Philanthropy has always been a part of modern civilization. Whether it is about a “patron of the arts,” a major donor to support a hospital, university research, a charitable organization or cause, or to end disease and/or poverty. The world is so often full of highly publicized events sponsored by mega-wealthy individuals to support one charitable vision or another, a pet project or two. As government has faced austerity – usually because the mega-rich have funded their chosen elected officials to hold their taxes down and limit regulation – the world has shifted so much of what the government used to do to charitable and religious organizations (with major strings attached) funded by the mega-rich. We can end malaria, foment projects to bring potable water to regions where disease proliferates and redesign nuclear energy to be “safe.” But then…
Try this reality on for size (reported by the Washington Post, December 4th) as an example of malign corporate power: “Joan Donovan claimed in a filing with the Education Department and the Massachusetts attorney general that her superiors soured on her as Harvard was getting a record $500 million pledge from Meta founder Mark Zuckerberg’s charitable arm… As research director of Harvard Kennedy School projects delving into mis- and disinformation on social media platforms, Donovan had raised millions in grants, testified before Congress and been a frequent commentator on television, often faulting internet companies for profiting from the spread of divisive falsehoods.
“Last year, the school’s dean told her that he was winding down her main project and that she should stop fundraising for it. This year, the school eliminated her position. The surprise dismissal alarmed fellow researchers elsewhere, who saw Donovan as a pioneer in an increasingly critical area of great sensitivity to the powerful and well-connected tech giants.” Money = Power!
The words “compassionate capitalism” have been used to identify a significant number of mega-rich, from individuals to corporations, dedicated to one cause or another. But under the laws of every state in the nation, the sole stakeholder in every corporation is the shareholder. A charitable corporate agenda, thus, must be anchored to support the economic value to shareholders. Other nations add “society” and employees as mandated stakeholders… but not the United States, which has long favored self-governance as the proper approach. I guess that really did not work so well with BIG TOBACCO or KING COAL/BIG OIL and appears to be an utter failure in confronting the obvious horribles inherent in the development and implementation of artificial intelligence.
Simply, “compassionate capitalism” is failing us. We have a major federal deficit because one political party is immutably dedicated to almost no regulation and lower taxes for the woefully mislabeled “job creators”… the benefits to the rest being the sole target to cuts towards “fiscal responsibility.” The mega-rich have never been more self-centered and selfish than they are today. They live behind gates or in secure towers with “doormen” blocking the path. But they want more; they want power. I know you know most of their names, so there is little reason to waste space naming just a few. See also my November 21st In America, Why the Rich Get So Much Richer blog. It indeed ironic that the major populist movement in the United States is led by one of the most self-centered members of the inherited wealth billionaire class.
Guido Alfani, an economic history professor at Bocconi University in Milan, wrote a brilliant OpEd for the December 3rd New York Times, which includes these observations: “[Rich supporting the society around them, perhaps just to buy safety, is a] symbiotic relationship [that] no longer exists. Today’s rich, their wealth largely preserved through the Great Recession and the Covid-19 pandemic, have opposed reforms aimed at tapping their resources to fund mitigation policies of all kinds.
“This is a historically exceptional development. Helping foot the bill of major crises has long been the main social function attributed to the rich by Western culture. In the past, when the wealthiest have been perceived to be insensitive to the plight of the masses, especially when they have appeared to be profiteering from such plights (or have simply been suspected of doing so), society has become unstable, leading to riots, open revolts and anti-rich violence. As history has the unpleasant feature of repeating itself, we would do well to consider recent developments, including legislators’ inability to increase taxes on the rich, from a long-term perspective.
“Let us begin with the consideration that the presence of very rich or even superrich individuals has always been somewhat troubling for Western societies. Medieval theologians regarded the rich as sinners and thought that the building of large fortunes should have been discouraged. At the very least, the rich were expected not to appear to be wealthy and to provide generous bequests to charitable institutions to the benefit of their souls…
“There is abundant historical evidence that for centuries across the West, the rich have dutifully fulfilled their role of barns of money in a variety of ways, which included accepting to pay exceptional taxes during crises or to provide loans to governments. Often, in early modern times, these were technically forced loans to ruling authorities, although the fact that they were not just a prerogative of absolute monarchies but were also required, usually in wartime, by republican governments such as that of Venice should make us wary of considering them the mere expression of an arbitrary power.
“Indeed, the rich merchants who were the main ‘victims’ of forced loans were also the rulers of patrician republics and understood they were contributing their private resources to the public good. For example, forced loans were imposed by Venice on its richest citizens after the terrible plague of 1630, as well as to fund an exhausting war with the Ottoman Empire from 1645 to 1669, although on both occasions the republic was able to raise much greater amounts from its patricians by means of voluntary loans.
“This is not altogether different from the patriotism with which many among the rich subscribed to various emergency loans during the World Wars, such as the Liberty Bonds issued in the United States in 1917-18 to contribute to funding the Allied war effort. These loans proved to be a poor investment, as the interest tended to become negative in real terms because of hyperinflation. But in the 20th century as in the 17th, the boundary between free choice and constriction was blurred, as governments welcomed any opportunity to increase the social pressure on those reluctant to contribute…
“Based on history, one would expect that in this [current, most difficult] period the rich would have been called once again to fulfill their traditional role, and proposals of this kind have entered the political debate in many Western countries… But so far, in most of them discussion has not been followed by action, and recent fiscal reforms appear to have done little to make the rich contribute more. Recent surveys of fiscal reforms by European countries in the wake of the Covid-19 pandemic show that increases in the top rates of the personal income tax or (where they exist) of wealth taxes have been rare and modest. In the United States, proposals by the Biden administration to increase taxation for the richest, such as a billionaire minimum income tax, have repeatedly failed to gather sufficient political support.”
It does seem that the United States has become the poster-nation for greed and avarice from the top of the economic ladder. They have gleefully glommed onto our “irresponsible deficit” to argue for cutting spending that benefits the rest of the nation, and so many of the relevant would-be beneficiaries have accepted that mantra, perhaps dreaming that success will find its way to them… which is highly improbable. We have the House of Representatives that runs every two years, spending 70% of their days raising money. Guess who funds their campaigns? We have a Supreme Court where justices take extraordinary gifts from individuals willing to embrace extreme conservatism that fosters more wealth. Wealth today is more focused on generating power, influence and visibility and so much less on what we need to grow as a nation.
I’m Peter Dekom, and you just have to look at still-accelerating income and wealth inequality to see indisputable proof of the rise of greed among our richest over doing what’s right.
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