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Though it's undeniable Big Philanthropists have done some good work, large-scale philanthropy is largely about letting billionaires feel better about themselves, a form of "conscience laundering”" that simultaneously functions to "keep the existing system of inequality in place." (Photos: Getty)

Philanthropy: Looking a Gift Horse in the Mouth

Gary Olson

Whenever I hear a powerful philanthropist piously proclaim, “I just wanted to give something back,” my first reaction is “Why not give it all back?” I say that because “giving back” is all about first taking away. Immense fortunes are derived from random luck, class background, tax avoidance schemes, off-shoring jobs, publically-funded research, inheritance, a low-federal minimum wage, and especially, from the labor of countless men and women who produced it. In Chris Rock’s pithy words, “Behind every great fortune is a great crime.”

As Dr. Martin Luther King, Jr. stressed, “Philanthropy is commendable, but it must not cause the philanthropist to overlook the circumstances of economic injustice that make philanthropy necessary.” And that’s the rub. The one thing that Big Philanthropy must overlook is the green elephant astride the boardroom’s conference table, the economic system that causes and extends these injustices in perpetuity.

We know that the munificence of the rich is rarely directed toward those most in need but to donor alma maters and limited access cultural institutions. This enhances the giver’s status among his or her peers while providing generous tax advantages. According to the Chronicle of Philanthropy, in New York State not one of the top 49 gifts of at least $1million went toward improving the lives of needy people. More typical was a gift of $190 million for Columbia University’s business school and another of $40 million for an indoor cycling track. Often the donor’s name is attached to the edifice. 

Private philanthropic mega-foundations are tax exempt which means 40 percent of their wealth has been siphoned off. The top seventy foundations have assets in excess of seven hundred billion dollars and in one recent year the tax subsidies amounted to a loss of $53.7 billion dollars to the U.S. treasury (Bob Reich, Boston Review, 2013). For example, as recounted in Mark Dowie’s book American Foundations, billionaire financier George Soros was conducting an executive session of his foundation when a spirited exchange occurred about grant-making priorities. Soros allegedly declared “This is my money. We will do it my way.” At that, a junior staffer pointed out that half the money didn’t belong to Soros because if not placed in the foundation “it would be in the Treasury.” The staffer’s employment was short-lived (Reich)

Just to be clear, some Big Philanthropists have done some good work. However, as Peter Buffet (Warren Buffet's son) has argued, philanthropy is largely about letting billionaires feel better about themselves, a form of “conscience laundering” that simultaneously functions to “keep the existing system of inequality in place...” by shaping the culture.

Gara Lamarche, a veteran grants administrator for large foundations, comes closer to candor than most by advocating forms of giving that go beyond laudatory volunteering at soup kitchens or reading books to underserved children. Echoing Dr. King, he says we need to “expose the root causes and structural conditions that result in hunger or lack of access to education in the first place.” Tellingly, Lamarche goes no further. Why not? Because philanthro-capitalists believe and want us to believe they’re indispensable, that only their fundamentalist, free market system can save us. Above all, we should never look to a democratically accountable government to insure every citizen has a social right to quality health care, first-public schools, free universities, employment security, dignified retirement, and an environmentally safe planet. This anti-government narrative is prompted by fear that a robust government pursuing these ends could also curb their control of the nation’s resources.

Finally, it’s terminally naive to expect the new Gilded Age plutocrats, 16,000 individuals or .01 percent with as much wealth as eighty percent of Americans will commit class suicide. Their wealth won’t midwife a world into existence in which they and their progeny no longer rule. The rest of us shouldn’t hesitate in undertaking this long overdue transformation. 


Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.
Gary Olson

Gary Olson

Gary Olson is Professor Emeritus of Political Science at Moravian College in Bethlehem, PA. His most recent book is "Empathy Imperiled: Capitalism, Culture and the Brain" (NY: Springer, 2013.) Contact: olsong@moravian.edu

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