At first glance, philanthropy work seems more than honorable. It usually includes charitable actions, most commonly through monetary donations for seemingly altruistic purposes. The amount of money being given away to charity has considerably increased over the years. However, it is worth noting that a large percentage of money is being donated in astronomical amounts by the wealthiest tiers of society, and less so in regular amounts by the middle class tiers. In fact, as shown in Gilded Giving 2018: Top-Heavy Philanthropy and Its Risks to the Independent Sector, the percentage of charitable donations from households earning over one million dollars in the United States grew from twelve to thirty percent in the span of twenty years, while the number of households that are partaking in charitable donations has substantially declined. It is obvious that in this day and age, the spotlight is on billionaire philanthropy, which is based on top-down approaches utilized in the name of selflessness. Throughout the past couple of years, billionaire philanthropists have pledged to ‘give back’ through ‘charitable’ acts and donations –all while wearing a mask of nobility and generosity. Despite the fluffy statements and façade around billionaire philanthropy, one cannot deny the overwhelming presence of wealth inequalities that donors almost never seem to address.
It would be a misconception to believe that billionaires donate money purely in the name of goodwill. The conditions and means through which they make donations largely revolves around self-serving intentions; billionaires give away their wealth in ways that benefit them. For instance, the use of Donor-Advised Funds (DAF) has recently been on the rise. Instead of giving money directly to nonprofit organizations, billionaires prefer making investments in DAFs, which conveniently allows them to be eligible for tax deductions, in addition to access to the fund for an unlimited period of time, in which they could hold the fund without actually spending it. Billionaires benefit from a range of tax loopholes, especially when donating money to private foundations, as they would profit from paying less income, estate, and capital gains taxes as a result. Moreover, in these cases, donations through investments in private equity funds allows these donors to circumvent income taxes by only paying for capital gains taxes, which stand at a much lower rate than income taxes. Donations that are made through stocks in DAFs rise and fall based on the value of the stock, which means that the value of the donation can plummet along with the stock. This results in a deceitful cycle of tax breaks that yield no accountability or oversight whatsoever.
Another reason why philanthropy has become so popular among billionaires is because it is particularly helpful in cleansing bad reputations. One example would be Jeff Bezos pledging $10 million dollars to address climate change while his company, Amazon is known to have “machine-learning contracts with oil and gas firms,” with Bezos also reportedly threatening to fire employees who participate in climate activism. It is noticeable how recurrent billionaire philanthropists claim to hold the solution to a problem in which they directly or indirectly contribute to.
Apart from the ways in which billionaires benefit from their own philanthropy, a question concerning the power it might hold should be raised. Some actions taken in the name of philanthropy reveal the power the wealthy could yield in interfering in public life and public issues. It was the case with Bill Gates, as discussed by Hasan Mihaj’s in an episode of Patriot Act, titled “Why Billionaires Won’t Save Us.” Gates has successfully penetrated the political scene and public life in the U.S. by injecting over millions of dollars into campaigning and lobbying for Washington’s Supreme Court to pass a bill subsidizing charter schools –overruling the power of hundreds of thousands of voters. Even if the intentions behind the actions of some billionaires seem gracious, cases like these remind us that it shouldn’t be the norm for wealthy individuals to have this much sway over public life, especially since it defeats the whole purpose of democracy.
The ‘philanthrocapitalist’ techniques that billionaires use to either expunge their public image or absolve them of their problematic, and sometimes criminal, activity should be viewed with a critical eye. The blurred lines that billionaires draw between their investments in charities, non-governmental organizations, and public policy need to be addressed. The means through which these plutocrats thwart public scrutiny cannot be overlooked. Taking a step back and looking at billionaire philanthropy from a bird’s eye view makes one question the reason why and how billionaires exist in the first place. One cannot amass billions of dollars in wealth without exploiting individuals from the bottom-up, and without evading taxes, whether it is through legal loopholes or illegal and unethical practices. Billionaires like to project a fallacious and romanticized narrative of ‘working-your-way-to-the-top’ –but in reality, you can’t get to the top without bleeding out those at the bottom.