‘In Chocolate We Trust’ Review: A Man, a Brand, a School, a Town

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From The Wall Street Journal:

In the early 20th century, Milton Hershey transformed chocolate from a luxury good to a working-class staple. It made him a fortune, which he used to establish Hershey, Pa.—a model company town 100 miles west of Philadelphia and the self-proclaimed “sweetest place on earth.” He also established an orphanage, the Milton Hershey School, to provide housing and education primarily for children from the area.

Hershey and his wife supported the school through a trust, which they established in 1905. By 1918, when he donated his full stake in his chocolate company to the trust, the trust was valued at $60 million. Today it is worth more than $14 billion—ranking it among the largest nonprofit endowments in the nation, on a par with MIT’s—and has maintained a profound commitment to its locale.

Peter Kurie’s “In Chocolate We Trust: The Hershey Company Town Unwrapped” is a study of the town and of its residents’ shifting attitudes toward its institutional trinity of trust, company and school. As Mr. Kurie notes, one of the trust’s most striking characteristics is its controlling interest in Hershey Co. Remarkably, this is not a stipulation of the trust’s official documents; the Milton Hershey School Trust has always been free to sell its shares in the chocolate maker. But as several failed takeover bids over the years have demonstrated, this ownership arrangement has proved surprisingly durable, producing a dense institutional tangle with the trust at its center.

. . . .

Mr. Kurie’s account shows how the town’s dominant institutions both guarantee a shared civic identity and produce tensions that threaten to undermine it. The trust’s imperative to generate more revenue for the school, for instance, has long strained the bonds of the broader Hershey community. Milton Hershey invoked the high costs of the school as justification for why he couldn’t afford a union at his company (his workers formed one anyway). In the 1960s, the trust received permission from a local probate court to expand its mandate and spend $50 million on a medical research and teaching center in partnership with Penn State University. It drew a new cohort of professional families into the community that were less deferential to the authority of the trust and company.

In the 1970s, after struggling to attract enough “true orphans” to the school, the trust opened admittance to “social orphans,” or those deemed to be receiving inadequate parenting at home. These students, many of them African-American, now make up the majority of those enrolled at the school. In reaction, a nostalgia-laced resentment has grown among townsfolk toward the students, who they charge treat the school less as a home than as a “welfare agency” to be exploited.

. . . .

Despite the hopes of some nonprofit leaders that place-based giving might insulate locally rooted philanthropic institutions from the antagonisms that have roiled the rest of the country, Mr. Kurie’s book makes it clear that Hershey is less a refuge from those broader conflicts than a microcosm of them, a fractal of grievances that replicates those of the larger system. Like so many other Americans, Hershey’s residents have been split over suspicions of an out-of-touch elite (the trust’s board, whose members have been accused of extracting outsize compensation from the trust) and over the incursion of outsiders who some feel don’t have the community’s legacy and interest at heart, be they African-American “social orphans” from inner-city Philadelphia or the former Hershey Co. CEO who arrived in town after a stint at Nabisco.

Link to the rest at The Wall Street Journal

PG suggests that, despite the best intentions and the undoubted genius of many of those who have amassed large fortunes, the establishment of a trust or other organization that will perpetually do good in anything close to the way the founder imagined is very difficult, if not impossible.

The OP says that the trustees have expanded the mission of The Milton Hershey School Trust well beyond the bounds originally established by Milton Hershey.

As the OP mentions, in the United States, legal matters relating to trusts typically fall under the jurisdiction of a local probate judge. Probate is the process of processing the estates of deceased persons to make certain any valid debts the decedent incurred while alive (plus funeral expenses) are paid and the remaining proceeds of their estates are properly distributed to their heirs. If the decedent had a will, the probate judge ensures that the assets are distributed according to the decedent’s expressed wishes. In the absence of a will, state law determines how those assets are distributed.

PG is not an expert on probate matters in the State of Pennsylvania, but the office of probate judge typically attracts individuals who enjoy a quiet life with minimal conflicts (no nasty divorce proceedings or criminals) making decisions that are consistent with state laws governing the probate of estates. These laws seldom change.

In some states, probate judges are elected to serve for a set term and may run for reelection. In other states, they may be appointed by the governor for a set term, subject to reappointment on the expiration of that term. There may also be other methods of designating probate judges of which PG is not aware.

Unlike other judges (Federal District Judges, for example), members of the probate judiciary are generally not inclined to throw their weight around or make headlines with their decisions. They are typically conscientious men and women who labor in relative obscurity as far as the larger community is concerned.

As the OP describes, in Hershey, Pennsylvania, The Milton Hershey School Trust is a really big deal. The trustees of the Trust will similarly be major figures of influence in the community. Hershey employs a great many people in the city. While it is part of a larger metropolitan area, the population of Hershey itself was 14,257 in the 2010 census. PG hasn’t been to Hershey for a very long time, but on his only visit, the smell of chocolate was literally in the air everywhere he traveled in or near the city.

PG will bring this long digression to an end by tying it to a mention in the OP that the trustees of the Hershey Trust petitioned the probate court for permission to expand the scope of the trust and the institutions it created and governed beyond the terms of the original trust documents.

While the probate court is theoretically the guardian of the Hershey Trust and the trustees’ obligations to carry out Mr. Hershey’s intentions as set forth in the trust documents he signed, faced with the power and influence of the Trust and its trustees, a great many probate judges would be inclined not to question the reasons presented by counsel for the trustees that an expansion of the Trust’s work into areas Milton Hershey didn’t expect or intend when he created the trust in the first place.

Successful authors who have created or wish to create trusts for charitable purposes may well wish to consider the lessons the OP provides.