Philanthropists Should Put Themselves Out of Business
Instead, we must organize to confront and change the cultural and economic systems that perpetuate inequality.
I dream of a world in which philanthropy is not only unnecessary, but remembered as a bizarre and unfortunate creation of societies past.
In this future world, accumulating resources in the hands of the few — whether for alleged social good or private benefit — will be recognized as fundamentally unequal, unfair, and unjust. My hope is that we will put in place mechanisms not to prevent the creation of wealth and prosperity, but to ensure that the fruits of labor and land are enjoyed by all.
Unfortunately, our current historical moment finds most philanthropic organizations focused on accumulating more wealth for their endowments, rather than on putting themselves out of business in the name of ending wealth inequality.
Philanthropy was originally created as a mechanism to keep control in the hands of the wealthy, and it has largely stayed that way. Up until 1969, the wealthy could put their money in a foundation — making it exempt from taxes — but were not required to give any of it away. Even though foundations are now mandated to spend or disburse a minimum of 5 percent of their total assets each year, the small minority of trustees and board members controls where all that wealth goes.
While a growing number of foundations practice social justice philanthropy, most philanthropists are simply not in the business of confronting the economic inequality that undergirds their power. The vast majority of foundation giving serves as a tax write-off for the wealthy, and it’s often directed at shoring up an individual’s or family’s influence culturally, professionally, and politically — not creating deep systemic change. According to the National Committee for Responsive Philanthropy, a mere 14 percent of annual foundation funding goes to “social change,” which it defines broadly as “work for structural change in order to increase the opportunity of those who are the least well off politically, economically and socially.”
The fundamental problem, though, is that philanthropy is voluntary. It is not a long-term solution to society’s ills to rely on the benevolence of the wealthy, even those who are focused on social justice philanthropy.
Instead, we must organize to confront and change the cultural and economic systems that perpetuate inequality. By “we,” I mean those of us with wealth and existing foundations. Our long-term goal should be to put ourselves out of business.
This radical goal has many implications for our work. It means organizing to confront systemic oppression, such as racially segregated and policed communities, and addressing the 1 percent of the world’s population that now has over 50 percent of the world’s wealth. Grassroots groups are building power every day for this purpose. If philanthropy doesn’t join them, we will be on the wrong side of history.
It means rerouting our resources. While the government is far from perfect, the resources currently being accumulated by the wealthy few should be redirected into public coffers to build a robust social infrastructure for all. Higher taxes on financial transactions and capital gains, and the closing of loopholes like those currently used for carried interest and offshore accounts, would go a long way toward redistributing wealth from one class to the broader public.
It means advocating for mandates like raising the minimum wage and requiring an annual payout higher than 5 percent for foundations. We could even consider legislation requiring foundations to share the power and decision-making over where and how their philanthropic dollars are spent with the people who are directly affected by economic injustice. Many social justice funders already do this, but legally requiring the presence of non-wealthy people on foundation boards would produce a real sea change.
In the end, the real issue is that the wealth in foundations shouldn’t all be theirs to begin with. This country was founded on the genocide of Native Americans and the forced labor of enslaved Africans. The stolen land, labor, and lives served to amass resources for mostly white European men. That is the history of wealth accumulation in the United States, and we need to face it squarely.
And yet our culture reinforces the myth that wealth is accumulated through the hard work of extraordinary individuals (again, disproportionately white men) who deserve every penny, when the reality is anything but.
Wealth is generated from the hard work of ordinary individuals, who labor and produce or grant access to their land — or have it taken from them. It isn’t that those who are accumulating wealth don’t work hard to get it or maintain it. It’s that, if the myth of meritocracy were true, there would not be millions of working poor people who struggle through multiple jobs or work over 40 hours a week just to scrape by.
Calling into question the very myths that uphold wealth accumulation and class privilege allows us to reckon with the ways that wealthy people are given unfair boosts in our society. Without recognizing that philanthropy is one of those boosts, we’ll be hard-pressed to actually address wealth inequality as we know it.
This forum first appeared at the Nation magazine. // The Development Set is made possible by funding from the Bill & Melinda Gates Foundation. We retain editorial independence