They Mean Well
Does modern philanthropy threaten our democracy?
David Callahan, author of The Givers: Wealth, Power, and Philanthropy in a New Gilded Age, sees the uniquely American tradition of philanthropy as a problem of our own making. “What we have here is another complicated story about philanthropy and influence in a new Gilded Age,” he writes. “It’s hard not to be inspired by the vision and achievements of many donors — and equally hard not to be troubled by the bigger picture of more power shifting into private hands.”
The founder and editor of Inside Philanthropy, a digital media site covering the world of giving, Callahan points out marked parallels between the past and present eras of opulence, such as an emerging class of politically connected and vastly rich individuals, declining government resources, and growing income inequality. Through philanthropy, the new gilded class, emulating earlier capitalists, is attempting to step into the breach of fiscal scarcity and help move the needle on some of society’s seemingly intractable problems. Like Andrew Carnegie, the father of modern philanthropy, many of these affluent individuals are moved to act on a moral obligation to support innovations that will make life better for humankind. Sometimes ferocious and sometimes scientific in their tactics, today’s philanthropists have the risk capital and the networks to influence policy on issues ranging from education reform to environmental remediation.
Twenty-first-century billionaires differ from earlier elites in that there are many more of them, and they are giving away much of their wealth (well, some of them) and pushing for change at breakneck speed. What will this mean for society as a whole? In light of declining government influence and an increasing gap in income equality, how will this new breed of ideological philanthropists affect civil society? Who can ensure that the people will have a say in how resources are allocated and how policies are changed? Callahan’s book issues a warning to those interested in the field of philanthropy or who are looking to enter it. He offers a tempering look at all that philanthropy promises as well as recommendations for checking the influence of unbridled giving.
“What ensures that philanthropic giving is done authentically and inclusively, and that it actually ends up helping those in need?”
Encyclopedic in its breadth, Callahan’s work depicts the myriad ways in which philanthropy shapes issues. In The Givers he paints a picture of active mega-donors with the ability to cultivate and fund just about any project or initiative and get any idea off the ground. He stresses the importance of measuring philanthropic gestures with the aim of including the voice of everyman. After all, these gestures do not merely support charities, they also have an impact on issues far beyond what the average person could hope to achieve.
Despite their importance as agents of innovation, these socially conscious disrupters — a term from the tech world where many of these mega-donors got their start — may ultimately pose a threat to our democracy. Younger donors “are often drawn to a more rigorous approach to giving.” As the author points out, “next-generation funders are often thinking about impact and breakthroughs.” They want more metrics. Results aside, what ensures that philanthropic giving is done authentically and inclusively, and that it actually ends up helping those in need?”
Callahan is fair in his estimation of the philanthropic sector, as well as in his portrayal of some big wins and some big losses by (primarily) United States givers, from Mark Zuckerberg’s $100 million gift to Newark, New Jersey’s public school system to the Eli Broad Foundation’s support of the arts. Callahan’s call for the inclusion of civil society is an important theme throughout the book. And is there a way for philanthropy to become more transparent and yet remain an agile instrument for accelerating positive societal change?
“With wealth comes a native vein of power, and the poorer and less powerful inevitably have less say in deciding what is good for society and what is not.”
Callahan presents a complex scenario, which includes the need to manage the expectations and ideologies of living donors like Silicon Valley billionaire Sean Parker, who see philanthropy through their own lens of success. “Philanthropists intent on spending fast to find breakthroughs or achieve disruptive change are more numerous than ever before, especially among the ranks of younger entrepreneurs emerging as major winners from tech and finance…. They don’t want to just support ‘causes.’ They want to solve problems — big ones.” They bring to the table the same sort of entrepreneurial vigor that worked for them in the business space. And while it’s valuable to have a diversity of minds around the philanthropic table wrestling with issues like public health, education, and scientific research, it’s essential that this plurality of philanthropy, as Callahan terms it, is thought through and not merely springing from donors’ ideologies.
Without philanthropy, scientific discoveries may not happen at an optimum pace as governments face new fiscal tightening. Although science funding is still distributed largely through government channels, it is shifting toward private donors who can support younger scientists and invest in riskier or neglected research topics that government agencies might not touch. With further funding cuts on the horizon, benefactors like Bill Gates and Jim Simons are likely to play bigger roles in supporting issue areas impacted by government funding cuts and in championing continued government support for science and education initiatives. “As the great twentieth-century tide of public money recedes … a new tide of private money is flowing in,” Callahan observes.
What happens, however, when a philanthropist supports a partisan policy and can wield enough catalytic power to influence government through funding tactics? Such was the case with philanthropist Art Pope in his home state of North Carolina. Pope is a funder of several conservative nonprofits including the John Locke Foundation and the North Carolina Family Policy Council (NCFPC). Among the NCFPC’s top priorities has been to halt the expansion of LGBT rights in the state. As Callahan writes:
NCFPC was strongly opposed to transgender people using bathrooms of their preferred gender, and celebrated when House Bill 2 was passed in March 2016…. During the ensuing uproar over the law, NCFPC became its main defender, pumping out statements and blog posts designed to combat “myths” about HB2. In an interview with NPR, Art Pope positioned himself above the fray, saying that both sides in the bathroom debate had legitimate concerns. But it’s fair to say that few in the state had done more to precipitate this “political Category 5 hurricane,” as Charlotte Magazine called the bathroom battle.
Callahan highlights this type of philanthropic giving to show the nuanced ways in which a giver can advance a personal policy agenda, and he stresses the lack of transparency sometimes associated with political giving. It is noteworthy that the repeal of the transgender-friendly bathroom law cost North Carolina hundreds of millions of dollars in lost business, depleting its economy. In this instance the voice of the people was heard, which Callahan sees as a possible silver lining: “Catalysts for systemic change, history shows, are social movements that unite masses of people who are unhappy with a current system and set out to transform it.”
“The world desperately needs both new resources and new ideas focused on its biggest problems. But it’s unnerving to watch rich people, however smart or well meaning, amass even more power through giving after three decades of rising inequality.”
— David Callahan, The Givers
According the Callahan, “Americans champion the idea of governance by the everyman, at least in principle. We don’t like the idea of having our destinies shaped by a bunch of trust fund kids, most of whom are only faintly acquainted with the real-life struggles of ordinary people.” And therein lies the rub: society needs philanthropic pluralism, diversity of ideas, and funding sources. No one entity will rid humankind of all that ails it. However, with wealth comes a native vein of power, and the poorer and less powerful inevitably have less say in deciding what is good for society and what is not. “The world desperately needs both new resources and new ideas focused on its biggest problems. But it’s unnerving to watch rich people, however smart or well meaning, amass even more power through giving after three decades of rising inequality.”
Philanthropy, the author maintains, is both good and bad. At best it is the promise of a gift of resources unencumbered by bureaucratic processes, giving the receiver the freedom to try out a crazy idea that might turn into the next great breakthrough in, say, cancer research. At worst it can become a tool to move personal agendas that serve the few. In The Givers David Callahan makes us think about both the intended and the unintended consequences of the uniquely American tradition of giving back.
David Callahan | The Givers: Wealth, Power, and Philanthropy in a New Gilded Age | Alfred A. Knopf. | 344 pp. | 2017 | ISBN: 978–1–10194–705–0 | More about this book
Adrienne Faraci is manager of digital campaigns and special initiatives, Carnegie Corporation of New York.
