The Grubstakers

Over the years, the tax-free philanthropic foundations have helped make the U.S. a true land of opportunity. They have spent millions to advance research, have sped hundreds of scholars on their way. But have foundation grants always been wise? Have some of them gone to support un-American and perhaps subversive activities? Last week a House investigating committee headed by Georgia's Eugene Cox was told: yes, on occasion.

As everyone knew, the Carnegie Endowment for International Peace had made one major blooper: in 1946 it appointed Alger Hiss to be its president. But, argued Trustee John W. Davis,* onetime Democratic candidate for the U.S. presidency, Hiss had come with the highest recommendations. One of his chief sponsors was Chairman John Foster Dulles, and not a single member of the board could see anything wrong with Hiss's record. Had he ever shown a bias in favor of the Soviet Union while in office? Replied Davis flatly: "Not the slightest."

Only 1%. Hiss was not the only name the endowment listed last week. Between 1926 and 1939 it gave $182,000 to the Institute of Pacific Relations, which in 1952 was denounced by the McCarran Committee as an "instrument of Communist policy." It also paid out about $15,000 in small sums to such leftists as Professor Frederick Schuman of Williams College, and Economist Mordecai Ezekiel, listed by the House Un-American Activities Committee as a member of the American League for Peace and Democracy and of the Southern Conference on Human Welfare. All in all, said the endowment's President Joseph E. Johnson, the endowment had spent something more than $246,000 on people and organizations that were later "cited or criticized" by congressional committees. But this represented only 1% of "all of our expenditures."

The Rockefeller Foundation's closets revealed some similar skeletons. It gave $1,885,359 to the I.P.R., $1,500 through a "misunderstanding" to Owen Lattimore to attend an I.P.R. conference in New Delhi, $15,684 from 1935 to 1939 to the French Communist Frederic Joliot-Curie for his work in physics, $8,250 to Composer Hanns Eisler, brother of Communist Gerhart Eisler, and $6,050 to Economist Oscar Lange, who later became a diplomatic representative of Communist Poland. In 1948, as a "calculated risk," it also gave the China Aid Council $7,500 to translate Western classics into Chinese --six years after the House Un-American

Activities Committee had tagged the council as a Red "subsidiary." The foundation's questionable grants, said President Dean Rusk (who resigned as Assistant Secretary of State to take the job), had cost about $2,000,000, but this seemed to be a good batting average out of a total expenditure of $470 million.

Only One Outrage. As for the John Simon Guggenheim Memorial Foundation, said its Secretary Henry Allen Moe, "the most outrageous mistake of all" was a 1935 grant to Scenarist Alvah Bessie, who later became one of the Hollywood Ten jailed for contempt of Congress. But except for Bessie and two or three others, said Moe, the foundation had done well: like its sister organizations, it had never knowingly subsidized a subversive, and it never would.

Then why do foundations make the mistakes they do? Said Secretary Moe: "Senator Guggenheim,* as you know, was a miner, a mining man, and he understood what a grubstake was . . . He used to say: 'When you are grubstaking, you take chances. You act on the best evidence you've got, but still you have got to take chances.' We who operate really on the frontiers of knowledge and understanding have to recognize that we are not the Almighty. And not being the Almighty, we can't find out everything ... If [applicants for a grant] are members of any movement . . . which does their thinking for them or which indicates what their conclusions must be or ought to be, they are not free to follow their evidence and their own thinking; and they get no money from us. [But] unorthodoxy of thinking, in a man who is free to think, is no bar and must not be a bar . . . "If this foundation . . . should attempt to prescribe what shall be orthodox in politics . . . science, art, or in any other manifestations of the mind or spirit, it had better not be in existence."

* For news of another case argued by Lawyer Davis last week, see NATIONAL AFFAIRS.

* The late Simon Guggenheim, a Jewish immigrant's son who, with his six brothers, built up the American Smelting and Refining Co. into one of the world's great mining empires, served as U.S. Senator from Colorado from 1907 to 1913. A lavish Lord Bountiful ("Have a new school on me," he would say), he set up his foundation in 1925 in memory of his son, to support "an endless succession of scholars, scientists and artists . . . [to] advance human achievement."

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