What happens when a major foundation president decides to speak out boldly during a crisis? How can philanthropy surge resources to protect nonprofit workers facing unprecedented job losses? In this season finale of the Fund the People Podcast, host Rusty Stahl sits down with John Palfrey, President of the MacArthur Foundation, to explore how courage becomes contagious in times of sector-wide attacks. You'll discover the real math behind foundation payout increases, learn why one foundation moved from 5% to 6% giving (adding $150 million over two years), and understand the strategic thinking behind multi-year general operating support.
Palfrey shares the behind-the-scenes story of how MacArthur Foundation responded to federal cuts targeting nonprofits—from increasing their payout rate to joining solidarity campaigns that have gathered nearly 700 institutional signatures. He offers frank "real talk" about the trade-offs of long-term funding, explains why he believes in the constitutional "freedom to give," and discusses how foundations calculated that nonprofit grantees lost about 12% of their federal funding. This conversation reveals both the possibilities and limitations of philanthropic response during crisis.
As attacks on nonprofits continue through 2025, this episode provides essential insights for anyone working in or with the social sector. Whether you're a nonprofit leader wondering how to navigate funding relationships, a foundation professional considering how to increase impact, or simply someone who believes in the power of organized giving, you'll gain practical knowledge about how major philanthropy is adapting to meet this unprecedented moment—and why taking summer breaks might be the most important advice of all.
Websites & Resources
- MacArthur Foundation
- Funding for Real Change (true cost initiative tools)
- FTP Podcast Season 5, Episode 7: "The Great Double Standard" (Rusty's rant about foundation overhead policies)
- FTP Podcast Season 4, Episode 10: “MacArthur Foundation Makes Changes to End Nonprofit Starvation Cycle – with Kenneth Jones, MacArthur Foundation” interview about MacArthur's indirect cost policy
- FTP Podcast Season 7, Episode 17: “Meet the Moment: A Call to Action for Funders – with Shaady Salehi, Trust-Based Philanthropy Project”
- FTP Podcast Season 7, Episode 1: “Do Funders Understand the Nonprofit Burnout Crisis? – with Elisha Smith Arrillaga, CEP” on the 2024 State of Nonprofits
Legislative & Policy Documents
Reports & Publications
- Center for Effective Philanthropy “State of Nonprofits 2025: What Funders Need to Know
- John Palfrey's 2025 guest post on CEP blog, “Courage in Unity: A Funder’s Response to the ‘State of Nonprofits’” (June 3, 2025 response to the 2025 report)
- Rusty Stahl’s 2024 guest post on CEP blog, “To Ensure Nonprofit Well-Being, Invest in Wages, Workload, and Working Conditions” (June 6, 2024 response to 2024 report)
- Rusty Stahl’s 2023 guest post on CEP blog, “Funders, Listen Up: It’s Time to Invest in Nonprofit Workers” (June 27, 2023 response to 2023 report)
Commitments & Initiatives
- Protect Philanthropy's Freedom to Give sign-on statement (~700 institutional signatures; stewarded by the Council on Foundations)
- Meet the Moment: A Call to Action for Philanthropy in 2025 (and Beyond) sign-on commitment (~200 institutional signatures; stewarded by Trust-Based Philanthropy Project, Grantmakers for Effective Organizations, and National Center for Family Philanthropy)
- The Courage Project - Launched in May 2025 with the support of the MacArthur Foundation and others, The Courage Project distributes awards for acts of courage and compassion that demonstrate bravery.
Bio
John Palfrey is President of the John D. and Catherine T. MacArthur Foundation, one of the nation’s largest philanthropies with assets of approximately $8 billion.
Palfrey is a well-respected educator, author, legal scholar, and innovator with expertise in how new media is changing learning, education, and other institutions. Throughout his career, he has demonstrated a commitment to rigorous thinking, disruption, and creative solutions often made possible by technology, accessibility of information, and diversity and inclusion. Palfrey has extensive experience in social change spanning the education, nonprofit, and philanthropic sectors.
Prior to joining the Foundation, Palfrey served as Head of School at Phillips Academy Andover, the only school of its kind to maintain need-blind admissions. During his tenure, the number of faculty members of color doubled, and the student body grew more diverse. He oversaw the creation of the Tang Institute at Andover, which seeks to reform and democratize excellent teaching and learning.
Palfrey was the Henry N. Ess III Professor of Law and Vice Dean for Library and Information Resources at Harvard Law School. In that role, he expanded the Library’s reach and services, finding innovative ways to use digital technologies to enhance the school’s scholarship and teaching.
From 2002 to 2008, Palfrey served as Executive Director of the Berkman Klein Center for Internet & Society, which seeks to explore and understand cyberspace. He is founding board chair of the Digital Public Library of America, and is the former board chair of LRNG, a nonprofit launched and supported by MacArthur.
Palfrey has published extensively on how young people learn in a digital era, as well as the effects of new technologies on society at large. He is the author or coauthor of several books, including Safe Spaces, Brave Spaces: Diversity and Free Expression in Education; Born Digital: How Children Grow Up in a Digital Age; and BiblioTech: Why Libraries Matter More Than Ever in the Age of Google.
Palfrey is the board chair of the United States Impact Investing Alliance and serves on the board of the Fidelity Non-Profit Management Foundation. He is a member of the American Academy of Arts & Sciences and serves on the governance council. Palfrey previously served on the boards of the John S. and James L. Knight Foundation, the Berkman Klein Center for Internet & Society, Boston Athenaeum, and MIT Press.
Palfrey holds a JD from Harvard Law School, an MPhil from the University of Cambridge, and an AB from Harvard College.