So Bill Gates is going around the world, shaking his tambourine and banging his big bass drum trying to billionaire donors in other countries to give. According to this very informative piece in the Atlantic by Benjamin Soskis, who is affiliated with the Center for Nonprofit Management at George Mason University, Gates is going around the world trying to get rich Indians, Chinese, and Vietnamese to sign up.
I gather Soskis is a lefty, since he has an earlier piece condemning Catholic University’s business school for accepting “tainted money” from the Kochs (and if he’s going to revive the “tainted money” phrase, I get to revive the old joke, that of course the Koch money is “tainted”—tain’t yours and tain’t mine). But his piece about Bill Gates’s giving seems fair to me and raises many good points I haven’t seen raised elsewhere.
To me, the Giving Pledge has lots of problems. It doesn’t commit the donor to a term limit. It forces the donor to enter into the world of professional philanthropy instead of handling his giving personally. Donors who prefer to give anonymously to donor-advised funds don’t count. Most pernicious of all, it argues that the best way to measure philanthropic excellence is solely to count how much money is granted, and I can think of lots of large grants whose contribution to society is, at best, minimal. For example, donors who contribute nine-figure unrestricted grants to university endowments (or, even worse, prep school endowments) are getting a very small return on their philanthropic investment.
Nonetheless, Gates is making some progress in getting the rich to take his pledge. He has made some progress in China where, according to this piece by Karla W. Simon of the nonprofit ICCSL (posted on the website of the British magazine Alliance), the Chinese Communist Party, in its Third Plenum held last November, declared that civil society was a good thing and should be encouraged. (Yes, Chinese communist planners have made civil society part of the Chinese national plan!) And to make sure civil society is created, these planners are working on ways to implement estate and gift taxes in China.
One enthusiastic signer of the Giving Pledge in China is Jack Ma, creator of the online market Alibaba, whose IPO is expected to raise $150 billion this year. But the Economist notes that it’s not clear whether or not charities are legal in China. (A new law is in the works.) Moreover, the magazine notes, the Chinese Communist Party is “scared of allowing independent groups of citizens to flourish and help solve problems, which is exactly what China needs. As long as civil society is kept weak, China’s problems will get worse.”
Soskis notes that the Giving Pledge has competitors, whose existence has largely been ignored by the press. One of them is Synergos, created by David Rockefeller and his daughter, Peggy Rockefeller Dulany. A 2007 article by Aili McConnon from Business Week praises the organization as “one of the most exclusive clubs anywhere. . . . [M]embers come from 68 of the wealthiest families in 22 countries.” For $25,000 in annual dues, donors can have the chance to have lunch with Prince Charles in London, or have Carlos Slim, the Mexican telecom billionaire, show off his art gallery. They can also go to Dulany’s 9,000-acre ranch in Montana, where participants go into the wilderness, either fasting or taking “along subsistence rations of fruits and nuts to munch on as they meditate on their philanthropic goals.”
Any donor who feels the urge for fruits, nuts, meditation, and trees has a standing invitation to meet me at the park up the street from my house. I charge a lot less than $25,000—and if you come, the snacks are on me!
Synergos has a brochure where they note all the services they offer donors, including “meeting facilitation” and “collaboration and partnership-building services.” Now given a chance to commune with Rockefellers about facilitating meetings or building partnerships, I can think of many things I’d rather do. Why, the fern I got for Christmas and forgot to water might not be dead! I’d have to check.
Another alternative to Gates-driven big philanthropy is the rise of community foundations overseas, an effort led by the Charles Stewart Mott Foundation, the Rockefeller Brothers Fund, and the Aga Khan Foundation. According to an article from the Mott Foundation, community foundations are spreading around the world. Mott program officer Nick Deychakiwsky told Soskis that because community foundations encourage local donors to raise money to solve local problems, their creation is “a tough sell for large donors, who are reluctant to cede control over a program agenda to the local populations they seek to assist.”
I don’t know enough about the international community foundation movement to say whether or not it’s a good or bad idea. What I’d love to see is a long, well-reported, and independent analysis of this movement and whether or not it is doing any good.
Soskis notes many complaints by Indian and Chinese billionaires that the Giving Pledge is a subtle form of Western imperialism. If you rephrased their complaint I’d agree with it. The problem with the Giving Pledge is that it is an example of one-best-way thinking, the idea that what works in Seattle or Omaha will work anywhere and everywhere. While it’s good that the rich give more, the Giving Pledge is probably not the best way to do it.
(Thanks to the Alliance for Charitable Reform for alerting me to Soskis’s piece.)