Philanthropy sounds nice, but it’s still a tax-sheltered way that plutocrats exercise power, says Stanford’s Rob Reich.
The world’s tech titans are amassing some of the biggest fortunes ever created. Some, like Mark Zuckerberg and Bill Gates, are giving most of it away. While there have been some dissenters, the general reaction to this kind of philanthropy has been positive. Bill Gates has the highest net favorability of any major political figure not named Colin Powell; he’s seen as warm and competent.
But Stanford professor Rob Reich, who directs the university’s Center for Ethics in Society, explores an argument against philanthropy in a forthcoming book, Just Giving: Why Philanthropy Is Failing Democracy and How It Can Do Better. It can be summarized in a sentence:
“Big Philanthropy is definitionally a plutocratic voice in our democracy,” Reich told me, “an exercise of power by the wealthy that is unaccountable, non-transparent, donor-directed, perpetual, and tax-subsidized.”
This was not previously a minority position. If you look back to the origins of these massive foundations in the Gilded Age fortunes of Andrew Carnegie and John D. Rockefeller, their creation was massively controversial, Reich said, and for good reason.
“A hundred years ago, there was enormous skepticism that creating a philanthropic entity was either a way to cleanse your hands of the dirty way you’d made your money or, more interestingly, that it was welcome from the standpoint of democracy,” Reich told me at the Aspen Ideas Festival, which is co-hosted by the Aspen Institute and The Atlantic. “Because big philanthropy is an exercise of power, and in a democracy, any form of concentrated power deserves scrutiny, not gratitude.”