Many nonprofits would like to get young people involved as volunteers and donors, but they're not sure how to reach them.

Ryan Hodgson is using music to open the door. His organization, Team Up for Nonprofits, is hosting its second event in downtown Seattle tonight to benefit Seattle Works. They're getting a boost from local speed skater J.R. Celski. After meeting him through a colleague, Hodgson heard that Celski wanted to do a musical event to give money to a nonprofit and asked him to join forces with Team Up.

Each monthly Gigs4Good event supports a different nonprofit and combines entertainment with raising money and awareness. This time, Rotary is sponsoring the bands, which also helps local Rotary clubs connect to potential new members.

HARRY HOW/GETTY IMAGES

Speed skater J.R. Celski, a two-time Olympic bronze medalist, is appearing at the Gigs4Good concert tonight to benefit Seattle Works. He's combining interests in music and community as an ambassador for Team Up for Nonprofits.

"What we want is to have this active group of younger individuals in the community, and each time they come they get exposed to a new nonprofit," Hodgson said. The goal is to help young people find a cause that resonates and stick with it over time. "We really want to foster philanthropy and make it a lasting opportunity."

Beneficiaries include the arts, environment and social justice, and both large and small nonprofits.

"We're going to try to spread the love," he said.

People in their 20s and 30s may not have the incomes to write big checks yet, but they make up for it in energy, as Hodgson's own all-volunteer organization shows. It's also the mission of Seattle Works to give young people ways to volunteer, donate and lead projects in the community.

Hodgson, 36, now has a day job at Comcast, but before that he took six months off to get Team Up for Nonprofits off the ground, and volunteer board members have been busy spreading the word online. Part of the group's mission is to help train nonprofits to use social media to expand their reach.

Tapping in to new supporters is critical at a time when donations are lagging. A GuideStar study of more than 7,000 nonprofits found that 40 percent of charities reported a decline in giving in the first five months of this year. Yet more than 60 percent of nonprofits reported demand for their services has increased.

Three months after its first event, Team Up is now getting two or three emails a day from nonprofits that want to partner with it, Hodgson said.

The first Gigs4Good was relatively small and raised about $2,000, Hodgson said. Momentum has been building and the group is starting to get more sponsors to offset the costs for the musicians, venue and advertising.

"You have to do the hard work and prove you're going to stick around before people get involved," he said. "We're hoping to raise a lot more than that tonight."

Events are also planned in September and October. September's show at the Triple Door will benefit Bike Works.

Ambitions to solve problems of poverty are at an all-time high, especially among organizations dedicated to global development in Washington state. But the public appetite to finance them is not.

The U.S. will have to get more results out of the money it's spending and find innovations that come from technology to help bridge the gap, USAID Administrator Rajiv Shah told a Seattle audience this morning. He spoke to a packed crowd inside St. Mark's Cathedral at an event sponsored by Global Washington.

Shah, the former Gates Foundation executive tapped by President Obama to head international development, has brought the foundation's well known focus on measuring results to the government arm responsible for more than $20 billion in foreign aid.

The administration is living up to its commitment to double the foreign aid budget, he said. But to do that it must prove to taxpayers that the resources are used effectively and that seemingly intractable problems can actually be solved.

"If we can continue to show things are really effective, generate results with the dollars and take efficiency very, very seriously, I believe Americans want to do more," he said.

Shah issued a call to action to Washington state, known for its role in technology, to contribute innovative ideas.

He described a vision of the future in which science and technology, in the form of a tablet computer with an Internet connection, could help a farmer in a remote village get access to information such as market prices, and send photos of pests or diseases outside in asking for assistance.

Chris Elias, chief executive of the Seattle health non-profit PATH, cautioned that it's a mistake to equate innovation with technology. "Too often we think of it in terms of the gadgetry," he said. "You can't do a C-section through a cellphone."

The U.S. is contributing to health problems in places like Africa and India by encouraging the best trained doctors and nurses to leave and work here, said Rep. Jim McDermott, D-Seattle .

"We are sucking that brain power and leaving a huge vacuum in the third world," he said.

Shah said one of the ways the new evidence-based approach has improved programs came from recent efforts to assist Haiti. To boost access to safe water, USAID made it mandatory for trucks providing fresh water supplies to also distribute chlorine tablets to Haitians. Diarrheal disease is now 12 percent lower than it was the day before the earthquake, he said.

Marla Smith-Nilson, executive director of Seattle-based Water 1st International, said she was pleasantly surprised at the forum's message, but she still wanted to hear more about developing human capacity and stronger communities.

"I don't think there's any technology that is going to replace neighbors talking to neighbors about the importance of washing hands and the importance of actually using toilets," she said. "There's nothing that fits in a box on a shelf that is sold in a marketplace that is ever going to replace that kind of learning about public health and behavior change."

How much money is enough? Is a system that produces so many billionaires a fair one? Is it a good idea to ask billionaires to contribute their fortunes to charity? If they do, are the results going to be positive?

So far, 40 billionaires have responded to the challenge by Warren Buffett and Bill and Melinda Gates to donate at least half of their money to philanthropy. But "The Giving Pledge" has also inspired some deeper questions about the role of wealth in society.

New research reported by the Wall Street Journal finds that the top 5 percent of Americans by income are responsible for nearly as much consumer spending as the bottom 80 percent.

The U.S. hasn't seen such a high concentration of wealth since the 1920s, with a relatively small number of individuals at the top who have personal control of huge assets.

"It creates an opportunity for people of wealth to think about how much to keep and how much to give," said Jason Franklin, executive director of the group Bolder Giving and a lecturer on public administration at New York University. The new Gilded Age points to both "possibility in philanthropy and an indicator of inequality," he said.

Bolder Giving, founded by the Boston couple Anne and Christopher Ellinger, aims to get people across the economic spectrum to think about how to donate a higher percentage of their assets and how to become effective philanthropists who can inspire and collaborate with others.

Even with economic inequality of nearly historic proportions, average charitable giving in the U.S. has remained between 2 and 3 percent of income, the group says. Our "intense consumer culture urges people to accumulate more and spend more."

At the same time, society is in a period of great flux where a sense of energy and optimism mixes with heightened concern, Franklin said.

"We're in a volatile moment where it seems each time we turn around we're facing major concerns from the oil spill to the economy," he said. "It feels like we're really on the brink of change that could be positive, but we could also be on the brink of things changing negatively."

In early May, the small three-year-old organization got a call from the Gates Foundation "out of the blue" with an offer to support its work. "That's a call every non-profit dreams of," Franklin said. Six weeks later Bolder Giving received a $675,000 grant from the foundation to expand its reach. Melinda Gates has credited the group's work in talking about the impetus for The Giving Pledge.

Reaction to the Giving Pledge in some parts of the world, such as Germany, has been critical. Millionaires there said charity by the rich shouldn't be seen as a replacement for basic functions of government, according to an article by Der Spiegel.

"Forty superwealthy people want to decide what their money will be used for," said shipping magnate Peter Krämer. "That runs counter to the democratically legitimate state."

Franklin agrees there is a larger question about the implications for civil society and decision making. "Philanthropy is almost always motivated by the desire to help or give back," he said, though "it is giving back on an individual basis rather than collectively."

United Way of King County said it has raised $101.2 million through its annual campaign, making it the leading United Way in the country for fundraising.

Donations were about flat with last year's total of $101.8 million. The organization has consistently ranked number one even as totals have fluctuated with the economy. In 2008, the total raised was $116 million, following a record $121 million in 2007.

The drive ended June 30 with former Boeing Commercial Airplanes CEO Scott Carson as its chairman. The United Way credited him for helping keep the campaign on track despite "an extremely difficult fundraising climate."

"This hasn't been an easy climate for businesses or non-profits alike," said Jon Fine, the United Way of King County's chief executive.

One change from last year was a decrease in unrestricted funds given directly to United Way. More donors designated funds to specific programs and organizations that United Way supports. Of the total, donors gave United Way $35.5 million in unrestricted funds this year, down from $41.1 million last year.

The United Way wants to keep growing its pool of unrestricted funds, said spokesman Jared Erlandson. Those funds help it respond quickly when new issues arise, such as last year's shortage of emergency food supplies, and coordinate with companies, governments and other nonprofits, he said.

The organization is focusing on volunteers to help people in need and to offset operating costs, which are about 3.2 percent of the organization's budget. This year, for example, more than 600 volunteers prepared 14,000 federal tax returns at no charge for low and middle-income families.

"There is no better way to communicate United Way's impact in the community than to have someone see it first hand as a volunteer," Fine said.

Next year's campaign is being led by Microsoft General Counsel Brad Smith and SonoSite General Counsel Kathy Surace-Smith, who are married. Contributions from Microsoft, Boeing, Safeco Insurance Foundation and The Seattle Foundation have helped them raise $9 million so far.

The recent decision by its board to close Seattle nonprofit Unitus and shift its resources to "other strategic areas" prompted Adam Sorensen, a consultant working for the International Finance Corporation, to write a response questioning the actions. Here's his personal perspective:

Adam Sorensen, a Seattle native, is a microfinance consultant currently working in South Africa.

Unitus, the Seattle-based, non-profit microfinance organization announced 'Mission Accomplished' on the eve of July 4th by closing its offices in Seattle, Bangalore and Nairobi and dismissing its 45 staff members. Like the infamous declaration by George W. Bush in 2003, the decision by the Unitus board of directors is hardly justified. Despite the definitive claims of success, the closure of Unitus has only raised confusion about the organization and questions about the state of the microfinance industry.

The Chairman of Unitus, Joseph Grenny, who is also a Unitus co-founder, shocked the microfinance industry by declaring that Unitus' "central premise... has been validated - capital markets have embraced microfinance to the extent that there are tens of billions of dollars in microfinance capital now available." Although the recently-appointed, now-departing CEO of Unitus has not publicly commented on the closure, the longtime COO, Ed Bland, added that Unitus had become "unnecessary" in the microfinance industry, equating the growth of for-profit microfinance providers with the availability of commercial capital.

The declaration of victory refers to Unitus' goal to reduce poverty by rapidly accelerating the provision of microfinance to the poor using commercial capital. Until the declaration, the goal appeared far off. The Unitus web site accurately stated that "even after 30 years of industry effort, there remains a huge gulf between the supply and demand for microfinance services. Millions of families are still without access, and at current growth rates, the gap will not be closed for decades." Unitus tackled this challenge by raising capital and then channeling it to microfinance providers in developing countries, while providing consulting assistance to improve their growth and productivity.

By all accounts, Unitus executed its strategy well in India, with far less traction in other parts of the world. Since 2001, when it began hiring professional staff out of a converted bungalow in the shadow of the Microsoft campus, Unitus raised $40 million in donor funding to support 12 microfinance providers in India, three elsewhere in Asia, four in Latin America and three in Africa.

To fund the growth of microfinance providers, Unitus also created and spun-off two for-profit investment management and advisory firms, which mobilized a total of $30 million from investors, many of whom sought various blends of financial and social returns. In India, Unitus has partnered with well-managed providers that have achieved very rapid growth and demonstrated the viability of for-profit microfinance, including SKS Microfinance, which is due to issue an IPO for $250 million to $300 million in coming weeks. Elsewhere, Unitus has had less success introducing new sources of capital and driving growth, with significantly lower impact on the growth of providers outside of India.

While its contributions should be lauded, the Unitus' board's claims that a wave of commercial capital washed over the industry is unsubstantiated and dubious. Outside of India, Unitus' limited activities mirror the limited penetration of commercial capital in the microfinance industry. Globally, the microfinance industry remains financed primarily from subsidized sources, with truly commercial capital (i.e. non-subsidized) limited to a few large, profitable microfinance providers, many of which previously received donor funding.

According to the World Bank's Consultative Group to Assist the Poor, donors and investors each provided roughly 50% of total funding to the industry in 2009. Of investors' share, half was invested by the German government and four development banks - all public institutions - and another large, but unspecified slice was sourced from social investors. Regionally, subsidized funding is even more important in less-developed regions like Sub-Saharan Africa, where donors provide 75 percent of total funding in Sub-Saharan Africa.

As a non-profit advocating for commercial capital, Unitus unsurprisingly branded itself as a different kind of non-profit in the microfinance industry and the philanthropic world. It promised better results by bringing commercial discipline and business practices cultivated by the leading companies that it often recruited from. In keeping with its brand, Mr. Grenny has spun the closure of Unitus as a carefully planned, cutting-edge decision that was 18 months in the making and will bring better results for donors and greater impact on the poor.

For a non-profit organization preparing to close its doors, Unitus has recently taken a number of "innovative" actions including:

• October 2009: Hiring a new CEO with a long resume in microfinance
• April 2010: Announcing a $15 million partnership with the US government's Overseas Private Investment Corporation and Citigroup
• May 2010: Advertising staff positions for fundraising and regional offices
• May 2010: Announcing two new partners (Grama Vidiyal, India and AMK, Cambodia) for its social performance management initiative
• June 2010: Holding a fundraiser with the local microfinance community in Seattle

At an industry level, the trouble with the Unitus board's declaration and the unwinding of the organization is that there are serious issues facing microfinance providers, donors and investors. These issues challenge Unitus' view of the microfinance industry and its impact on the poor.

First, the 2007-08 commodity inflation bubble, followed shortly by the financial crisis and widespread economic distress, has pierced the oft-repeated assumption that microfinance is unaffected by the macroeconomic environment. Second, the rapid growth of microfinance providers, especially commercial players, in countries like Bosnia and Morocco has shown how uncontrolled microcredit extension can destabilize the industry at a national level. Finally, these difficult circumstances are compounded by an existential threat from a string of randomized-control trials have called into question the impact of microfinance as a strategy for poverty-reduction. Cumulatively, these developments demand the participation of Unitus as a proponent of commercial capital to spur the rapid growth of microfinance to reduce poverty - not a victory lap.

Although I have never donated to, invested in or worked for Unitus or its affiliates, I do have an interest in the microfinance industry. Since leaving the U.S. in 2005, I have worked in various roles to promote microfinance, from volunteer to manager to investor. While these experiences may qualify me as a member of the much-maligned 'international development complex', it is the interests of the poor and less-fortunate across the world that I hope to represent by questioning Unitus' departure from microfinance. If anything, I believe the economic hardships of the past three years have taught us that growth and opportunity are not guaranteed anywhere in the world. Without Unitus, there is one fewer reason why the poor and the less-fortunate may have access to microfinance tomorrow.

Granted, at least the Unitus board didn't splash their announcement across an aircraft carrier.

Seattle nonprofit Unitus' operating cost of between $600,000 and $700,000 a month was a factor in the board's decision to shutter operations, said Joseph Grenny, Unitus board chairman.

The abrupt announcement two weeks ago stunned employees and supporters, and has prompted some donors to question the decision.

Grenny said the decision was made by a unanimous vote of the five- member board of directors in Utah days before the announcement, but the discussion about changing direction had gone on for more than a year.

Next month the board will announce more specifically what its plans for the new direction will be, Grenny said.

When it was clear that Unitus would be pursuing a different strategy, the board asked, "Do we need an organization that has this kind of expense rate to pursue those options?" Grenny said. "To continue on for months and slowly drip that out would be fiscally irresponsible."

Unitus supports 22 microfinance institutions and plans to "quickly wind down any ongoing engagements in a prudent manner that prioritizes the best interests of their clients," Grenny said.

KEN LAMBERT/SEATTLE TIMES

Vikram Akula, founder and CEO of SKS Microfinance in India, appeared at a Unitus reception and fundraiser in Seattle.

As for foundations and individuals that have funded its work, such as the Omidyar Foundation, "the board takes its stewardship very seriously to ensure those funds are deployed for their original purpose -- philanthropic purposes that help the poor gain economic self-reliance," Grenny said. On its latest financial report, Unitus had about $11 million in net assets.

"We will have conversations with Omidyar and every one of our significant supporters about what funds are remaining and what those will use to accomplish," he said.

Today is the last day of work for most of Unitus' 45 employees; about a dozen will remain through end of August and a few through the end of the year.

SKS Microfinance, one of the earliest lenders to the poor that Unitus backed, plans its initial public offering in India in the next weeks.

Unitus Equity Fund, the for-profit arm of the Seattle organization, has a stake in SKS, which could end up benefiting Unitus.

Grenny called the SKS IPO "a validation of what we set out to do," in accelerating the amount of capital devoted to microfinance.

"The willingness to stop when something is accomplished isn't done much in the nonprofit field... organizations that don't contribute much continue on," he said. "Painful as it is, we're trying to do the right thing by the donors' intentions."

The system of U.S. foreign aid is broken, Seattle experts on development issues say. Now local non-profits, businesses and educational institutions hope to have a direct impact on how it's fixed.

To start, the U.S. needs a national strategy to clarify the goals of foreign aid, trade policy consistent with those goals, an easier process for small businesses to participate and support for international education programs.

KRISTI HEIM/SEATTLE TIMES

U.S. Sen. Maria Cantwell (left) speaks to audience members at a forum on global development at Seattle University.

Those recommendations from Global Washington, a Seattle association of 120 groups working in the field of global development, were released today and discussed by U.S. Sen. Maria Cantwell and others in a forum at Seattle University. The full report is here.

Cantwell said she and Sen. Patty Murray requested the recommendations last fall and will take them to back to Washington D.C. to contribute to the ongoing debate over how the U.S. should change its policy for foreign assistance.

Among the problems: flooding the market with food aid from overseas and causing local crop prices to drop, and trade tariffs that end up costing poor countries much more than the aid they receive.

In 2006, for example, the U.S. gave $120 million in aid to Bangladesh and Cambodia, while at the same time collecting $853 million from them in import duties. This report has further details.

Effective foreign aid can improve economic conditions and help fight terrorism, Cantwell said. Though the U.S. contributes less than 1 percent of its federal budget to foreign aid, polls show spending on aid is unpopular nationally, she said. More accountability of the funding is needed to measure and show results.

Washington is home to about 200 non-profits working on global development issues in 144 countries, according to Global Washington. They include global health, clean water and sanitation, food security, poverty and education.

"These are some of the most basic and life sustaining issues that demand involvement of us as a nation and certainly involve us in Washington state," Cantwell said.

Global Washington recommended that foreign aid be aligned with United Nations Millennium Development Goals, that USAID have autonomy from the departments of State and Defense, and that aid be based on priorities of local recipients and proportionally targeted to countries that are the poorest and most in need.

"We have the technology, we have the people and the passion. We need a structure for coordinating it and measuring the impact," said Yvonne Harrison, assistant professor of non profit leadership at Seattle University, who helped write the recommendations.

Washington is uniquely positioned to comment, Cantwell said, with almost 5 percent of all Peace Corps volunteers, the highest percentage of any state, as well as America's most diverse ZIP code -- 98118 in Rainier Valley, where people who speak 60 different languages now live.

Seattle's impact on the other Washington is already being felt in the number of people with positions in the Obama administration, including former Gates Foundation agricultural development director Rajiv Shah, now head of USAID, former Washington Gov. Gary Locke, now Commerce Secretary, and Travis Sullivan, a former Boeing executive now Locke's chief policy advisor.

Maura O'Neill, Cantwell's former chief of staff, now works under Shah as chief innovation officer at USAID and spoke at the Seattle event.

"My role is to be on the hunt for new breakthrough ideas and put innovative partnerships together," she said.

One of them was a $10 million partnership USAID recently announced with the Bill & Melinda Gates Foundation to develop mobile banking in Haiti. O'Neill said the project may be expanded globally.

Another is a USAID partnership with Coca-Cola to connect Haiti's mango growers to the drink maker's supply chain to provide juice for drinks under the Odwalla brand, she said.

USAID is working with U.S. companies in Indonesia, the third largest carbon emitter in the world, to develop new business models to reduce deforestation for palm oil production.

Investor Warren Buffett's annual donation to the Bill & Melinda Gates Foundation rose significantly with the value of Berkshire Hathaway stock this year, meaning the foundation will see a windfall of about $1.62 billion, according to the Wall Street Journal.

That's a 30 percent increase over last year's donation, which was the smallest amount since Buffett began distributing the gift in 2006.

Four years ago, Buffett pledged most of his fortune to the Gates Foundation, to be distributed in annual installments of Berkshire Hathaway Class B shares.

Berkshire Hathaway, a holding company, owns more than 70 businesses, including insurance companies General Re, National Indemnity and Geico, as well as stakes in Coca-Cola, Wells Fargo, Procter & Gamble, Burlington Northern and American Express.

The WSJ estimated the total value of Buffett's donation, including future gifts of shares he has pledged, to be about $39 billion as of Wednesday.

Next Tuesday Global Washington will release its recommendations for revamping U.S. foreign assistance from a panel of 45 local experts.

It's a good time to talk about strategies for improving aid after last weekend's meeting of G8 leaders, which many non-profit groups say failed to adequately fund basic programs to prevent the deaths of mothers and their newborns.

KIER GILMOUR/MCCLATCHY NEWSPAPERS

Protesters demonstrate on stilts while wearing masks portraying G8 leaders in Ontario, Canada, as the summit meetings began.

Humanitarian organizations had urged leaders of the eight wealthiest nations to double their collective spending on maternal and child health to $20 billion over five years, saying the money could save a million children a year and more than 200,000 mothers.

What the group offered was $5 billion over five years, with an additional $2.3 billion from others. The Gates Foundation is picking up most of the private tab with its $1.5 billion pledge, the second largest in its history.

"With economic uncertainty and the massive Gulf oil spill taking a significant toll in the U.S., it's not a shock that President Obama and other leaders shied away from greater commitments at this summit," said Robert Zachritz, director of advocacy for Federal Way-based World Vision. But it's shortsighted, he added. "Investing in global child and maternal health yields a high return for a tiny fraction of the sums spent so far on financial bailouts."

Politicians are absorbed by the world financial crisis and other mounting problems at home, and skepticism about the effectiveness and impact of U.S. foreign assistance has grown.

SCOTT OLSON/GETTY IMAGES

A highlight of the G8 meeting was the Muskoka Initiative to save 1.3 million children; a low was the funding to do it.

One lesson in all this may be that guilt doesn't work as effectively as self interest. Investments in global health in fact are an economic stimulus, argues Jack Chow, a CMU professor and former U.S. health ambassador under Secretary of State Colin Powell.

The combination of rising diseases and economic uncertainty calls for a new approach that can address both, he said.

"The G-20 leaders should recognize the connection between health and long-term economic security in both developing and developed countries," Chow argues. Healthy workers are more productive and can save more for food and medicines. Sound economies, in turn, permit greater investment in health." And, he might add, eventually buy the products that ailing economies like ours are making.

Chow suggested combining the two aims by promoting a health-jobs package for the poor, supported by alternative funding sources from the reserves of oil-rich and Asian exporting nations.

In Seattle, global health and biotechnology are important sectors that continue to add jobs in spite of the recession and inspire a generation of young people to tackle some of the world's toughest challenges.

One of the main recommendations of Global Washington is for the U.S. government to streamline the process for businesses, especially small businesses, to get involved in public-private projects designed to boost health and development in emerging markets. Trade policy should also be linked to development objectives, the Seattle non-profit argues.

Tueday's discussion will include examples of successful development partnerships in Washington state, with Sen. Maria Cantwell and Dr. Maura O'Neill, chief innovation officer at USAID, participating.

World Vision, whose foundation is faith-based, also uses economic terms to get its point across. It estimates that $15.5 billion in potential productivity is lost each year when mothers and babies die from preventable causes such as malnutrition and lack of basic health care. Each dollar invested in global health would create a $3 gain through extended healthy lifespan and faster economic growth, the organization says.

World Vision estimates it will spend $1.5 billion on child and maternal health over the next five years, making health a greater priority throughout its programs. The organization has an annual income of about $2.6 billion.

By Sandi Doughton

Funding for programs to boost health around the globe has continued to increase over the past few years, despite the economic downturn.

But the growth is unlikely to continue much longer, said Christopher Murray, director of the Institute for Health Metrics and Evaluation at the University of Washington.

An earlier analysis by Murray and his colleagues found that spending on global health programs quadrupled between 1990 and 2007, from $5.6 billion to nearly $22 billion.

The upswing was partly fueled by wealthy, private donors, including the Bill & Melinda Gates Foundation. The total includes funding from developed nations, corporations and NGOs.

But Murray said Thursday at IHME's annual board meeting that the previous report was outdated by the time it was released last year.

An update shows that funding climbed to $23.6 billion in 2008. Murray estimates it will hit about $29 billion this year.

Economic modeling predicts that the effects of the global recession will start to be felt in 2013, when total spending will probably dip, he said.

Founded with a $105 million grant from the Gates Foundation, IHME's mission is to bring rigorous statistical analysis to the evaluation of health programs and trends worldwide.

But the institute's work, which has uncovered exaggerated childhood vaccinations rates and undermined UNICEF claims of rapid declines in child death rates, has earned it animosity.

Dr. Richard Horton, editor of the British medical journal The Lancet -- which has published many of IHME's studies -- read the board members a scathing e-mail he received from another global health scientist, angry that Murray and his team were viewed as a "conquering hero," while those who have worked for decades on the front lines of global health are now portrayed as villains.

Horton urged IHME to reach out more to its critics, perhaps by sponsoring an annual conference focusing on global health science.

Ethiopian Health Minister Tedros Adhanom Ghebreyesus, a member of IHME's board, said the institute wouldn't be doing its job if there was no controversy about its work. But he suggested IHME make its work more useful to developing nations by tailoring analyses to individual countries.

The Gates/Buffett billionaire pledge drive provoked some thoughtful analysis as well as barbed commentary. Among the more interesting questions raised was this: why now? Why are wealthy Americans more interested in philanthropy, and if not, why do their peers think they should be? One answer is that they have a lot more money to give away.

The United States has seen a rise in income inequality over the past several decades. The sheer number of billionaires has also increased steeply. Take a look at this chart from Gapminder to watch the yellow billionaire balloon shoot to the top.

The U.S. has one of the best business environments for people like Buffett and Gates to make their fortunes. Yet when you look at wealth per person, several countries are doing better than the U.S. without many billionaires. Norway's GDP per capita, for example, is $49,000 compared to $43,000 for the U.S., and it has 4 billionaires compared to 415 in the U.S.

By the middle of this last decade, the U.S. had one of the highest levels of income inequality of any developed country, measured by something called the Gini coefficient. Since 1975, that number has steadily increased here, from .35 then to .45 today, according to OECD figures. (Click on the map to see more detail)

Arul Menezes, a principal architect at Microsoft Research, grew up in India and came to the United States in 1988. He told me an anecdote about his experience living here that I found striking.

One of the things that drew him to the U.S. initially was the relative equality and meritocracy of the society, education system and economy, he said.

"There wasn't an entrenched elite with all the power and wealth," he said. "It was a society where there was opportunity to almost anyone from almost any background to achieve almost anything."

Houses built 40 years ago were much more modest than the mansions of Medina today. And yet on comparably less, people found the money to pay for infrastructure and community centers, he said.

Of course, Microsoft has helped produced quite a few of those Medina millionaires and several billionaires, but Menezes speaks to a broader trend.

"People didn't have granite counters but they had good roads, good schools and good universities," he said. "Instead we have 6,000 square foot houses -- time will tell whether that was a good choice."

Lack of money for education, a jobless recovery and massive public debt is creating whole new problems for philanthropy to solve. No matter how laudable the personal causes of billionaire philanthropists, the upshot is that too much decision making power is concentrated in the hands of a few.

"A lot of countries have settled into long periods of time into the status quo of an endemic elite and disenfranchised majority with little movement between the two," Menezes said. " I don't think the U.S. is anywhere near there, but I can see the risk."

Bill and Melinda Gates and Warren Buffett are launching a drive to persuade billionaires to give away the majority of their fortunes.

They are asking fellow billionaires to sign a "Giving Pledge," making a public statement to donate most of their wealth to philanthropic causes of their choice.

The pledge isn't legally binding, but they hope the effort will generate more money to address important social problems and set a standard that becomes the norm, former Gates Foundation CEO Patty Stonesifer, who is an adviser to the Gateses, said in an interview today.

SETH WENIG/ASSOCIATED PRESS

Investor Warren Buffett, who is ranked as the third richest person in the world, is donating most of his wealth to the Gates Foundation.

Buffett, who pledged to give away more than 99 percent of his $47 billion fortune, was the main driver of the initiative, which has the support of a couple dozen billionaires, Stonesifer said. Buffett was inspired not by the rich but by the generosity of ordinary people who sacrifice more to contribute hard earned dollars to churches, schools and other organizations.

The idea came out of a series of private dinners the Gateses and Buffett held in New York and the San Francisco Bay Area over the past year. They will invite people who take the pledge to meet at an annual event to share ideas.

The potential for philanthropy is huge -- the United States alone has at least 400 billionaires with a net worth Forbes estimates at $1.2 trillion. If those billionaires gave the minimum pledge of half of their fortunes to charity, that would triple the current amount of charitable giving in the U.S.

"That could be transformational," said Phil Buchanan, president of the Center for Effective Philanthropy. "It could have a dramatic effect on some of the toughest social challenges that we face. But people have to do it first."

The Giving Pledge does not involve pooling money or supporting particular causes. But philanthropic efforts have the most impact when different non-profits and foundations unite around the same cause, often bringing in support from businesses and policymakers, Buchanan said.

"There are so many pressing human needs and the temptation is so great to want to address all of them," Buchanan said. "There's going to need to be collaboration among philanthropists to move the needle in significant ways."

Four couples have already signed on to the pledge, Stonesifer said. They are Eli and Edythe Broad, John and Ann Doerr, Gerry and Marguerite Lenfest and John and Tashia Morgridge.

In his pledge letter today, Buffett describes how having too much wealth is a burden.

"Too often, a vast collection of possessions ends up possessing its owner," he wrote.
"Were we to use more than 1% of my claim checks on ourselves, neither our happiness nor our well-being would be enhanced."

How are some of the country's billionaires reacting to the plan? Forbes has an interesting smattering of answers from Donald Trump and others here.

Washington state is home to six billionaires: Bill Gates, Microsoft Chief Executive Steve Ballmer, Microsoft co-founder Paul Allen, Amazon.com Chief Executive Jeffrey Bezos, wireless entrepreneur Craig McCaw and Oakley sun glasses creator James Jannard, who lists his residence in the San Juan Islands.

"This is an exciting idea and sets a new standard for charitable giving," said Susan Coliton, vice president of the Paul G. Allen Family Foundation. Allen was out of the country and unavailable for comment. He has been ranked among the top philanthropists for years, Coliton said, adding "I am sure he will be interested in learning more about this challenge from Warren Buffett and Bill and Melinda Gates."

Ballmer said in a recent interview that he and his wife preferred to keep their philanthropy private and anonymous. McCaw declined to comment. Bezos and Jannard could not be reached Wednesday.

Leaders of the pledge will have their work cut out for them. It turns out the richest Americans are not all that generous.

"We agree with Andrew Carnegie's wisdom that 'The man who dies rich, dies disgraced,' and we also believe 'he who gives while he lives also knows where it goes,'" the Broads said today in a statement along with their pledge to give 75 percent of their wealth to charity.

Giving may be rewarding, but it's not that easy, they said.

"Philanthropy is much harder than running two Fortune 500 companies."

In the face of the ongoing environmental disaster in the Gulf of Mexico, the U.S. Senate must pass a clean energy and climate change bill now.

That urgent call today came not from the usual environmental advocates but from business leaders who see their economic landscape eroding along with the melting glaciers without some immediate action.

WIN MCNAMEE/GETTY IMAGES

Contract workers from BP ferry contaminated waste from the Deepwater Horizon disaster while other workers use skimmers to clean oil from a marsh in Louisiana. This map helps to visualize the size of the disaster if it were here in Puget Sound.

Weyerhaeuser, Nike and other companies from around the Northwest joined Olympia-based non-profit Climate Solutions in urging the Senate to act. They spoke on a conference call with journalists this morning.

Unveiled last month in the Senate, the American Power Act aims to cut greenhouse gases, reduce oil imports and create millions of new energy-related jobs.

Climate Solutions' Ross Macfarlane said the bill has the backing of hundreds of Northwest companies for a variety of reasons, including increasing American competitiveness, creating a stable and predictable environment for investments, protecting national security and minimizing the damage that businesses are seeing in natural resources.

While the bill isn't perfect, the most important element is "a strong and escalating price signal on global warming pollution and carbon dioxide," Macfarlane said.

He also cited recent polls in Oregon and Washington that show public support for clean energy and climate legislation. Washington voters supported legislation by a 13 point margin, while Oregon voters supported it by an 18 point margin, according to surveys done in late May by Public Policy Polling.

The $730 billion U.S. outdoor recreation industry, which includes companies such as REI, Timberland, The North Face and Patagonia, supports 1 in 20 jobs, said Amy Roberts, vice president of government affairs at the Outdoor Industry Association. A warming climate is taking a toll on the ecosystem and the economy, she said, and among the effects is a decline in snow packs, which shortens ski seasons.

Clay Young, co-founder and CEO of Inovus Solar in Boise, said developing new energy technology is a huge opportunity, but he sees this country falling behind. The U.S. is facing strong competition from Chinese companies because of investments and incentives China is making in clean energy.

"We are more and more looking at sourcing energy technology outside the U.S.," he said. "I see our leadership in this sector as waning not gaining."

Changes to energy policy, with a focus on taxing carbon, are needed to stimulate innovation from the private sector, Young said.

Denny Gignoux owns and operates Glacier Wilderness Guides at Glacier National Park in Montana. As the park celebrates its 100th anniversary, the number of glaciers there has dwindled from 150 to 25, he said.

"We're looking at the loss of one of our main attractions," he said. "Where is it going to be for our children and grandchildren?"

Arlo Skari, a Montana farmer, said rising temperatures have brought more flies and insect damage to the state's wheat varieties. As snow melts earlier, spring runoff depletes water supplies, leaving shortages in late summer.

For Nike, its typical consumers are young, active and concerned about climate change, and will be more impacted by it than generations before, said Sarah Severn, director of stakeholder mobilization for Nike.

The company's global supply chain relies on cotton production, which is vulnerable to changing weather patterns, she said.

For Weyerhaeuser, a national policy on carbon emissions makes more sense than state by state legislation, said Sara Kendall, vice president for environment, health, safety and sustainability. The company is looking at ways to turn plant fibers into cellulosic biofuels. "Good policy will allow us to accelerate these investments," Kendall said.

Convincing Northwest businesses to get behind the legislation may be a lot easier than bringing coal companies, automakers or other heavy industrial manufacturers on board.

Ultimately a lot more is at stake than the bottom line.

"Without leadership from the U.S.," said Severn, "the rest of the world will have difficulty coming together" on a climate change agreement.

Last year was the worst year for non-profit fundraising in a decade, and all but 10 percent of non-profits in the U.S. are expecting this year to be as difficult or more so, in terms of demand for services and available resources.

Update: The Foundation Center reported Friday that U.S. charitable foundations cut their 2009 giving by a record 8.4 percent. Grant dollars fell from $46.8 billion to $42.9 billion, the largest decline the center has recorded.

How do such dismal national results compare with the Northwest?

Philanthropy Northwest surveyed more than 100 foundations at different times, replicating a survey done nationally by the Council on Foundations.

In the spring of 2009, the number of foundations predicting their grant-making would decrease more than 10 percent was 44 percent nationally, and 40 percent in the Northwest, said Philanthropy Northwest CEO Carol Lewis.

She is presenting a detailed report on trends in Northwest giving April 22 in a free public program.

In the fall of 2009, Lewis surveyed her members to look ahead to 2010. Almost 60 percent said their grant-making would stay the same, showing a leveling out that "actually seemed encouraging," she said.

"Flat is the new up."

However, almost 20 percent said they will cut their grant making by more than 10 percent.

"There definitely is going to be disruption out there and non-profits that feel the pinch," Lewis said. Arts organizations and environmental groups may be hit hardest, she added, because some funders have diverted resources from those causes to basic services like food and shelter.

Northwest nonprofits received more than $1 billion from foundations in 2008, a high water mark year. Giving increased dramatically between 2004 and 2008, and even faster when the Gates Foundation was excluded from results.

"Philanthropy grew very quickly across the region between 2004 and 2008, more quickly than nationally. In some respects we are operating from a stronger base than the rest of country, and we've seen less of a decline."

Yet the hardship is real for non-profits. "It doesn't take a complete decline to make your life miserable -- you just need to have the one big foundation you rely on go south," Lewis said.

That's why non-profits with loyal individual donors are probably going to be more secure than those that rely on a couple of foundations.

Looking at the national picture, the Association of Fundraising Professional's annual survey released this week found that the economy is still putting a damper on efforts to raise funds, with just 43 percent of charities raising more money in 2009 over 2008, 46 percent raising less money and 11 percent about even.

"These figures represent a low mark in fundraising over the past 10 years and quite possibly since the 1980s," said AFP President Paulette Maehara. "We've never seen so many organizations raise such few funds."

A separate survey by the Nonprofit Finance Fund of more than 1,300 nonprofit leaders nationwide found that almost 90 percent expected 2010 to be as hard or harder than last year; 80 percent expected to see more demand for their services, and 61 percent had less than three months cash on hand (12 percent had no cash). Only 18 percent of organizations expected to end the year in the black.

However the AFP found that the majority of its respondents felt prospects were improving -- more than 60 percent believe they will raise more money in 2010 than in 2009.

The Foundation Center said the decline in giving last year was tempered by increased giving by the Bill & Melinda Gates Foundation, and decisions by a significant number of funders to cut expenses and/or dip into their their endowments to bolster their giving.

And the center forecasts that 2010 foundation giving will remain flat, which is a less pessimistic outlook than a year ago.

Some rich Americans are leading a tax revolt of sorts -- to pay more, not less.

Judy Pigott, a Seattle author, philanthropist and an heir to the Paccar fortune, is among the group of wealthy individuals calling on Congress to end tax breaks that have enriched people like her.

They have signed a Tax Fairness Pledge to take the money they saved as part of tax cuts enacted under President George W. Bush and donate it to groups working to overturn those policies.

The tax cuts were "based on the erroneous assumption that the trickle-down effect would somehow benefit everyone," Pigott said. "What we have now is the greatest wealth disparity since the Great Depression."

She is part of a group called Responsible Wealth, a project of the non-profit United for a Fair Economy. The network of 700 individuals who are among the wealthiest 5 percent in the United States includes Jeffrey Hollender, the co-founder of Seventh Generation natural products, and Eric Schoenberg, an economist at Columbia University and former investment banker.

United for a Fair Economy, which has worked to prevent permanent repeal of the estate tax, is now trying to counteract "Tea Party" protests over higher taxes, and argues that eliminating the tax cuts for the wealthiest Americans is one solution to the country's deficit.

They want Congress to restore the 39.6 percent and 36 percent rates on the highest income earners (those with household incomes over $200,000) and end special treatment of dividends and capital gains.

"Half the deficit comes from taxes that weren't taken from people who could have afforded to pay those taxes," Pigott said.

She has supported the effort for four years. Last year she donated about $600,000, half of which was savings from tax cuts, she said.

Why not just keep giving the surplus away?

"I think it is the national government that can deal with clean air, water, national transportation systems, education," she said. "l see those things are in trouble on a state level and on a national level because we don't have the money. Yes we can do a lot, but we can't do what the federal government can do."

Pigott, co-founder of Personal Safety Nets, is the daughter of the late Formula One race car driver Pat Pigott and the granddaughter of Paul Pigott, who owned the truck company that is now Paccar. Paccar CEO Mark Pigott is one of her cousins.

Asked whether she has approached members of her family about the tax cuts, Judy Pigott said she has talked to her cousins. "I'll just say we have a large enough family that we cover all points of view and a solid enough family that we can agree to disagree."

Another member of the network is Arul Menezes, who came to the U.S. as a graduate student with $250 and earned his wealth over the past 20 years at Microsoft. Investments made decades ago created the universities and research systems that helped him succeed, he said.

Menezes said that while the tax cuts have saved him more than $20,000 a year, he worries about the long-term impact.

"The tax cut was paid for entirely with borrowing," he said, while funding for schools, roads and research was cut. With a deficit of $1.5 trillion this year, "that's just robbing the bank," he said.

Menezes said has stepped up his charitable giving as a result of the tax savings. But that won't have the same effect as reworking the tax system, he said.

Menezes said that while he paid 15 percent in capital gains tax, a person making $30,000 to $80,000 would pay 40.3 percent for federal income tax plus Social Security and Medicare.

"It's grotesquely unjust," he said. "It embarrasses me to go into a grocery store and know that the person at the checkout stand is paying a higher tax rate than I am."

To look out at Puget Sound on a clear day is to be dazzled by its beauty. But that's just the surface.

Elliott Norse, president of Marine Conservation Biology Institute, a non-profit in Bellevue, struggles with the fundamental problem of public awareness about what's underneath.

Unfortunately, "out of sight is out of mind," he says, despite the fact that oceans make up 99 percent of the habitable space on Earth and provide half of our oxygen.

MARK HARRISON/SEATTLE TIMES

Kayakers paddle back to the beach after an evening outing in Puget Sound.

He's blunt about the problem -- the way too many people, industries and government agencies are treating the oceans.

"Oceans have two purposes -- to take things out, like bluefin tuna, and put things in, like feces," he said. Norse founded the institute in 1996 with a mission he describes as "science for the sake of change," applying marine conservation to strengthen policy.

In the Puget Sound area, almost three million people live on a large mass of land surrounding a relatively small body of water, flushing toilets, changing oil, fertilizing lawns, bleaching laundry and creating other human impacts that the abundant rain washes into the sound, he said.

But the biggest menace is carbon dioxide, which is making ocean waters more acidic and threatening local shellfish, among other effects. It's no longer a problem that can be solved locally, Norse believes. The oceans are declining so dramatically that change will have to be from the top.

Pushing on the policy side, the institute worked to curb bottom trawling and helped convince the Bush Administration to establish three new marine national monuments, creating the world's biggest marine protected area.

"Most Americans don't know that George W. Bush was the best friend of the oceans we've ever had," Norse said.

Norse was optimistic that the Obama Administration would do even more.

One of the institute's main goals is to work with the administration on a National Ocean Policy, which President Obama was on the verge of announcing.

The national policy would mean a coordinated focus on U.S. waters, now subject to 20 federal agencies, state and local governments, and more than 140 different federal laws and regulations, and management based on the idea of environmental stewardship, Norse said.

One of its backers is Jane Lubchenco, the former Oregon State professor now administrator of the National Oceanic and Atmospheric Administration (NOAA).

A National Ocean Council would integrate the different branches of government, and a system of Marine Spacial Planning would help determine things like which areas are most fragile, which are best for wind and wave power and how that would affect fishing.

Amid that progress came Wednesday's reversal of a ban on oil drilling off most U.S. shores, which Obama announced as part of a new policy that could mean oil and natural gas platforms in waters along the southern Atlantic coastline, the eastern Gulf of Mexico and part of Alaska. He explained the change in the context of the nation's need for energy and jobs to keep American businesses competitive.

Norse called it "a carefully calculated political decision," but one he's not sure will achieve its goals.

"This is a president who plays things down the middle. He makes decisions that won't always make his friends or his enemies happy," he said. "This is not something I wanted to see. It's a major change and it's one that has all sorts of ramifications."

One of them is that an intelligent national policy is needed more than ever to balance economic and environmental interests, he said.

"I wish we didn't need to drill for oil, but on the other hand we are addicted to it," he said. "I think we need to understand that our addiction has costs."

Hans Rosling, who will be in town Thursday to speak at the Seattle Biomedical Research Institute's annual Passport to Global Health event, is a physician from Sweden who has created a unique way of visualizing data to make sense out of global trends.

In the process, the rumpled hair professor has become a kind of rock star in tech and global health circles whose fans include Bill Gates.

With his non-profit Gapminder, Rosling's mission is "converting boring numbers into enjoyable, animated and interactive graphics."

PHOTO BY STEFAN NILSSON

Hans Rosling teaches global health and uses data animation to bust common myths about development.

Gapminder depicts countries as bubbles and they move along a chart tracking things like incomes, literacy rates, child mortality and life expectancy. The bubbles are colored according to geographic regions of the world, and each expands along with a country's population growth. Watching the moving bubbles over the decades gives a real sense of how the world has changed and what factors have made a difference.

The data shows that it makes sense for countries to invest in reducing child mortality because "you can move much faster if you're healthy first than if you're wealthy first," he said.

Rosling made a presentation on the tool at the TED conference, and I'm eager to see what he has in store for the Seattle audience.

The library of available data is vast. Some of the more interesting comparisons I've found: plotting the way China is projected to narrow the gap with the UK in the five years after the global economic crisis, and comparing Washington state's income and infant mortality against the rest of the world (you have to check the box for Washington state to see it highlighted in the graph). Any way you slice it, compressing hundreds of years of history into a five-minute video graph seems perfect for the Internet generation.

An equity fund focused on poverty? Sounds odd, I know. But Chris Brookfield, who managed funds for Unitus, and his partners at Elevar said today they have raised $70 million to invest in companies providing services to people at the bottom of the economic ladder. Elevar told me a bit about the fund last June.

Seattle-based Elevar will invest in companies involved in microfinance and other services targeted at the working poor in countries such as India, Mexico, the Philippines and Peru.

KEN LAMBERT/SEATTLE TIMES

Chris Brookfield, left, then Unitus Equity Fund's investment director, with Veena Mankar, director of Swadhaar FinAccess, at a 2007 reception in Seattle.

Elevar is the second fund of Unitus Equity Fund, initially run as a for-profit arm of Unitus, a Seattle-based non-profit organization. Elevar is now independent of Unitus, though it remains a strategic partner, Brookfield said.

Besides microfinance, Brookfield said Elevar will also seek to invest in financing low income housing, agriculture and information services. The idea is to bring more commercial capital into development.

Improving incomes of billions of poor people -- the so-called "Next 4 Billion" -- has benefits for companies here, too. Economic growth in developing countries "is the strongest opportunity for long-term business growth," according to this report by the IGD, since the poorest two-thirds of the world's population represent $5 trillion in purchasing power. The more development can be supported through investment, the less dependent countries will be on foreign aid. The majority of poor countries don't attract much private investment, so it will be interesting to see whether a socially motivated fund can create a path for it.

"Our strategy is to challenge discrimination and democratize the distribution of opportunity by investing in companies providing high volume, low cost services to the poor and their communities," Sandeep Farias, managing director at Elevar, said in a statement.

The anchors of the new fund are Legatum and Omidyar Network.

Elevar's portfolio includes microfinance institutions SKS Microfinance, Ujjivan, Grama Vidiyal, Madura Microfinance and Swadhaar in India; Grupo Crediexpress in Mexico and FINSOL in Brazil.

Elevar has also invested two non-financial services companies in India: Moksha Yug Access, which builds trading infrastructure and market links between rural communities and larger commercial markets, and Comat Technologies, which provides Internet connectivity in rural areas for government services and education.

Only 4 percent of the 400 wealthiest Americans listed by Forbes magazine were among the top 50 donors in the country, according to a tally of the nation's leading philanthropists in 2009.

Those top 50 donors gave a total of $4.1 billion to charity in 2009, according to the Chronicle of Philanthropy, which compiles the list every year.

While it's separate from the Forbes richest list, said the Chronicle's Cynthia Powell, "when we cross compared that with who has the most money, we were just struck by the fact that of the 400 richest Americans, only 17 are giving a lot of money away."

The other most generous Americans were not wealthy enough to make the Forbes list but showed a greater ambition to use their money toward solving social problems, along with a more creative approach, she said.

Here is the Chronicle's list of the top 50 donors.

One obvious question is where are the other 383 richest Americans, the remaining 96 percent, when it comes to philanthropy? Here is the Forbes richest list.

Generosity took a hit along with diminished portfolios in the recession. In 2009, the top donors gave only about a quarter of the money they gave in the previous year. In 2008, the top 50 gifts totaled $15.5 billion.

The top 10 donors in 2009 were:

1. Stanley and Fiona Druckenmiller $705 million to the Druckenmiller Foundation
2. John M. Templeton (Bequest) $573 million to the Templeton Foundation
3. Bill and Melinda Gates, $350 million to the Gates Foundation
4. Michael R. Bloomberg, $254 million to 1,358 groups
5. Louise Nippert, $185 million to the Greenacres Foundation
6. George Soros, $150 million for Fund for Policy Reform and Central Europe Univ
7. Eli and Edythe L. Broad, $105.2 million to the Broad Foundations
8. J. Ronald and Frances Terwilliger, $102 million to Habitat for Humanity and others
9. William P. Clements Jr., $100 million to Southwestern Medical Foundation
10. Pierre and Pam Omidyar, $92 million to Hawaii Community Foundation and others

(Paul Allen was #11 with $85 million, the only other local donor I could find on the list).

A microenterprise program that mentors Latina women to become successful food vendors in local farmers markets was among the 66 non-profits awarded a total of $4.6 million in grants by the Paul G. Allen Family Foundation today.

The Hacienda Community Development Corporation in Portland received $200,000 to expand its Micro Mercantes program. In Seattle, the White Center Community Development Association also received a $200,000 grant to develop a green jobs initiative. That program aims to use federal stimulus funding to train young adults in home weatherization and related skills. It even has its own hip hop video Got Green?

The latest grants reflect a focus on strengthening the social safety net for people living on the financial edge and supporting longer-term programs for people with low incomes to build economic stability, the foundation said.

"During one of the most dramatic economic downturns in history, we remain committed to helping our nonprofit partners and the communities they support respond and adapt to these growing challenges," said Susan M. Coliton, the foundation's vice president.

Other grants included $400,000 to the Washington State STEM Education Foundation in Kennewick. That grant helps fund professional development for teachers at Delta High School, a new high school focused on science, technology, engineering and mathematics in the Tri-Cities region.

Local arts grants included $25,000 to the Seattle Chamber Music Festival for marketing initiatives to increase ticket sales and expand its 2010 Summer Festival audience, and $50,000 to the Northwest African American Museum to develop a marketing and outreach program to promote the museum.

Food from vendors in the Micro Mercantes program is getting good reviews in Portland. Maybe it will be expanded to Seattle's numerous farmers markets if it's not already in the works.

In the heart of Vancouver's poorest neighborhood, a thriving business is helping homeless and low-income people earn money by cleaning up the environment.

United We Can pays about 700 people a day deposits on recyclable containers they've collected, distributing more than $2 million a year to "binners" who eke out a living rummaging through garbage. I profiled the non-profit and its founder Ken Lyotier in this story today.

KRISTI HEIM

United We Can safety trainer James Hance, who grew up in Vancouver's tough Downtown Eastside, says he'd rather stay and help the community than work elsewhere. He stands in front of a T-shirt with a corner chewed off by rats in the organization's aging warehouse.

In addition, the non-profit employs 150 part-time and full-time workers to pick up from local businesses, sort bottles and cans in its warehouse, and haul them to a recycling center. United We Can earns a handling fee from beverage producers, who are required by law to ensure that their containers are refilled or recycled. The handling fee supports United We Can's operations, making it a sustainable business.

United We Can will be able to expand its work during the Olympics, hiring 60 additional people to help collect containers around downtown and at local hotels and restaurants.

KRISTI HEIM/SEATTLE TIMES

People line up with carts full of recyclables outside United We Can's bottle depot along East Hastings Street. The average "binner" earns about $10 a day.

Lyotier, who battled homelessness, alcoholism and drug addiction himself, said he has never turned away anyone who wanted to work.

"Many of the people working at United We Can came from the streets," he said.

"I personally believe that when people who have had obstacles discover they do have value," Lyotier said, "they sometimes make the choice to move on to a more normal model of what success means."

Vancouver's Downtown Eastside is notorious for a concentration of social problems such as open drug dealing, homelessness, mental illness and prostitution. Blocks away from Olympics venues, the neighborhood will face a global spotlight next month as the focus of protests by activists who are frustrated by a lack of progress on social issues. And yet people at the busy bottle depot see a resilient community underneath.

"You hear a lot of bad stuff but I see so many good things," said United We Can safety trainer James Hance. "Everyone says all you find is misery here, but I find more kindness here than lots of other areas."

The new face of U.S. foreign assistance stared into my living room from the TV screen, looking very familiar. There was Rajiv Shah, the former Gates Foundation agricultural development director, being interviewed by Jim Lehrer about Haiti.

Just when I was getting ready to write about how Shah must prepare to tackle things like streamlining bureaucracy, localizing programs and funding, and strengthening support for democratic governance (no pressure), along comes the biggest disaster in two centuries, striking an already fragile nation 700 miles from Miami. Now Shah, 36, is leading U.S. relief efforts just six days after being sworn into office.

COURTESY OF USAID

Rajiv Shah is sworn in as USAID Administrator as Secretary of State Hillary Clinton and Shah's family look on. Shah had supported her presidential campaign.

It's interesting to think that Shah was chosen to head the organization after the humanitarian physician Paul Farmer pulled out of the running last summer. Farmer, chairman of Harvard Medical School's Department of Global Health and Social Medicine, had dedicated so much of his life to improving health conditions in Haiti through Partners in Health that he would have seemed almost destined for that moment.

At Shah's swearing in ceremony, U.S. Secretary of State Hillary Clinton lauded his passion, vision and quiet humility, his degrees in medicine and business and experience with the Gates Foundation. "He brings determination and an unwavering belief that anything is possible," she said.

Shah, in turn, said that belief "was founded on our country's rich experience turning crisis into progress."

Shah talked about the necessity of reforming USAID to create stronger local systems in the countries it helps, staying focused on tracking progress and elevating the position of women and girls. Now more than ever the world has the ability -- and the technology -- to create massive improvements in the human condition, he said.

"We find ourselves in a unique moment of opportunity," he said. "A powerful consensus has formed that development is vital both to our national security and the shared interests of an interconnected world."

On TV tonight Shah looked like he hadn't slept in a long time. He talked about President Obama's commitment to focus U.S. efforts around saving lives in the first 72 hours after the quake, working with various branches of the federal government and in partnership with other countries to be as effective as possible. He projected a steady, smart and genuine presence.

Shah's first major test is also an opportunity for the country to show a struggling neighbor how it intends to redefine its role in the world.

With the success of microcredit, poor people have access to more loans than ever before. But many are still stashing savings in a lock box, storing it with a "money guard" or pooling it in an informal savings club because they have no other options.

Many banks and other institutions don't make savings accounts available to the poorest borrowers.

Today the Bill & Melinda Gates Foundation is contributing $38 million in grants in a push to help leading microfinance institutions (MFIs) offer clients safe and affordable places to save money.

"We see it as a major step to drive change and help broaden the microfinance business model to include savings," said Bob Christen, the foundation's director of Financial Services for the Poor.

GRAMEEN FOUNDATION

Members do banking at ACSI, a microfinance institution in Ethiopia's Amhara region, which depends largely on agriculture. ACSI provides savings accounts for more than 586,000 people.

Six grants will help 18 institutions expand their portfolios and make savings accounts available to 11 million people in Africa, Asia, and Latin America over the next five years. The challenge of finding ways to reach poor savers is being met with the help of motorcycles, PDAs, mobile phones and even soap operas.

The largest grant, $9.8 million, will go to the Grameen Foundation to begin a Microsavings Initiative with partners in Ethiopia, India and the Philippines to test and fine tune models for savings for people at the bottom of the economic ladder -- those living on about $1.25 per day.

Even at that level, people are putting away small amounts -- often pennies at a time -- and using sophisticated balancing acts to stretch their capability. But the informal savings methods often lead to financial losses.

Many of the poorest people live far from cities, so the cost of traveling to a bank is too high. It's also expensive for banks to create branches in remote areas where the number of clients is limited and their deposits small.

A $5.8 million grant to ACCION International will focus on agent banking, mobile banks, and access to savings accounts over mobile phones. A $3.3 million grant to World Vision will help it offer savings accounts to rural farmers and poor people in Ethiopia through mobile technologies, including equipping savings offers with PDAs and motorbikes to travel to clients in outlying communities.

Collecting more savings deposits from local customers could help the microfinance institutions reduce their reliance on external funding from commercial banks, becoming more like community banks in the United States, said Kate Druschel Griffin, director of the solutions for the poorest initiative at the Grameen Foundation.

GRAMEEN FOUNDATION

The microfinance institution ACSI holds a meeting for clients in Ethiopia's rural Amhara region.

"For us it's how do we make sure we are enabling the poor households to have tools they need to work their way out of poverty," she said. Grameen's initiative aims to reach 1.45 million new savers over three years. Besides a safer place to store assets, clients can earn interest -- ACSI, Grameen's partner in Ethiopia, provides 5 percent interest on regular savings accounts, and between 5.25 and 5.5 percent on time deposits.

The Grameen Foundation has begun using a tool called the "progress out of poverty index" to measure the impact of credit and savings programs on borrowers. The index measures a range of non financial indicators, such as housing type and sanitation type to see whether living conditions improve.

An $8.5 million grant will go to Women's World Banking (WWB), a network of leading microfinance institutions and banks dedicated to the economic empowerment of women.

The grant will help WWB to create new savings products and services for nearly seven million low-income people in Latin America, Africa and Asia.

WWB will use the money to support its network members invest in market research, product design, marketing and sales and service delivery methods. The members are Banco ADOPEM in the Dominican Republic, WWB Colombia, Kenya Women Finance Trust, and Kashf Microfinance Bank in Pakistan.

"As the microfinance industry matures, we are seeing the beginning of a major shift from a focus on credit to an emphasis on savings," said WWB president and CEO Mary Ellen Iskenderian, adding that demand for savings among the poor is increasing.

WWB found that poor people save between 10 to 15 percent of their monthly household income, using it to pay for childrens' education, health emergencies, housing and marriage.

Since women tend to be the savers in a poor household, designing savings products for them is critical, WWB said.

Using a creative approach, WWB will launch a TV soap opera in the Dominican Republic, part of a financial literacy campaign to bring attention to the benefits of savings. WWB said it seeks to change cultural attitudes and behaviors related to money and will work with Puntos de Encuentro, a Nicaraguan NGO that has used TV serial drama to successfully affect social change.

"Loans or credit were the model for the first 30 years of microfinance," said Iskenderian. "Savings is the future."

You know things are out of whack when an investment bank is considering forcing its employees to donate to charity.

That plan is reportedly in the works at Goldman Sachs, with bonuses, some as high as eight figures, being paid to bankers this week.

Expected bonuses at Goldman Sachs average about $595,000 per employee, while employees of JPMorgan Chase average about $463,000.

Big banks are undoubtedly taking preemptive measures to ward off further public rage following the massive taxpayer bailout, and this is a year when non-profits could certainly use all the help they can get.

RON EDMONDS/ASSOCIATED PRESS

JP Morgan Chase & Co. Chief Executive Officer Jamie Dimon, left, and Goldman Sachs Chief Executive Officer Lloyd Blankfein, leave the White House in Washington, after a meeting with President Barack Obama.

But rather than channel more money into pet causes for image repair, a more fundamental issue needs addressing.

That is the enormous disparity between the rich and poor, which by some measures is now the widest since just before the Great Depression. In this new Gilded Age, reducing that gap could do a lot more good than contributions to charity.

It benefits society in fundamental ways by improving health and raising life expectancy, while reducing crime, suicide, drug addiction, teenage pregnancy and mental illness, British epidemiologists Richard Wilkinson and Kate Pickett argue in their new book "The Spirit Level: Why Greater Equality Makes Societies Stronger."

An interesting and thorough review of the book is here.

In the U.S., the recession has widened the income gap because income declined most for middle-class and poor Americans, and poverty soared.

This week, the Financial Crisis Inquiry Commission will hold its first public hearings with top bank executives to begin dissecting the causes of the economic crisis. Meanwhile a campaign is taking aim at big banks by encouraging people to move their money out of them and into community banks and credit unions.

Bankers who perform well should be rewarded -- after all, the wealth they create often does help shareholders and the economy. But as they debate what to do with all the bonuses, evidence suggests that giving back isn't as powerful as taking less.

If the flood of email this week is any indication, non-profits are working hard to capture any donations in the last few days of the year from people seeking a 2009 tax deduction.

In fact, Dec. 31 is the busiest time of the year for online giving, according to this story in the New York Times, based on data from Convio. In 2008 it found that charities raised 22.5 times more money on the last day of the year than on an average day, and the gift size was 57 percent larger in the last week than the average week.

Locally, Gov. Chris Gregoire sent out an appeal for donations to food banks, including
Second Harvest Inland Northwest, which provides more than 1 million pounds of donated food a month to neighborhood food banks in Eastern Washington; Northwest Harvest, which serves more than 300 food programs across the state; and Food Lifeline, which served more than 675,000 hungry people across Western Washington last year.

The Society of St. Vincent de Paul appealed for year-end donations, citing a doubling of demand at its Food Bank and a 53 percent increase in demand for general assistance.

Some companies transformed the holiday parties of the past into end-of-year charity drives. PricewaterhouseCoopers in Seattle invited people from three charities into its office for a reception with more than 75 of the firm's employees, and gave each non-profit a $10,000 check. PricewaterhouseCoopers partners and staff chose Childhaven, Northwest Harvest and Treehouse as the recipients of their holiday giving campaign.

Olive Crest, which serves abused and at-risk children, said it received a last minute gift from the federal government of $500,000, which represents 13 percent of its total annual budget. The appropriations funds will go toward supporting programs in Washington State focusing on child abuse prevention and training for young teens and adults to live and work on their own and transition out of the child welfare system.

Some non-profits are making year-end donating go even further. The global health organization PATH said every donation to its Catalyst Fund will be matched up to a total of $116,000, thanks to support from the McKinstry Charitable Foundation and an anonymous donor.

Radio station KEXP challenged listeners to help with its year-end fundraising by pairing donations with a pledge from its Volunteer Leadership Boards. The board members committed an additional $85,000 if donors can raise $130,000 by Dec. 31.

For people evaluating charities as they consider donating, GreatNonprofits CEO Perla Ni had a few tips:

1. Don't look at the proportion of the budget that goes to programs. Ni considers focusing on overhead the worst way to pick a charity. "They tell you nothing about the impact that the charity has, and actually encourage charities to make decisions that make them less effective," she said.

2. Look for opinions and information from people who have had direct experience with the charity. GreatNonprofits.org and GuideStar are two sources.

3. Listen to what experts have to say about the charity. Philanthropedia provides access to opinions of experts who evaluate charities.

4. Find direct evidence of impact. Ask the charity how it evaluates the effectiveness of its programs. GiveWell has reviews on hundreds of charities based on impact.

5. See for yourself. Take a donor tour or sign up to volunteer and experience firsthand what the nonprofit does.

More for charity and less for the landfill, says TisBest founder Erik Marks. I talked with him about the trend of charity gift cards, which his non-profit issues, and recent criticisms from consumer advocates. Marks, a member of Social Venture Partners, started TisBest Philanthropy in 2007.

Even as TisBest has grown, Marks has kept his day job as general counsel at EDG Commercial Real Estate in Seattle and operates TisBest with three employees. Previously he worked at law firms Cairncross & Hempelmann and at Perkins Coie. He studied philosophy as an undergrad and has a law degree from Harvard.

Q: How are you different from other charity card issuers?
A: The array of charity gift card issuers has become broader with eight or nine now, but the largest are TisBest, Charity Gift Certificates, JustGive, and the Good Card.
Only TisBest and Charity Gift Certificates are single-purpose portals -- the only thing you see are gift cards. I like to believe the single-purpose approach is better. When the recipient gets a card, the Web site speaks only to the gift in hand, not six other things.
We've got the best Web site for a lot of reasons, and the uploadable image feature is probably the feature people get most excited about. That customization makes our cards particularly valuable for businesses.

Q: You have less than 300 charities to choose from, not thousands or a million -- why?
A: One advantage is browsing. When someone gets a gift card, most people have a few charities in mind but not one they're dead set on. When you get to the charities tab, it's broken down in categories.
We've consciously chosen 125 organizations that are major recognized brand names. Under homelessness for example, you will find recognizable names like Habitat for Humanity. But people also see smaller organizations they don't recognize, then they browse around and they learn. People talk about choosing a charity as a challenge and a challenge they like.
Another advantage is accessibility. If you put YMCA into the Network for Good search box, it will turn up about 200 organizations. At TisBest you turn up just one.

Q: How do you find organizations to list?
A: We spent some time when we started out in 2007 building that list, doing research, basically hard work. Now we source organizations through user recommendations. We receive emails four or five times a day nominating new organizations. We go over those and pick 20 new organizations a year. We will remove 20 that aren't receiving donations.

TISBEST PHILANTHROPY

TisBest is appealing to businesses by making customized gift cards.

Q: What is the $1.95 transaction fee for?
A: It covers our overhead for operating the organization and Web site.
We are a social enterprise model. We offer a valuable and self-sustaining social service on a nonprofit basis.
The idea is we offer charity gift cards in a format that isn't profitable but that does produce enough revenue that our organization can operate and grow. We ask people on receipts to request matching donations from their companies, and that too helps cover our overhead.

Q: Why are gift cards any better than direct donations?
A: It's the difference between charitable giving and charitable gifting. In giving, I take my own money and give it to a cause I support. I love the beach, I love to surf, so Surfrider Foundation might be something I support with my money. But let's say I'm buying you a holiday gift. That might not be your first choice for a charity. There are a lot of different ideas about what the right thing is to do to create change in the world.

We give each other gifts to build relationships. It's a great way to connect human to human. It's the connection that matters, not the thing... When a person who receives the card spends it, the person who gave it learns the charity that was chosen. That's a great opportunity to build a relationship.

Q: How much have you raised for charity?
A: Over $1 million. This is our third holiday season.

Q: How can charity gift card issuers avoid the problems of retail gift cards?
A: One thing to keep in mind is that I really don't think there are many problems with gift cards in the marketplace... it's just a fringe. Gift cards came out around the year 2000. Everyone was figuring out how they worked. Now almost all states regulate gift cards, including Washington.

(Marks also cited the book Scroogenomics, which argues that holiday presents are inefficient and unsatisfying, but gift cards, especially to charity, are not).

Q: Why transfer funds quarterly -- are you holding money to earn interest?
A: That's a red herring. We had to make a decision. Every transfer has a cost. If we made transfers on weekly or monthly basis it would be unreasonably expensive. At the current interest rates of maybe about 1 percent a year. if you hold for a calendar quarter instead of a week, you're not getting a lot of extra interest, and that tiny amount is earned by a philanthropy trying to do good in the world.

Q: Why did you start TisBest?
A: I'm an attorney and I still practice part time -- that's how I pay the bills. I made a conscious decision to change. I wanted to work in something that made the world better, and to some degree I was bored. Partly it was a response to personal frustration. I was scratching my head around the holidays. I needed to give gifts and I didn't know what to get. I don't want to buy people stuff they don't want. I think the world would be better if people focused on how to make it better rather than how to get more stuff.
Today in running TisBest I get to see what people write about giving and receiving charity gift cards, and see the true joy that comes there; and then when I leave work and walk around and see stores with heaping baskets of stuff they're trying to sell, it is a disconnect. The stuff just doesn't create joy in the same way as sharing with others.

Q: How are commercial products like gift cards changing philanthropy?
A: It's the democratization of philanthropy. It's making philanthropy more fun and more accessible for more people. It captures additional dollars from consumers. If you look at how a normal consumer lives, they have a certain income and they allocate it out. One of those wallets is gifts. We're taking dollars out of the gifts wallet and turning them into charity dollars. We're not diverting any funds from charity. Charities have always focused on the big donors, but no one becomes a big donor without becoming a little one first. We are an entry point for accessing those little ones.

Charity gift cards are springing up as a new way to give a gift and let the recipient pass it on to the non-profit of his or her choice.

The cards have been growing in popularity as people combine holiday shopping and philanthropy on tight budgets. But the non-profit Consumer Reports warned last month that charity cards are saddled with some of the same issues as gift cards in general -- including added fees and expiration dates.

TONY AVELAR/ASSOCIATED PRESS

Spending on regular gift cards is expected to drop this year, according to the National Retail Federation. But charity gift cards are becoming a popular tool for some non-profits.

The card issuer generally charges about $5 to purchase the card and may charge another 3 percent when the recipient redeems the card to make a donation, according to the report. The tax deduction goes to the purchaser, not the recipient. And card issuers sometimes take up to four months to forward the donation.

Three of the top charity gift card producers took issue with the report and complained that "Consumer Reports is driving money away from charities at a time they need it most." The cards serve a useful purpose by redirecting "money that was being spent on unneeded and unwanted stuff" to charity.

Seattle's Paul Shoemaker, founder of Social Venture Partners, also weighed in with support for the charity cards.

"In our experience, charity gift cards introduce many potential donors to charitable organizations that they otherwise would not connect with," he said. "That is a good thing at a time when so many non-profit organizations are struggling to survive."

CharityChoice, JustGive and TisBest, which are all non-profits themselves, say they have repeat users who have been happy with the experience and terms. They point out that donors would pay the same 3 percent processing fee for any online donation.

Seattle-based TisBest was created to provide "non-material options available in a world of many, many material choices," said Executive Director Jon Siegel.

The American Institute of Philanthropy, a charity watchdog, recommended people give to charities directly. "Why hand over a chunk of your contribution to a third party web site when you can give directly through a charity's own site?" it asks.

The institute also frowns on the practice of earning interest on donations by delaying their transmission to the charity. "If the site allows you to give to hundreds of thousands of charities, your $25 donation may sit in its bank account for awhile," it said.

Consumer Reports advised people to consider giving directly to the charitable group in someone's name and cut out the middleman.

But obviously that takes away the option of letting the recipient choose where to give, which may be worth a few extra dollars. Either way, the blending of commercial tools and charitable goals seems like an unstoppable trend, and one that will benefit from good watchdogs. If done right, it has the potential to get many more people involved in giving than traditional philanthropy.

Before giving any card, it's a good idea to check out its terms and conditions, which are usually listed on its Web site under FAQs.

Retail gift card sales are expected to decline this year as people hunt for bargains and try to steer clear of expiration dates, added fees, lost cards or stores that may go out of business, according to a recent survey. Still gift cards will account for almost $25 billion this year, according to the National Retail Federation. That's a significant market for charities to try to tap.

New ways of blending charity causes with online behavior continue to grow -- hastened by the need to find creative ways to raise funds in a down economy.

The latest is GlobalMojo, a Web browser that channels money to nonprofits when its users search, shop or book travel.

It has agreements with Yahoo, with online retailers and with travel companies, which give ad revenue to GlobalMojo for directing users to their sites. Users generate money even if they just browse. The company also customizes its browsers for individual nonprofits.

GoodSearch is another Yahoo-powered search engine that donates half of its revenue to charities and schools designated by its users.

This month GlobalMojo will be donating 100 percent of its revenue to non-profits and schools chosen by its users. After that it will give half of the revenues to charity and use the other half for its operating costs.

The company is based in San Francisco but with an equal number of staff in its Seattle office, where one of its investors and advisers is McCaw Cellular veteran Dan Kranzler.

GlobalMojo Creative Director Chris Wilson says the browser helps nonprofits address two of their most pressing needs: a new, ongoing revenue stream to help with fund raising and a way to stay in front of their constituents on a daily basis. The site has 1.5 million nonprofits and schools in its database, and 100 non-profits and schools are actively using the tool.

Right now users are generating between $10 and $15 a year for the non-profits they support, Wilson said.

Local groups participating include At Work, Northwest Harvest, People for Puget Sound, Seeds of Compassion, Seattle Humane Society and Whatcom Middle School.

The historic Whatcom Middle School was gutted last month by a three-alarm fire. Two of its students happened to be the nieces of GlobalMojo's Vice President Emily Hine. She created a special school-themed Internet browser to help raise funds.

I've written about other tech tools such as mobile applications that facilitate donations by SMS, granting money to nonprofits chosen by online voting and other hybrids. I've also heard about companies that have people fill out marketing surveys and donate a portion to charity.

Maybe this is all just part of our multitasking-obsessed world.

"Many people find it difficult to help others in need while dealing with constraints in their own lives," says GlobalMojo's material.

But an interesting debate is also going on here -- whether such services make it too easy, giving us the illusion we're doing community service when in fact we have no real connection to the cause and we're simply buying more stuff or getting lost in our gadgets.

That was the charge leveled against "micro-volunteering" company The Extraordinaries, which has an iPhone app to let people volunteer a few minutes during the day to tag photos or something similar.

"We consider ourselves to be philanthropic," says Wilson. "We are not in this to make a pile of money."

With the Internet, something that has become such a fundamental part of daily life, trying to put it to better use makes sense, he said.

"Everything you do is online."

If anyone has been trying these tools and has thoughts about their usefulness, I'd be interested to hear your opinions.

Today the Gates Foundation made nearly $3.4 million in grants to bolster Internet connections in libraries in five states.

Public libraries received grants for plans to improve and maintain Internet connections in Arkansas ($735,207), Kansas ($363,099), Massachusetts ($367,789), New York ($947,517), and Virginia ($977,468). The states were selected because they had a high number of libraries without high-speed Internet access that were struggling to increase their bandwidth for patrons.

Even in tech-savvy Seattle, I have gone into public libraries and found there's a waiting list to get online using library computers, which patrons with library cards can use for 90 minutes per day.

The Gates Foundation said it is giving technical and consulting assistance to 14 other states, including Washington, to help their libraries develop broadband proposals to compete for federal broadband stimulus funds.

For about 40 percent of Americans who have no Internet access at home, library connections provide the only way they can check their email, search for jobs and get all kinds of basic information that is increasingly available in digital form only. Sadly the country where the Internet was invented has fallen behind the rest of the industrialized world in broadband deployment.

Libraries are hard pressed to keep up with growing demand, especially for higher bandwidth.

A study by the American Library Association found that 60 percent of all libraries say their current Internet speed is insufficient.

Nationwide broadband is the longer term solution. The Gates Foundation provided an analysis to the FCC in October that estimated the cost of installing fiber optic networks across 80 percent of schools, hospitals and other large institutions at $5 billion to $10 billion.

The Grameen Foundation today named David Edelstein as the new director of its Seattle-based Grameen Technology Center.

Edelstein had been the director of information and communication technology innovation at the center, and like his predecessor, also has experience at Microsoft.

The Grameen Foundation and Microsoft are getting ready to announce a new initiative this week to use technology in support of financial services for the poor.

GRAMEEN FOUNDATION

The man above is a Village Phone operator in rural Uganda. At 15 to 20 cents per minute, mobile phone calls are expensive, but they save villagers from walking miles or taking a long bus ride to the nearest public phone.

The two are planning a series of education and mentoring forums and other activities to help microfinance institutions strengthen their technology management capabilities. It's part of an effort by Grameen to help microfinance institutions understand how technology can enhance their work.

One of the signature products of Grameen is the Village Phone, which local entrepreneurs rent to villagers for pennies a call.

Grameen also has a partnership with Google in Africa for its AppLab, using mobile phones to help people in poor communities without Internet access get information about farming, health and trading by SMS.

Mobile phones, which are becoming commonplace in many developing countries, have proven to have a number of promising applications, including mobile banking and medical diagnostics. The M-PESA system in Kenya, developed to help borrowers receive and repay money for micro loans, now has more than 6 million subscribers.

Edelstein's experience includes helping build AppLab and focusing on affordable technology products and business strategies for people in developing countries at Microsoft and at McKinsey & Co.

He replaces Peter Bladin, founding director of the Technology Center who is now the foundation's executive vice president for programs and regions.

Football fans have to bundle up to keep warm during games. For homeless people it's a daily struggle against the elements.

CHRIS JOSEPH TAYLOR/SEATTLE TIMES

Can the Cougars out-donate the Huskies?

A non-profit serving homeless and needy populations is taking advantage of the rivalry between UW and WSU to stage a "Competition for Caring" during tomorrow's Apple Cup.

JIM BATES/SEATTLE TIMES

Husky fans get in the holiday spirit.

The competition, sponsored by St. Vincent de Paul of Seattle/King County, will challenge Washington Husky and Washington State Cougar fans to see who can bring the most blankets and coats for donation.

Tomorrow between noon and 3:30 p.m. at Husky Stadium the charity will have a Cougar Bin and Husky Bin for fans to fill up in name of their favorite team.

About 100 community volunteers will also be going around the perimeter of Husky Stadium to collect donations. The winning team will be announced later on Twitter.

People not attending the game can drop off blankets and coats through Monday at St. Vincent de Paul thrift stores in Seattle, Burien, Renton, Kenmore, Kent, Everett, Lynnwood, Monroe and at its Food Bank in Georgetown.

The items will be given out at no cost to low-income and homeless people by the charity and through its partners in King and Snohomish counties.

UPDATE: Husky fans scored with 682 items; Cougar fans scored with 268 items. Cash donations are still being counted.

Boeing has a long tradition of philanthropy in the Puget Sound region. Its total giving reaches almost $50 million a year, including its Employees Community Fund (ECF) of Puget Sound, which has given out well over half a billion dollars in its 58-year history.

At a time when many companies have cut matching gift programs, Boeing still matches employee charitable donations dollar for dollar up to a maximum of $6,000 per year.

Boeing people are involved in non-profit boards and community service projects of all kinds. This year Scott Carson, recently retired as CEO of Boeing Commercial Airplanes, is chairman of the United Way of King County's 2009-10 fund-raising drive.

"I think Boeing has played a phenomenal role as a philanthropic leader in the community," said Carol Lewis, CEO of Philanthropy Northwest. "They have a wonderful legacy."

Is that about to change?

Last week Boeing altered its management to combine two units responsible for local government relations and corporate philanthropy into one position and shift authority over both to an executive in St. Louis.

What impact does it have if the local area loses a vice president in charge of corporate giving and government relations? In the short term, maybe not much. This year the level of donations from Boeing remains constant at around $48 million.

"Titles and location aside, if we are giving the same amount of money to great causes in our community then what has changed? said Boeing spokesman Bernard Choi. "Nothing has changed in that realm at all."

Companies tend to give and get involved where their employees and operations are based. In the longer term, as those workers, managers and markets shift to new areas and are diffused all over the world, it's hard to see them remaining loyal to one geography.

The vice president may have had the ear of company executives around the board room, but much of the work investing in local organizations is done by a small group of Boeing staff here who specialize in areas such as arts and culture, early learning, environment, health and human services and primary and secondary education.

Whether that staff remains (and how many) is one test of the company's commitment.

Boeing hasn't said what it expects for next year's giving. The prediction for 2010 is that it will be even more difficult than 2009 for non-profits because needs are greater while assets are down. Many grants are planned in advance (based on assets of the previous year) so the fallout from losses during the recession takes longer to play out.

To comprehend how fast the pace of change is, read this profile just two years ago of Bob Watt, the man who used to be in charge of state and local government relations and global corporate citizenship and who hired Fred Kiga. In 2007 Boeing had 72,000 employees in Washington state, it paid tuition and books for any employee to pursue higher education, and things were looking brighter.

"I stand in awe of how beautifully Seattle supports its nonprofit world," Watt said. "We are blessed and we are thriving."

Despite the lingering economic woes that most Americans are still feeling, only one in five plans to reduce donations to charity this holiday season, the American Red Cross found in a new survey. More Americans will cut back on travel, decorations, parties and gifts.

ELAINE THOMPSON/ASSOCIATED PRESS

Volunteers Ken Newman, right, and Caren Shepsky heft a 50-pound bag of rice at the Cherry Street Food Bank, run by Northwest Harvest. As hunger has worsened, Northwest Harvest's pantry is seeing more than 2,500 visitors on busy days this year, up from a peak of 1,800 visitors last year.

The results tell a somewhat different story than a recent Harris Interactive survey that showed charities will probably see a decrease in generosity this season. Some large charities are preparing for lower holiday giving.

Regardless of how they interpret the data, charities are downsizing their appeals and targeting smaller donations. They're also making the most of free social media sites like Twitter and Facebook and asking supporters to help them spread the word.

The United Way of King County recently launched its Give 10/Tell 10 campaign, which asks for $10 contributions to help struggling families hit by the recession avoid falling into homelessness. After making a gift on the site, donors have the option to pass on a message emailed to 10 friends, encouraging them give, too. The charity is also using Twitter and Facebook to network, post links and share facts, such as "$25 = a week of food for a homeless person in Washington."

"We really wanted to do something different to get the word out to people that the needs are so great right now and provide a low barrier way for them to get involved," said United Way spokesman Jared Erlandson. "The thought was what if we could get people to tweet not just about what they are doing tonight, but about how they just helped someone stay in their home for the holidays then we could really have an effective vehicle to get our message out."

Mercy Corps is getting creative around Thanksgiving with a new online tool that allows families and groups of friends to make donations together. The global charity is calling on people to match the amount they spend on their own Thanksgiving Day meal with a donation that fights global hunger. The average American family spent $45 on Thanksgiving dinner in 2008, Mercy Corps said.

Other interesting new twists include gift cards with a $5 donation to charity built in. The recipient can choose where to direct the $5 gift from among more than 5,000 charities.

Getting donor fatigue? Another option is to vote for your favorite charity and have a large bank pick up the tab. Chase is donating $5 million -- $25,000 each to the top 100 charities on Dec. 15, one $1 million and five $100,000 grants to others in February, and another $1 million chosen by an advisory board of active philanthropists.

Community service helps veterans make an easier transition home, but the new generation of veterans is underutilized in their own communities,
a report released today by Civic Enterprises found. The report is based on the first nationally representative survey of veterans from Iraq and Afghanistan.

"Veterans from a younger generation are returning from Iraq, Afghanistan, and around the world eager to assimilate back into their communities and campuses but often do not have the means to do so," said Army Reserve Staff Sergeant Brian Hawthorne, president of the George Washington University chapter of the Student Veterans of America, who has served two tours of duty in Iraq.

Starting today a program called Mission Serve will help connect veterans to volunteer opportunities near their homes, supported by a coalition of non-profits. The effort, led by the national campaign ServiceNation, involves more than 50 organizations in 36 projects to bridge the gap between service to the country and service to the community, and expand the U.S. volunteer movement.

MANUEL BALCE CENETA/ASSOCIATED PRESS

Veterans and their families can find volunteer opportunities using this Web site.

First lady Michelle Obama, along with Jill Biden, wife of Vice President Joe Biden, kicked off the initiative in a speech at George Washington University, saying average Americans can honor veterans by volunteering, too.

Local participants included Steve Dubiel, executive director of EarthCorps, and Mark Fischer, Veterans Conservation Corps coordinator in the Washington State Department of Veteran Affairs. Organizations participating in the program include EarthCorps, Sierra Club, Veterans Conservation Corps and Big Brothers Big Sisters.

The initiative is interesting on many levels. Helping others is a way to address the trauma many veterans face after war, including high suicide rates. It also brings together diverse groups like idealist.org and the environmental movement, the American Legion and the American Red Cross to form partnerships between civilian and military service organizations. Idealist, an interactive site for exchanging resources and ideas, has Seattle non-profit expert Putnam Barber as its senior researcher and several staffers from Portland.

Soldiers who are part of the Warrior Transition Battalion at Fort Lewis will continue a program to build low-income houses through a Habitat for Humanity project.

Sierra Club is offering outdoor trips and environmental education for military personnel, their children and families.

Another event for veterans is taking place next week, when the RecruitMilitary Opportunity Expo opens on Thursday from 11 a.m. to 3 p.m. at ShoWare Center in Kent.

More than 300 veterans are expected to attend the expo, which aims to connect recently returning troops, other veterans and their spouses with employment, entrepreneurship and educational opportunities. More information can be found here.

In the current jobless recovery, people are running out of unemployment benefits before they find job openings. Some may look to starting a small business of their own, but who would loan them money without a track record? Certainly not banks.

For such local entrepreneurs, the answer has been non-profits like Community Capital Development. CCD has provided $26 million to more than 1,000 previously "unbankable" local businesses, including Plum Bistro, Bedrock Industries and Utilikilts.

CCD-backed businesses create and sustain hundreds of local jobs, most of which go to people with low-to-moderate incomes. For entrepreneurs with a solid business plan and 10 percent of the capital, CCD provides a fixed-rate loan over five years plus free business counseling and subsidized accounting and marketing services. It charges 9 percent interest on loans.

CHRIS MUNFORD

Bedrock Industries, which turns recycled glass into art, is one of CCD's success stories.

But CCD ultimately relies on banks for capital to lend. In the current economy, that has dried up, and Chief Executive Jim Thomas worries about the fallout on struggling enterprises.

"They can't go to a bank," he told me over lunch recently. "They'll struggle along but they won't be able to grow. They'll go to the credit cards, which are at least 18 percent. they'll end up paying interest only. At interest only, you can never reduce that debt."

Another blow was losing Washington Mutual, which was one of CCD's top lenders. The new owner, JPMorgan Chase, does not lend to CCD. Washington Mutual was closed by the government a year ago in the largest bank failure in U.S. history. Its assets were sold to JPMorgan for $1.9 billion.

Meanwhile, CCD is down to microloans, funded by the Small Business Administration. The trouble is borrowers can get only one, and it's usually not enough to get a business off the ground in the U.S.

The problem is much bigger than CCD. The entire industry of Community Development Financial Institutions, a category of firms known as CDFIs that provide credit, financial services and training to under served markets, has been hit hard by the credit crunch. The segment that serves the least advantaged is suffering from a problem brought on largely by the mistakes and greed of bigger banks and Wall Street, now the beneficiaries of billions in bailout money.

Janet Ozarchuk, vice president and treasurer of the Local Initiatives Support Corporation (LISC), said her institution received some help recently from Bank of America. But banks in the first two quarters of 2009 didn't lend a single dollar to CDFIs, she said.

"The grant dollars have hung in there, but a good part of funding comes from banks," she said. "That has just been devastated."

"We have one of the strongest balance sheets of any non-profit," Thomas said. "We are not leveraged. But we cannot borrow money because it's not available."

Some efforts have begun to address the problem.

Community development non-profits may be able to raise capital from foundations' Program Related Investing (PRIs). In the current economy, foundations are exploring ways to make more social impact with their assets. PRIs can be used to guarantee loans and bring other investors and banks into the deal, said Ozarchuk.

Last month Senators Jeff Merkley (D-OR) and Barbara Boxer (D-CA) introduced legislation to extend credit to small businesses by allocating existing TARP funds to community banks.

Banks that get such federal help would be required to generate new credit equal or greater to the amount of capitalization received from the federal government. By the end of 2010 the bank would be required to increase overall business loans outstanding by at least 5 percent over the lowest level reached in 2009.

Untested borrowers are a higher risk. Many banks, whether commercial or community or even credit unions, are interested in making low interest loans for community development non-profits "only because they have some legal obligations to fulfill," says CCD's Chief Operating Officer Hongqing Chen.

The bill has the potential to be effective "if and only if it requires a certain percent of new business loans be made to distressed communities and low to medium income borrowers," she said.

Norm Rice has only been on the job at the Seattle Foundation since July, but he aims to broaden the foundation's base from hundreds of wealthy donors to more than a million people in King County.

"Everybody can give, whether it's $5 or $5 million," he said.

BARBARA KINNEY

Norman Rice, former Seattle mayor and current CEO of the Seattle Foundation.

The Seattle Foundation is one of the largest community foundations in the country and the fifth largest foundation in Washington state, according to the Foundation Center, with assets of about $570 million.

With a staff of 26, the foundation has 1,200 funds under its umbrella, ranging in size from $30,000 to many millions of dollars. They include bequests from people who have made gifts to charity in their wills, and active "donor-advised funds," which help philanthropists invest their assets and make grants to charitable causes without the time and expense of running their own foundations. The foundation charges fees averaging 1 percent of the fund's balance.

Rice said he wants to get more people involved, with or without a fund. It's part of a sea change in philanthropy, a shift from passive donations to a new model shaped by a younger generation eager to see results and be personally engaged.

To broaden its appeal, the Seattle Foundation is revamping its Web site to offer detailed profiles and reviews of the non-profits and programs it funds, and allow online donations for the first time. The new Web site, expected to be launched early next year, will also have an Amazon.com-style recommendations feature to help people find programs related to their interests.

His goal is to reach as many as 1.5 million people over the next several years, getting them involved in some way with the foundation's programs. He'd also like to increase the number of donor-advised funds the foundation manages from the current 750.

Even without a lot of money to give, he thinks people can help support its long-term strategy to improve the community by working in seven areas: basic needs, the environment, the economy, education, arts and culture, neighborhoods and communities, and health and wellness.

Rice said he wants to focus particular attention on workforce development and early childhood learning.

Speaking to the Seattle Philanthropic Advisors Network (SPAN), the former Seattle mayor said he thinks "foundations are in an enviable place to be change agents" and show governments new ways to solve problems.

The foundation's assets, down 27 percent last year, have bounced back somewhat this year, growing 17 percent from January through the third quarter. While it has had to make significant cuts in its operating budget, Rice said he doesn't expect the foundation to reduce its grant making.

After taking a financial blow in the past year, non-profits have been forced to work with fewer resources. More than ever, it makes sense for them to consolidate, Rice said.

He suggested a "non profit mergers and acquisitions fund," where "those who come together get the dollars. I just believe some things we're funding are doing too many things that are alike."

"Every organization needs to look at themselves to see what they do best," he said. If someone else is doing it better, they should partner or concentrate on something else.

Amina S. Ali, African Union ambassador to the United States, made her first visit to Seattle this week, seeking to build bridges with Washington state institutions, which she says are playing a more important role in African business and development.

Ali, who is from Tanzania, represents an organization of 53 countries formed in 2002 and loosely based on the European Union, with the goal of helping integrate the continent to give it a stronger voice in the global economy while also addressing social, economic and political issues. The AU launched its first diplomatic mission in the U.S. in 2007.

Ali is the second high-level diplomat to come through Seattle in a week to meet the Gates Foundation, with a message to focus more on improving maternal health. Both Ali and U.N. Secretary General Ban Ki-moon warned that the world's goal of improving the health of mothers and children is falling further behind.

The African Union is calling attention to the issue in a new campaign to reduce deaths of women in pregnancy and childbirth.

"We found for the last 10 years the donor community is focused on HIV/AIDS, and it's a stubborn problem," she said. "But there are other issues that confront women and children that nobody is talking about. There's no reason women in Africa should die in childbirth."

"We are thinking what can we do to bring women's issues to the top?" Part of the problem is a shortage of doctors and nurses, she said. Throughout parts of rural Africa, the ratio is 1 doctor to every 40,000 to 100,000 patients.

Like Ban, Ali also talked about the important role business can play in solving global issues. In Seattle, she met with Microsoft, the Trade Development Alliance and the African Chamber of Commerce.

Mobile phones are now helping medical diagnosis, she said. In Tanzania, patients living 1,000 miles from a city are using mobile phones to send information about illnesses and receive diagnosis.

For all the wrangling over trade with China, the U.S. should take a look at the way it's investing in Africa, she said.

"Americans should start to think why the Chinese have gone to Africa while the Americans have not taken advantage of that," she said. Americans have been more cautious, sitting on the sidelines. Chinese have been aggressively pursuing business, and while the relationship is not always easy, they are helping Africans solve key infrastructure problems, especially in building ports, she said.

One thing that has mitigated risk for the Chinese companies is a Chinese government development fund targeting Africa. The $10 billion China-Africa Development (CAD) fund aims to promote economic cooperation between China and Africa and advance Africa's economic development by providing money to Chinese companies starting ventures there.

Ali said she hopes the United States can create a similar, large fund to help American companies bridge the gap and start to invest more in the continent to transform its future.

Such a fund could go a lot further than simply giving money to government aid programs, she said. "Give the fund to your own people to invest in Africa," she said.

"It can be done," she said. "China 20 years ago -- it was nothing, and then the private sector decided to work with them. Let's try to work with Africa."

The Bill & Melinda Gates Foundation is giving out $4 million in grants to help community foundations, libraries and legal aid services in Washington cope with the effects of recession.

The foundation is announcing a package of grants this morning aimed at local non-profits, including $672,000 to 10 community foundations. The money will help the foundations get government benefits to families, and fund programs to curb domestic violence and hunger.

Another $400,000 will go to the Washington State Library's "Renew Washington" grant program, funding 17 public libraries offering services to people looking for work. The libraries have seen a surge of people looking for information and resources during the downturn. The State Library will receive an additional $115,000 for advocacy, marketing and online training.

Another $3 million in Gates Foundation money will go to the Legal Aid for Washington Fund over the next three years. The fund provides legal support for state residents through a network of 26 nonprofit law centers. More than 80 percent of low-income households in the state need but can't afford legal services to deal with foreclosures, evictions, domestic violence and other problems, according to the foundation.

The 10 community foundations sharing $672,000 are the Blue Mountain Community Foundation, the Community Foundation of North Central Washington, the Community Foundation for Southwest Washington, the Grays Harbor Community Foundation, the Inland Northwest Community Foundation, the Orcas Island Community Foundation, the Skagit Community Foundation, the Three Rivers Community Foundation, the Whatcom Community Foundation and the Yakima Valley Community Foundation.

The Gates Foundation's local spending is still a small part of its overall giving. The foundation says it has given out about $20.4 billion in grants since 1994. Of that about $1.5 billion has gone to grants serving Washington state. Its budget for Pacific Northwest Initiatives is about $33 million this year, focusing on community organizations that address homelessness. Its work in Washington state also includes education and libraries. The foundation's total budget is about $3.5 billion.

Calling themselves "impatient optimists," Bill and Melinda Gates plan to talk directly to lawmakers and others in Washington D.C. tonight to push for continuing U.S. funding for global health.

CHUCK BURTON/ASSOCIATED PRESS

The Gates will tout the success of foreign aid, including contributiosn to the GAVI Alliance, a global initiative to immunize children in poor countries, which has prevented an estimated 3.4 million deaths over the last decade.

"In our visits to developing countries, Bill and I have met countless people who are alive, healthy, and productive as a result of U.S. global health programs," Melinda Gates said today. "We want Americans to know how much their generosity is accomplishing, and how much it's appreciated."

U.S. spending on global health has increased steadily, but it still makes up less than one percent of the federal budget. It was close to $8 billion this year, up from $1.5 billion in 2001.

The U.S. has started some ambitious development projects, even though the country's top post on foreign aid remains unfilled, and many pressing issues are vying for resources and attention.

The Bill & Melinda Gates Foundation has become an increasingly important and active player in global health and development. Its annual budget is more than $3.5 billion, and about half of that goes toward global health. The United Nation's annual budget is just under $4.2 billion.

The couple started a project called Living Proof to promote the success such funding has achieved in developing countries. Positive stories about foreign aid aren't getting told, they say.

The Gates Foundation has spent about $12 billion on global health since 1994.

Their aim is to cut the number of child deaths in half worldwide by 2025. Preventable deaths of children under five have declined worldwide to about 9 million in 2007 from 12.6 million in 1990, despite population growth, according to this report.

The presentation will be webcast live at www.livingproofproject.org at 4 p.m. Pacific.

Last night Nicholas Kristof told the story of a boy on a beach who collected starfish washed onto the sand and threw them back into the ocean one by one. A man came along and told him he'd never make a difference, but the boy replied "It sure made a difference to that one."

What if there were thousands, or even millions of boys and girls on the beach, an entire clean up crew, and each one saved at least one starfish?

That is the possibility in cities like Seattle.

A city where each citizen is linked to another citizen of a city somewhere in the world that needs our help.

We have sister city programs where delegations of bureaucrats go visit each other and talk about expanding ties. That's the old paradigm. So here's my idea: take Seattle's enormous talents, compassion and global perspective, and scale it up.

Time for the younger generation to redefine this civic pillar and make it really meaningful.

Because something is happening here but you don't know what it is, in the words of Dylan. A whole generation is looking at the world in a new way and is hungry to change it. These are the students who pack auditoriums and line up for hours to meet their rock stars - the Paul Farmers and Kavita Ramdases and Nicholas Kristofs of the world.

Three years ago an 11-year-old girl, Jessica Markowitz, decided to help educate girls in Rwanda. She traveled back and forth, raised more than $30,000, and now she's expanding her partnership to high schools in Seattle and Kigali. At Bellevue High School Brett Mennella helped start a microfinance club, which raised more than $130,000 for a local non-profit helping poor entrepreneurs, and now five other high schools have followed his lead. There are countless other examples here and in cities across the U.S.

Everyone knows the wealth system today is unequal. As Kristof said, we who won the birth lottery buy lattes and iPods while kids overseas starve. But we as individuals have the power to change it ourselves right now, and even the technology.

The Kiva model has shown the possibilities for transformation when one person uses the Internet to send one tiny bit of her resources to one other person.

Joe Mallahan would like it, from what I hear about his ideas to use mobile phones for social business. Mike McGinn would like it, from what I hear about his enthusiasm for grassroots environmental movements.

Someone in Edmonds liked the idea, because he made sure every one of its 43,000 residents could give $1 to help Carol Schillios save girls in Mali.

Kristof also told us about a $10,000 bank mistake that saved a school in China that was able to waive $13 in school fees for each of the girls, who became accountants and sent money back to their town, which got a road built and attracted more investment, which made life better for everyone. A virtuous cycle.

What if we could change a whole town in a place like Cambodia or Cameroon, and create a new sister cities model for others? Take soft power right down to the local level.

We have 602,000 residents in Seattle, and most of them can afford a latte. Some school in some town with a poor girl who can't afford an education is just waiting for us to notice.

Alexander Friedman, chief financial officer of the world's largest private foundation, says he's leaving next year to pursue other interests.

Friedman, CFO of the Bill & Melinda Gates Foundation, announced his intention to leave early next year in an e-mail today to colleagues at the foundation, calling the move a personal decision.

A former investment banker at Lazard, Friedman said he would most likely return to the private sector, but he is also considering government and non-profit work.

He presided over a period of rapid, sometimes tumultuous growth after billionaire investor Warren Buffett pledged to give the foundation most of his fortune, then estimated at more than $30 billion. Over the past year Friedman has had to steer the foundation's budget through the economic crisis, and he recently launched its first foray into program related investing, which I wrote about here.

"I was really brought in to help the organization scale," he said in an interview, adding that when he started in March of 2007, the foundation had less than half of its current payout (now about $3.5 billion) and about a third of its current headcount (now 781 employees).

"The real thing is I made a personal decision when I came here that it would be a tremendous honor to work with Patty [Stonesifer] and Bill and Melinda [Gates] as the foundation doubled in size, and that was an exciting challenge for me and we have pretty much done that."

Friedman would not say if he was considering any specific offers but said he wanted to give the foundation time to plan for his departure.

"I feel great about the experience here and super positive about the organization," he said.

Friedman said he will remain at the foundation until about February to make sure the 2010 budget is finalized and work handed over to the next CFO "as responsibly as possible." He said he intends to stay in the Seattle area "for the foreseeable future."

"To resort to a CFO-like phrase for a moment, my 'bottom line' is that I came here to try and accomplish a set of discrete goals and to contribute to the development of strong strategies and operational procedures," he wrote in his email to colleagues.

"I am proud to have been part of the team that strove for these goals and made real progress on our collective agenda. Now, it is with great excitement that I begin to think about what comes next."

The founders of a new Seattle non-profit called SaveTogether think so.

They are pairing low-wage workers in the U.S., many of them working moms, with people willing to help them save small amounts at a time to reach their goals of education, home ownership or opening a small business.

A saver starts with $25, a donor chips in $25 and a non-profit matches that with another $25, tripling the saver's original amount. So savers can earn two more dollars for every dollar they save.

Sandra is one of the clients of SaveTogether, saving $120 a month to expand her hair salon business in San Francisco.

The non-profit operates a Kiva-like online model, relying on the generosity of strangers to help people profiled on the site realize their dreams. Other Seattle-based efforts that build on Kiva's success with peer to peer online philanthropy include Vittana, a non-profit started by former Amazon employees that helps fund educational loans, and Jolkona and See Your Impact, which help young people get involved in philanthropy by making small donations and tracking their progress.

SaveTogether co-founder and CEO Dylan Higgins likens it to a 401(k) match for low-wage workers.

Convincing donors to help people they don't know save money could be a challenge, Higgins acknowledged. But it's about encouraging responsibility, he said.

"These people have already taken steps to better themselves and you are helping speed the process."

After law school at the University of Washington, Higgins worked as a fellow for microlending Web site Kiva in Ghana, where he got the inspiration for the project.

The Spokane native remembers being struck by the number of borrowers who had trouble finding a way to save, while at the same time he saw the economy in the U.S. on the verge of collapse because of an overindulgence in credit.

"I was amazed how these two apparently different worlds were reacting in a similar way," he said. "They both needed savings to come to the forefront again. It was an amazing epiphany for me. I studied economics as an undergrad and was always frustrated that Americans were poor savers."

SaveTogether aims to build on the success of Individual Development Accounts, matched savings accounts for working poor who are trying to buy their first home, pay for college or start a small business. IDAs are supported by organizations such as the Corporation for Enterprise Development (CFED) and are funded by government and private sources. Seed funding for SaveTogether came from CFED.

Caroline is a nursing student saving to complete her studies at a university in Boston. She arrived in the U.S. from Uganda last year.

Recently I have been writing about new programs by the Gates Foundation and others that recognize savings as an essential part of financial well being and help people build assets. One study showed that low-income Americans who participated in matched savings programs weathered the recession relatively well. Almost none of them lost their homes.

The same study, while giving Washington state good marks overall, said the state could improve its low rates of micro enterprise and small business ownership by making capital more widely available through micro loan programs, restoring funding for Individual Development Accounts and training more entrepreneurs.

The non-profit is helping people such as Sandra, a single mother of five in San Francisco who runs her own salon and is saving to expand it; Andria, a 20-year-old who is the main breadwinner in her family and is saving for college tuition; and Raymond, a Native American father of two in Spokane who is saving to open a business.

Dylan Higgins is CEO of SaveTogether.

Robert Friedman, CFED's founder and chairman, said he has witnessed matched savings programs change the lives of poor working families for almost 20 years. He now supports several of SaveTogether's featured savers. They are screened and selected by the partners, including Neighborhood Assets of Spokane and Opportunity Fund of San Francisco.

SaveTogether has tried to build in a kind of fraud-protection system. It collects the matched funds from donors, holding them until the saver reaches his or her goal. SaveTogether then disburses the funds to the local non-profit partner and they release the funds directly to the vendor. For example, the organization writes the check to the university, not the student, or to the mortgage company, not the home buyer. This ensures that the saver uses the matching funds for the specified purpose, Higgins said.

Higgins and his partners were looking to work with a non-profit in Seattle, such as Washington CASH, but the United Way of King County no longer administers the individual development account programs and has transferred the operation to the YMCA to help foster youth save.

"For all those other uses of matched savings for business, homeownership and education, it remains to be seen what kind of market we will have in King County," Higgins said.

For now SaveTogether is working with organizations in Spokane, Boston and the Bay Area and hopes to expand around the country and eventually overseas.

Update Friday: The University of Washington said this morning that it will use $25 million in Recovery Act funding from NIH to create a new Northwest Genomics Center and explore the origins of common heart, lung and blood disorders.

The UW will receive two of the six "Grand Opportunity" large-scale DNA sequencing project awards to examine the genetic connections to the diseases, which account for three of the leading causes of death in the United States.

UW Professor Debbie Nickerson is one of the principal investigators for the two-year national project. She said the new center "will apply cutting edge, next generation sequencing technology to uncover the differences in our genetic code and explore how these may influence traits, such as cholesterol and blood pressure, that impact our risk for developing cardiovascular disease."

The UW center is one of two sequencing centers for the project, with the second located at the Broad Institute of MIT and Harvard in Cambridge, Mass.

"This is one of those times in science when it is just the right moment to scale newly emerging technologies to obtain important medical insights," Nickerson said.

Washington State University said it has received more than $30 million in 42 federal stimulus funding awards, including $9 million from the National Science Foundation, $5 million from NIH and Health and Human Services, and $16 million in Commerce, Energy and other funding related to the Recovery Act.

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Hundreds of health research projects in Washington state have received federal stimulus funding of about $170 million, led by the University of Washington, according to the National Institutes of Health.

The updated NIH database lists millions of dollars in federal stimulus funding to Seattle researchers studying the effectiveness of various cancer diagnostic tools, screening tests and treatments.

On Monday researchers from the Fred Hutchinson Cancer Research Center, UW and Group Health Cooperative will describe their projects, supported by the National Cancer Institute, that are helping to build a hub for cutting-edge cancer research in Seattle. Of the 385 projects funded in Washington state, 359 of them were in the Seattle area.

My colleague Sandi Doughton wrote about the potential windfall from the $787 billion stimulus package to locally-based scientific research efforts earlier this year.

President Obama announced the funding Wednesday as part of a plan to spend $5 billion on medical and scientific research, medical supplies and upgrading laboratory capacity. The funds come from the $787 billion economic stimulus package.

Washington State University has received close to $3 million, including $1.5 million to professor Norman G. Lewis for a project to classify medicinal plants into a comprehensive database to aid the discovery of new medicines. (NIH only lists funding of $1.46 million for the first year, but the total award is $2.75 million, Lewis said.)

One standout nationwide was the UW, which has had more than 240 projects funded so far for a total of $99 million. At UW, professor Debbie Nickerson leads a project to study human genome variation that received $11 million this year.

Besides scientific research, Recovery Act dollars also went toward social services. Building Changes, a Seattle-based non-profit focused on ending homelessness, received a $1 million grant to provide technical assistance and grants to smaller non-profits serving the homeless and at-risk or very low-income families.

Building Changes is one of 35 organizations in the U.S. awarded money through the Strengthening Communities Fund, which aims to improve the ability of non-profits to help low-income people recover from the recession. Other recipients in Washington state include Seattle's Human Services Department and the Confederate Tribes of Colville Reservation, which received about $250,000 each, and the Northwest Leadership Foundation, which received $1 million.

The Institute for Systems Biology was chosen to receive nearly $8 million in federal funds for research into the genetic causes of cancer and potential targeted treatments.

A member of the Cancer Genome Atlas Research Network, ISB will analyze data gathered by research centers around the country with the goal of learning how environmental factors affect genes and cause cells to malfunction, leading to cancer. ISB will then use the knowledge to identify drug targets and therapeutic treatments. The principal investigator at ISB is Ilya Shmulevich.

The Research Network has initially focused on cancers of the brain, breast, kidney, lungs and ovaries. Part of ISB's role is to develop state-of-the-art software and other tools that assist researchers with processing and integrating data analysis.

The award is $7.88 million over five years, with $3.1 million of the funding approved so far, according to the National Institutes of Health. The project is jointly run by the National Cancer Institute (NCI) and the National Human Genome Research Institute (NHGRI), both under the NIH.

Note: The ISB funding was not, as I reported yesterday based on information from ISB, part of the federal stimulus package announced by President Obama in a plan to spend $5 billion on medical and scientific research, medical supplies and upgrading laboratory capacity.

Funding for the Cancer Genome Atlas came from two different sources -- $175 million from the Recovery Act and $100 million pledged jointly by the National Cancer Institute and the National Human Genome Research Institute.

The cancer research funds came to ISB from that second pool of $100 million, ISB spokesman Todd Langton said Thursday. ISB did receive Recovery Act funds -- a $2.3 million grant to complete an atlas of human peptides and a $200,000 grant to study how external factors combine with genetic factors to drive asthma attacks.

A full list of NIH grants as part of the Recovery Act is available here. Other large grants awarded in Washington state include $8.5 million to the Northwest Institute of Genetic Medicine at UW and $8.3 million to the Allen Institute for Brain Science. In fact, various UW researchers have racked up a total of more than $80 million in NIH grants this year alone.

ISB, a non-profit research institute on the north end of Lake Union, is hiring an additional eight people and dedicating some of its existing full time positions to the project, ISB spokesman Todd Langton said.

The institute is pioneering an approach to medicine it calls P4 -- predictive, preventive, personalized and participatory. The idea is that future medicine will consider the unique biology of an individual and his or her probability of developing various diseases, and then design appropriate treatments before a disease manifests.

More than 1,500 Americans die from cancer every day, according to the NIH, and the rate is expected to rise as the U.S. population ages.

Seattle's business community should consider homeless people as valuable assets, and tackle homelessness not as charity but as an investment in the future, the head of the world's largest philanthropy said today.

"Homeless people aren't just a problem to be minimized or cleared away," Gates Foundation CEO Jeff Raikes said, addressing more than 900 members of the Greater Seattle Chamber of Commerce. "They have amazing potential."

THOMAS JAMES HURST/SEATTLE TIMES

Gates Foundation CEO Jeff Raikes has taken part in the One Night Count of the homeless population in Seattle for several years.

The chamber's new slogan for "It's Time for Business" could apply to the problem of homelessness, too, he said.

Half of Seattle's homeless population are parents in their prime productive years, with children in their prime development years.

In fact, homeless families tracked by the University of Washington had better high school graduation rates than the Seattle School District, he said.

"Most homeless families are right on the edge of being a productive part of a healthy community and a thriving economy," he said.

Raikes called for a new approach that would take some money being spent on shelters and put it into permanent homes, a careful needs assessment for each family instead of a standard response for everyone, more affordable housing, and an emphasis on preventing people from becoming homeless, such as short-term rent subsidies.

Seattle is the second most expensive metropolitan area in the country, he said. Building more affordable housing would be good for the construction industry and add jobs.

In King County, there are about 10,000 people who are homeless, but tens of thousands more barely able to keep themselves afloat. They earn half the median income and spend half of that on housing.

Close to 50,000 people are "living on the border of economic stability and destitution," he said.

Given a safe place to sleep, combined with services to address the root cause of becoming homeless, three-quarters of the 1,500 families in a Sound Families program moved on to permanent stable housing, Raikes said.

He called for expanding that model, and asked business people to volunteer their ideas and expertise and to support local government leaders to put homelessness on the political radar.

Note: Yes, Seattle really is the second most expensive metropolitan area in the country, based on Federal Housing Finance Agency 2Q 2009 purchase prices, beating out New York and second only to San Jose/San Francisco.

Economists may say we're coming out of the recession, but that doesn't ring true to local non-profits and people without work.

"Everybody's hearing about the leading economic indicators -- everything's getting better economically," says Richard Bray, who directs donor and community relations at the Society of St. Vincent de Paul in Seattle/King County. "We're not seeing that when it comes to the average person."

ST. VINCENT DE PAUL SOCIETY

Tom Kobayashi (right), who is 93, walks at the Friends of the Poor Walk last year, with Paul and Nicki Tran at left.

Calls for assistance last month were up 60 percent over last year, hitting an all time record of 411 calls on Sept 14, he said. The 2-1-1 community information line has referred 18,000 calls to the charity so far this year. The number of people seeking food at the Georgetown food bank doubled from last year, to 8,000 each month.

Another troubling trend has emerged -- the charity has noticed a jump in domestic violence cases -- only 1 percent of the cases it manages in a long range assistance program were related to domestic violence a year ago, but in the last month that number has grown to 10 percent.

The problem stems from economic difficulties, Bray said. "People are out of work, they're stressing out and unfortunately taking it out on some of the ones closest to them."

Joining the ranks of the poor now are former professionals who worked all their lives and were doing well before the recession, he said.

To raise money and awareness about local people in need, the charity will host its second annual "Friends of the Poor Walk" tomorrow from 9 to noon at John F. Kennedy High School in Burien. Other walks are planned in 150 cities nationwide, including Tacoma, Everett and Sequim. Details are here.

"The theme is walk a mile in my shoes, to reflect and think about someone who's going through hard times," Bray said.

Last year, one participant covered 50 laps on the school track, but the standout was Tom Kobayashi, who participated at age 92, and plans to walk again this year.

Kobayashi, of Seattle, is the longest serving St. Vincent de Paul volunteer in the nation. A Japanese American who was forced into an internment camp as a child during World War II, Kobayashi has spent the last 73 years as a member and leader of the charity, making weekly home visits to people who are struggling.

"If he can do it, anyone can," Bray said.

The Bill & Melinda Gates Foundation is planning to use its massive endowment to offer $400 million in new low-interest loans, loan guarantees and equity investments.

It's a significant step by the world's largest private charity to use more of its $30 billion in assets to finance program-related investing. I first wrote about the idea here.

The $400 million will be used for a range of new opportunities, including charter school expansion, agricultural financing for small farmers in Africa, and investment in global health technologies, according to people familiar with the plan.

The program-related investments or PRIs will be managed by Gates Foundation Chief Financial Officer Alexander Friedman and his staff. The Gates Foundation will seek partners for joint investments, aligned with its strategies in areas such as global health, U.S. education, agricultural development and financial services for the poor, to more than double the total funding.

U.S. foundations have hundreds of billions of dollars in their endowments, but pay out just 5 percent of the total each year. Meanwhile the economic downturn has forced them to think about new ways to achieve their charitable goals. Foundation endowments plunged an average of 26 percent last year.

Non-profits have heard plenty from business people about how they can make philanthropy work more efficiently. Isn't it time to ask how ideas from the non-profit world can improve business?

The wreckage of the Wall Street crash and the global economic crisis reveals not only toxic assets but also toxic ideas, said Matthew Bishop, American business editor of The Economist magazine.

Among them: the deadly virus of short-term profit fixation and the assumption that the market is the best judge of success or failure (people who believed this wildly underestimated the consequences of a burst housing bubble, for instance).

Capitalism needs a makeover. The economic crisis, not to mention problems such as disease, poverty, hunger and climate change, provides more than sufficient impetus.

Big businesses will have to prove their usefulness to society, Bishop said. The author of Philanthrocapitalism spoke at a meeting of private foundations in Seattle.

"There needs to be a coming together of the head and the heart," he said.

He gave some examples of interesting new hybrids:

--The Peterson Foundation, a non profit set up with the mission of improving fiscal policy in the U.S.

--New Philanthropy Capital, a UK firm that provides equity research and sector reports for philanthropy in the same way Morningstar does for companies.

--Socially useful finance in the form of New Profit Inc., which provides two dozen innovative non-profit organizations with capital to build management skills.

--Google.org got off to a rough start, but shows the potential of companies to use their core strengths to help society. Peaks in searches for flu are effective indicators of flu patterns and much quicker than WHO data. Searches on cars provide important data on the economy.

The economic crisis also shows how the ownership function has failed, Bishop said. The vast majority of stocks are owned by institutions, and Americans' retirement money is managed by people who are setting agendas at companies. Corporate governance, including executive pay, should reflect the values of the owners -- us.

"The crisis ought to make us accelerate those trends so that by the time we retire, not only will we have a good retirement income, but the world will be one we want to spend it in," he said.

Another new effort called FutureLab is a non-profit incubator for ideas that I learned about here.

The Bill & Melinda Gates Foundation is doing more with its money than giving it away. It has been moving into investments, loans and loan guarantees aimed at furthering its programs.

The $30 billion foundation has made several investments so far and others are in the works, as I reported in this story today.

Program related investments or PRIs are one way the Gates Foundation can increase its impact beyond the $3.5 billion a year it makes in grants. The approach also imposes financial discipline on recipients so they operate more like businesses.

What will be most interesting to watch is to what extent the foundation uses its $30 billion endowment towards its charitable goals. It plans to carve off a portion of the endowment to invest in ventures related to its programs, but has not released details about how that will work..

That step could mark a shift from the strategy of the past several years in which it invested its endowment, or asset trust, solely with the goal of maximizing profit.

The next PRI could be a loan guarantee towards U.S. education.

PRIs are set up to further the charitable mission of a nonprofit, not to make money. They are risky and the default risk rises in a bad economy, but they can also be very profitable. The investor can also call in the loan if the recipient is not adhering to the stated mission.

Examples could be a low interest or no interest loan to needy students, an investment in a low-income housing project or a loan to a for-profit pharmaceutical company. In fact a new designation called an L3C, or a low-profit limited liability company, has been created to facilitate such program investments.

The Gates Foundation has made least three program-related investments in the area of global development: $20 million to Africa ProCredit Holding to increase access to banking services for micro entrepreneurs, small businesses and low income groups; $20 million to ASA International Holdings to scale up a proven microfinance model in several countries in Africa and Asia; and $10 million to Opportunity Transformation Investments to create or expand commercial banks for the poor across five African countries.

They are not the same as mission-related investments, which align investment of assets with a charity's mission, and include actions by shareholders to affect the behavior of companies, said Lance Lindblom, chief executive of the Nathan Cummings Foundation.

The Gates Foundation came under fire in 2007 following a report that it was investing in companies contributing to health problems and other human suffering the foundation was working to alleviate through its grants. At the time, the Gates Foundation said it would not alter its approach to investing its endowment.

When screening companies for behavior contrary to a foundation's mission, sorting out responsibility can be difficult, Lindblom said. He advocates that foundations exercise their proxy votes to persuade companies they invest in to act more responsibly.

The current investments of the Gates Foundation's endowment trust can be found here.

When you're homeless your feet take a beating. That was the simple fact behind the idea to provide a foot washing service.

KRISTI HEIM

Volunteers washed and massaged peoples' feet at a United Way event on Sept. 11, the first National Day of Service and Remembrance.

People approached a section of folding chairs inside Qwest Field and gradually began to sit down and take off their shoes. Volunteers brought over warm water in clear plastic boxes.

One man's feet were so frost bitten from last winter that it hurt too much to brush them with a towel. Another man asked a volunteer to recite the little piggy nursery rhyme on his toes. A third said it was the first time another human being had touched him in months.

KRISTI HEIM

Candice Mooneyham gets her hair done during a volunteer event to help homeless and low-income people get basic services free of charge.

The United Way organizers hoped last Friday's event, which included hot meals and dozens of free basic services, could narrow the divide between people with homes and people without them, at least for a day. A wrenching year of layoffs and foreclosures had already pushed many of the housed into the other camp.

The activity also held a deeper spiritual dimension for volunteers like John Fergueson, an Episcopal priest from Kenmore. The Christian tradition is based on Jesus washing the feet of the Apostles, turning a menial task for servants into a lesson about humility.

"It's a way of acting on the solidarity of all people," he said. "The face of homelessness is different now. People are much more like us than not like us."

The community event drew 1,200 people, including the newly homeless: young people without jobs. People like Candice Mooneyham or Mike Schreck who didn't even look poor but had been sleeping on the street and in parks.

KRISTI HEIM

People approached the foot washing station tentatively at first but eventually filled all the seats.

Mooneyham, 39, who came from Spokane and before that from Oregon in search of work, said she had slept outside under a bridge in downtown Seattle the day before.

"I have never in my life seen so many homeless around," she said. "I'm not really scared, but it's not something I hope to do a lot longer."

Mike Schreck, 42, who is now living in a Queen Anne shelter, said he dreaded the winter months when he will have to compete for a bed with men who have been living outside all summer. The unemployed waiter said social services are overwhelmed by people with drug and alcohol problems, while there's little help for those who just need work.

"As it gets worse more and more people who are economically depressed are going to be shocked at the treatment they will get," he said. "As the job situation gets worse there are going to be a lot more of those people."

People waited in line from dawn until the doors opened at 9 a.m. Some information booths hardly had a visitor. But hundreds of people, including a woman with her middle-aged mother and her baby in a stroller, stood in a line stretching around the inside of the building to a room where they could pick out a few items of clothing and get a new backpack. After a few hours organizers ran out of clothing and had to turn people away.

We hear a lot about the promise of microcredit, small loans to help low income people start businesses and improve their lives. The concept has caught fire among philanthropists who see it not as a handout but as a way to help people help themselves.

In the Seattle area, nearly two dozen non-profits are dedicated to microfinance -- loans and other financial services for the poor.

PHIL COALE/ASSOCIATED PRESS

Americans who bought homes through the IDA program have been very good at keeping them.

In talking with Bob Christen of the Gates Foundation for my story today, he told me the reality of microcredit hasn't lived up to its promise to lift poor people out of poverty, despite the $2 billion a year being spent on it. He made a strong case that the picture is more complex than just loans, and savings should be a much bigger part of the solution. Savings helps individuals, enterprises and economies get through uncertain times.

The same thing may apply in the United States, where savings is finally making a comeback. Americans' savings rate dropped to negative territory in 2005, but has since reversed that trend, rising to almost 7 percent in May and averaging about 5 percent so far this year.

New research shows that low-income Americans who participated in matched savings programs weathered the recession relatively well. Almost all of them held on to their homes, said Andrea Levere, president of the Corporation for Economic Development (CFED). She presented the findings this week at an annual conference of Philanthropy Northwest.

Last year, CFED surveyed about 750 low-income home owners who had received an Individual Development Account sometime over the past five years. An IDA, similar to a 401K match, is a grant that matches the monthly savings of working-poor families trying to buy their first home, pay for education or start a business.

Only one of the homeowners had foreclosed. CFED repeated the study using courthouse records of properties and found a foreclosure rate of less than 2 percent.

"This is wealth creation done right," Levere said. Participants saved money for a down payment, received intensive financial education and fixed rate long-term mortgages, all requirements of the IDA program.

JIM SIMON

People who once lived in a Kenyan slum are able to purchase their own homes built by the microfinance organization Jamii Bora.

Housing is also at the center of an innovative but risky program in Kenya started by the non-profit microfinance group Jamii Bora Trust, which Jim Simon wrote about here. The women involved said loans alone aren't going to get people out of poverty. Jamii Bora provides street beggars and others small loans to start businesses, but only if they first save half the amount themselves.

In the U.S., about 83,000 people have received individual development accounts, Levere said. Banks had an incentive to participate because they could sign loans with families buying homes through the program.

Washington state has become a hotbed for similar "asset building activities," she said. The Asset Building Coalition got off the ground in late 2006 and promotes financial literacy, saving and access to mainstream banking, in addition to the Earned Income Tax Credit and other benefits.

While poverty is traditionally measured by income, Levere prefers to measure assets -- the net worth of a household that helps it withstand crises.

The question is whether or not a household could exist at the poverty level for three months if its main source of income went away. Under that definition, almost a quarter of Americans fall under the poverty line, she said.

Considering the high cost of education coupled with the recession, this may be the first generation that is less educated than the one before, Levere said.

Since people need more support to save for education, entrepreneurship and home ownership, she thinks it's a good idea if "every child born in America started with an account."

A University of Washington researcher looking at new U.S. Census data today found that more than one in eight Americans were below the official poverty line, and poverty is growing slightly faster in the West than elsewhere in the country.

Jennifer Romich, an associate professor of social work at UW's West Coast Poverty Center, said that from 2007 to 2008 poverty in the 13 Western states rose from 12 percent to 13.5 percent, slightly higher than the 13.2 percent national figure.

"It was not a surprise because I think the West was slower to get hit by the most recent economic downturn," Romich said. "In Washington state, our economy didn't start to tank until the last quarter of 2008."

In the West, the percentage of people without health insurance rose from 16.9 percent in 2007 to 17.4 percent in 2008. Nationally, the statistic remained unchanged at 15.4 percent uninsured.

Yet real median income in the West declined less -- 2 percent to $55,085, compared with a nationwide decline of 3.6 percent.

The way the Census Bureau measures poverty is the same across the lower 48 states -- a family of four living on less than $22,000 a year is under the poverty line. That may actually understate the economic distress that poorer people are feeling in places like Seattle, where the cost of living is much higher than in the Midwest or South, for example.

"If you make $25,000 and have a family of four people in Seattle, you are not officially poor," Romich said. "But functionally if you are trying to find housing in this market it's going to be very difficult."

Romich analyzed data from "Income, Poverty and Health Insurance Coverage in the United States: 2008." She said she expects the trends to continue next year. The full report can be found here.

Friday marks the first National Day of Service and Remembrance, a way to honor the anniversary of September 11 by volunteering to help the community.

In Seattle, hundreds of volunteers will connect with people who are homeless or facing poverty in a day-long event at Quest Field. About 90 organizations are offering free services, from haircuts and dental work to help applying for jobs, housing, food stamps and veterans benefits.

CURT NAKON

People get free haircuts during United Way's Community Resource Exchange, a day when dozens of local non-profits gather to provide free services for homeless people. .

The United Way of King County decided to hold its biannual Community Resource Exchange on the first National Day of Service, meant to encourage more volunteering and support for non-profits. Hundreds of projects are planned throughout King County on Friday, and more than 8,000 people have volunteered to work on them. Details can be found here.

The Community Resource Exchange, from 9 a.m. to 2 p.m. at Quest Field, gives people a central place to find help, relax, eat and socialize with others, said United Way spokesman Jared Erlandson. The non-profit expects to serve at least 1,000 needy people at the event, which is open to the public.

"Instead of having to navigate the gauntlet of services -- when they're spending so much time just trying to survive -- finding them all in one place is really valuable," he said.

The national day was established earlier this year as part of the Edward M. Kennedy Serve America Act. People can get ideas and share their own volunteer plans at this site.

On any given night in King County about 8,500 people are currently homeless, and over the course of a year, about 24,000 people have been homeless for some period of time, according to the United Way.

In another volunteer event Friday, the Jubilee Women's Center is getting a vegetable garden built by 25 Microsoft employees. The center provides low-cost housing for homeless women trying to get back on their feet. I visited the center a few months ago and met one of the residents, a woman who had fled an abusive husband and was working her way through law school.

They regularly receive canned food, but the garden will fill a big void in fresh produce. Local businesses donated the soil, seeds and building materials.

Dr. Stefano Bertozzi is joining the Bill & Melinda Gates Foundation next week as its new HIV director in the global health program.

An expert in health economics, he will manage grants in HIV vaccine development, biomedical prevention research, diagnostics, development and resistance monitoring, and strategies for introduction and scaling-up of interventions, the foundation said.

HIV is one of the biggest programs at the foundation, which has spent nearly $12 billion on global health since 1994.

For the past 11 years Bertozzi has worked in the National Institute of Public Health (INSP) in Mexico as the director of its Center for Evaluation Research & Surveys, where he leads economics and statistics teams that conduct impact evaluations of large health and social programs.

He also chairs the Steering Committee of aids2031, an international consortium of people from diverse backgrounds looking for new ideas for the global response against HIV/AIDS. I found this video of him in which he talked about the need for a new approach to HIV that is longer term, and building more efficient management systems.

"We've been so caught up in the urgency of people dying that we haven't thought about how to win this fight over the long term," he said.... "It's foolish for us to take an emergency response to prevention."

Bertozzi co-authored this paper that discusses the spread of HIV from sex workers whose clients are willing to pay more not to have to use a condom.

"His intimate knowledge of the medicine, science, economics and policy of HIV will help make this important portfolio have the most impact," said Tachi Yamada, president of the Gates Foundation's global health program. Bertozzi worked with the foundation in his previous roles at UNAIDS, the World Health Organization (WHO) and the World Bank.

Jeff Raikes has kept a pretty low profile in his first year as chief executive of the Bill & Melinda Gates Foundation. The man who built Microsoft Office now runs the largest private foundation in the world, which gives out more than $3 billion a year from an endowment of $30 billion.

Raikes recently talked about the fallout of the economic crisis on the foundation, the importance of risk taking and failure in philanthropy, and his experience working with Melinda Gates, which he said has been the most fun. He spoke at a breakfast last week sponsored by the Puget Sound Business Journal. (I couldn't get in, but thanks to the Seattle Channel I was able to watch it here).

DEAN RUTZ/SEATTLE TIMES

Jeff Raikes grew up a "farm kid" in Nebraska and later gave up a job at Apple to join Microsoft in 1981. "Steve Jobs yelled at me, telling me that Microsoft was going to go out of business," Raikes said.

Not a lot of what he said was new, but he did reveal some insights from his first year, including how serious the stock market plunge hit the Gates Foundation.

"The biggest impact by far is on our partners and the people that our partners and we strive to serve," he said. "It's one of those things if you think about it you get a little depressed."

On Jan. 1, 2008, the Gates Foundation's endowment was $39 billion. In just one year it had dropped to $30 billion.

"That's nine billion," Raikes said. "Part of that is the payout, part of that is the drop in the market. Let's say you have another 10 percent drop in the market. We're paying out $3.5 billion in direct charitable activity. Jan 1, 2010, we're now at $23 billion."

"At one point in time I thought that was the scenario I was looking at," he said. "The good news is the market has come back. The situation isn't quite as dire as it was a few months ago."

"At the end of the day we're very fortunate that Melinda and Bill took a deep breath and decided we're going to keep investing." The foundation's direct charitable giving is up about 10 percent this year, and its endowment stood at $30.2 billion at the end of June.

But the crisis has forced a renewed focus on top priorities, Raikes said, namely the biggest killers of children in the developing world -- HIV/AIDS, tuberculosis, malaria, pneumonia and diarrhea.

"We have to figure out how we can keep the momentum going in the short term while recognizing we have to conserve financial resources for the long term," he said.

One of the most important things he's learned in the first year is how the role of philanthropy differs from business and government.

"The private sector certainly is important but appropriately driven by the profit motive... government has the responsibility to provide services to raise the overall standard of life... You really don't like the government doing risky things with your tax dollars."

The Gates Foundation will take on some risky ventures and challenging ideas that government couldn't take on alone, he said.

"There are going to be times because we're taking risks we will fail... that's part of our role," though the goal is to succeed, Raikes said. "It's not that different frankly from how we operated at Microsoft."

Billionaire Warren Buffett, who is giving the bulk of his fortune to the Gates Foundation, told Raikes the foundation shouldn't be succeeding all the time. Raikes understood the message, but said it's another thing to try to pass it down.

"Warren would say swing for the fence," Raikes said, using a baseball metaphor. "But I've got the 700 or 800 employees at the Gates Foundation saying oh, alright, it's OK for me to fail."

Raikes has known and worked closely with Microsoft Chairman Bill Gates for 28 years. Raikes joined Microsoft when the company had about 100 employees and met his wife, Tricia, there.

He said working with Melinda Gates has been a highlight of the year.

"I knew Melinda at Microsoft, but in particular for me the most new fun in this year has been working with Melinda," he said. "For me she's a tremendous collaborator, a great coach, a great mentor." She has a deeper understanding of how the foundation works than her husband, who was busy at Microsoft until last year, he added.

Raikes said former Microsoft President Jon Shirley and baseball manager Lou Piniella are among his own mentors. He said he looked up to Shirley because he could not only guide others but "personally step in, roll up [his] sleeves and make it happen."

On Sept. 25 Raikes will address the annual meeting of the Greater Seattle Chamber of Commerce, focusing on the impact of the economic downturn on efforts to address family homelessness. Details are here.

Rohan Paramesh, 16, combined his interest in mountaineering with his desire to help charitable causes during his summer break from school.

He just finished climbing Mount Rainier and used the trip to raise about $15,000 from friends and family members supporting his twin goals.

At a time when funds are tight but needs are great, creative approaches to fundraising and charitable giving are flourishing. Local groups are holding new kinds of events to raise money while sharing knowledge about what they do. Individuals are reaching out to personal networks, and businesses are identifying worthy customers to help during the recession.

COURTESY OF ROHAN PARAMESH

Lakeside School senior Rohan Paramesh climbed Mount Rainier to raise money for Seattle Children's Hospital and for a children's education project in India.

Following a passion for mountain climbing, Paramesh planned to try to summit Rainier this year. When he found out he had secured a spot in early August, he realized the training would make it hard to spend a lot of time volunteering for non-profits.

So he decided to turn his trip into a fund raiser for schools in India, where he spent time volunteering the summer before, and for Seattle Children's Hospital, which had helped his brother with bouts of severe allergies.

"I know it's more than if I went around to peoples' houses and asked for donations or sold key chains," he said.

"It was a unique thing to do -- an adventure I would tell people about. Climbing a mountain itself represents surmounting some huge obstacle. That is also representative of what I'm trying to help others do."

His conclusion? "One lesson was clear to me -- even a small, sustained effort can matter."
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Fred Hutchinson Cancer Research Center started the Innovators Network just over a year ago to recruit donors under the age of 45.

Tonight it's holding an event to review its progress, where prospective donors can meet and talk with leading researchers.

"This generation does things a little bit differently," said Christi Ball Loso, the center's media relations manager. "They're more hands-on. They want to be able to interact with the researchers, and they ask really good questions. They're interested in the science."

Earlier this year the non-profit eliminated 83 jobs, or about 3 percent of its workforce, as part of budget cuts in response to a drop in charitable donations. It's looking to establish a larger pool of younger donors now to fund cutting-edge research and get started early on philanthropy aimed at fighting cancer.

The program helps young donors increase their knowledge of scientific innovation and share the information about research with their own social and professional networks. Individuals make annual gifts of $1,000 or more to support some of the Hutch's most cutting-edge, high-risk, high-reward research projects, Loso said.

UPDATE: The group raised a $306,000 in its first year and 131 charter members were recruited, surpassing the original goal of 100 first-year members in the Innovators Network.

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Project Treehouse, a Seattle nonprofit that supports foster children with clothing donations, education fees and summer camps, used the demand for back-to-school clothes in a year of tight budgets to stage a unique fashion show on Wednesday.

Project Treehouse, wanted to highlight the needs of foster children while adding some clothes to their wardrobes.

People attending the event brought clothing and toured The Wearhouse, a supply store that provides free items such as clothing, shoes, school supplies, books, toys and bikes to 2,800 foster kids every year. Volunteers and foster families accompanied them to talk about their experiences.

The fashion show featured 14 foster kids modeling donated clothes as Seattle Seahawks' SeaGals cheered them down the runway. Guest received shopping bags to take home and fill up with needed items. Five local clothing boutiques listed on the Web site are still taking drop-off donations.

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Mywedding.com founder Rob Johnsen thought of a way to help couples during the difficult economy by holding a "wedding wish contest" monthly through the end of the year.

The contest's first recipients were a Bellingham couple, Megan Larama and Robert Ziesing, who were struggling to afford their wedding when unexpected costs arose from the adoption of a foster child. Larama said she was impressed by Ziesing's bighearted nature. The 30-year-old teacher had a house full of children and was on his way to adopting a third child.

The bride-to-be wrote a letter to the Seattle-based company explaining the situation. Johnsen worked with local vendors, who chipped in $2,500 worth of services, including a wedding cake, tux, transportation and a stay in a downtown Seattle hotel.

The Bill & Melinda Gates Foundation's endowment grew $2.7 billion in the last quarter, according to new figures posted on the foundation's Web site today.

The world's largest private foundation had $30.2 billion in its asset trust endowment as of June 30, up from $27.5 billion. It also added 21 new employees for a total of 781.

The fourth and most recent installment of Warren Buffett's gift, $1.25 billion, was recorded on July 1. The gift comes in the form of Berkshire Hathaway B shares. This year, the value of those shares was about 30 percent less than last year's, owing to the decline in stock prices during the recession. Buffett has given the foundation a total of $6.41 billion so far.

The Gates Foundation's endowment, including Buffett's annual installments, is held in an asset trust, which funds the foundation. The Bill & Melinda Gates Foundation Trust is managed by a team of outside investment managers. In addition to selling Berkshire Hathaway shares, they have been buying shares in U.K. sportswear retailer JJB Sports. Here is a look at Michael Larson, the man who runs it.

The country is facing a new and painful economic crisis, but "we've been in an education crisis for decades," Bill Gates told a conference of lawmakers today.

Educational performance at every level, from primary school to college, is dropping against the rest of the world, he said. The United States has fallen from No.1 to No.10 among industrialized nations in college graduation rates.

And U.S. high school graduation rates have not improved for 40 years, said Gates, who is co-chair of the Bill & Melinda Gates Foundation. More than 30 percent of all students drop out, including almost half of minority high school students.

MATT ROURKE/ASSOCIATED PRESS

Bill Gates, who dropped out of Harvard to start Microsoft, is calling on lawmakers to reform education and raise graduation rates.

"Success in this century will depend on how well America does what we have so far done very badly -- give low-income and minority students a world-class education," Gates said in a speech at the National Conference of State Legislatures in Philadelphia.

Difficult times can often spark needed reforms, he added.

He called on lawmakers to use $100 billion in federal stimulus money to change the way schools are run, creating new ways to measure and reward graduation rates instead of enrollment rates, for example, and tracking which colleges prepare students best for the job market.

"Colleges are not entitled to escape scrutiny at a time of a plunging educational performance and permanent fiscal pressure," Gates said.

He also advocated linking financial incentives such as state funding, financial aid and other programs to school performance.

Adding financial incentives for graduation can encourage colleges to offer schedules that make more sense for students who have to work, courses and counseling that guide students toward specific job goals and more innovative use of technology, such as online lectures, Gates said.

Teachers play the most important role in student achievement, so effective teachers should be identified and rewarded.

"We reward teachers for things that do not identify effective teaching -- like seniority and master's degrees," Gates said.

He criticized a law passed last year in New York that bars student test scores from being considered in teacher tenure decisions.

"That was a strategic win for people who oppose reform -- because no real reform will happen until we can evaluate teachers based on their students' achievement."

Gates encouraged lawmakers to support the state-led Common Core State Standards Initiative as a way to create higher standards for students across the country.

Linking common standards to curriculum can unleash creativity in new teaching materials, such as online tools and videos of every required course, he said. Gates said he and his wife have used online videos to help their own children with school work.

"Imagine having the people who create electrifying video games applying their intelligence to online tools that pull kids in and make algebra fun," he said.

The Gates Foundation has focused its U.S. grantmaking program on education, but its initial push for small schools produced mixed results and led to revamping of its strategy.

The foundation recently announced a new post-secondary initiative with a goal of doubling the number of low-income students in the United States who graduate from college or other post high-school programs by 2025. The foundation is funding pilot programs at community colleges and technical schools to help low-income adults with full-time jobs get through college.

Of the $20 billion the Gates Foundation has given away over the past 15 years, about $5.2 billion has gone into U.S. programs, mostly for education.

Some fundraising campaigns have done surprisingly well even in the face of recession.

Led by Seahawks CEO Tod Leiweke, the Seahawks helped United Way of King County raise more money this year than any other United Way in the country.

The local United Way announced yesterday it had raised a total of $100.3 million in its 2008-2009 campaign ended June 30. It's the third consecutive year the organization has broken the $100 million mark.

United Way raised about $116 million in 2007-2008, according to its annual report.

Seeing the effects of the plummeting economy on poor families, United Way announced a Response for Basic Needs in November. It has raised $3.7 million for that program, supporting 6 million additional pounds of food into emergency food banks and signing up more than 1,000 people for food stamps.

Earlier this month, United Way held a Climb for the Community. Leiweke, Fine, Seahawks coach Jim Mora, United Way Chairwoman Molly Nordstrom and NFL Commissioner Roger Goodell climbed Mt. Rainier to raise money and awareness for the basic needs campaign. The event raised an additional $380,000.

"The Northwest is a special place," Leiweke said.

Current and former Seahawks were involved last month in an event focused on global humanitarian work. Medical Teams International raised about $1.7 million at its 10th Annual Field of Dreams Dinner and Auction at Safeco Field. The event drew 820 guests, the largest turnout in its decade-long history.

Seahawks Quarterback Matt Hasselbeck and his wife Sarah and Horizon Air CEO Jeff Pinneo and his wife Janey co-chaired the event, with former Seahawks coach Mike Holmgren as honorary chairman.

Fund raising in such a difficult economy takes direct personal involvement and proof of financial efficiency, organizers said.

"The people and businesses here are incredibly generous, but they are also savvy," said Leiweke. They want to know that they're making a smart investment, so it helps that 96 cents of every dollar to United Way go to the community assistance programs.

With Medical Teams International, nearly 97 percent of all proceeds go directly to providing medicines and urgent care to people affected by disaster, conflict and poverty.

Organizers turned Safeco Field into a recreated orphanage in Romania with a flashing light bulb signifying a child dying every three seconds, and attendees walked over cardboard and garbage in recreated "dumps" of Mexico, where entire families live and dig through the rubbish to survive. There were also make-shift medical tents with IV's hanging from tree-branches.

Holmgren's wife, Kathy, a nurse, knows those situations well. As a volunteer with Medical Teams International, she worked in Uganda earlier this year with their daughter, Calla, a doctor, helping families forced from their homes by ongoing fighting in neighboring Democratic Republic of Congo. Three years ago, Kathy Holmgren was on a medical mission in DRC while her husband coached in the Super Bowl.

The non-profit humanitarian relief and development agency has deployed more than 1,900 volunteer teams and shipped over $1.2 billion in antibiotics, surgical kits and medicines to 35 million people in 100 countries. In the Pacific Northwest, Medical Teams runs a mobile dental program for more than 16,000 patients a year with the help of 900 dental professionals who donate their time.

Fireworks shows are out, but grants to non-profits will continue.

JPMorgan Chase will maintain its level of charitable giving in Washington state, though the mix will change, CEO Jamie Dimon said today in an interview with the Seattle Times' Drew DeSilver and other local reporters.

PAUL SAKUMA/ASSOCIATED PRESS

JPMorgan Chase CEO Jamie Dimon.

Chase's decision to drop sponsorship of the Independence Day fireworks show at Lake Union sparked concerns the New York-based bank, which took over Washington Mutual last September, was scaling back from WaMu's level of corporate philanthropy.

WaMu gave about $2.6 million in the state in 2008, and had sponsored the fireworks show since 2002. After Chase picked up WaMu, it said it would continue WaMu's level of corporate giving this year and agreed to pick up most of the $500,000 cost for this month's fireworks show.

JPMorgan Chase made a profit of $2.1 billion in the last quarter ended in March.

But Chase's charitable giving typically takes the form of grants to nonprofits rather than sponsorships, said Dimon and Phyllis Campbell, Chase's head of Northwest operations.

"Sponsorships really aren't in the sweet spot for us," Campbell said. Campbell joined the bank earlier this year after six years leading the Seattle Foundation, and her priorities are likely to shape what Chase funds.

Going forward, Dimon said Chase's philanthropy in Washington "will continue probably around that ($2.6 million) level" but added that "obviously there are going to be changes -- some things are going to go down, some will go up."

On a related subject, Dimon and Campbell said Chase was still sorting out what to do with WaMu's extensive collection of art and artifacts. Some likely will join Chase's collection in New York -- a collection that dates back to when the Rockefeller family ran one of the company's predecessor banks -- while other items will be donated to the Museum of History and Industry or other local institutions, Campbell said.

This afternoon the micro-lending site Kiva will be hosting an open conference call to get feedback on its pilot program in the United States.

The program has generated mixed reactions and a protest led by a Seattle lender who thinks Kiva should stop featuring borrowers from the U.S. The U.S. loans deviate from Kiva's original mission to help the poorest, said Tom Behan.

"New Kiva loans are facilitating the richest country on the planet in making loans to itself," Behan said.

Kiva spokeswoman Fiona Ramsey said the non-profit expected the move to be somewhat controversial.

At the same time, "We never saw ourselves as just a platform for Americans to loan to developing countries," she said. "We've received emails for years from people who say that charity begins at home -- why aren't you giving me an opportunity to do that?"

One positive outcome has been the high degree of interest and engagement of Kiva users who feel strongly about the issues, Ramsey said.

Kiva is working through two microfinance partners: ACCION USA and the Opportunity Fund. Those organizations select entrepreneurs to post on the Kiva site. Recent U.S. borrowers have ranged from a New York homeless man to a San Francisco architect.

Each partner has caps on the number of loans it can post. Even if they each reached the limit, the U.S. loans would not exceed 5 percent of Kiva's total global portfolio, Ramsey said.

Right now the partners are going through an adjustment period, Ramsey said, getting direct feedback from Kiva users about the types of borrowers and projects they would like to see. She summarized the reaction along these lines:

"The homeless guy -- that story brought me to tears," she said. "The architect -- I'm not buying it."

President Obama and other world leaders seem to be taking their cue from the Gates Foundation for a new three-year agricultural initiative announced today.

Leaders from the Group of Eight leading economies made the $20 billion pledge to finance agricultural projects in poor countries to fight hunger and reduce food price volatility.

The U.S.-sponsored food security initiative aims to provide poor farmers in developing countries with seeds, fertilizers, infrastructure and other tools to help them boost local food production, a shift from previous policy that emphasized sending food aid from abroad.

Here is what Obama said about the issue today:
"There is no reason why Africa cannot be self-sufficient when it comes to food. It has sufficient arable land. What's lacking is the right seeds, the right irrigation, but also the kinds of institutional mechanisms that ensure that a farmer is going to be able to grow crops, get them to market, get a fair price."

The Gates Foundation has focused on seeds, fertilizer, irrigation and market access in its own programs, spending $2.6 billion on global development so far, most of it for agriculture in Africa.

The world's largest foundation has taken on a major role in agricultural development since it launched the Alliance for a Green Revolution in Africa (AGRA) in 2006. AGRA funds work to improve seeds, fertilizers, irrigation, and market access for small farmers, employing techniques of the original Green Revolution started in the 1940s in an effort to boost food production in Africa.

The new grants by Gates and Rockefeller came at a time when U.S. funding for agriculture had fallen sharply. Agriculture's share of U.S. development assistance was 3 percent in 2005, compared to 12 percent in 1985, according to this report. In dollars, support for agriculture went from a high of about $8 billion in 1984 to $3.4 billion in 2004.

Now besides the Gates and Rockefeller foundations, the U.K'.s Department for International Development has become another core donor to AGRA.

Obama also talked about agriculture and his trip to Ghana in this interview with AllAfrica.com.

"I'm still frustrated over the fact that the green revolution that we introduced into India in the '60s, we haven't yet introduced into Africa in 2009," he said.

The push for a green revolution in Africa has sparked criticism and debate about the role of high-tech solutions over ecological farming methods. Obama said today that low-tech solutions are also important.

"We don't need fancy computers to solve those problems; we need tried and true agricultural methods and technologies that are cheap and are efficient but could have a huge impact in terms of people's day-to-day well-being."

The Gates Foundation has also funded policy studies and advocacy campaigns. It gave nearly $1 million to the Chicago Council on Global Affairs to fund a project on the U.S. role in global agricultural development, and Gates Foundation Senior Fellow Catherine Bertini co-authored the report.

At the beginning of the Obama Administration, the Chicago Council released the report with recommendations for a new policy on agriculture as a way to restore the United States "as a force for positive change in the world."

The report, "Renewing American Leadership in the Fight Against Hunger and Poverty: The Chicago Initiative on Global Agricultural Development," made five recommendations and more than 20 specific suggestions, calling for a renewed U.S. commitment to alleviating global poverty through agricultural development in Sub-Saharan Africa and South Asia. The recommendations include increasing support for agricultural education, research, including genetic engineering, and infrastructure.

The official support for biotech and commodity crops was called into question today in this piece by food writer Paula Crossfield.

Bill Gates has used forums such as the World Economic Forum in Davos to increase public attention to the issue, and has spent more time talking directly with world leaders since leaving Microsoft to dedicate himself to full-time philanthropy.

Gates has taken up the cause of agriculture in meetings with key leaders such U.K. Prime Minister Gordon Brown and Spanish Prime Minister Jose Luis Rodriguez Zapatero.

Former UN Secretary General Kofi Annan, chairman of AGRA, recently outlined a 10-year strategy to develop regional breadbaskets among African countries to produce staples. AGRA President Namanga Ngongi was in Brussels a couple of weeks ago meeting with European Union officials about the topic.

The food crisis itself may pushed the issue back onto the political agenda. The UN predicts the number of people going hungry will rise to 1.02 billion this year, reversing a four-decade trend of declines.

Yet today's G8 commitment also shows that the foundation's relatively new efforts in global development are beginning to have a catalyzing effect on agricultural policy, just as its health programs have helped shape the world health agenda.

Mark Suzman, director of policy and advocacy for the Gates Foundation's global development program, said today's pledge is encouraging. Leadership coming from the G8 on agriculture could be a platform for the future in the same way that a G8 agreement to support public health in 2000 helped create the Global Fund to Fight AIDS, Tuberculosis and Malaria, he said.

"It's focused on the right set of issues."

The Seattle non-profit Global Partnerships has dollars to invest, but the microfinance institutions (MFIs) it's trying to help need money in local currencies. In the case of Honduras, it's easy to see why that gap is dangerous.

Global Partnerships has made several loans to organizations in Honduras, in dollars, and those organizations in turn lend money to poor entrepreneurs in local currency, the lempira. The ongoing political crisis has pushed an already weak Honduran currency to the edge of a major depreciation. In that case, the local organization will have to pay back possibly twice as many lempira as it borrowed, and pass the costs on to its borrowers.

"There hasn't been a credible mechanism to be able to hedge our loans so that the risk of depreciation is not absorbed by the poor borrowers this is supposed to be helping," said Gary Mulhair, chief investment officer at Global Partnerships.

Soon there may be a new solution to the risk of such currency fluctuations in the microfinance industry. Global Partnerships is helping to back a new company called MFX Solutions.

CHRIS MEGARGEE/GLOBAL PARTNERSHIPS

Silveria Champi Choque took a loan to help with a family business raising livestock in Peru. The lender, an NGO called Arariwa, received funding from Seattle-based Global Partnerships.

Its debut today is the result of a three-year effort involving more than 30 microfinance organizations from around the world, led by Global Partnerships, Calmeadow Foundation, ACCION International, Calvert Foundation and MicroRate.

MFX was created to apply modern hedging instruments to microfinance lending, analyzing and quantifying currency risk and mitigating that risk by trading among a basket of currencies. MFX also offers free Web-based risk management tools tailored to microfinance needs.

The initial backers are U.S. and European microfinance funds, networks, and foundations that have pooled their resources to set up MFX. In its first round of financing, MFX has secured $13 million from 17 investors, with Omidyar Network providing the biggest chunk: $9.3 million.

Other investors include Seattle-based Unitus, Triodos-Doen and Hivos-Triodos Fund of the Netherlands, Incofin CVSO of Belgium, ADA (Luxembourg), Grameen Foundation, Blue Orchard (Switzerland), Mecene/Africap, Microcredit Enterprises, Grassroots Capital, and Developing World Markets.

The Ford Foundation, The Currency Exchange Fund (TCX), The Dutch Development Bank FMO and USAID all contributed grant funding for MFX.

"Hedging goes on every day between very strong banks and companies," said Mulhair. Global Partnerships has tried to do such currency swaps with a bank, but "we're not big enough for banks to take us seriously."

With MFX, Global Partnerships may have to pay a higher cost up front to invest in places such as Honduras, he said, but ultimately it will have "less risky transactions, the cost will not be born by the micro-borrower, and we can do business with (microfinance organizations) we could not do business with before."

World Vision has laid off about 50 employees, between 4 and 5 percent of its U.S. workforce, saying a decrease in cash donations in the first half of 2009 has forced it to make some painful cost cuts.

Some of the layoffs were at the Christian relief organization's Federal Way headquarters, where about 800 employees work. Employees were notified of the layoffs last week. World Vision will cut 2 to 3 percent more jobs by eliminating 25 open positions.

World Vision said its private cash donations have fallen this year, dropping about 3 percent from January through March, and about 18 percent in the most recent quarter.

The non-profit's cash shortfall is expected to be $39 million for fiscal year 2009, which ends Sept. 30.

"We can no longer avoid the painful cost reduction steps that many organizations have already implemented," World Vision President Richard Stearns said in a statement. "The efforts of our faithful employees and donors have allowed us to swim against the tide longer than almost any other non-profit."

Other cost-cutting moves include reducing the organization's contributions to retirement plans by 50 percent, increasing employee premiums for health benefits and canceling annual merit raises for the second year.

Stearns received annual compensation of $336,000, and Lawrence Probus, senior vice president of strategic solutions, received $197,000, according to World Vision's 2008 tax filing.

Its five highest paid employees are Atul Tandon, vice president of donor engagement ($213,000); William Randolph, vice president of information technology ($160,000); George Ward, senior vice president of international programming ($157,000); Martin Lonsdale, vice president of channel management ($155,000), and Michael Veitenhans, senior vice president ($150,000), according to the filing.

Stearns talked about the role of faith-based organizations and federal funding in an interview earlier this year.

World Vision is coming up shorter in cash contributions from major donors and individuals, but income from current and new child sponsors is expected to rise about 4 percent in 2009, to about $333 million. Sponsors regularly donate $30 to $35 per month.

"The overwhelming majority of our child sponsors remain loyal, despite the harsh economic conditions many of them are facing," Stearns said. "These unsung heroes have been the foundation of our ministry for decades, and we are grateful for their faithfulness."

In-kind gifts of products such as pharmaceuticals are up more than 30 percent this year, he said, to top a record of $390 million.

Globally, World Vision International said its cash income likely will drop from a projected $1.9 billion to $1.6 billion in the fiscal year. World Vision International has about 40,000 employees in 100 countries.

Investor Warren Buffett made his annual gift of Berkshire Hathaway stock to the Bill & Melinda Gates Foundation Wednesday. At $1.25 billion, the value of the gift is 30 percent less than last year's contribution of $1.8 billion.

Buffett donated 428,688 shares of Class B Common Stock to the Gates Foundation in 2009 as part of his lifetime pledge, described here.

Under Buffett's plan to transfer the majority of his wealth to the Gates Foundation, the timing of the annual gift and the amount of shares are predetermined. But the value fluctuates.

According to the schedule, the number of shares donated diminishes by 5 percent each year. Buffett had expected the value of his shares to increase by an amount that more than compensates for their smaller number. And for the first two years, they did. CNBC's coverage has a chart of the annual gifts here.

But even shrewd investors have not escaped the wrath of the global recession, and Berkshire Hathaway has seen the price of its Class B shares decline by about 26 percent over the past year. Those shares closed at $2,924 a share on Wednesday.

Forbes estimated Buffett's net worth at $37 billion this year, ranking him second only to Bill Gates (whose worth was estimated at $40 billion) in the list of the richest people in the world.

Adnan Mahmud's inspiration to create a new kind of charity started when he passed a stranger at a cemetery.

He was in Bangladesh visiting his grandfather's grave when he saw a man who clearly didn't have money for his own son's funeral.

The man was carrying his dead son, dressed only in a pair of shorts. He couldn't afford the traditional white cloth used to shroud the dead for a proper Muslim burial.

"There were vendors selling cloth for 50 cents or a dollar," Mahmud said. "I could have helped him, but by the time I came to the realization I was already back home."

MIKE SIEGEL/SEATTLE TIMES

Adnan Mahmud and Nadia Khawaja are founders of Jolkona, a non-profit designed to encourage young philanthropists.

Even a small amount of money can make a huge difference in the life of another person, he thought, but the problem was how to connect them.

"I couldn't have saved his son, but I could have at least helped ease the pain a little bit," he said.

Mahmud, 31, a program manager at Microsoft Research, thought about the many young professionals he knew who want to do some good but don't have the resources of Bill Gates.

"They'll all tell you 'I want to make a difference, but I don't know what I can do,'" he said.

The solution was to create an online space for people to get excited about philanthropy with just a couple hundred dollars a year.

So in 2007 he and his wife, Nadia Khawaja, created the non-profit Jolkona Foundation. Jolkona is a Bengali word meaning "a drop of water."

"Small drops of money can add up and make a ripple of changing the world," said Khawaja, 26. She was drawn to social service after a stint as a volunteer math tutor in South Central Los Angeles during college. "I don't want to just work in the corporate world, not feeling like I'm making a difference when there's so many problems going on."

After six months of testing, their Web site went live this month. Similar to Kiva and Global Giving, it lets people channel funds to specific people and causes. It also gives them new tools for monitoring their impact. Mahmud said he was put off by large conventional charities because it was hard to choose specific programs or know exactly how contributions were used.

"It goes into this black hole," he said. "I don't know what happens to it."

Jolkona's founders are part of a growing number of young people demanding more control of their philanthropy. A generation used to connecting around the world through Facebook now wants a face and a direct connection to someone they're helping.

Donors can pinpoint countries where they want to contribute and choose from five categories: cultural identity, education, empowerment, environment and public health. Projects can be filtered by the amount of dollars needed, going down to as little as $5, and the duration, from less than a month to six years.

"For young professionals, you're so busy it's hard to do research," Khawaja said. "You just get lazy. It's on your list to do, but it just doesn't get done."

"Our goal was to use technology to engage youth and make it as simple as possible to donate," Mahmud said.

The site also offers what it calls "tangible proofs for every gift."
"If you give $50 to buy library books, you'll actually know what books they bought with your donation," Mahmud said.

A person's donations are broken down into charts and graphs that look as detailed as a 401K portfolio, pages that Mahmud calls "a resume of good."

Mahmud opens up his account and sees an update on a project he's been supporting in India, helping a pregnant woman in a Calcutta slum. "Look, on the 20th she had her baby," he said. "Adopting" a mother and her baby costs $235, and donors can follow their progress for three and a half years.

In Afghanistan there's a school for girls, where $40 provides 10 months of educational expenses. Donors can see the name of a girl and "at the end of 10 months you'll see the report card," Mahmud said. For $30 you can buy seeds, tools and training for women farmers in Sudan.

Some non-profits might loathe such micro-management by donors. Mahmud acknowledges that the model isn't for every one. But for small non-profits without budgets for IT departments, it's a way to supplement other funding and reach a new generation of donors. So far they've found 19 partners and 39 projects.

Jolkona has raised $3,000 from 50 friends in six months of testing. The couple has funded the non-profit themselves, with help from volunteers and one paid software developer. Since all donations go to the charities, they created a separate button for donations to offset operating costs.

Mahmud says the next step is to get more people involved, using online tools like Facebook, Twitter and LinkedIn. A small group of volunteers will be traveling to different countries and blogging about their experiences on the Jolkona site, hoping to inform and inspire others.

Charitable giving in the U.S. fell 2 percent in 2008 to about $307 billion, but the decline was not as sharp as expected, considering the economic downturn, according to the Giving Institute. The results were part of an annual report on philanthropy that the institute released today.

The last time the U.S. saw a drop in overall giving was in 1987.

Among the findings:

• Philanthropy accounted for 2.2 percent of the the U.S. GDP, and individual donors accounted for 75 percent of all charitable giving.


• Giving to religion increased 5.5. percent, and religion received the largest share of contributions (35 percent).


• Giving to public-society benefit organizations rose 5.4 percent, a category that includes the United Way and groups engaged in voter registration.


• Giving to international affairs organizations rose 0.6 percent, slowing considerably from the 16.1 percent increase in 2007.


• The largest decline in giving (12.7 percent) was in human services, yet 54 percent of human service organizations saw an increase in demand.


• Foundation grant-making increased 3 percent, while giving from corporations and corporate foundations fell 4.5 percent (the largest decline among categories of donors).

What should Seattle do to make sure philanthropy here is as effective as possible? The Seattle Foundation came out with its own (very long) report last week that sets out a kind of road map for the region.

The person leading that drive will be named tomorrow when the foundation will announce a new CEO to replace Phyllis Campbell, who left in March to become chairman of JPMorgan Chase's Pacific Northwest business.

The foundation has identified strategies for a healthy community, from increasing affordable housing to restoring Puget Sound to supporting low-income entrepreneurs.

The report lists specific goals, ways people can help and more than a dozen local organizations working in each category. It also profiles people and organizations doing interesting work.

In real estate, for example, Windermere 's CoHo Team donates one-third of their commissions to support community development and affordable housing.

In South Seattle, the Got Green project and the Moontown Foundation are organizing young people of color to help weatherize low-income homes in the city.

In a forum at City Club, Crosscut publisher David Brewster seemed to put his finger on the pulse of Seattle philanthropy when he suggested that adding some "entrepreneurial garage culture" to non-profits could release their creativity.

Blending "Seattle's entrepreneurial genius and its humanitarian civic-mindedness creates an interesting chemical reaction," he said.

The Bill & Melinda Gates Foundation's endowment has dropped $2 billion since January. The foundation's asset trust endowment fell to $27.5 billion from $29.5 billion at the end of 2008.

The new figure was reported quietly on a fact sheet on the foundation's Web site last month.

In the Gates Foundation 2008 annual report, released last week, it reported endowment assets of $29.5 billion. That figure reflected a 20 percent decrease in the endowment portfolio's value in 2008 as a result of the economic downturn.

It's a challenging time for all non-profits, even the world's largest private foundation.

"We're all digging deeper into our pockets and coming out with less money," Gates Foundation CEO Jeff Raikes wrote in an open letter accompanying the report. "Our endowments are down, so even if we draw a higher percentage than we did last year, we don't have as much to give away."

Seattle Seahawks head coach Jim Mora sounds like an energetic guy. The Northwest native who's fond of running up Tiger Mountain is planning to climb Mount Rainier next month, along with Seahawks CEO Tod Leiweke and United Way of King County CEO Jon Fine, to raise money for the charity.

JOHN LOK/SEATTLE TIMES

Seahawks head coach Jim Mora.

Other climbers include NFL Commissioner Roger Goodell, Molly Nordstrom, the United Way's incoming board chair, Boeing vice president Fred Kiga, Costco vice president John Thelan and Wells Fargo regional managing director Greg Bronstein.

It's part of a drive by United Way to raise more funds for basic needs to help people struggling in the recession. Programs support housing, food banks and access to public benefits such as tax credits and food stamps.

Last year the Seahawks and United Way partnered to raise awareness about family homelessness. This time, the non-profit is hoping to reach Seahawks fans to participate in the fund raising drive.

Whit Alexander hopes rechargeable batteries can give a boost to incomes of people in Ghana.

It's the first product in a new Seattle venture that Alexander has started called Burro, a for-profit company with a social mission: to help people in developing countries improve their productivity.

"Our mission is to profitably deliver affordable goods and services to empower the poor to do more with their lives," Alexander said.

AL SADANAGA

Hayford Atteh (left), field agent with new Seattle startup Burro, Philip Sarpong (center), the first Burro employee, and Burro founder Whit Alexander, a Microsoft veteran and co-founder of Cranium.

He started Burro last October, after waiting two decades to get back to the part of the world that held a special appeal for him since high school. He and his wife majored in African studies at Georgetown University's School of Foreign Service, and Alexander later did consulting work in the region for World Bank projects.

After that came a five-year stint at Microsoft, where he created the Encarta world atlas, and then more than 10 years at Cranium, which he co-founded with Richard Tait. Now owned by Hasbro, Cranium closed its Seattle offices just last week.

"I'm coming up on 48 and I thought if I don't do this now when am I ever going to do it?" Alexander said of his new project.

The startup will focus on products that help people earn more income or provide a more affordable replacement for a product they're already buying.

He came up with the name Burro, using a symbol that is "a good animal in most cultures, hardworking and trustworthy, with extraordinary productivity," he said.

It also serves as a kind of "call to action" to do more, he said. "This isn't a handout."

Giving away the batteries wouldn't be sustainable, so Alexander had to figure out how to charge for them.

"The for-profit model is fundamental for me personally," he said. "We really do have to demonstrate that private enterprise can create opportunities that are sustainable, responsible and driving important social change."

He began by looking at where people were spending their money. People earning about $1 a day spend $2 to $6 a month on disposable batteries. Rechargeable batteries would save people money in the long run, but they couldn't afford the higher cost up-front, and most of them didn't have electricity to charge them.

So Alexander is introducing rechargeable batteries that people can rent rather than buy, and pick up through Burro agents who then take them to a central office to be recharged.
The customer pays a flat fee of 60 cents a month per battery, with unlimited exchanges for a fresh battery. Alexander figures his customers will get four times the energy of their standard batteries for about the same price.

He's starting in Ghana but believes the products could work well in many developing countries. For now, until he can prove the business model, Alexander says he's funding the venture himself with a lot of "donated sweat equity" from friends, including Jan Watson, Cranium's former operations manager.

Alexander is already experimenting with two additional products -- battery-powered lighting to replace kerosene and battery-powered cellphone charging. Both are significant expenses for people in Ghana.

BURRO

Burro produces rechargeable batteries for the West African market.

When Cranium closed its doors in Seattle last week, Alexander was there for the send-off with employees. "It was bittersweet," he said. "It's not the storybook ending we hoped for."

Now he's turning to a different market, one that relies on consumers in Africa and the uncertainties of their disposable incomes, which often fluctuate around harvest time.

"We are literally waiting for the corn to come in," he said.

As Seattle's new Express Credit Union makes its official debut this week, it turns the tables and tailors banking specifically to the needs of low-income people.

Its new model combines a credit union with policies and products designed to encourage savings, and a non-profit arm that can fund financial education. Accounts can be opened through local community service organizations, where people are already going for help.

Will that solve the problem for the estimated 20 percent of King County adults who lack a bank account? Recent legislation tackles some of the excess, but there is also debate about the merits of payday lenders. Meanwhile, Express predicts it will take about four years to become financially sustainable and not need to rely on grants.

COURTNEY BLETHEN/SEATTLE TIMES

Nathan Hawkins, a representative for Express Credit Union, helps members at the YWCA Opportunity Place downtown.

With Express rolling out its services to the public and hosting a "grand reopening" on Saturday, there are many questions about how it works, who qualifies and why it's taking on the payday lending industry.

While it aims to help people who have been rejected by banks in the past, not everyone will be accepted for all services. Clinton Jacob called me to say he was annoyed at having been turned down for a checking account at Express after the credit union looked up his history using the Chex system. Jacob owed $500 to a previous bank from a series of overdraft fees, charges which he considered unfair and did not intend to pay back.

Chief Executive Brenda Kurz said Express can't help every case.

"Every situation is very unique," she said. "We're willing to take that extra step and evaluate rather than turn people way."

In some cases, people can open a savings account and establish a six-month track record before being considered for other services like checking accounts and loans.

Express loans are not designed as payday loans, but as an alternative short-term loans with monthly payments, she said. Express offers repayment terms, and the loan is reported to credit reporting agencies so it can improve a credit score if paid back on time. Borrowers get a rebate of one-third of the loan fee once it's paid off, and no checking account is needed to qualify.

To illustrate how Express loans stack up to payday loans in cost, I asked for a detailed breakdown, which can be found here in a comparison chart.doc

Checking and savings accounts are free and can be opened with $5 or $10, along with free ATM use at a network of 300 locations.

Another program, Bank on Seattle, started last year as an effort to extend the services of commercial banks and credit unions to more "unbanked" low-income residents. Express is a member of that initiative.

The non-profit agencies offering Express services are YWCA, Catholic Community Services, the Refugee Women's Alliance, Solid Ground, Hopelink, Multi-Service Center of South King County, New Futures and Neighborhood House.

The agencies are getting grants from the new organization's non-profit arm to handle services like the financial education (which Hopelink is designing) and efforts to reach diverse immigrant communities through the Refugee Women's Alliance, whose staff members speak more than two dozen languages.

I've written a lot about microfinance, which proved to be one of the initial inspirations for Tricia McKay, executive director of the Medina Foundation, who came up with the idea and did years of research to develop a plan. The system of small loans to poor entrepreneurs also turned conventional thinking about banking on its head.

"I became convinced microfinance can and will change the world," she said. "Why is it we have payday lenders on every corner of low income neighborhoods and nothing like this for people in our own backyard?"

For now, Express is focused on King County, but anyone who lives or works in Washington can apply for membership. If the concept proves successful, McKay hopes it can spread and become a model for other communities.

Bill Gates and some of the country's other top billionaires met in secret in New York earlier this month to discuss the economy and philanthropy, according to IrishCentral.com.

The May 5 meeting at Rockefeller University included Gates, Warren Buffett, Michael Bloomberg, George Soros, Eli Broad, Oprah Winfrey, David Rockefeller Sr. and Ted Turner, among others on the Forbes list of the world's wealthiest people.

The IrishCentral post says the letter of invitation came from Gates, Buffett and Rockefeller and cited the worldwide recession and the urgent need to plan for the future. "They wanted to hear the views of a broad range of key leaders in the financial and philanthropic fields," according to the post.

Apparently they're not sharing any details. According the New York Times blog, participants are refusing to talk about the content, citing an agreement to keep the meeting confidential.

A global campaign to get women to donate $1 million each toward non-profits that help women and girls surpassed its ambitious targets, thanks in part to a handful of Seattle philanthropists.

As the Women Moving Millions campaign came to a close even in the midst of a bleak economy, organizers called it "an historic moment in the world of women's philanthropy."
The event raised $177 million from individual women donors, more than its $150 million goal.

SEATTLE TIMES

Nancy Nordhoff says she was inspired toward volunteering and donating at Mount Holyoke College. She founded Hedgebrook, a retreat on Whidbey for women writers, and helped found CityClub in Seattle.

The Seattle-based Women's Funding Alliance, the local organization participating in the drive, received three $1 million donations from local women. The largest gift the alliance had received previously was $100,000.

"This is an amazing, bold step these donors have taken to support women and girls in our region," said LeAnne Moss, executive director of the Women's Funding Alliance.

Turns out Seattle was among the top cities around the world for contributions. It started with Nancy Nordhoff, a 76-year-old donor on Whidbey Island. Her efforts encouraged two younger women from Microsoft to kick in a million dollars each.

Nordhoff said she was cautious at first but decided the time to act is now.

"You live 70 years and you see a lot, and I began to know what's going on in families' lives," said Nordhoff, a Seattle native who has three children and seven grandchildren. "You've got a working parent and they lose their job and there isn't any housing.The community statistics are a clear picture of the need. You don't have to touch people to feel for them."

Donna Bellew worked 10 years at Microsoft before leaving in 1999 to be a full-time mother and community volunteer.

"I thought gee whiz if I can do it, I better step forth," she said. "Those of us who have the resources have to respond to the need."

Families run on the backs of women, she added, so helping them can strengthen families and communities.

Her gift helped inspire Rebecca Norlander and Donna and Matthew Bellew, longtime supporters of the alliance, to contribute more than they have before.

The alliance is a public foundation supporting 140 non-profits such as the Refugee Women's Alliance, Washington CASH, Jubilee Women's Center, Northwest Women's Law Center and others. Moss said the organization will use at least half of the funds toward economic programs for women in Puget Sound. The alliance will also be able to "dramatically increase" the amount of money it gives out, including multi-year grants, to groups that work to improve women's lives, Moss said.

Bellew, 42, said she's been following women's status in the workplace and was struck by their over representation in low wage and part-time jobs. "These economic situations seemed to exacerbate the problem," she said.

Rebecca Norlander, a software executive who manages online advertising, has supported the Women's Funding Alliance since 1993, two years after she joined Microsoft.

She remembered a study the alliance did a year ago on issues affecting women and girls. Washington state had a huge wage gap, ranking 42nd in gender wage equity. "That was sort of surprising. In many ways you think of Washington as a pretty progressive state." Another statistic stood out: women in King County are seven times more likely to live in poverty than men.

She was determined to use her money in conjunction with the other donors to change things. Her husband, Matthew, also wanted to make a statement in support of that cause.

"This was a really big stretch gift," she said. "We had to have several conversations about how do we make this happen, what do we have to change to do this now? It had to be something both of us believed in."

It was also important for their school children: two daughters and a son.

"I have this one life, and I have a vision for the world, one that includes women and girls being at the table in an equal way," Bellew said.

Seattle Pacific University is putting on the first ever Pacific Northwest Microfinance Conference tonight and tomorrow, a testament to the growing interest in the topic. Seattle has at least three dozen organizations working in microfinance, and no doubt students are already dreaming up others.

SPENCER PLATT/GETTY IMAGES

Microfinance pioneer Muhammad Yunus, founder of the Grameen Bank in Bangladesh, is now loaning to hundreds of borrowers in the U.S.

More than 400 people are expected at the sold-out event. Speakers include Matt Flannery, co-founder and CEO of Kiva.org, Skip Li, founder of Agros International, and Atul Tandon, World Vision senior vice president.

Tandon, who left a career in global banking to join non-profit World Vision, said the current economic crisis has made it more urgent to find, train and equip local entrepreneurs in poor countries.

"Microfinance is a time-tested tool," he said, "to generate self-employment and provide local jobs for those who are losing the little they have gained over the last twenty years of global prosperity, and stand to drop back into the black hole of the abject poverty."

Defying the global recession and Wall Street meltdown, microfinance has continued to grow. But as commercial banks and private investors move in, more questions are being raised about how effectively it reduces poverty, and whether more efforts should go into other areas, such as savings and larger-scale employment.

Microfinance is expanding in the U.S. through programs like Washington CASH, which provides training and "peer microloans" to low-income entrepreneurs in the Seattle area. Mercy Corps Northwest recently formed a partnership with Washington CASH to make more micro-loans available in Washington state.

GRAMEEN FOUNDATION

Grameen Foundation executive vice president Peter Bladin.

Peter Bladin, who will also speak at tomorrow's conference, is taking on a new role at the Grameen Foundation as executive vice president for programs and regions, part of a new strategy to expand the reach of microfinance and technology in international development. Bladin, a Microsoft veteran and founding director of the Grameen Technology Center, will lead global operations for microfinance and technology and remain in Seattle.

The field is attracting more interest from job seekers. The World Affairs Council is sponsoring a "Careers in Microfinance" panel Tuesday at 7:30 p.m. at the Seattle Public Library. Details are here.

The RealNetworks Foundation is taking applications through June 1 for community grants to non-profits in Seattle and three other cities where its employees are based, restarting a competitive grants program.

The foundation expects to distribute more than $1 million this year, with grants ranging from $1,000 to $10,000 in spring, and as much as $25,000 in the fall, said RealNetworks spokeswoman Oona Rokyta.

The spring grants will give priority to programs that promote economic and job development. The first grant is being made to Solid Ground, a Seattle multi-service agency focused on food, housing and legal, mortgage and tenant counseling. Other cities are San Francisco, New York and the D.C.-metro area.

TOM REESE/SEATTLE TIMES

RealNetworks CEO Rob Glaser is president of the RealNetworks Foundation.

The fall grants will focus on freedom of expression and independent media, and climate and the environment.

According to its last tax filing, the foundation had assets of $21.7 million and paid out just $421,000 in grants in 2007. It's largest grant, for $25,000, went to the Phoenix House Foundation.

I asked Rokyta why the foundation, which was founded in 2001, chose to restart its competitive grants process now.

"The foundation has around $21 million in assets and this is a great time to reinvigorate giving to the community (nationally and internationally) when so many are pulling back on their grants programs," she said.

The heat is on, but FareStart is staying right in the kitchen.

The economic downturn has put pressure on the non-profit as more people are seeking its services, and even successful graduates are returning for help after being laid off, Executive Director Megan Karch said.

THOMAS JAMES HURST/SEATTLE TIMES

But she's not deterred.

"If ever there's a time we should be stepping up, it's now," Karch told supporters at a recent lunch.

For homeless and disadvantaged people, FareStart provides a wide range of services to help them turn their lives around: housing and food, case management, counseling, support, culinary and barista training and job placement. As a social business, it helps to fund its programs by operating a retail restaurant, cafe, catering services and meals for local childcare centers and shelters. It's also opening a second employee cafe at the Gates Foundation's current offices. Business revenue was about $2.5 million last year, a little less than half of its overall funding, Karch said.

At mid-day on a Wednesday, FareStart's downtown restaurant was bustling with customers. The trouble is, other restaurants are so not bustling any more, especially those at the high end. Many of them provide jobs and services for FareStart students.

In a good economy, FareStart found jobs for 95 percent of its graduates within 90 days. That's a lot harder to do in a recession. It's taking longer, and the job placement rate has dropped to 80 percent, Karch said.

Last year 600 people came in for FareStart services. About half of them entered the 16-week training program and about 200 finished.

This year, enrollment is at record highs. Adding to that, more graduates are coming back and asking for help, "worried they will spiral back down" into homelessness, substance abuse and other problems, Karch said. With more people on the street, FareStart is also seeing an influx of all kinds of people looking for services, not necessarily fitting the group's core mission of culinary training.

Sometimes they're just looking for a place to stay.

FareStart depends on other non-profit partners to provide services to students. Many of them, especially mental health and substance abuse programs, have taken the hardest financial hit. "It's a biggie for us," Karch said, "how to serve students with less ability of partners to help."

FareStart set up a job club and put more resources into job placement efforts. It's still finding openings for graduates in assisted living, hotels and cruise lines. Its largest expense is paying housing costs of $400 to $700 a month for each student while in training.

When Karch presented the FareStart board her budget for 2009, it was the first time in her nine years with the organization that she proposed running a deficit. The non-profit has been in a good financial position, and now's the time to stay true to its promises, she said.

FareStart's five-year vision is to expand current services to help move students into living wage jobs with health insurance, permanent housing and self sufficiency. Nationally, FareStart hopes to create a network for similar programs (such as Inspiration Cafe in Chicago) to share ideas and best practices.

It's a question being asked more often of the online retail giant, a 15-year-old company that reached a recession-defying jump in profit last quarter to $177 million. Amazon's quarterly sales rose to nearly $5 billion. Annual profit was $645 million last year. The company's share price of $85 today is up 74 percent since October, with a market capitalization 30 percent higher than Boeing's.

Good news for shareholders. Maybe it's enough to reward them with robust earnings and employees with good jobs. But at a time when social service organizations are struggling, some critics are asking why isn't Amazon donating more? Any thoughts from readers on this topic are welcome.

It may be useful to take a look at some of Amazon's peers. Many retailers said they are planning to increase their giving to charity despite sales declines, according to the Chronicle of Philanthropy.

Here is Amazon.com's Giving page, which shows the retailer donating about $35 million to disaster relief programs through the years, and supporting various programs for authors and publishers.

A recent Taproot survey of business professionals attempted to measure the mood around corporate philanthropy during the recession. About 75 percent of the 4,000 business people surveyed said they would be proud of their company if it gave time and money to charity right now, and they also called on executives to give more of their own personal time and money.

In an interview last year with Portfolio, Amazon.com CEO Jeff Bezos hinted that he is at least thinking about the question of philanthropy. Here's what he said:

Q: You've become a very wealthy man. What are you going to do with your money?

A: Good question. I don't know. My parents are running the Bezos Family Foundation, and they're focused on education. I'm still focused on Amazon, but I have some ideas. I'll keep them to myself for now.

Q: So you won't tell us?
A: No.

One segment of the retail world bucking the trend of declining sales is thrift stores. The Society of St. Vincent de Paul is opening its seventh thrift store in King County today to coincide with Earth Day. The 16,000-square-foot store in Kent replaces a former carpet business that sold the building to the charity in November.

SOCIETY OF ST. VINCENT DE PAUL

Kent store employees (left to right) Margarita Mercado, Donna DeLorenze, Judy DeLauney, Neil Jennings and Lori Bedwell.

The local charity is using the event to encourage both giving to the community and recycling. More than 2,500 tons of material is recycled through store sales and reclamation efforts each year, said Richard Bray, director of donor and community relations.

Proceeds from thrift store sales directly fund assistance to people in the community, including food, clothing, furniture and help paying rent and utility bills.

"The nature of our work compels us to expand during tough times," Bray said. "St. Vincent de Paul's outreach grew in the Great Depression and we are growing during this "Great Recession" too."

This past year, the Catholic charity says it has received more than 29,000 calls for help in King County, including a 50 percent increase in people at its food bank.

It comes as no surprise, but two-thirds of U.S. foundations expect to reduce the number and/or size of the grants they award this year, according to new research by the Foundation Center. The recession's hit to their finances is causing them to try to give in other ways.

The report is based on surveys of more than 1,200 U.S. foundations in January. Many said they will turn to other activities such as seeking out partnerships and collaboration, advocating on issues and providing technical assistance.

"Foundations can do so much more than simply make grants," said Bradford K. Smith, Foundation Center president. "The important thing is for them to remain true to their values and causes and to stand by their nonprofit partners."

In lieu of cash, non-profits can get a "valuable form of currency" in professional services such as pro bono work or skilled volunteering, says consulting firm Deloitte.

Deloitte is doing work free of charge with groups such as the YWCA to help struggling women with interviewing skills and resume writing. Deloitte Seattle increased its collective employee donations by 6 percent this year in spite of the business downturn.

Comcast is sponsoring an event in Seattle April 25 with media and tech experts in the state volunteering to provide one-on-one help for non-profits to learn how to use social media to get their message out.

In fact, while today might be the most challenging time for corporate philanthropy in history, the Taproot Foundation finds support for increased giving among business people throughout the country. Many of them say companies should not back off from charitable grants and community service, even if they are struggling, receiving government bailouts or laying off employees, though helping employees should come first.

Executives especially should be giving more of their personal time and money to charity right now, those responding to the Taproot survey said.

India is in focus next week with two major events in Seattle. The first, called "India Rising," will examine the country's move onto the world stage -- including its success in information technology -- and its business ties to Washington state. From 2005 to 2007, Washington state handled one-third of all U.S. trade with India.

India is a destination for both philanthropy dollars and commercial exports -- a place where many of Seattle's humanitarian efforts are aimed, from groups such as RDI, the Gates Foundation and Unitus, and a key market for state products such as airplanes, computers and electronics.

JOHN D MCHUGH/ASSOCIATED PRESS

India's "People's President" Abdul Kalam in 2005.

Wednesday's talk from 8 to 9:30 a.m. at the Greater Seattle Chamber of Commerce will feature a delegation from the Indian Ministry of Commerce, along with South Asia expert Anand Yang, director of the Jackson School of International Studies at UW.

And on Saturday, April 25, the Seattle chapter of TiE (The Indus Entrepreneurs) will host Dr. Abdul Kalam, the president of India from 2002 to 2007, in a formal banquet from 6 to 9 p.m. at the Fairmont Olympic Hotel. Kalam is a distinguished scientist who led development of India's missile program and nuclear tests, advocating a "peace through strength" policy and positioning India as a technology superpower.

He proposed a "National Prosperity Index (NPI)" to measure the growth rate of GDP along with two other factors: improvements in quality of life for people living below the poverty line, and the adoption of what he called Indian values, such as a strong family structure and a conflict-free, harmonious society.

GAUTAM SINGH/ASSOCIATED PRESS

India produces the world's cheapest car, the Tata Nano, which went on sale this month for about $2,000. The Financial Times called it "a symbol of India's ambitions to become a modern nation." That's a funny statement considering Tata already owns Land Rover and Jaguar, the symbols of elite Britain.

India's economy is expected to grow about 6 percent in 2009 and 2010. Not sure where the National Prosperity Index would stand. Besides the focus on trade ties, the Indian visits should shed some light on the heated political situation with Pakistan. I will also be keeping an eye on the theme of social entrepreneurship. Entrepreneurs are a key to India's economy and leaders of Indian communities abroad. Through groups like Ashoka, they also create some of the most promising and creative solutions to social problems.

And speaking of India, I didn't make it to the legendary blue city of Jodhpur, but some of that city's treasures have made it to Seattle, where they're on display until April 26 at Seattle Asian Art Museum. The exhibit features newly discovered paintings depicting palace life of India's great desert kingdom.

Yes, there is grinding poverty. Yes, there is also glittering wealth. But in New Delhi I found something unexpected.

I happened to meet a family by chance while checking into the YMCA. Addison Samuel, his wife and their three children, all named after tennis players: Martina (Navratilova), Steffi (Graf) and Stefan (Edberg). Samuel had retired from his job as accountant at the YMCA but brought his children there after school to take part in activities. Seeing that I was traveling alone, he invited me to dinner in his home.

The tiny apartment in a two-story cement housing block had no dining room or dining table -- just a kitchen and bedroom. As far as I could tell, meals were eaten while sitting on the beds. They served me a delicious dinner of lentils, mixed vegetables, pickled mangoes and bread, eagerly watching to see if I enjoyed the food. I began to talk with Martina about life in India and my job in Seattle. When I mentioned some of the work that Seattle organizations are doing in India, she had a lot of questions. "Where are these programs?" she asked. They are generally aimed at rural people living on $1 a day, I said. Her response surprised me. "But we live on $1 a day," she said.

It was Martina, on a salary of 7,000 rupees (about $140) a month, who supported the family of five. With her father retired, her mother in declining health and her younger siblings still in school, the 24-year-old elementary school English teacher was the family's sole breadwinner.

By the time she paid rent (4,000 rupees) and the transportation costs of a long daily commute to work, she was left with a little more than $1 a day for the family's food, clothes and other needs. She explained that her situation was not really unique. Many families survive on that much.

And yet here was a woman who dressed relatively well, had a good education and even found time to volunteer at the YWCA to help women less fortunate than herself.

It struck me how much in common they have with many families here, who are struggling to pay the rent and afford health care, just on the border of homelessness or not enough to eat. Any unexpected expense could throw them into a desperate situation.

But Martina's biggest worry was not daily living. It was the question of how her father, already busy searching for a suitable husband for her arranged marriage, would come up with the money for her dowry, which could be as much as a new car. Her father's biggest worry was how the family would get by once Martina left home after marriage.

Meeting the Samuel family was eye opening. They were certainly not the poorest in India, but somewhere beyond the reach of philanthropy, falling through the cracks in the widening gap between rich and poor.

It's just another sign of the times: without retirement benefits to count on, people are working later and later in life. The recession creates an even tougher situation for seniors who need work but can't find it.

Today one national group based in Seattle is getting help from the federal stimulus package to put more seniors into job training programs.

The National Asian Pacific Center on Aging received $1.6 million for its Senior Community Service Employee Program, designed to help low income Asian Pacific Islander seniors 55 and older with limited language skills get on-the-job training with community organizations and transition into employment.

It uses an interesting model of federal money to pay wages while seniors train at local non-profits, which serve as their bridge to jobs in the private sector (though sometimes they are hired on at the non-profits, too).

The federal stimulus money will pay wages for an additional 180 seniors to train at community based organizations and government offices within the next 60 days, the NAPCA said today.

"This is just the kind of targeted job creation that should be first priority in a stimulus bill," said NAPCA President Clayton Fong. "The program has a long waiting list that demonstrates the need and would allow seniors to be hired immediately."

Lam Vuong is one of the people who has gone through the program in Seattle. The 67-year-old immigrant from Vietnam trained for a year at Helping Link and Kawabe Memorial House. He then got a full-time job as a dishwasher at Ruth's Chris Steak House in Seattle. He earns more than minimum wage, but for Vuong the most important thing was getting health benefits.

NAPCA works with 400 agencies nationally to serve 1,000 low-income seniors a year, but 250 more are on a waiting list. In Seattle, the project serves 100 seniors annually who work at 40 host agencies -- local non-profits that get the benefit of an employee in training. They include Asian Counseling & Referral Service (ACRS), Catholic Seamen's Club, First AME Child & Family Center, Millionair Club Charity and St. Mary's Food Bank.

The current recession is hitting Puget Sound arts and cultural organizations hard, calling for bold steps to manage through the crisis, a study of more than two dozen local arts groups found.

Endowments and contributions are down anywhere from 5 to 50 percent. Corporate contributions have fallen 20 to 50 percent overall, and in several cases dropped completely. But foundations and individuals are continuing to give, so those contributions have declined less -- 10 to 25 percent.

ROZARII LYNCH

Malgorzata Walewska (Judith) and John Relyea (Bluebeard) in Seattle Opera's "Bluebeard's Castle."

The 24-page report, commissioned by the Seattle Mayor's Office of Arts and Cultural Affairs, the Seattle Foundation, Paul G. Allen Family Foundation and 4Culture, was done by Helicon Collaborative, based on confidential interviews with representatives of 28 cultural organization leaders in January. The report cost $20,000, shared among the four sponsors.

While some organizations are actively addressing the crisis, others are responding cautiously and still others "seem to be in denial," the report said. Most are reducing programming schedules over the next 18 months and shifting to more "popular" and less experimental material.

The report identified ways donors could collaborate to help the arts sector, such as setting up a revolving loan fund and collectively investing in technology.

Funders could also help support the arts without spending any money, by cutting application paperwork or extending current grants another year; offering loan guarantees or lines of credit; and encouraging arts groups to share resources and to work with nonprofits outside the arts.

Arts groups could do a better job of communicating and collaborating on both programs and resources, according to the report. "Most are too busy managing their own institutions to think about how they might work with others" in a strategic response.

The groups surveyed include Intiman Theater, Seattle Art Museum, Seattle Symphony, SIFF, On the Boards and Town Hall Association,

"This study provides valuable insight for both cultural groups and funders about how we can work together to emerge stronger, be more nimble and be better equipped to address these economic challenges moving forward," said Susan M. Coliton, vice president of the Paul G. Allen Family Foundation.

Many arts organizations are still evaluating the findings. At the Seattle Opera, corporations contribute 2 to 3 percent of the budget, and those contributions have fallen. It takes 10 to 15 individual donors to make up for just one corporate gift, said Kelly Tweedale, the non-profit's executive director.

Still attendance is holding up. And the story isn't all about money and efficiency.

"The arts are unique in giving hope and perspective to the human condition," Tweedale said. "The report wasn't hopeful and didn't talk about that unique aspect of what we do that could be leveraged."

In a dismal economy, that suggests the arts are a good investment in sustaining public spirit.

Update: Looks like the White House may reconsider the plan, writes the Wall Street Journal. Nevada Democratic Rep. Shelley Berkley summed it up this way: "I'd like to think that people give out of the goodness of their heart, but that tax deduction helps to loosen up the heartstrings."

Will wealthy donors contribute less to charity under the Obama budget proposal that would reduce their tax savings?

Some foundations, non-profits and fundraising professionals are speaking out against the plan. But others, including tax experts, say the question is more nuanced and the impact unlikely to be so drastic.

Clinton Stretch, a principal in the Washington office of Deloitte & Touche, advises clients on the federal budget and tax issues. The concern for nonprofit groups "is real, but it's not absolute," he told Bloomberg News. "There are multiple ways people go about giving, and multiple reasons people go about deciding to do it."

Obama's plan is expected to generate an additional $318 billion over 10 years by reducing tax deductions for top earners, including deductions for charity.

The proposal limits the value of itemized tax deductions to 28 percent for about 2.6 million U.S. households that fall into the top two income tax brackets, beginning in 2011. Currently they can deduct up to 35 percent of charitable contributions.

While applauding the overall budget, the Association of Fundraising Professionals (AFP) and the Association for Healthcare Philanthropy (AHP) oppose the proposal, saying it "sends the wrong message at the wrong time to those who support charitable causes."

The plan "would effectively devalue charitable gifts made by the very people who are in a position to make substantial donations at a time when they are sorely needed," the association said.

Independent Sector, a coalition of 600 nonprofit groups, opposes the measure as a "disincentive" to giving in challenging economic times.

Council on Foundations CEO Steve Gunderson said he is still reviewing the implications, but "we are opposed to proposals which will significantly depress incentives for charitable giving."

While some may look at the increased cost of making charitable contributions and reduce their giving accordingly, "I find it hard to imagine that this will occur on any significant scale," says Jane Searing, CPA at Clark Nuber in Bellevue, who provides tax services to private foundations and public charities.

For one thing, they would have to pay tax advisers for their time.

"By the time the taxpayer pays the adviser to figure out how much to reduce their contribution to get to the same after tax position, they could have just made the charitable contribution that seems appropriate based upon other factors," Searing says.

The charitable contribution deduction is meant to be a more efficient means of getting money directly to organizations that serve the public good rather than paying more taxes and having the federal government distribute funds to charitable organizations.

For married people filing jointly or head of household taxpayers, the proposal applies to people with taxable income slightly more than $200,000, according to Searing.

"I am not convinced that the reason these folks give is to get a tax deduction," Searing says.

Besides, she notes, many households in the top income brackets already have the value of their deductions reduced to 28 percent by the alternative minimum tax, which is designed to limit the use of deductions and exemptions by the wealthy.

The stimulus package authors are betting that people in these higher income levels will give as they normally have and take the tax hit.

One case in point is Lauren Bricker, co-founder of the Two Herons Foundation in Seattle.
"Speaking from personal experience, if we had been looking solely at maximizing our tax break we might have reduce our giving," she said.

"However, we also took into account the amount we needed to contribute to start our own foundation, rather than donating money through a community foundation, such as the Seattle Foundation. If the 28 percent deduction was close but not quite enough to make starting our own foundation cost effective, we would have donated more than we could deduct anyway."

At least if recent history is any judge, caps on deductions didn't stifle the growth of giving.

Between 1990 and 2001, a period when the minimum tax was increasingly limiting deductions for six-figure income households, deductions for charitable giving actually grew more than 8 percent a year, according to a Bloomberg story that cites an Internal Revenue Service study.

But of course the U.S economy today looks very different from what it was in the 1990s.

Seattle Foundation CEO Phyllis Campbell is stepping down at the end of the month to become chairman of JPMorgan Chase & Co.'s Pacific Northwest business. A formal announcement by the bank is pending.

Campbell is a lifelong resident of the Pacific Northwest, where she earned her bachelor's degree from WSU and MBA from UW.

Campbell, who has headed the Seattle's largest community foundation for the last six years, will become the bank's senior executive in Washington, Oregon and Idaho. JPMorgan Chase acquired Washington Mutual's banking operations last September.

"I am excited to join a world-class firm and to help build on the community legacy forged by Washington Mutual," Campbell said in a statement. "Returning to my banking roots and staying in the community I love is a wonderful combination for me."

She spent three decades in banking, including as CEO of U.S. Bank of Washington, handling private banking, commercial banking and retail banking -- all areas that JPMorgan Chase plans to expand in the Pacific Northwest.

"We could not have found a better person than Phyllis to lead our expansion of financial services in this important region," said JPMorgan Chase CEO Jamie Dimon said in a statement. "Phyllis's hard work, integrity and success in banking and philanthropy define true leadership in the community."

The Seattle Foundation more than doubled its total charitable assets during her tenure, focusing on education and economic opportunity. It had assets of $676 million at the end of 2007. Campbell's annual salary at the foundation was $211,200.

JPMorgan Chase plans to convert all 316 WaMu bank branches in Washington, Oregon and Idaho to its own brand by June.

It has also pledged to continue WaMu's local philanthropy, committing $2.65 million in grants to Washington non-profits in 2009, which matched WaMu's local corporate giving in 2008. The bank gave a $10 million grant to the Seattle Art Museum.

Good timing for Campbell and the bank, but her departure poses a challenge for the Seattle Foundation to find someone who can steer the umbrella organization that so many non-profits depend on through rough economic times.

The Seattle Foundation released a statement today from board chairman Bill Lewis.

"Certainly we will miss Phyllis' steady hand at the helm, but are thrilled for her..." he said. "She is a one-of-a-kind leader who leaves strength and success in her wake."

Lewis said that "while the foundation's assets have been affected by the economic downturn, our solid footing has enabled us to do more, not less, to help our community."

A controversy is brewing over the Obama administration's proposal to limit tax deductions for charitable gifts in the new budget to Congress.

Whether people are giving for the sake of giving or to reduce their tax burden doesn't matter -- charities will feel the impact, some contend.

Under the proposal, taxpayers earning more than $250,000 will have potential deductions for charitable contributions reduced to 28 percent from 35 percent now, according to an analysis in this New York Times story. That means a 28-cent deduction for every dollar donated.

How this affects donors here in the "Compassion Corridor" remains to be seen. If you have any thoughts, please share them.

While several studies show donors are not greatly affected by tax changes in terms of their giving, "in these times, every dollar given to a non-profit, just like a small business, is key to their survival," notes Jule Meyer, principal at Parkman Foundation Services, which helps people start and manage foundations.

One survey by Bank of America, for example, found that half of donors would continue giving the same amount to charity even if deductions were essentially eliminated. But nearly 40 percent said their giving would decline.

"If we dis-incentivize any stimulus to our economy (such as penalizing generosity among higher donors), it can't be good for the non-profit community," says Meyer. "In this community, solutions that deliver are rewarded by donors--so I don't consider it good economics to take from the fragile non-profit community via donors. Non-profits are for the most part, improving our world, not damaging it."

The change could apply to families selling businesses, since they can often save capital gains taxes by starting a private family foundation.

"This is a line item in the Stimulus Package that I would certainly reconsider," says William Pearsall, a Bellevue intermediary who connects businesses for sale with buyers.
In fact, he suggests the deduction should be 40 percent "to reduce reliance on the government to fund some small but critical social service programs."

Philanthropy Northwest CEO Carol Lewis said she had not heard yet from local charities and guessed "our members will divide up around this based on whether or not they are Obama supporters generally."

"I think they have larger questions beyond the question of charitable incentive that will dictate their response," she said. "My members are generally giving because they believe in giving."

Arriving like a well-timed tonic on the heels of "Slumdog Millionaire" and "Creative Capitalism," entrepreneurs came to Seattle with ideas for how to improve life in those same Mumbai slums and prove that socially motivated business can work.

Sreejith N G and his team from NMIMS are creating 10 cent meals for poor slum dwellers using vegetable peels from nearby hotels, along with rice, beans and sugarcane, in disposable foil packets.

Bright Simons and Kofi Boateng aim to solve the growing problem of counterfeit medicine by developing a consumer protection grid that links an authentication system with SMS text messaging, called West Africa Consumer Protection Grid or WAPGrid.

Kat Wickersham and her team aims to build a girls school in Rwanda, with a for-profit project attached to fund the school and train girls in native arts, selling traditional paintings made of cow dung.

PAUL GIBSON/FOSTER SCHOOL OF BUSINESS

MBA student Kat Wickersham (left) talks with Claudine Zongo, Hubert Humphrey Fellow in the UW School of Public Affairs.

They're among 14 teams of business students pitching creative and commercially sustainable ways to address problems of poverty in developing countries. They're competing for $20,000 in prize money in the Global Social Entrepreneurship Competition, now in its fifth year at the University of Washington's Foster School of Business. The full list of projects is here.

The grand prize is $10,000, the global health first prize is $5,000, global health second prize is $2,500, and the Investor's Choice Award is $2,500. Winners will be announced at tonight's awards banquet.

UPDATE: And the winners are...

Grand Prize ($10,000): Aahar: Meals for Poor at 10 Cents
Global Health Grand Prize ($5,000): Solar Cycle (simple solar ovens made from local waste materials, a project of Brown University)
Global Health Second Prize ($2,500): WAPGrid
Investor's Choice Award ($2,500): WAPGrid

Since most of these teams don't have a Web site of their own, here's my suggestion for next year -- they each get a GSEC page to describe themselves and their project.

Chris Meyer, a GSEC finalist I had a chance to meet in 2007, created Planting Empowerment, which is still going strong and maintains 50 acres of timber plantations in Panama, where it operates sustainable forestry.

"People are very committed to doing good and helping people and thinking about problems in creative ways," said Josh Herst, a Seattle entrepreneur who is one of this year's judges.

His approach to evaluating social businesses is "exactly the same as a startup," said Herst, who founded TripHub and worked at Expedia and Madrona Venture Group. "The people involved, their passion and commitment, familiarity with their business, and opportunities that can be leveraged and scaled in broad and interesting ways."

As he thinks about new ventures to pursue, Herst has taken an interest in social business: "I'm attracted to the commitment, energy and passion of finding ways to make a positive impact on the world," he said.

Can it work? "I believe so," he said, "but that's what I'm learning about."

Michael Kinsley has produced a thoughtful 310-page book about "Creative Capitalism," but he's not entirely convinced it's the answer. In fact he comes down about 51 percent against it.

As the former Slate editor and political columnist discussed the book Tuesday over lunch with the Greater Seattle Chamber of Commerce, he was hard pressed to say exactly how the concept could apply to small business or global health non-profits working with the private sector. The book has 43 contributors, each with a different viewpoint, making for a rich debate. But only two names in bold letters appear on the cover, a point of dispute between Kinsley and the publisher.

Kinsley sat down to answer some questions about the book between bites of chocolate cheesecake.

Q: Can you give a quick definition of creative capitalism?

A: It's not my term, it's Bill Gates' term, but I would say it is the use of capitalism and capitalist techniques in areas that traditionally are left to government and philanthropy.

MIKE SIEGEL/SEATTLE TIMES

Is it just me or does Michael Kinsley look like Stephen Colbert with facial hair?

Q: What has Bill Gates' reaction been to the book?

A: We had this embarrassing cover and because of that I really have not heard from him to see what his reaction is. We had an agreement with Simon & Schuster that they wouldn't exaggerate the role of Bill and Warren [Buffett]. They are two contributors among many. This is actually a compromise. Basically I don't like the cover and I don't even know what Bill and Warren think. If they're annoyed, I don't blame them.

Q: What effect has the economic downturn had on the potential for creative capitalism?

A: It's clearly reduced because corporations are more attentive to their own bottom lines.

Q: In another way you could argue it's made it more urgent.

A: Yes, and that's what I do. The problems it's supposed to address are more urgent. But also the incentive to address them has been reduced, so who knows how those two factors balance out?

Q: Sum up the best arguments for and against...

A: The best argument against is the basic one that companies should take care of their stockholders and if there are social problems that's the job of government.

The best argument for is: for goodness' sake, capitalism has been such a force. If there are problems in the world and there are ways capitalism can address them, why would you be against that?

Q: Where do you come down in your own assessment?

A: About 51 percent con. It's basically because I'm a terrific admirer of what Bill Gates actually did, and I would be slightly afraid we might not have had that if he had been concentrating on the social thing.

Q: If governments were working well and markets were fair and efficient, would creative capitalism even be necessary?

A: It depends on how far you think we are from that ideal and whether you would agree with anybody else about what is fair. It's mainly conservatives who said 'I thought capitalism by its nature was creative.' So they say 'why do we need to reinvent it?'

A lot of people were so complacent back in the '80s and '90s (the tax system among others) and, if they're having second thoughts right now, that's good. Now it's almost too easy because we need the stimulus. We've got to shovel this money out the door, and I'm sure there's a lot of wasteful stuff going on that we'll discover in a few years.

Q: Are there any real results or examples where this idea has worked (besides maybe the Grameen Bank)?

A: The ONE campaign. Bill says what he has in mind is not so much corporate charity, but corporations doing what they do, only in ways that help people who need it. For example, Microsoft giving away software and training people how to use it would be creative capitalism to him. Target gives away some percent of its profits -- in Minneapolis I guess it's really part of the culture. God, if you were watching the Oscars on Sunday I was struck by the ads... every corporation in America is doing wonderful things and nothing to do with their core business.

Q: Has this book changed anything you're doing or are you just a neutral observer?

A: I'm pretty neutral. I'm very sympathetic to the idea that Bill Gates is an excellent role model, and following his example might be a better idea than following his suggestion.

Q: Tell me about your next project...

A: I have this idea of trying to update Studs Terkel. We would gather stuff on the Internet, open it up for anyone to go and write their stories. It's about what's happening now -- getting laid off -- all the awful ways people get laid off and the good (or more humane) ways they get laid off.

Losses, layoffs and budget cuts make headlines, but Northwest businesses "are still giving back to their communities in meaningful, even life-changing ways," says Carol Lewis, CEO of Philanthropy Northwest. Lewis has a background in business (Coinstar) non-profits (Pacific Northwest Ballet) and government (Seattle's deputy mayor).

Carol Lewis of Philanthropy Northwest

Despite the downturn, Microsoft employees gave away a record-breaking $87.7 million to charitable organizations in 2008 through the giving campaign, company matching gift program and volunteering, exceeding the previous year by $3.6 million, she noted. Almost 60 percent of employees donate, and the company matches their gifts up to $12,000.

Corporate grants (a separate category from employee giving) total more than $100 million dollars a year in the Northwest, Lewis said. The top donors include Microsoft, Boeing, Starbucks, Wells Fargo, Bank of America, Safeco Insurance Foundation, Weyerhaeuser and Regence. (Comparing figures, it's interesting to see that Microsoft employees donate more money than many large corporations.)

But even companies you might expect to back away from philanthropy are still giving, Lewis said. For example, J.P. Morgan Chase CEO Jamie Dimon pledged that the bank will continue Washington Mutual's long-standing commitment to give more than $2.5 million dollars to local nonprofits each year. (Laid off WaMu employees might be the ones needing some of those dollars. And Dimon himself was paid a salary of $41 million in 2006 and $30 million in 2007).

On April 16, Philanthropy Northwest will hold its annual Corporate Philanthropy Institute, where local companies will share their strategies for hard times.

ALAN BERNER/SEATTLE TIMES

Former Slate editor Michael Kinsley talked with Gates, Warren Buffett and critics of "Creative Capitalism" for his new book.

"We should thank them and ask them to keep up the good work," Lewis said. "We need their help now more than ever."

Later today I'll talk with Michael Kinsley about "Creative Capitalism" and whether that's different from corporate philanthropy or better than job-creating, profit-maximizing capitalism. The concept unleashed by Bill Gates has spawned books, blogs and much long-winded debate.

Are companies willing to go beyond public relations triumphs to use their business for the greater good, or has the question itself become a luxury at a time when many are focused on survival?

What a difference a decade makes. One of the companies that sued South Africa to block distribution of low-cost drugs to fight AIDS now says it's cutting drug prices and funding health clinics in poor countries.

Last week drug maker GlaxoSmithKline said it would slash prices to the 50 poorest countries in the world and use 20 percent of its profits from them to build health clinics. Prices for the poorest countries would be no higher than 25 percent of the price in developed countries, CEO Andrew Witty said.

GSK's revenue from those countries is about $43 million a year, so it would generate $1.5 million to $2.5 million for the clinics, according to the Wall Street Journal.

Witty proposed that drug companies and non-profits create a common pool for intellectual property, donating patents related to neglected tropical diseases to speed development of new drugs.

It's an interesting model that might apply in other cases where patents on technology make prices prohibitively expensive. GSK is the company with the most advanced vaccine candidate for malaria, a project backed by the Gates Foundation.

On Friday, GSK said it would not donate patents on HIV drugs, however, because they're sold at not-for-profit prices and there is enough competition to drive innovation.

Doctors Without Borders responded today: Thanks for the Valentine; now show us some real love.

The group welcomed GSK's new stance, saying patent pools offer new ways to stimulate research, but added that more details are needed about licensing terms and "promises now need to be turned into action."

GSK must include in its patent pool drugs for HIV, a field where the gap between what is needed and what is available is large, Doctors Without Borders contends.

A bit of history: GSK was among a group of 39 pharmaceutical companies that sued the government of South Africa in 1998 for enacting an amendment to WTO rules, which allowed it access generic versions of patented HIV drugs. The companies later dropped the suit , facing international public pressure.

But the impact of trade policies on disease remains an ongoing issue, says Health Alliance International, a non-profit based at the University of Washington that addresses disparities in health.

In a tough economy, finding creative ways to stretch resources has its rewards.

Trying to fulfill increasing demand from the local food banks it serves, Food Lifeline has turned to a new model -- a kind of bank account that lets it take advantage of "opportunity buys" and cut out the middleman.

"We're now going to develop as a line of business an entire program where you can reliably expect a number of different products," says Chief Executive Linda Nageotte.

The non-profit's Shoreline warehouse holds the first of such bulk purchases -- 44,000 pounds of Great Northern beans.

MARK HARRISON/SEATTLE TIMES

Volunteers Susan O'Callaghan, left, and Karen Sullivan pour beans from 100-pound bags into bins for repackaging.

Food Lifeline's nascent revolving food purchase program, funded with grants from the Bill & Melinda Gates Foundation and the Paul G. Allen Family Foundation, lets the organization buy food directly from growers and vendors, cutting costs and passing the savings on to 300 food banks in Western Washington.

In this case, the beans are good nutrition for 28 cents a pound, says Jerrimi Hofman, the program's coordinator. About 90 percent of the food at Food Lifeline is donated, but donations aren't predictable or continuous. When food banks need something they aren't getting from Food Lifeline donors, they have to go out to a wholesale store to buy it.

"They need more and we want to give more and do it in an absolutely cost effective way," Hofman said.

Since bargain food comes by the truckload, Food Lifeline relies on volunteers to repackage it into smaller sizes for distribution. On a recent Friday, the volunteer bean counters were Stuart Despain, Nikita Shvachko and their team of 12 Microsoft program managers.

Despain can relate personally to people who need help. After he graduated from Evergreen State College in the 1980s, during a different recession, he used a food bank himself.

"I had a heck of a time finding a job," he said. "The choice for me was whether to pay the rent or pay for groceries." A food bank in the University District helped him get by.
"Those are the things you don't forget," Despain said.

Working throughout the day, the Microsoft team packaged about two tons of food into family-sized servings. At a time when some companies are considering cutting employee volunteer time or matching gift programs, it was a reminder how much those benefits matter.

The team's general manager, Eric Wilfrid, who heads the Macintosh Business Unit, is a supporter of the program and let the team spend a day there as a morale-building event.

Despain calls it a "2 for 1 special -- socializing and having fun together and at the same time doing good things for the community," he said.
"We're going to do this as often as possible."

Twestival is a hybrid online / in-person event taking place in 175 cities around the world today, including one in Seattle tonight at Spitfire.

It's an experiment in using social media to advance charitable giving. The beneficiary is New York based charity:water, which builds wells to provide clean drinking water in developing countries.

Supporters are using microblogging tool Twitter to spread the word. This site makes it possible to watch live feeds from any of the locations.

Organizers are using Twitter to nudge companies and Seattle's tech elite to contribute to the cause, sending messages to their Twitter accounts which are posted publicly.

But the Seattle tweets recently show that even a cutting-edge fundraising method is encountering a challenging local economy.

"I wish @waggeneredstrom had decided to sponsor Twestival Seattle. I guess times are tough. Hope they help out the PDX event," organizers wrote Tuesday.

"I'm Close to giving up on local corp. sponsors for Twestival Seattle. Everyone business appears to be in budget / risk lockdown. So sad."

Washington state is in the soft power business. Dozens of local organizations involved in global affairs have a stake in defining the U.S. role in the world, and they're calling for an overhaul of some basic principles.

They're hoping to influence policy in the other Washington to focus on more equitable, efficient and sustainable development as the Obama Administration sets its budget and priorities.

One area that needs changing most is foreign aid, participants at a Global Washington forum on Monday agreed.

WALLY SANTANA/ASSOCIATED PRESS

The U.S. foreign aid program needs a thorough overhaul to be more effective, many NGOs say.

The current Foreign Assistance Act, all of 417 pages, contains programs to attack the Soviet threat and address disasters in Nicaragua and Pakistan that ended in the 1970s, said Jenni Rothenberg, field director of the U.S. Global Leadership Campaign. With 140 priorities and 400 directives, it's complex and cluttered without any clear road map.

The campaign, whose leadership includes local charities such as PATH, Mercy Corps and World Vision, along with Boeing and Microsoft, is advocating for a strong international affairs budget. The administration's current international affairs budget proposal for fiscal 2009 is $39.8 billion, about 1.3 percent of the total budget request, according to the campaign.

As the U.S. has been involved in two wars, the military role in development has grown significantly, said U.S. Rep. Adam Smith (D-Tacoma).

The Defense Department "moved into what was traditionally the State Department's lane," Smith said. Now it's in over its head in some places and needs to work cooperatively with more civilian experts in a broader mission. But as for getting the military out of the business of development entirely, "it's not going to happen and it's not desirable," Smith said.

Foreign investment and trade will play a key role, but the U.S. needs a new approach to that as well, he said.

"We have learned an enormous amount about how to not make it work," Smith said. "Foreign investment comes in, keeps separate from local populations, sucks money out, pays shareholders somewhere else, pays no taxes and flees."

JOHN MOORE/GETTY IMAGES

As the U.S. military has expanded its role to include more international development, it has stretched beyond its capability and needs more civilian involvement, local leaders say.

Bill Clapp, a Seattle businessman and philanthropist who launched the Global Washington network, suggested that the mission of the U.S. trade representative should be redefined.

Rather than simply negotiating the best deal for U.S. companies, "there has to be a change in priorities, or an additional priority on the trade arm, that says economic development is also one of the outcomes we are looking for," Clapp said.

Speakers debated the role of corporate involvement in economic development.

Foreign aid, originally used to bring foreign countries in line with Washington and promote U.S. economic interests, has fostered a sense of mistrust of U.S. programs, some said.

Margaret Willson, international director of Bahia Street, a Seattle non-profit that aids impoverished girls in Brazil, said her organization refused money from the U.S. Agency for International Development. "All the construction materials had to be brought from the States, supervisors had to be from the States. No money was going into the community. They did not own it, they did not supervise it." In addition, USAID "wanted dossiers on every person involved in the organization," she said.

Simeon Karanja Waidhima, a businessman from Kenya, pointed out that while many criticize U.S. foreign investment, almost none has actually gone to Africa. He also argued that foreign aid has done some good.

"I'm a product of foreign aid," he said. The aid that came in the 1960s and 70s was visible on the ground in the form of teachers and machinery, he said. But in recent years "what we received is not visible," he said. "It's packaged in democratization, but this has no effect on the local population."

Aaron Katz, senior lecturer at the University of Washington School of Public Health, said business interests can be a positive force for development if the focus is on creating economic opportunities for families.

"If there is an intersection between the interests of some corporations and expanding opportunities for those families, I say great," he said. "It's not the companies' interest or U.S. interest that should be paramount. It's the economic well being and opportunity to expand one's freedom that should be paramount."

Since foreign debt consumes up to 70 percent of the budgets of some countries, it has to be addressed to make resources available for health, education and other services, Katz said. An audience member from Ethiopia, however, was quick to chime in that governments often don't use those resources appropriately, and the savings from debt relief does not go to the poor.

Katz and Willson put forth what they called "A Modest Proposal" for U.S. foreign aid, based on the following principles: Do no harm, support public institutions and transparent decision making, invest locally, serve local agendas and priorities, and foster equitable relations.

The damage from Bernard Madoff's investment scam just keeps piling up. This time it has hit two Seattle area foundations hard. Both are relatively small foundations involved in conservation and education.

The Patrice and Kevin Auld Foundation of Seattle and the Kaleidoscope Foundation of Bellevue relied on Madoff for their investments. In its last tax filing, for the year ended in August 2007, the Auld Foundation reported holding $1.67 million in Madoff security investments, while listing its total assets as $1.75 million. The Kaleidoscope Foundation reported holding $3.16 million in Madoff investments, with total assets of $12.6 million at the end of 2007.

The foundations were first listed in a preliminary estimate of Madoff exposure among private foundations, compiled by Benefit Technology for the New York Times. The list included foundations across the U.S. based on data from tax returns.

Patrice Auld, a New York native who heads her family foundation, said the loss was devastating. "This is somebody we all felt we could trust."

The Auld Foundation has been a supporter of Conservation International, a Washington D.C.-based organization working to protect biodiversity around the world. Its other recent beneficiaries include the Seattle Symphony, Seattle Art Museum, Seattle Biomedical Research Institute, Lakeside School, Seattle Academy, and the Pacific Northwest Ballet.

"This is a real blow," said Carol Lewis, chief executive of Philanthropy Northwest. "When you have foundations like the Auld Foundation, which has done so much that is positive for the community, it just makes me very sad for the impact on them and on the organizations they support."

The Kaleidoscope Foundation of Bellevue is headed by co-presidents Richard Leeds and Anne Kroeker, who have supported wildlife preservation and were given a lifetime award by the Cascade Land Conservancy in 2006 for protecting open space.

Reached by phone today, Leeds said the Madoff issue is an ongoing legal matter for the foundation and he could not comment until it's resolved.

Leeds' parents, Gerard and Lilo Leeds of New York, built the company CMP Media, listed on the Nasdaq in 1997 and later sold to a British publishing firm, after arriving in the United States in 1939 as refugees from Hitler's Germany, according to information from the University of Colorado at Boulder. A $35 million commitment from the Leeds family endowed the university's business school. Richard Leeds is a graduate of the university. Among CMP Media's publications are InformationWeek and Computerworld.

The Kaleidoscope Foundation's major grantees include the Grays Harbor Audubon Society, Audubon Washington, Columbia Land Trust in Vancouver, Hoh River Trust, Museum of Glass in Tacoma, Bellevue Schools Foundation, and Bainbridge Graduate Institute.

The Kaleidoscope Foundation reported more than $235,000 in income from Madoff securities in 2007 and listed shares in dozens of blue chip companies in its Madoff account that were held only one or two months and sold, most of them for a short-term gain but quite a few for a loss.

The Auld Foundation reported $200,000 in gains through Madoff investment securities in 2007 and $150,000 in gains in 2006.

Now both foundations' losses are among the carnage of an alleged $50 billion fraud. The damage has already forced several charities to close (JEHT Foundation, Robert I. Lappin Charitable Foundation and the Chais Family Foundation), and others may be next. JEHT's closure has already hurt funding to address racial disparity in the justice system.

Auld said she hoped to be able to continue her foundation's work. "We're going to do the best we can," she said. "I care very much about these causes."

It's a sign of the times that whenever a Gates Foundation employee speaks in public, the question and answer session becomes an audition for would-be job candidates. You can save the world and still wear Prada, too.

MICHEL EULER/ASSOCIATED PRESS

Shaping the post-crisis world with an economy on edge.

Gates Foundation CFO Alexander Friedman spoke to the Trade Development Alliance in Seattle this week, offering such a clear, detailed and unvarnished analysis of the market it's amazing there was no run on banks.

The talk came after Bill Gates revealed his foundation lost 20 percent of its assets in 2008 but vowed to push ahead this year, and just before Gates headed to Davos to urge other non-profits, businesses and governments to do the same.

In Friedman's analysis, the roots of this crisis date back a long time. In the 1980s, the current account balance flipped as the U.S. began importing more than it exported. At the same time, Americans started saving less.

Interest rates came down from the ultra-high levels of the late 1970s and early 1980s; largely as a result, home ownership surged from the mid-1990s until 2007. Subprime loans grew from about 6 percent of all loans to 20 percent. And most mortgages, rather than being held by the banks that made them, increasingly were packaged together and sold as securities.

FABRICE COFFRINI/AFP/Getty Images

Davos: a spectacle of wealth, power and debate... but less caviar.

With money so cheap, investment banks borrowed more to increase their profits. Consumers went on a debt-fueled spending spree, borrowing against their homes and loading up their credit cards. When the bubble finally burst and defaults started rising, mortgage-backed securities went from 100 cents on the dollar to 15 cents on the dollar. About $2 trillion in securities were downgraded.

How much could it all cost to fix? To shore up the financial system, U.S. government agencies have committed almost $8.5 trillion, even before the $819 billion stimulus package. That's about half of the U.S. GDP, and the single largest expenditure in American history.

Looking at various financial crises over the last 30 years, the minimum losses from this one appear to be far more severe -- almost double the losses from Japan's banking crisis of the 1990s and triple those of the Asian financial crisis.

Global markets have fallen in tandem with the U.S. What's the net result? Poverty is likely to rise sharply, especially in the poorest countries.

The World Bank estimates 20 million more people will go into extreme poverty for every one percentage point drop in developing countries' growth rate. Overall growth rates of developing and emerging economies are projected to fall from 8 percent in 2007 to about 5 percent in 2009. Robust African growth rates of 5 or 6 percent are almost certain to drop, too. Add at least another 60 million to the 100 million people pushed into poverty by the food crisis

So back to Gates' mission. Poor countries, especially in Africa, depend on foreign aid, which typically makes up 10 to 25 percent of their GDP. Aid has disproportionately gone into education and health, so those programs will be hit hard if it falls.

The prospects for aid look fairly grim throughout much of the world, said Friedman.

United States: Could be reduced or stretched out over longer period.
Japan: Flat or falling, unless aid becomes part of an anti-deflationary package.
Italy: Threatened 50% cut in bilateral aid program..
France: Official intent is to flat-line aid, but internal discussions indicate cuts.
United Kingdom: Holding firm -- so far.
Canada: Flat to negative.
Gulf states: Falling oil prices and financial contagion likely to minimize their role.
Nordic countries and Netherlands: Maintaining aid targets for now, but ministers say that's politically unsustainable if big donor countries cut theirs.

Gates is holding a press conference Friday to call on global leaders to maintain their commitments.

Meanwhile, Friedman thinks consumer debt, commercial real estate and private equity could be the next trouble spots in the U.S. economy. Big commercial banks may not be prepared for much higher unemployment levels and the related defaults, he said. Still he's trying to stay optimistic.

"When you're in a crisis, you tend to think the sky's falling," he said. "When you look at a 5 or 10-year horizon you adopt a more positive frame."

"We're trying to address diseases that are essentially Biblical..." Friedman said. "They've been around thousands of years... so the time frame of two or four years is something we can't let distract us."

Grim financial news has made raising capital almost anywhere a challenge. But a relatively new kind of investment with a social payoff is expanding this year -- vaccine bonds.

The bonds offer retail investors a fixed rate of return along with the opportunity to use their money to help immunize children in poor countries.

The bonds are offered by the International Finance Facility for Immunisation Co., (IFFIm) a UK-based charity and subsidiary of the GAVI Alliance, a global partnership to expand vaccines that was one of the Bill & Melinda Gates Foundation's first major health initiatives.

Since introducing the bonds first to institutional investors in 2006, GAVI has raised about $1 billion. The organization seeks to raise an additional $500 million this year, beginning next month when the bonds go on sale to retail investors in Japan. Based on their success so far, they may be offered in other markets in the future, says Gargee Ghosh, senior program officer for development finance at the Gates Foundation.

JACQUELINE M. KOCH

Researchers are closing in on a successful vaccine against malaria in Mozambique, .

They're backed by long-term government aid commitments over one or two decades from donors such as the United Kingdom, France, Norway, Spain and other countries. Based on those pledges, the IFFIm board issues bonds as needed. The donor countries make annual payments toward their commitments, covering the interest on the bonds.

"What this essentially does is create predictable on-call funding for vaccines," says Ghosh.

The previous bond, issued in March 2008 to Japanese institutional investors, pays 9.9 percent a year with a two-year maturity. This year's bond, arranged by Daiwa Securities SMBC, pays 6.6 percent interest over three years.

Their triple-A rating makes the bonds solid enough to appeal to the gun-shy, Ghosh says.

"IFFIm has really tapped a market we thought but weren't sure existed," she said. "People talk so much about social investing. This is such a great example. It's a completely viable financial structure. People don't need to care about kids in Africa at all for this to make sense in a portfolio. But if they do, they can track the impact of their funds."

(The University of Washington's Institute for Health Metrics and Evaluation recently questioned some countries' reporting methods, which may influence the way GAVI measures progress.)

GAVI uses the funds for big upfront investments such as buying trucks and stockpiling polio vaccines. In the future it may call upon bonds to help finance a malaria vaccine.

The innovative financing is creating a new kind of asset class, one that could work for other kinds of investments supporting humanitarian projects. It could also attract socially motivated investors in the U.S.

"We've just scratched the surface of understanding the social investment market," she said. "The U.S. is a deep market we just haven't really tapped."

The Paul G. Allen Family Foundation is cutting back on its giving to non-profits this year, according to a message on its Web site.

The foundation "is not immune to the current financial crisis," says the message signed by Paul Allen and sister Jody Patton. It faces challenges of "managing spending when resources are down, confronting an uncertain future, and helping to meet increasing community needs."

In response, the family foundation has "had to reduce both the number and size of grants in some areas," they say.

COURTESY OF GARY NEILL

Paul Allen performs at Super Bowl party

The message is "the first move in trying to create reasonable expectations for grant recipients," says David Postman, a spokesman for Vulcan, Paul Allen's company. The foundation has not disclosed exactly how much it plans to reduce its giving.

The foundation is shifting its strategy to address more immediate needs, such as food, shelter and jobs.

Allen's approach to philanthropy has been eclectic and local.

"For the foreseeable future, many of our grants will focus on helping non-profit organizations respond and adjust to the difficult economic circumstances," Allen and Patton say.