Balkinization  

Wednesday, October 22, 2025

Could the Garland Fund Upend America Today?

Guest Blogger

For the Balkinization symposium on John Witt, The Radical Fund: How a Band of Visionaries and a Million Dollars Upended America (Simon and Schuster, 2025).

David Pozen 

John Witt’s The Radical Fund: How a Band of Visionaries and a Million Dollars Upended America recovers the remarkable story of the American Fund for Public Service, known as the Garland Fund, and its efforts to advance social democracy during the 1920s and 1930s. With his characteristic mix of erudition and elegant prose, Witt brings to life the personal dramas, institutional dynamics, and ideological struggles that shaped the Fund’s interventions in many of the most pressing issues of the era. A riveting read, The Radical Fund seems likely to become that rarest of academic birds: a 700-page monograph that finds a large and grateful audience. 

Given my limited historical chops, I will leave it to others to evaluate The Radical Fund’s contributions to the history of philanthropy, labor relations, civil rights, and the interwar period. My first encounter with Witt’s project was at a conference on nonprofit law, and it is through this lens that I will offer some reflections. As exemplified by books such as Winners Take All and The Tyranny of Generosity, recent years have seen a boomlet in commentary that depicts wealthy nonprofits in general, and private foundations in particular, as enemies of democracy and engines of plutocracy. Against this backdrop, perhaps the most striking thing about The Radical Fund is its celebratory tone. The Garland Fund, Witt tells us, managed “to remake an unjustifiably unfair society” (p. 4) through its righteous pursuit of economic and racial justice. The implication, made explicit in the book’s Epilogue and in Witt’s recent New York Times essay on “How to Save the American Experiment,” is that a Garland Fund of today might do the same. All that’s needed is a similar level of creativity and courage. 

I am not so sure. Contemporary foundations might take inspiration from the Garland Fund in a generic sense, striving to emulate the Fund’s intrepid spirit while otherwise forging their own path. But nonprofit law has evolved since the 1930s in ways that would make it hard to replicate the Garland Fund’s most innovative tactics and important breakthroughs. Consider some examples.

Grantmaking to Labor Organizations 

“Of the nearly $2 million the Fund gave away in its two decades of operation,” Witt relates, “over half went to labor movement efforts” (p. 536), including pro-union publications and labor unions themselves. The modern Internal Revenue Code strongly disincentivizes such a grantmaking focus. Since 1969, private foundations have been required to distribute a certain percentage (now 5%) of their assets each year for charitable purposes, or else incur a penalty. Grants made to § 501(c)(3) public charities count automatically toward this 5% payout requirement. Grants made to most other types of nonprofits, by contrast, only count toward the 5% floor if the foundation goes through the costly and cumbersome process of exercising “expenditure responsibility,” which must be documented to the IRS. Labor unions are not 501(c)(3) organizations (though some “alt-labor” groups are). Neither are publications that lack a religious or educational character. 

Add this up, and we find that a twenty-first century Garland Fund—let’s call it Garland 2.0—would likely take a significant financial hit from prioritizing labor movement efforts to such an extent. Contemporary nonprofit law steers foundation dollars away from unions.[1] 

Pursuing Social Change Through the Courts 

The Garland Fund also gave money to organizations pursuing social change through the courts. Most notably, it supported lawyers at the NAACP, including Thurgood Marshall, in a litigation campaign against Jim Crow that would eventually culminate in Brown v. Board of Education. The tax code still smiles upon impact litigation by “charitable” nonprofits like the NAACP Legal Defense Fund. (The NAACP is now a less favored 501(c)(4).) What’s less clear is whether the lawsuits brought by these nonprofits can still have comparable impact. 

The court victories that the Garland Fund bankrolled were made possible, in part, by Jim Crow itself and the explicit system of racial apartheid that it established. By the turn of the twenty-first century, most of the leading justice struggles for marginalized groups had shifted from “first-generation” demands for formal equality to second- and third-generation demands for economic and political power. And these latter demands—for positive rights to state support instead of negative rights against state abuse—are seldom vindicated without mass popular mobilization, electoral victories, and transformative statutes. Generally speaking, judicial decisions cannot address the most salient forms of inequality today to the same degree that they could in the 1920s and 1930s. 

But in that case, why couldn’t Garland 2.0 simply abandon litigation and shift all its resources to the electoral and legislative arenas? Tax law comes back into the picture here. Since the mid-twentieth century, politicking and lobbying by private foundations and public charities have been strictly limited by the tax code. What public charities may do to their heart’s content, the IRS clarified in a series of revenue rulings in the 1970s, is litigate. The 501(c)(3) rules, I have argued, thus “fit snugly into the postwar theory of legal liberalism, in which the federal courts were seen as the key agents of social reform and professionally managed nonprofits as their partners in that effort.” To the extent this vision still has descriptive purchase, it has been thoroughly coopted by right-wing outfits such as the Institute for Justice, Pacific Legal Foundation, and Students for Fair Admissions with goals anathema to the Garland Fund’s. 

In short, in the years following the Garland Fund’s litigation successes, the tax code began to encourage a court-centric approach to pursuing social change—just as this approach was losing promise for progressive activists in the Garland mode. 

Eschewing Perpetual Life 

The Garland Fund closed up shop within two decades of its launch. From the vantage point of today, this might be the most “radical” thing it ever did. There are a small (though reportedly rising) number of contemporary foundations that commit to spending down their assets within a certain timeframe; Witt’s New York Times essay cites the example of the Gates Foundation, which Bill Gates recently announced will shutter in 2045, forty-five years after he started it. But as reflected by the shockwaves this announcement caused, the Gates Foundation is the exception that proves the rule of perpetual life. 

Nonprofit law doesn’t penalize spend-down strategies in the same way that it penalizes funding unions, lobbying legislatures, or endorsing candidates for public office. But it does cast such strategies in a suspicious light. At the federal level, the annual payout requirement was initially set by Congress at 6% and later lowered to 5% for fear that anything more would jeopardize foundations’ ability to exist in perpetuity. At the state level, the widely adopted Uniform Prudent Management of Institutional Funds Act provides in an optional subsection that spending more than 7% of an endowment’s value in any year creates a rebuttable “presumption of imprudence.” The message is clear: safeguarding charitable assets for the long, long haul is the norm. Giving it all away is a deviant approach that requires special justification. 

None of this is to suggest that contemporary foundations couldn’t or shouldn’t follow the Garland Fund in limiting their lifespans—Richard Posner once described the “perpetual charitable foundation” as “a completely irresponsible institution, answerable to nobody”—just that nonprofit law and culture have moved in the opposite direction since the 1930s. The norm of perpetuity also helps explain why there are now some 150,000 private foundations in the United States, with more than $1.6 trillion in assets. While Garland 2.0 might stand out for embracing an aggressive spend-down strategy, the sheer size of the sector reduces the odds that any given grant will stand out in terms of innovativeness or impact. 

* * * 

In sum, while it is possible to imagine any number of intriguing versions of Garland 2.0, the legal, cultural, and economic conditions under which progressive foundations currently operate make it much more difficult to imagine them “upending America.” 

What does this counsel for those who wish to see the country upended anew? The Radical Fund’s Epilogue pits the view that it is hypocritical to rely on wealth to attack inequality against the view of the Garland Fund’s directors that such “moral purity” comes at “the unacceptable cost of unilateral disarmament in the fight to shape society” (p. 540). Witt plainly agrees with the Garland Fund directors. It’s better for the wealthy to join the fight. 

Yet if the thrust of this post is persuasive, then it may be less illuminating to debate whether elite philanthropy is good or bad, in abstract binary terms, and more fruitful to debate how these activities are regulated and taxed. In other words, perhaps the creativity that we most need now is not so much in the decisionmaking of individual donors and foundations as in the design of nonprofit law, so as to increase the likelihood that the sector as a whole will advance rather than impede democracy. The Radical Fund naturally does not take up this task, but in reconstructing and redeeming the Garland Fund’s “compelling democratic vision” (p. 541), Witt’s masterpiece helps us to see how important the task may be.

David Pozen is Professor at Columbia Law School. You can reach him by e-mail at dpozen@law.columbia.edu. 



[1] I am assuming here that a contemporary version of the Garland Fund would be structured as a private foundation. Throughout the book and in his New York Times essay, Witt refers to the Fund as a “foundation.” Chapter 11, however, suggests that toward the end of the 1920s, the Fund was granted tax exemption as a “civic league,” or what would now be called a § 501(c)(4) “social welfare organization.” A grantmaking 501(c)(4) would be free from the 5% annual payout requirement and the expenditure responsibility rules, but donations to it would not be deductible and donors would have to give up control over the organization to avoid exposing their transferred assets to the estate tax.



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