Big money, bigger choices
What to do with $100 million? That's Poetry magazine's unresolved problem.
It was a gift that, to many, seemed to lack rhyme or reason. In November 2002, Poetry magazine announced that Ruth Lilly, heiress to the Eli Lilly pharmaceutical fortune, would give the publication roughly $100 million, the largest single donation ever to a literary organization.
The small but venerable publication was created in 1912 by Harriet Monroe "to print the best poetry written today, in whatever style, genre, or approach," and had published the first important work of many major modernist poets, including Wallace Stevens, William Carlos Williams, and T.S. Eliot. But for many Americans, the front-page headlines were their first introduction to the influential poetry publication.
What would a magazine with a circulation of just 10,000 do with such a fortune, people asked. Can poets and money really mix, journalists wondered.
More than a year after the announcement, Poetry is still struggling to answer the first question. And culture mavens are anxiously waiting for an answer to the second.
Poetry's first order of business was to form a foundation to satisfy IRS regulations. But later developments seemed not just to suggest growing pains but to hint at the old adage that money ruins everything. Joseph Parisi, who had edited Poetry for 20 years, was named executive director of publications and programs of the new Poetry Foundation in May 2003, but by summer's end, he had resigned. The official reason: He wants to pursue his own writing projects.
Then the foundation filed a lawsuit against a bank in Indiana for mismanagement of two of its trusts. The amount of the loss, resulting from an ill-timed sale of Lilly stock, will not be known for some time, says the foundation's lawyer, Rich Campbell, of Mayer, Brown, Rowe, and Maw in Chicago.
Perhaps most troubling to many in the literary world was the fact that Poetry magazine seemed to have been eclipsed by its new foundation. These fears have been fueled by recent media reports that highlighted the organization's struggles and its move from an office of 875 square feet to one that was more than five times as large.
"As time has passed, it does seem a possibility that the results of the gift will not be able to overcome this ancient moral, which is that too much money brings out the worst in people," says Billy Collins, former poet laureate of the United States.
"For me what's important is that the magazine continue," adds Mr. Collins, who has been a frequent contributor to Poetry. "The foundation is rather amorphous, but the magazine has the reality of being the oldest poetry magazine in the world, having this deep history and giving exposure to such a wide range of American poets."
Debrorah Cummins, chair of the foundation's 22-member board of trustees, says Poetry's readers have nothing to worry about. "The board is determined to make sure that Poetry magazine remains the crown jewel [of the foundation]."
And she insists that events thus far do not prove the adage that poets and money don't mix.
Shifting from pauper to prince has meant that the board has had to become heavily involved in day-to-day operations - choosing advisers, hiring money managers, and formulating a business plan.
That business plan is crucial, Ms. Cummins says, since the gift will come in 30 annual installments, which are tied to various trusts and can change in size from one year to another. The organization will also have to spend 3.3 percent of its total assets annually, once it loses its status as a publicly supported charity, which will happen in the next few years.
Spending those installments - $14 and $15 million the first two years - does not mean a thicker magazine with more poems. (Although the poets who now publish there receive $6 a line instead of the $2 they earned previously.)
Instead, most of the money will be used to build a larger audience for poetry and to show the world how the art form is relevant to daily life. Exactly how to do that has not yet been decided.
"We can't be everything to everybody," Cummins says. "We need to say, 'Here's what we can do. How can we achieve the greatest impact? What makes sense to do now, what later?' "
Cummins hopes that the foundation's new president, who should be announced in about a month, will give the organization more momentum. She also expects that specific programs will be unveiled by the end of the year.
While many observers are anxious to see results, Poetry's go-slow strategy is in keeping with advice many financial planners give.
Jon Gallo, a lawyer in Los Angeles who specializes in estate planning, says that the first order of business for any organization receiving a large sum of money is to find topnotch financial advice and to design a five-year plan for how it will be used.
He advises that a long-range strategy be in place before the organization makes any major business decisions, such as hiring additional staff or purchasing property.
Poetry "got a dream they weren't prepared to deal with," Gallo says. But he believes that any difficulties the group has had so far are not insurmountable.
Even the monetary losses can be overcome, he adds, giving as an example: "If the bequest is $3 million a year, then the mistakes they've made have only affected one or two years. They have the ability to take corrective action."
Gallo's wife, Eileen, agrees. A psychotherapist, she has studied lottery winners'ability to adapt to newfound wealth. Ms. Gallo says that the challenges those winners face are similar to those that Poetry is now dealing with.
The prime determinants of success, she says, are good coping skills and a well-thought-out plan.
She describes one lottery winner who easily adapted to her new lifestyle, despite the fact that she lacked a a high school education. "But she had good advisers and picked people who could relate to her."
There's no reason, say both Gallos, why poets can't do just as well.