Philanthrocapitalism: The billionaires’ ploy

We have all praised the work of philanthropists and other wealthy donors who have generously donated their wealth to advance society. However, philanthropy has raised criticism recently after nearly $1 billion was raised by wealthy donors for the reconstruction of the recently burnt Notre Dame Cathedral. Many critics argue that the money would be better allocated towards fighting global hunger or poverty or even reducing inequality within France. In this post, I argue that many philanthropists don’t act altruistically to resolve global issues but rather act to support their own agenda even if it does little to benefit those who are suffering.

This brings me to the concept of philanthrocapitalism.

Philanthrocapitalism, in this context, is the concept in which wealthy millionaires/billionaires donate money to charities, while still profiting from a system that necessitates the charities in the first place. Further, philanthropy, under the tenets of philanthrocapitalism, is run in a business manner and seeks to maximize return on investment–thus, causes and projects that aren’t as profitable, don’t receive as much funding even if their net social benefit is greater.

Rather than reorganizing the system so a charity is not needed, the wealthy abiding by philanthrocapitalism prefer to donate for several reasons: 1) it’s cheaper and they retain more of their wealth, 2) donations can influence agendas that can be economically advantageous to the donor, and 3) to feel good–some people are unaware of the negative consequences of the system from which they benefit.

Donating money, upholding the system

While donations can provide immediate assistance for those in need, I argue that philanthropy is little more than a publicity stunt by the wealthy to garner approval and retain their wealth. If their actions were truly altruistic, then they would embrace efforts to dismantle the system of greed that necessitates these charities in the first place, and from which, coincidentally, these billionaires benefit. Additionally, often corporate foundations are simply corporate social responsibility (CSR) strategies to increase sales and get in an edge on the competition.

Jeff Bezos, CEO of Amazon and the wealthiest man in the world, donated $2 billion in 2018. The newly established Bezos fund is directed towards supporting NGOs addressing homelessness and poverty. This sounds good and altruistic, but…. Bezos’ net worth is $150 billion, so the $2 billion (a little more than 1% of his worth) seems a little half-hearted. Further, many claim that his wealth has been accrued by exploiting workers’ rights and compensation rules that perpetuate poverty and homelessness. Following workplace accidents at Amazon and unjust worker’s compensation, numerous former employees have been rendered homeless and unable to work. Additionally, besides skirting labor laws by primarily hiring temporary workers who receive no benefits, the median pay for Amazon workers is an abysmal $28,446 a year. Why doesn’t Bezos just alleviate the suffering of his workers by paying them more and giving them benefits? Because this way he can donate 1% and be excused from profiting from the mistreatment and underpayment of his employees.

Additionally, Apple has a donation matching program with its employees and has raised $78 million to charities to date. But, Apple won’t be shutting down their many Chinese sweatshops or paying the $40 billion they owe in federal taxes anytime soon. Tim Cook, the CEO of Apple, also pledged to donate to the reconstruction of Notre Dame.

Like the old Chinese proverb, give a man a fish….etc. Why should the wealthy monopolize the fishing ponds and be praised ten-fold when they give away 1% of their fish to those in need if they could just give others access to the ponds, and they can fish for themselves.

The amount of wealth Bezos and other billionaires are retaining, neigh gaining, from the current political-economic system far exceeds the minute percentage of their wealth (and power) they are giving away through philanthropy.

Another big example in which philanthropy is literally a public relations stunt to ensure unhampered exploitation by the donor is the nearly $1 billion in aid set towards the Yemen Humanitarian Fund donated by Saudi Arabia and the United Arab Emirates–two countries that have helped fuel the conflict.

You’re not a hero if you give away fish after you’ve depleted the stock downstream.

Philanthropic agendas

But philanthropy can do more than ensure system stability, they can influence actions altogether. In fact, by donating large sums of money to an organization, the philanthropist can dictate political and research agendas that “coincidentally” benefit the donors and their enterprises/investments. Linsey McGoey, author of No Such Thing as a Free Gift: The Gates Foundation and the Price of Philanthropy, suggests that the Bill and Melinda Gates Foundation is “supporting agricultural initiatives in Africa and South America to increase the economic influence of U.S. agribusinesses.” Recently, the foundation partnered with Monsanto, the notable big agri-business that monopolizes genetically-modified seeds and the fertilizers and pesticides on which the seeds are dependent, which results in financial dependence from vulnerable smallholder farmers in the developing world.

For an example closer to home, John Cassidy from the New Yorker uses the Gates Foundation and Mark Zuckerberg’s philanthropic ventures towards charter schools to illustrate how donations can lead to political influence in the education debate. Cassidy states, “people like Zuckerberg and Gates, by virtue of their philanthropic efforts, can have a much bigger say in determining policy outcomes than ordinary citizens can.” Also, as a reminder, donations aren’t taxed…

The same holds true for philanthropists donating to political campaigns. We know the impact that Citizens United and unlimited campaign finance have had on our democracy and election process.

Overall, philanthropists are not all evil and their donations often do benefit those in need. But, we need to be cautious about the influence that these donations have and whether they are given in good morals. With that said, does the motivation behind philanthropy matter if it still helps the beneficiaries? In all, this post aims to invoke healthy scepticism towards philanthropic pursuits–philanthropists shouldn’t be automatically heralded as heroes, it’s not so hard to give money when you have money.

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