I also believe you have accurately illustrated your concerns about the Social Innovation Fund. I agree with everything you have said here. It is good to see that (finally) a Presidential Administration is at least giving philanthropic, non-profit causes their deserved attention. But alas, upon examining the facts more closely, this is still almost little more than lip-service. Much more needs to be done.

In my opinion, the biggest concerns are:

1) NOT ENOUGH FUNDING IS BEING OFFERED! $50 million, maybe incrementally increased to $100 million? Seriously, they need to do better than that. All things considered, that is a rather paltry amount, and – not to be too pessimistic – unlikely to to make a significant, lasting impact.

2) Perhaps more importantly, THESE FUNDS WILL CERTAINLY NOT GO TO THOSE ORGANIZATIONS WHO NEED IT MOST! In order to make the most impact, the wealth needs to be dispersed better to more of the lesser-known community-based organizations (many of whom arguably just as much, if not more, of an impact and are doing great work). The more organizations that are involved and enabled toward the non-profit cause, the better off society will be.

Of course, Jasmine, you do bring up a very excellent point, about the maintenance of certain evaluation standards. Of course, the White House is going to want to cover its back, and not foolishly give money out to anyone. Obviously, stricter standards mean that much of this funding will end up in the hands of the larger, more well-known organizations. This is the nature of the beast, unfortunately. Certainly, something can be done about this.

Pablo Eisenberg, in a blogpost to onphilanthropy.com (http://tiny.cc/f5ynt) gives some pretty interesting ideas, such as perhaps lobbying congress to increase the five percent minimal payout that foundations are required to distribute annually – and making sure these payouts are all in the form of grants. According to Eisenberg, under current law, foundations can include all their management costs as part of their minimal payout.

As all students and practitioners of policy know, change in the Republic of the United States of America was intended to be, and is, slow. Such is the business of government!

I think you hit the nail on the head. There is an additional dimension so to speak to the issue, the barriers or costs to influence. There are some groups which due to their size, lack of capital and organization etc. are unable to exert a significant amount of influence. Students are a good example, they have a huge stake in what happens, and are usually one of the largest stakeholders, but rarely exert significant influence because they cannot organize for a variety of different reasons. So basically the political power influences the organizational behavior, but costs/barriers to power influence the amount of political power any particular group holds. The question is how to we accurately conceptualize and measure these relationships?

In some ways when you speak about the continuum I wonder if there’s almost another component to your model, both external/internal, potential influence and then the supply side factors that impact the ability of constituents to influence these organizations. I think back to Ben-Ner’s stakeholder theory and Steinberg’s failure theory in the nonprofit Bible. In both of these ‘theories’ they talk about the COSTS to collective action but ultimately I think these same elements could be applied to the COSTS to potential influence.

For example, in many universities even when tuition is raised for all students, you basically see student protests, and some media hits, but you don’t see a ton of other action/influence.

Do you think these COSTS to collective action, access, entry have some impact on influence?

Indeed, you were quite clear about your theme: fund-based art investments as a form of socially responsible investing. Unfortunately, governmental securities regulations here in the USA preclude me from commenting on personal involvement in your noteworthy topic. By the way, Europe seems to be leading the way in the formation of tangible investment funds

I urge you and any readers to purchase/read a most authoritative academic text (wonderfully annotated) I have encountered dealing with the broad investment concepts at work in the “traditional hobbies” of collecting fine items: “Collectible Investments for The High Net Worth Investor,” Stephen Satchell, Academic Press, 2009. Stephen is, amoungst many roles, the Reader in Financial Econometrics at Trinity Colledge, Cambridge.

Thank you for your kind reply. I do hope that we might get more participants.

As your case shows, these collections can become investments in the truest sense of the word: as a repository to save pieces for the future. Moreover, some of our finest museums have either grown out of large personal collections or have been the beneficiaries of major gifts of this kind.

I suggest art funds for the beginning ‘pure investor’ because this would be the simplest way to generate a financial return on art. People who have both investment and collecting motives are likely to want to buy artwork themselves, but there is a big learning curve to knowing about some of the price movements and rules of value construction. (Beginners in this area should probably take a look at Olav Velthuis’ book Talking Prices.) One major caveat is that contemporary art galleries do not like short term investors or ‘flippers’ and may do things like refusing to sell additional works to people who get a reputation for this behavior. This is because they are trying to build the long term careers of their artists, and price volatility can create problems.

As a side note- have you been to the finance museum in New York? It is a must-see for everyone interested in financial history. I have been hoping to find a museum of this kind in London as well, but so far have not found anything of this nature.

My collection was/is born of the appreciation for the intaglio art of reflecting commerce/agricultural, political, architectural, etc. reflections of the times (centuries past) when the currency and stock/bond certificates were produced. While I deployed investment techniques in the hobbyist pursuit, it has always been my motivation to: 1.) custodian all items for future generations to enjoy, and 2.) incrementally enhance each item by fitting it into a mosaic of choices, “correlation and integration” if I might borrow the terms, so that my individual collection style would add some artistic, historical and cultural perspectives to the items.

The ultimate “RoI’ here has been the thousands of hours of joy my pursuits have brought me. The lifetime fulfillment,though,has turned out to be the return, volatility and correlation attributes, and the preservationist satisfaction of knowing that generations which will not know physical financial media will pass it forward.”

It seems to me that I have both satisfied myself and others to come. For me, collecting artwork is socially responsible

Any thoughts of taking this and looking at other industries? Also, how could you explain away an alternate hypothesis that perhaps this is just correlated with nonprofits become organizationally/ financially adept and diversifying their revenue sources?

Would really love to hear your thoughts on this!