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Gospels of Giving for the New Gilded Age | The New Yorker
"Are today’s donor classes solving problems—or creating new ones?"



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We live, it is often said, in a new Gilded Age—an era of extravagant wealth and almost as extravagant displays of generosity. In the past fifteen years, some thirty thousand private foundations have been created, and the number of donor-advised funds has roughly doubled. The Giving Pledge—signed by Bill Gates, Warren Buffett, Michael Bloomberg, Larry Ellison, and more than a hundred and seventy other gazillionaires who have promised to dedicate most of their wealth to philanthropy—is the “Gospel” stripped down and updated. And as the new philanthropies have proliferated so, too, have the critiques.

Anand Giridharadas is a journalist who, in 2011, was named a Henry Crown Fellow of the Aspen Institute. The institute is financed by, among other groups, the Carnegie Corporation, the Rockefeller Brothers Fund, and the Gates Foundation. The fellowship, according to its Web site, aims to “develop the next generation of community-spirited leaders” by engaging them “in a thought-provoking journey of personal exploration.”

Giridharadas at first found the fellowship to be a pretty sweet deal; it offered free trips to the Rockies and led to invitations from the sorts of people who own Western-themed mansions and fly private jets. After a while, though, he started to feel that something was rotten in the state of Colorado. In 2015, when he was asked to deliver a speech to his fellow-fellows, he used it to condemn what he called “the Aspen Consensus.”

“The Aspen Consensus, in a nutshell, is this,” he said. “The winners of our age must be challenged to do more good. But never, ever tell them to do less harm.” The speech made the Times; people began asking for copies of it; and Giridharadas decided to expand on it. The result is “Winners Take All: The Elite Charade of Changing the World.” “I hadn’t planned to write a book on this topic, but the topic chose me,” he writes."



"Inside Philanthropy is a Web site devoted to high-end giving; its tagline is “Who’s Funding What, and Why.” David Callahan is the site’s founder and editor. If Giridharadas worries that the super-wealthy just play at changing the world, Callahan worries they’re going at it in earnest.

“An ever larger and richer upper class is amplifying its influence through large-scale giving in an era when it already has too much clout,” he writes in “The Givers: Wealth, Power, and Philanthropy in a New Gilded Age.” “Things are going to get worse, too.”

Part of the problem, according to Callahan, lies in the broad way that philanthropy has been defined. Under the federal tax code, an organization that feeds the hungry can count as a philanthropy, and so can a university where students study the problem of hunger, and so, too, can a think tank devoted to downplaying hunger as a problem. All these qualify as what are known, after the relevant tax-code provision, as 501(c)(3)s, meaning that the contributions they receive are tax deductible, and that the earnings on their endowments are largely tax-free. 501(c)(3)s are prohibited from engaging in partisan activity, but, as “The Givers” convincingly argues, activists on both sides of the ideological divide have developed work-arounds.

As a left-leaning example, Callahan cites Tim Gill, who’s been called “the megadonor behind the L.G.B.T.Q.-rights movement.” A software designer, Gill became rich founding and then selling a company called Quark, and he’s donated more than three hundred million dollars toward promoting L.G.B.T.Q. rights. While some of this has been in the form of straight-up political contributions, much of it has been disbursed by Gill’s tax-exempt foundation, which has financed educational efforts, message testing, and—perhaps most important—legal research. “Without a doubt, we would not be where we are without Tim Gill and the Gill Foundation,” Mary Bonauto, the attorney who argued the 2015 Supreme Court case that legalized gay marriage, told Rolling Stone last year.

On the right, Callahan points to Art Pope, the chairman of a privately held discount-store chain called Variety Wholesalers. Pope has used his wealth to support a network of foundations, based in North Carolina, that advocate for voter-identification—or, if you prefer, voter-suppression—laws. In 2013, pushed by Pope’s network, the North Carolina state legislature enacted a measure requiring residents to present state-issued photo I.D.s at the polls. Then the North Carolina Institute for Constitutional Law—another Pope-funded group—led the effort to block challenges to the measure. (The I.D. law was struck down, in 2016, by a federal appeals court that held it had been “passed with racially discriminatory intent.”)

It is difficult to say what fraction of philanthropic giving goes toward shaping public policy. Callahan estimates that the figure is somewhere around ten billion dollars a year. Such an amount, he says, might not sound huge, but it’s more than the annual contributions made to candidates, parties, and super-pacs combined. The result is doubly undemocratic. For every billion dollars spent on advocacy tricked out as philanthropy, several hundred million dollars in uncaptured taxes are lost to the federal treasury.

“It’s not just that the megaphones operated by 501(c)(3) groups and financed by a sliver of rich donors have gotten louder and louder, making it harder for ordinary citizens to be heard,” Callahan notes. “It’s that these citizens are helping foot the bill.” That both liberals and conservatives are exploiting the tax code is small consolation.

“When it comes to who gets heard in the public square, ordinary citizens can’t begin to compete with an activist donor class,” Callahan writes. “How many very rich people need to care intensely about a cause to finance megaphones that drown out the voices of everyone else?” he asks. “Not many.”"



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Critiques of “The Gospel of Wealth” didn’t have much impact on Andrew Carnegie. He continued to distribute his fortune, to libraries and museums and universities, until, at the time of his death, in 1919, he had given away some three hundred and fifty million dollars—the equivalent of tens of billions in today’s money. It is hard to imagine that the critiques of the new Carnegies will do much to alter current trend lines.

The Gates Foundation alone, Callahan estimates, will disburse more than a hundred and fifty billion dollars over the next several decades. In just the next twenty years, affluent baby boomers are expected to contribute almost seven trillion dollars to philanthropy. And, the more government spending gets squeezed, the more important nongovernmental spending will become. When congressional Republicans passed their so-called tax-reform bill, they preserved the deduction for charitable contributions even as they capped the deduction for state and local tax payments. Thus, a hundred-million-dollar gift to Harvard will still be fully deductible, while, in many parts of the country, the property taxes paid to support local public schools will not be. It is possible that in the not too distant future philanthropic giving will outstrip federal outlays on non-defense discretionary programs, like education and the arts. This would represent, Callahan notes, a “striking milestone.”

Is that the kind of future we want? As the latest round of critiques makes clear, we probably won’t have much of a say in the matter. The philanthropists will decide, and then it will be left to their foundations to fight it out."
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august 2018 by robertogreco

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