Are supersized philanthropists diminishing our democracy? What bothers the right about "big government" should bother us about "supersized philanthropy." The growing power of philanthropists has begun to undercut our democracy and our democratic institutions.
Famed supersized philanthropist Bill Gates is speaking to the G20 countries in Cannes in favor of levying a small financial transaction tax on each stock and bond trade, also called an FTT or a Robin Hood tax. The tax will generate revenue to help wealthy nations (not individuals) meet their goals in helping the poor, by taking the revenue away from banks, bankers and wealthy people. It's a fascinating spectacle in this luxurious French playground, revealing once again who has access to global power and who doesn't. It is not that I don't like Mr. Gates -- I do -- or that I don't agree that banks and the wealthy should be paying more to society for the benefits we have given to them -- I do -- or that governments should be the arbiter of those funds -- I do -- it is that we have elevated Mr. Gates and other supersized philanthropists to the level of sovereign these days.
Mr. Gates' pro-tax and pro-government push contrasts sharply with America's recent genuflection to wealthy oligarchs -- like Michael Bloomberg, Bill Gates, Warren Buffett, the Waltons and Koch Brothers -- and "their unique ability to get things done." I don't really know any of them personally (I might have met a couple in the course of my work raising funds for charities or political candidates) and for the most part philanthropists that I know are wonderful people, who care passionately about doing good -- as they see it.
And herein lies the problem. America at its revolutionary founding explicitly rejected monarchy and gentry. Yet in the last few decades Americans have passively allowed a group of people to control our lives in ways that seem very un-American. "Too Big to Fail," "Too Big to Jail," the 1% have become very analogous to the ruling royals of nations whose systems Americans reject. The ridiculous US Supreme Court decision on political spending in Citizens United took the personhood of corporations to new heights; and too many hope that the Bill and Melinda Gates Foundation alone will provide the panacea to our broken education system and the world's pervasive health problems.
Supersized philanthropists and the corporations that created them in America are replacing our democratic institutions. Most people agree that democracy is at the heart of America, and the public good is anchored in the democratic processes of our government and civil society. Yet we are allowing, if not promoting, these supersized philanthropists to be the arbiters of the public good; even though they are not subject to democratic processes. Under the gloss of philanthropy we ignore that these supersized philanthropists are often in lock step with the expansionist powers of Wall Street and corporations -- sectors that we know aren't democratic by definition.
I believe philanthropists like Mr. Gates are well meaning. But I am very sensitive to this slippery slope of handing over to the superrich what should be democratically decided policies. I am an immigrant to this country -- and what I love about the promise of America -- is its commitment to resolving problems through a democratic process and a democratically elected government. Socialist Guyana, where I was born, was virtually a one-party state, hideously corrupt, repressive, with rampant economic inequality. Much has changed there and much has not.
The Madoff and Enron banking scandals of the last few years, the fleecing of the 99% and the rising joblessness and inequality bring back terrible memories of those Guyana days. America is the promise of something different -- and better -- a more equal and democratic society. And perhaps Mr. Gates is trying to restore that promise, and put the brakes on the runaway belief that supersized philanthropists and their corporations can save the world.
I hope that Mr. Gates' support of the Robin Hood Tax is an indication that he agrees that the way supersized philanthropy and corporate power and Wall Street now control so much of our lives is un-American and undemocratic. Occupy Wall Streeters have found their voice -- our pro-democracy American voice. Their protests hold the promise of changing both power relations and the ownership of assets. In fighting for the 99%, they are fighting for democracy and community solutions. The 99% want to increase their role in the collective spending of our country's resources, and diminish the role of the 1%.
Occupy Wall Streeters have the power for social transformation that supersized philanthropists will never have. Their cries are for structural change -- and to correct the asymmetry of the concentration of wealth and power in the 1%. We should honor Mr. Gates' philanthropic success in manipulating business interests and the market to improve global health, education, food production, microcredit for the poor and get them goods and services. However we should recognize the certainty that these achievements have little or nothing to do with long term investment in democracy or in developing economies with greater equality at its core. No private philanthropy could achieve what the United States achieved in Afghanistan, Libya or with the Marshall Plan in Europe. It took a resourced government to do that.
Yes I am as irritated as the next person about the inability of our government -- the Court, Congress and the President to work -- we need better politicians, better judges and better officials who can reach compromise and collective solutions and get the country back on track. But I reject the notion that supersized philanthropists are better because they get what they want done without all the bureaucratic mess and red tape. "Messiness" is how our democracy protects us all, creates community and keeps us free. It also has the power to aggregate resources and target massive problems in a way no supersized philanthropist can or should. And I, for one, am not about to give that up.
So thank Bill Gates for arguing for the Robin Hood tax so that governments -- not the supersized wealthy -- can fund strategies to transform the lives of the poor and oppressed. Mr. Gates may be recognizing that supersized philanthropists are super-puny when it comes to BIG problems. In the case of the Robin Hood Tax alone it would generate $400B per year for government spending -- a vast improvement over the $3B his foundation gives away each year. We need to capture money from the supersized philanthropists, wealthy bankers, millionaires so that our community chest is resourced, and democratic solutions -- like job creation -- funded. That is American democracy.
Occupy Wall Street can bring focus to the decay that Wall Street greed and supersized philanthropy have made to our democracy. Narrowing the role of philanthropists (and corporations) will expand our democracy and force community driven solutions. This still leaves our 100% the ability to enjoy our individuality and to pursue happiness, and be philanthropic. We will just not to be kings or oligarchs, or get too big to fight off, too big to fail, too big to jail, and too small to actually fix our problems.
Follow Maxim Thorne on Twitter: www.twitter.com/maximthorne
Some might argue that foundations can propose and support innovative initiatives that governments are unwilling or unable to support. I wonder about that in the case of these mega-grants. The foundation processes are cumbersome, and they seem to lack the agility required of innovation. My memory is not perfect, but I remember learning that places were spending the better part of a year or more to go through the process. It requires many people to craft a 60+ page proposal - including subject matter experts, program staff, writers, administrative staff, Board members, executives, and more. At times, the nonprofit staff are trying to craft the proposals to the foundation staff's expectations; at other times, they are arguing with the foundation staff who don't know the situation "on the ground" as well as those who will actually deliver the program.
The only changes in Guyana have been changes for the worse. Everything you mention in your first sentence remains, only to a much greater degree. Oh! and nothing 'virtual' about it any more.
Maybe it's time to play catch up. If we began taxing UNREALIZED CAPITAL GAINS at the top marginal rate of 35% ( the same as the inheritance tax), Mr. Gates first year tax bill would be about $20 Billion. This would be a terrific tax change interpretation of INCOME that would be a great stride forward in limiting wealth accumulation and concentration. I am absolutely sure that there is not a think tank or foundation in the country that would endorse treating UNREALIZED CAPITAL GAINS as income because thier wealthy founders and directors would never permit such an altruistic approach to governance and taxation.
Those with the money tend to have the notion that they know what is best and what needs doing when in fact that is rarely the case.
If only Gates Foundation money were lost, that would be bad enough; kids lost time and teacher attention in the changes, time and attention that might have been worth it if the changes in those "formerly large, then small schools" had worked. Instead, the little that those kids might have had in troubled schools was used in a fruitless effort. Those kids were and are worse off BECAUSE the Gates Foundation donated money to their schools. We can't know what grants the Gates schools turned down or never applied for, what initiatives they might have been able to afford that would have worked.
Educational reform is like living in a house that's being remodeled. Many actions are critical and must be handled in just the right order; a small change can cause months of delay; the inhabitants who'll be moving out of the house before it's finished seriously question whether the end product will be worth the inconvenience to them.
Fighting malaria is much more straight forward because there's a single enemy, the mosquito.