Is Dean Zerbe The Big Bad Wolf?

My wife, Lisa, is an expert on Little Red Riding Hood. This may sound trivial but it is not! Throughout centuries the character and fate of Little Red has changed in reflection of the changing social mores of society - innocent victim, seductress or empowered, independent woman to name a few. The enduring character of the story through time has been the Wolf, who represents danger fairly consistently in every version of the story.

What does the Big Bad Wolf have to do with philanthropy? Last week we learned that Dean Zerbe will soon be leaving as Senior Counsel and Tax Counsel for the Senate Finance Committee. Many in the charitable field breathed a sigh of relief. Mr. Zerbe was widely viewed as being responsible for proposals that in their initial form could have severely harmed many valuable charitable structures, including donor advised funds and supporting organizations.

However, to characterize Mr. Zerbe as the Wolf would be unfair. The danger in this case transcends any individual. There are, in fact, many who question the rationale for giving donors a charitable deduction for certain kinds of gifts. Gifts to art museums and gifts to huge college endowments are examples. Furthermore, Mr. Zerbe was not the only person who has questioned whether the spending rate of endowments and charitable funds should be higher.

We would do well to remember the lesson that Little Red’s mother forewarned. There is danger in the woods. Mind your business, keep your focus and proceed to your destination undistracted. For charities, be transparent, operate efficiently and set policies that are mindful of our charitable purposes and the good of society. The Wolf is a metaphor for the entire population of wolves, who lurk and await the lowering of our defenses. What’s more, if charities do not adequately self-regulate to a higher standard of practice, we might find there are Wolves among ourselves.

Robert Thalhimer