How can they donate to trust funds then? Welfare checks a little too big?
They don't. Daddy does. Here's the economics of it. Daddy is well to do but not fabulously wealthy. Daddy wants to avoid having his estate pay death taxes, so he sets up a trust. The purpose is to give the money to junior before daddy dies. To avoid gift taxes, daddy can only give (I think) $10,000 per year.
Junior can bank the money and live on a paying job.
Junior can have a paying job and suppliment his income with the trust money. This enables junior to take a low paying job doing what he likes or working for some "good cause" and still live well. The various PIRGs and Nader's outfit hire these.
The true trust fund hippie lives on $10,000 per year plus welfare.