of his donations.

Hayes Mizell, director of the Edna McConnell Clark Foundation’s program for disadvantaged youth, said the gift was “sending a signal to people who are in the business of public education that things must not remain the same, there must be real reform, that business as usual will not go on.”

Explaining why he decided to make the donation to the public schools, Mr. Annenberg said: “Our colleges and universities are perhaps the best in the world, but below that level we’re in a rather sad state, a sad state because of a lack of parental attention to the young, rock and rap music, and obscene motion-picture and television productions.”

‘Something Had to Be Done’

What disturbed him to the point of action were reports that youth violence was reaching the nation’s suburban communities. “That was a clear indication to me that something had to be done,” he said.

Of the $500-million in donations announced by Mr. Annenberg last month, $115-million will go to existing organizations that work on school reform. The rest will be given out over the next five years, mainly to public schools. Vartan Gregorian, president of Brown University, will serve as coordinator of the effort, called the Annenberg Challenge.

While education leaders seemed excited about the potential of the effort, some expressed concerns about what will happen to the money. “It’s a tremendous gift to education,” said James Piereson, executive director of the John M. Olin Foundation, but “I’m not too optimistic about how all this will turn out.”

Mr. Piereson said he would like to see efforts to give parents more choice about where they send their children to school, but he doubted that the idea would get much play with Mr. Gregorian. “He is not committed to the kinds of things that I think are important,” Mr. Piereson said.

David Milner, the 25-year-old president of a Washington-based non-profit called Funds for the Community’s Future, said he applauded Mr. Annenberg’s effort to improve education but worried that students and other residents of low-income neighborhoods would not be consulted. fcf works with children and adults in some of Washington’s poorest areas to raise scholarship money to help them pursue further education.

“These people are underutilized in terms of rebuilding our country and our [school] systems because they’re unable to adequately voice and implement their plans,” he said. So far, the allocations of the Annenberg Challenge represent “the epitome of the top-down approach,” Mr. Milner added. “It’s going to well-known established people or institutions, which reduces the risk of giving away money.”

Criticism of Gift to School

Mr. Annenberg’s money — intended for projects that can raise matching funds — will be directed at students of all income levels, mainly at public schools. The philanthropist provoked some criticism in June with his gift to his alma mater, the Peddie School. Some donors and people in education considered the gift ill conceived at a time when the nation’s urban public schools were in dire straits.

Eugene M. Lang, a wealthy businessman whose work as founder of the I Have a Dream Foundation has encouraged dozens of philanthropists to help poor kids, had called the gift to Peddie “depressing.” He said, however, that Mr. Annenberg’s new commitment to reform public education was right on the mark. “There is no question about it: In terms of being responsive to society’s needs, there are just light years of difference in terms of the social significance of the grants,” Mr. Lang said.

The attacks on the Peddie gift annoyed Mr. Annenberg, who has made it his mission to do everything he could for the school since he was 15 and saw a rival institution’s more impressive campus during a football game. “If any bigmouth