There are answers to most of the questions in life, but you have to ask the questions. Which brings us to a mystery: Why are very few journalists asking questions about the Third Sector? Indeed, some journalists may not know what that is.

It's philanthropy. There is government. There is business. There is philanthropy, the third sector. We cover the dickens out of the first two. The Third Sector might as well be reported by people pretending to be seers, diviners or swamis.

Journalists tend to regard philanthropy-if at all-as a source of warm and runny holiday stories, or the target of occasional ironic derision of big salaries at charities, or as the possible funder of a mid-career fellowship. Some of us may be privy also to a relatively narrow discussion, accompanied often by hand wringing, about civic journalism or the activism of the Pew Charitable Trusts. I will get to wringing my hands in a few minutes.

First I would like to set some context, to persuade you that the Third Sector is vastly more important and broader than the Pew Charitable Trusts. Pew is, at $4.7 billion in assets, the seventh wealthiest U.S. foundation. But it is only one of about 35,000 American grant-making foundations. The 1997 edition of The Foundation Directory lists 131 organizations that profess an interest in "Media/Communications" and 38 that have an interest in "Journalism & Publishing." Pew is on neither list.

Among the 35,000 grant-making foundations are 7,960 foundations that had assets of at least $2 million. Together, their assets totaled two hundred and seven billion, three hundred and seventy-three million, eight hundred and sixty dollars. That's right: $207.3 billion, in 1995 dollars. Given the bull market in which these organizations have been invested, their total assets are sure now to be considerably higher. In 1998 alone, for example, the Lilly Endowment in Indianapolis increased the value of its assets 21%-to a total of $15.3 billion-and became, for now, the wealthiest foundation in America.

Except for the John S. and James L. Knight Foundation, which endowed this journalism ethics program at Washington and Lee, what do you know about these organizations that control well over $200 billion in assets? Not much, I am confident.

Notice too that I have referred so far only to grant-making foundations. The nonprofit sector also includes schools, religious groups, hospitals, charities and many other intriguing organizations that pay no taxes-such as the National Football League.

According to a 1993 story by Gil Gaul and Neill Borowski in The Philadelphia Inquirer,

The National Football League, that bastion of free enterprise and million-dollar quarterbacks, doesn't look like a nonprofit organization. Then again, it doesn't act like one, either.

The NFL spends less than 1 percent of its $35 million budget on charitable activities, pays its commissioner $1.5 million a year, and spends another $1.5 million to lease seven floors of a Park Avenue Office tower.

Or take the Motion Picture Academy of Arts and Sciences, which spent $6 million to put on the dazzling Oscars show.

You thought nonprofit organizations had to be charities, run by meagerly paid managers and volunteers?

Not anymore.

Thanks to the remarkable largess of Washington lawmakers, an ever-expanding definition of charity and a near-total collapse of government supervision, America's nonprofit economy has become a huge, virtually unregulated industry.

Within it, almost anything and anybody qualifies for tax-exempt status.

Auto racing promoters. Collection agencies. Country clubs. Criminals. A half-billion dollar defense research corporation. Investment houses. Mail-order colleges. A polo museum. Retail stores. Professional surfers. An association of Druids. Foreign real estate investors. Space explorers. Even a chili appreciation society.

Each year for the last dozen years, an average of 29,000 new groups have been declared nonprofit and gone off the tax rolls. Today, an estimated 1.2 million organizations are exempt from taxes -- not counting churches, which don't even have to apply.
 

One-point-two million tax-free organizations. (One of them, I should note, is The Poynter Institute in St. Petersburg, Florida, from which I come. I am trusting you know already that Poynter is a school dedicated to training journalists to be better at their craft.) What about the other 1.2 million nonprofits? What are they up to? Who is covering them? Is there a nonprofit beat? If there were 1.2 million college basketball teams, would we assign just one reporter? Or ignore the Foundation Final Four? Who is reporting on what sounds like an oxymoron: nonprofit businesses?

These nonprofit businesses are owned by hospitals, museums, universities and churches, and many of them compete directly with for-profit businesses. Their combined 1990 revenues were estimated at $500 billion. Their revenues were, as Gaul & Borowski reported, six times the income American farms generated, five times as much as all U.S. utilities, and twice as much as the entire American construction industry.

Nonprofit businesses had 7 million employees. They represented 6 percent of the nation's total economic output. Since 1970 they were growing at a rate four times as fast as the rest of the economy. You would think that they-and the implications of their growth-would be at least Topic C, if not Topic A or B, in the news.

Except for the series of stories that ran for one week in April, 1993, in The Inquirer, except for occasional stories in a handful of America's largest newspapers, except for a very good publication called The Chronicle of Philanthropy that is little-known outside the nonprofit world, except for a website called Philanthropy Journal Online established by the retired publisher of the Raleigh News & Observer, hardly anybody is covering this enormous sector of the U.S. economy-a sector that controls property, cash and investments estimated to be well over $1 trillion.

Still, you may be asking yourself: What does this maundering about nonprofits have to do with the ethics of journalism? Aren't there any number of other topics that might excite the nerve endings of people having a pleasant ethics chat on the Blue Ridge? True, we might profitably talk about sourcing, especially after the events of the last year pretty well documented that no one in Washington, D.C.-with the possible exception of Linda Tripp-takes direct responsibility for anything they say, and we in the media let them get away with it.

We might warn-as Bill Kovach of the Nieman Foundation and Tom Rosenstiel of the Project on Excellence in Journalism just did-that the journalist's obligation to verify information is being mooted by the Internet's capacity to shout rumors in all directions.

We could spend time keening about the awful increase in volume that accompanies a decrease in forethought in what passes these days for broadcast punditry. [At Poynter we display a framed copy of Edward R. Murrow's prophetic caution about TV: "This instrument can teach, it can illuminate; yes, it can even inspire. But it can do so only to the extent that humans are determined to use it to those ends. Otherwise it is merely lights and wires in a box."]

We could fret over the insidious practice of journalists pretending to know more than they do by incorporating into their stories information that has just popped onto their computer screens from competing media, or from somewhere.

And but for the fact that Max King did it so elegantly a year ago in this very setting, we could examine what it might mean to a democracy when publicly traded media corporations concentrate their journalism resources on marketing to high-demographic audiences in America's most acquisitive suburbs.

Worthy topics all, and that is why they are rather more familiar than journalism's studied ignorance of the Third Sector. It is as if journalists have some genetic coding that causes our brains to automatically translate the word "nonprofit" into "charity" or the word "foundation" into "dull." How else might we explain the widespread practice in newsrooms of suspending curiosity whenever the subject arises?

I was leafing through the Foundation Directory the other day when I saw the intriguing name of "The Ethics and Excellence in Journalism Foundation" in Oklahoma City. Curious, I went online, but that foundation name did not show up in a search of the last 674,899 documents in the database of The Daily Oklahoman.

Another of the organizations that formally profess an interest in the topics of media and communications is a small grant-making outfit in Teaneck, New Jersey, with the come hither name, "Grand Marnier Foundation."

And I would venture a small wager that you would find, if you checked, very few stories in the Virginia press or on the state's airwaves about the activities of the Cartledge Charitable Foundation, c/o Grand Piano Furniture, Roanoke, George B. Cartledge Sr., chairman. You would find little about the David S. Blount Educational Foundation, or Christian Heritage Foundation, or Herndon Foundation, or other foundations among the 148 based in Virginia that have combined assets exceeding $2.6 billion. We are missing stories, mllion-dollar stories.

I have another, more personal reason for engaging you with this topic. I am hoping you will explain to me-here comes some hand wringing-why it is ethical for profit-making news organizations to take cash from tax-exempt organizations to gather the news. Perhaps they are in need. Profits have slipped to 15 percent-in some cases 50 percent.

For as long as I can recall, we journalists have been scrubbing our ethical knuckles. In the 1960s, when I worked at The (Cleveland) Plain Dealer, it was customary for politicians and PR people to mark the holidays by giving away so many bottles of expensive liquor to the journalists who covered them that the newsroom supply rivaled a state liquor store. If OSHA had existed then, we would have been fined for obstructing aisles and exits with cases of booze. We gave new meaning to the phrase, "take the fifth." Today, we would fire a reporter who accepted those Christmas spirits.

I remember vividly an occasion when I asked the auto editor if he could advise me which Chevy dealer in Cleveland would give me an honest price on a new family sedan. "Forget the dealers," he said. "Call this number." I dialed and got the regional public relations office of General Motors. The PR person asked two questions: what model of car was I looking for? Where did I live? He volunteered to deliver that model to the dealer nearest my house, and to charge me not one cent more than the dealer paid. Today I would be fired for doing that. Our ethics have improved. Great!

Except-help me understand this-if we would not let a reporter accept money to cover a story or create a beat, why do we allow the editor? It is possible I just don't get it. What I do get, after 40 years in newsrooms, is hair rising along my neck at the notion of outside funding of the First Amendment. When I first heard about these grants, my ethical stance was purely instinctive: Keep the foundation money out of the newsroom.

That instinct was, if anything, reinforced by a cautionary experience in my last newsroom: It was during the early days of the civic journalism movement, and the editors of the editorial page at The Philadelphia Inquirer had an idea: They would explore the possibilities of regional collaboration in the area centered on Philadelphia.

Forget for the moment that this idea may have had limited practical prospects: It imagined literally close to 500 communities in two states reaching agreement on common purposes which had eluded them for more than 200 years. Still, it was a responsible, and civic, idea.

The Inquirer Editorial Board planned to commission a study in which Neal Peirce, the thoughtful columnist who writes about such matters, would frame the issues. The newspaper would print his study and distribute it. The Editorial Board would convene meetings at which citizens in these disparate communities could hear and discuss these issues framed by the learned journalist acting on behalf of the newspaper.

There was a problem: The Editorial Board had no budget for this project. Moreover, this was happening in an era when the parent of The Philadelphia Inquirer was making two seemingly contradictory requests: One, Knight Ridder sought more profit from its Philadelphia newspapers. Two, Knight Ridder was encouraging all of its newspapers to engage in civic journalism. Hmmmm: Tighter budget. Civic expense?

So the leaders of the Inquirer Editorial Board concocted a plan to obtain a foundation grant to support this civic journalism project. Some Inquirer editors-I was among them-took exception. More intuitively than intellectually, we resisted the idea that the paper let anybody with money or power get anywhere near our newsgathering. That was not a new position, nor one aimed explicitly at civic journalism. It was the same instinct that had led us to thwart a brilliant advertising department scheme to let Camel run cigaret ads surrounding-and thus seeming to sponsor-the sports agate results.

Fortunately, there was, and I trust still is, a clear and deliberate division between the editorial pages of the newspaper and the newsgathering staff. We often refer to this division as akin to that of the separation of church and state-although, on reflection, I am not sure anything a newspaper does should be confused with either government or religion. But because of this formal policy of separating the two functions, we were able to stake out, on behalf of the newsroom, a position that essentially came down to ignoring what those yahoos were doing on the editorial pages. We would pursue the subject of regional cooperation as a news story, at least so far as the news editors thought events warranted. But we would not write stories derived from any "tainted," i.e., foundation-funded, activities such as the study undertaken by Neal Peirce. Nor would we have anything much to do with the community forums the Editorial Board was going to sponsor. Everybody was, or at least pretended to be, comfortable with this dance on top of our ethical pinhead.

And off went the Editorial Board to get money for its civic journalism project from the logical source, The Pew Center for Civic Journalism. The Pew Center was already engaged in dispensing several millions of dollars to encourage community-minded journalism projects. Its parent, Pew Charitable Trusts, was based right there in Philadelphia, so it was presumptive that the virtues of a civic project in Pew's home town would be self-evident. Evidently not. As it turned out, the Philadelphia Inquirer project on regional cooperation did not get a dime from Philadelphia Pews.

No way, said the Pew Center for Civic Journalism, because the project did not include the newsroom. To this day, the Pew Center's funding guidelines state: "Your proposal must entail journalism, that is reporting and news coverage." Aha, said some of us in the newsroom: We were right to be skeptical; what a valuable object lesson. But, no. The Editorial Board, which like editorial boards everywhere was convinced of the soundness of its judgment, scouted around and came up with another foundation-another one right in Philadelphia!-that was willing to pony up $35,000 laundered through an office at the University of Pennsylvania.

Everything went smoothly with the Editorial Board exploring a subject that, last I checked, had contributed regional conversation but not much regional collaboration, and the newsroom contenting itself to be formally distant from the whole venture. In the spring of 1995, however, three noteworthy publications changed the scene. On March 26, The Inquirer gave each Sunday purchaser a 12-page section containing "The Peirce Report: Reinventing the Region." On April 16, The Inquirer published on Page One a feature story about something called the Foundation for New Era Philanthropy, which was the unusual vehicle through which the Editorial Board's special section was financed. Here is some of what the feature story said:

While the Pew Charitable Trusts has assets of about $3.5 billion, the Foundation for New Era Philanthropy has none.

Instead, it gives out everything it takes in each year from about 125 very wealthy individuals who are interested in flexing philanthropic muscle but who are also interested in doing so anonymously.

If it sounds too good to be true, get this: The foundation not only gives away tremendous sums of money, it also shows nonprofits where to get more.
 

New Era, said the Inquirer story, had a novel program called New Concepts in Philanthropy, which "doubles money for a nonprofit." The story gave an explanation:

Here's how it works: Your group agrees to raise a specified amount of money by a certain date, and goes out and finds the money. The foundation then banks your group's money for six months, while it finds a sympathetic philanthropist to match it.

The foundation returns your group's money, plus the match, but keeps the bank interest for its own grants to run its institute and other programs.
 

On May 15, on Page One of The Wall Street Journal a devastating story answered The Inquirer feature's implicit question whether New Era might be too good to be true. Those "New Concepts in Philanthropy?" The arrangement in which sophisticated donors like Laurance Rockefeller and the Philadelphia Orchestra would deposit millions of dollars with the understanding New Era would double it in six months?

Investigators, The Journal reported, were looking into whether these matching grants were "a variation on a Ponzi scheme, in which victims are lured by promises of huge returns paid off from other victims' principal-until the sums grow too huge and no more victims can be found." The Foundation for New Era Philanthropy proved to be precisely that, a scam. There were no anonymous matching donors. It was a Ponzi scheme. The Inquirer was obliged to explain to its readers how it had funded the Editorial Board project through a scam, and to pledge that it would return the $35,000. So forgive me if I went from The Inquirer to my current job needing to be persuaded of the virtue of foundation involvement in newsgathering.

Let me be clear. I did not need to be persuaded of the virtue of foundation involvement in news research and journalism education. Poynter itself spends about $7 million a year to improve individual journalists' skills through ridiculously inexpensive seminars. Poynter is in the midst of a multi-year research and training project-for which the Ford Foundation so far has provided $800,000 and is considering another $250,000-to demonstrate to journalists how they can report on diverse communities. The Knight Foundation not only established the chair in ethics occupied by Lou Hodges but chairs at 11 other journalism schools.

Indeed, The Knight Foundation is the sugar daddy of mid-career journalism training. It singlehandedly rescued the Stanford Fellowships when their funding by the National Endowment for the Humanities ended. It funds mid-career fellowships at Columbia, Maryland, Yale, MIT, Michigan, and Harvard. Knight sponsors fellowships through the International Center For Journalists that send U.S. professionals to teach craft skills to journalists in emerging democracies. Knight endowed the Newspaper Management Center at Northwestern. It funds programs to attract minority college students to, and train them in, journalism.

Other foundations also support journalism education and research. The McCormick Tribune Foundation gave $20 million to the Medill journalism program at Northwestern, and it sponsored the long-range study of newspaper credibility undertaken by the American Society of Newspaper Editors. McCormick Tribune has for a long while supported the alphabet soup of journalism organizations: API, RTNDF, NAB, ICFJ, IAPA, IRE, CPJ, WPI, NABJ, NAHJ, FIU and the Maynard Institute.

I do not wring my hands over the funding by Pew Charitable Trusts of such ventures as the Project on Excellence in Journalism, or the Pew fellowship program at Johns Hopkins to prepare young journalists for international coverage, or the Pew endowment of the National Arts Journalism fellowships at Columbia. Those are all admirable ways to educate journalists, not to influence their coverage plans.

At Poynter, I began to wonder if I was the oddball in instinctively recoiling at a foundation venturing into newsroom content. Fine journalists, such as the late and revered Jim Batten, saw foundation grants for civic journalism as a means of enabling journalists to engage their communities and to win the respect of their readers. It was Jim Batten who invited Rebecca Rimel of the Pew Charitable Trusts to consider funding projects in civic journalism.

And that venture has attracted other highly regarded journalists, such as Hodding Carter (who once chaired the committee that determines which applicants get Pew civic journalism money and who now is President of the Knight Foundation). There is also Jack Nelson of the Los Angeles Times, one of this half-century's most honored and honorable investigative reporters, who succeeded Hodding as chair of the Pew Center. Another is Ed Fouhy, who was Walter Cronkite's producer at CBS and who created the Pew Center, and who has gone on to create a second center-this one focused on state government. Finally, there is Chris Anderson, the veteran editor and business executive, now publisher of The Orange County Register, who is the leader of Poynter's National Advisory Board.

When I got to Poynter in 1996, the Institute was ankle deep in civic-or, as we referred to it, "community"-journalism. We have been partners with Pew in some studies of civic coverage. We have been hosts to Pew events. We continue to be associated with research projects and discussion forums funded by Pew and conducted by such groups as the Committee of Concerned Journalists. We are active partners in journalism teaching and research projects with such groups as the Robert Wood Johnson Foundation, The Kaiser Family Foundation, the Freedom Forum, the Kettering Fund and the Knight Foundation. So, for manifest reasons, I have tried for three years to examine this subject from a less intuitive and more reflective stance.
 

I have come to this conclusion: Keep the foundation money the hell out of the newsroom.

Sorry. I couldn't resist. I don't mean to appear quite that snippy. One of the real problems with the civic journalism movement was that some early advocates actively disdained traditional journalists who were troubled by being guided toward civic partnerships with those about whom they were reporting. And many traditionalists closed their minds not just to troubling aspects of community relationships or funding but to the very notion that the news organization should pay attention to the views of its community. While we were not pursuing civic journalism in The Inquirer newsroom, we weren't campaigning against it either. Yet the contentiousness reached a point where it was assumed that anyone at The Philadelphia Inquirer was an opponent of civic journalism.

In hindsight, that is as ludicrous as all the other nutcake paranoiac theories of managed news. If those of us in The Philadelphia Inquirer newsroom all had thought alike, then how did it happen that the current director of the Pew Center on Civic Journalism took that job after a career as an Inquirer reporter and editor. Or that at the headquarters of the Pew Charitable Trusts, the Director of Operations and Special Projects is a former Inquirer editor and executive. The Public Affairs Manager is a former Inquirer layout editor. The Director of the Venture Fund, the very fund that supervises the Pew ventures into journalism, is a former Inquirer foreign correspondent and editor. And Gene Roberts, the mentor of us all, currently husbands a small fortune in Pew grant money to fund the American Journalism Review series on The State of The American Newspaper. There are real issues confronting broadcast and print journalism. It is important to get beyond the stage at which the civic journalism debate is conducted in anger or based on presumption.

Or so I reasoned when Pew's 1997 "Civic Journalism Retreat" was scheduled to happen at Poynter, and I was to welcome all those folks who had presumed me to be an enemy. I told them that I had studied it enough to know "there can be little doubt now that this movement has focused attention and energy and passion on the need to improve journalism in service to community."

I noted also that Poynter was a place where we worried less about closing ranks than about opening minds, and that Poynter always will welcome those who are deeply committed to practicing a journalism that pays respect to readers, viewers and listeners; that revitalizes news coverage of communities; that re-energizes journalists acculturated to hiding in the cloister of newsrooms where they become, or are mistaken for, arrogant elitists.

And in candor I told them this: "I don't, and I won't, subscribe to everything done in the name of Civic Journalism. In particular-let me be frank-I believe it's flat wrong for any news organization to take any money from any outside institution-even one as benevolent as Poynter-to pay for any newsgathering."

This is not a position lightly taken, or an academic issue. As a nonprofit school, Poynter has taken pains to distinguish training and mentoring journalists from serving journalism companies. Poynter owns the St. Petersburg Times Company and its affiliates, which include such publications as Congressional Quarterly, Governing, and Campaigns & Elections magazines.

Governing has been a partner in a Pew-funded reporting project. Campaigns & Elections has been tantalized by a sizable sum, an amount any of us would be thrilled to win in the state lottery, to conduct a Pew-funded reporting project. In the course of these deliberations I have listened to many reasoned arguments for accepting Pew money, arguments such as: Look at Public TV and radio. That is fair enough. Clearly, NPR and every public broadcast station would be imperiled if it were not for foundation grants (and, of course, sempiternal fund drives).

But public radio and television are by design nonprofit. The audience has a well developed expectation that the programming relies upon the generosity of underwriters. And the public broadcast media facilitate explicit notices about who is underwriting. [It does, however, give pause when Minnesota Public Radio's subsidiaries generate such profit selling "Prairie Home Companion" trinkets that the statewide network can sell its catalog business for $120 million.]

Okay, the advocates say, what about AJR? The admirable series on the State of the American Newspaper, edited by Gene Roberts and reported by some leading journalists, would not have been possible at the financially struggling magazine without Pew's, or someone's, philanthropy. But the American Journalism Review is not a for-profit venture nor a general circulation publication. It is, like the Columbia Journalism Review, an earnest handmaiden of a journalism school, more trade publication than newsmagazine. Well, say thoughtful editors, how is foundation money different from Macy's?

This, I believe, is the nub of the issue. The money may not be different, but the forms and the purposes are:

>Macy's buys space amid news content. A foundation grant buys content.

>Macy's is overt, demanding attention, often in double-truck, full-color. A foundation grant is subtle, usually noted in a passing phrase or by an italic sentence tucked into a sea of type. >Macy's uses advertising to influence the behavior of the media audience. A foundation grant is meant to influence the behavior of the media.

>Advertising is transparent. A foundation grant is often opaque, its purpose less clear.

Rebecca Rimel, the president of Pew, was direct and clear when Lisa Shepard of the American Journalism Review, interviewed her a couple of years ago: "I've never had," Rimel said, "any particular interest-didn't see it as our role, still don't-how journalism goes about its business. Except we do see it as an issue if journalism can be used as a tool, as a way to get the public reconnected, reinvigorated, recommitted to democratic values . . . ."

Pew is not the first outside institution to regard news organizations as a tool. It may be the first one that news organizations embraced with gusto. Pew has affected how journalism goes about its business. Journalism has cultural and, in most newsrooms even now, structural impediments to the advertiser trying to influence news content. The nature of a foundation grant for newsgathering is to influence news content.

That was the purpose of the W. Alton Jones Foundation when it gave NPR $200,000 for "coverage of nuclear non-proliferation and other international security issues with focus on reporting from bureaus in Kiev and New Delhi." That was the purpose of Pew when it funded Terence Smith's coverage of the media on "The NewsHour with Jim Lehrer."

Please do not misunderstand what I am saying. I do not seek to impugn the motives of editors who accept or foundations which grant newsgathering money. People whose sensibilities I respect assure me they know of no effort by Pew or other grant givers to edit their stories or pull their strings. But an underwriting grant is not the equivalent of advertising except in so far as both are counted as revenue.

The problem with conflicts of interest is that they need not be consummated to be troublesome. We know journalism has a credibility problem. We know Editor & Publisher reports that the Scripps Survey Research Center at Ohio University has found that fewer than fifteen percent of Americans regard newspapers as reliable. We know Chris Urban's survey last year for the American Society of Newspaper Editors determined that 78% of US adults believe that powerful people or organizations can influence a newspaper to "spike or spin" a story. We know that it stretches credulity to suggest that the way out of this credibility problem is to convince the skeptical audience that we are on top of this issue, thanks to these fabulously wealthy guys in Philadelphia or Teaneck who have given us a bunch of cash to document how much we are listening to you.

Most of all, we know what it is we don't know. We don't know squat about foundations. Not a clue. Which brings us back to journalism's studied ignorance of the Third Sector. Foundations surely bear responsibility for closing themselves off to all but the shallowest scrutiny of their Forms 990. But it is not the foundations' fault that journalists have made so little effort to understand and explain the conduct of nonprofit organizations.

Is the Foundation formed by the brothers Knight comparable to the foundation set up by the family of Richard Mellon Scaife? We have few instincts for sifting through distinctions in foundations because we have so little experience on which to build instinct. If it is all right for Pew to pay for your reporting, is it all right for the Phillips Foundation? I had never heard of the Phillips Foundation until I was told the other day it gave individual journalists grants to do reporting. Sounded like an Alecia Patterson fellowship.

It will not, by now, astonish you that in scans of databases for the last two years of The Washington Post, The Baltimore Sun and even The Chronicle of Philanthropy, I could find no news about the Phillips Foundation. Fortunately, Poynter's library is blessed with a gifted researcher. David Shedden found the Phillips Foundation in Potomac, Maryland. It turns out Phillips makes fellowship grants of from $5,000 to $50,000 for what it describes as "journalism projects supportive of American culture and a free society." The foundation's assets come from Thomas L. Phillips, founder and chairman of Phillips Publishing International, Inc. The company began in Phillips' garage a quarter-century ago and grew to 1,200 employees, revenue of $304 million in 1997, and more than 100 newsletters. Phillips announced in 1998 that he was seeking a buyer for three of his four subsidiaries. The fourth, not for sale, is Eagle Publishing Inc., which produces such conservative political publications as Human Events and the Evans-Novak Political Report and which owns the Conservative Book Club and Regnery Publishing, the company that publishes books whose authors seem commonly to be critical of President Clinton.

Is it ethical to be largely inattentive to the activities, the attitudes, the assets or the flaws of more than 1.2 million organizations in our communities? Talk about your failure of community journalism!

Is it smart to ignore foundations? There is an old adage of journalism: Follow the money. There is real opportunity in finding out what non-profits do. You could even, if you wish, call it civic journalism.