The Poverty of Philanthropy

On Thursday the New York Times published Jo Becker and Mike Mcintire’s story suggesting potential impropriety between the Clinton Foundation and a Canadian Mining company. The story is an illustration of the realpolitik of modern philanthropy. The notion that private money coming from multinational corporations and the wealthiest individuals will not influence the goals and direction of foundations and charities demands a level of trust in private organizations that cannot be justified. Given the track record of the wealthiest companies and individuals in the world regarding their institutional role as the exploiting class, the idea that they are ones who can best direct aid to communities that are directly impacted by their policies and decisions is to have their cake, and eat it too. The question arises: What is the value of Philanthropy?

Origins and Development

The word philanthropy comes from the Greek φιλανθρωπία meaning “love of humanity.” In the Hellenistic tradition this meant subjects we now call the “humanities” – art, literature, politics, and science – were undertaken because they promoted what it meant to be human. In focusing their efforts in this way, the Greeks were able to achieve incredible things. Societies around the world still retain reverence for this ancient culture. But with the fall of the Greek city states and the rise of Rome this love for humanity was transformed into the love for the state and done in furtherance of this less noble but still advantageous goal. After Rome fell, and Christianity and Islam came to be the dominating political entities, these pursuits, if engaged in at all, were not pursued merely from that impulse that arises out of a general love for that which is human, but rather in service of the Almighty.

During the long dark period of the Middle Ages these vestiges of philanthropy took a totally ecclesiastical tone. As humans, we simply cannot refrain from such activity and so we are left with the likes of Dante, Aquinais, the Hagia Sophia and St. Peter’s Basilica. It was not until the Italian Renaissance and the following enlightenment period that the ideas of philanthropy were again resuscitated not to please apostolic authority, but for their own sake and the obvious benefits that these advances in technology and science gave to those who investigated them. The Italian Renaissance ushered in a new period of human advancement in which the thousand year rule of the church was contested and the formerly subjugated fields of inquiry like astronomy or chemistry released a new productive capacity. With this advance in technology rose a new class, the bourgeoisie, which sought to replace the old ruling class – that of Monarch and feudal lord – with themselves as the new ruling class of the advancing economic system that we call capitalism.

For the bourgeoisie, science was essential for their rising power, and was in many ways the basis of it. Therefore this new class was a very strong proponent of science and technological development. This however did not promote the philanthropic aspect of the humanities, but instead transformed these activities from pleasing God to serving the interests of the capitalist economy. That gave rise to the emergent ideas of intellectual property and copyright. Instead of being pursued for its own sake, scientific advancements, art, literature, and politics were oriented to serve the interests of the capitalist class, thereby making owners of property out of scientific inquiry. Philanthropy, it seems, was dead. The value of doing activities for a love of humanity instead of profit was antithetical to the philosophical underpinnings of capitalist society.

The rise of capitalism’s productive capacity came with it the birth of a new class: the proletariat. This class – thrust from the village to the city and from simple agricultural work to atomized factory production – saw their material condition change but not dramatically improve. In fact, as they continued to urbanize and fill the streets of ever-growing cities the new working class was subjected to all manner of new social ills of a kind the world had not previously seen. Poverty and pauperism in the urban poor was ubiquitous during the entirety of the 19th century. Because of this there was rising resistance to the inequalities capitalism produced.

Many theories, most notably Marxist, critique the capitalist system particularly because it is unable, even given its great productive capacity, to cure the worst social pariah: poverty. Marx sought to replace the system through revolution of the proletarian class, while others argued that we ought to not go that far. Instead, they sought to fill the gaps that capitalism creates through charity. The church, having lost its leading role in society, now found a niche by which it could use its historical lessons as well as its great cash reserves to provide least some assistance to the worst off. But the church was not the only player in this game and by the mid-to late 19th century several large-scale charitable organizations sprang up and were providing aid to proletarians. Some of them are still around today; think the United Way, the YMCA so of course Catholic Charities. While these reasonable efforts were appreciated by those for which they assisted, they were unable to tackle all of the issues and growing animosity between the working-class and the bourgeois class became ever more ardent. By the late 19th century and early 20th century, the bourgeoisie recognized that if they continued these policies, the their dominant position in society couldn’t long endure.

Because a class is hard to hate as a whole, it is much simpler to pick out the most famous of those who represent the class to hurl your anger in that direction. In America it was directed at the likes of John Rockefeller, Andrew Carnegie and J.P. Morgan. Recognizing this animosity, these prominent capitalists sought to repair their public image. Notably, John Rockefeller hired Frederick Taylor Gates to do just that. Gates’ understanding how public opinion can be manipulated paved the way for the rise of modern field of public relations which Edward Bernays would later revolutionize and entrench in American society. He would do so all while claiming what he was doing was simply propagandizing, but the euphemism was much easier to swallow by the American public. Gates convinced Rockefeller to start his own charitable foundation in which his name would not be attached to the destruction of unions, deaths of striking workers at Ludlow among others, and the overall continued oppression class, but instead on public houses for the arts and humanities and medical research and outreach. In order to attach more weight to these charitable givings the word “philanthropy” was resuscitated as a way to describe his activities. This public relations scheme changed the names Rockefeller and Carnegie from the capitalist juggernauts with all the attributes thereof – selfishness, greed, capriciousness – into the most charitable Americans ever known.

If one is, as I am, in the business of critiquing capitalism, this is a common argument. It states that capitalism and wealth concentration can actually be a social good rather than social ill because it allows those who make the most to give a lot back. The campaign to change social attitudes regarding the bourgeois class from anger and frustration to appreciation and idolization was a great success.

Philanthropy as a Social Good

Philanthropy, like all charity, has many positive components. Namely, charity does in some ways overcome the failure of the current economic system to provide all of the mean that people need to survive. It is not news to anyone that there are countless people within even the most advanced economies, to say nothing of the Global South, who suffer economic woe on a daily basis. Charities attempt, sometimes nobly, to target these individuals and to do their best to aid them in whatever means they have at their disposal. Philanthropic foundations and other charitable organizations have the advantage of being flexible whereas governments and other political institutions may have significant barriers or bureaucratic hurdles that make them less able to quickly and specifically target all the various needs. Likewise, charitable organizations are able to focus their energies in a very limited field such as the Gates Foundation focusing on disease or women’s organizations funding better women shelters. When they grow to significant size, these organizations become institutions in and of themselves and are recognized and institutionalized as nonmarket players that can be counted on. These include the Red Cross, United Way, the YMCA, among others. There is no doubt that these charities and foundations have saved or improved the lives of millions of people around the world. They can and should be commended for doing so, but they are not without their own problems and shortcomings.

Charities and philanthropy are stopgap measures. They take as a presupposition the failures of capitalism and instead of working as powerful institutions to change those dynamics they instead focus on ameliorating the problem as much as possible. Though in some senses a virtue, the specific focus of many charitable organizations means that not all manners of social exclusion or economic hardship are covered by every charity. On top of that, as Janet Poppendieck and Robert D. Lupton have shown that charity has two poor consequences for recipients. First, it is demeaning and inhuman – it makes those in poverty feel personally responsible and immoral for needing “handouts.” Second, it can solidify a dependency culture in which the aid given to a community or individual becomes a lifeline that they depend on but one in that is constantly insecure. For more on this, check out Quinn Zimmerman’s blog about his time in Haiti. Simply put, charities are not enough to fix the real problem.

There is a large propaganda campaign which Nicholas Kristof is one of the notable apologists. He promotes charitable organizations, especially the Christian ones, as more than what they really are. Charities plug the hole in a cracked dam in which leaks spring up every day. A band aid cannot heal a wound that is continuously reopened. Charities also serve a different function. They stand as symbols that this capitalist epoch is not run by capricious and self-serving individual but indeed philanthropists are capitalism’s greatest achievement in that those who have reaped so much of the benefit feel in some ways compelled to give back.

As I said before, this urge or compulsion to give back is not for the love of humanity but for the rehabilitation of public image. Though tempered by the experience of the Cold War and the seemingly internationalization of class conflict, the animosity between workers and owners appears to have waned. Philanthropists only serve to decrease that animosity through the public relations firestorm that they create to promote and raise awareness of their so-called altruistic endeavors.

In Andrew Carnies book, “Gospel of Wealth,” he attempts to outline this obligation but does so not by criticizing the system for having produced the great inequalities and failures of capitalism but to suggest that it may well be the engine by which society as a whole can be made better, all through the contributions of the wealthiest individuals. They have shown themselves to be capable in business, why not in charity? This self-serving justification is the very basis of all modern capitalistic philanthropy. It doesn’t, and will not, suggest there is anything structurally wrong that produces these inequalities but instead the fact that these inequalities exist creates some kind of obligation in them. This is a perverse manifestation of philanthropy.

The Limits of Charity

If those who have benefited the most from this economic system truly feel compelled to do something about its worst consequences, charity is not the most effective means. It should also be noted that very few, if any, wealthy individuals give away their entire fortunes. And, though Americans are very charitable overall, most of it comes not from the rich, but from the working class itself! (The article uses “middle class” which is a misnomer and should be translated to “working class”) The rich, and the most rich are by in large unwilling to give up their class position or to throw themselves off the rolls of the millionaires or billionaires club. Instead they commit just enough to be able to form a public image that sees them not as the exploiters of labor that they are, but as kind and generous people. The two richest Americans, Bill Gates and Warren Buffett, are perfect examples of this sort of disinformation campaigners. The way in which both of those men made their billions is not through some sort of hard work or smarts, but by being able to promote and engaging in business practices which produced for them the most profit.

Economics 101 teaches us that the way companies make profits is to charge more for the commodities they produce than the cost to do so. In order to make profit or to increase profits a company must either lower the cost of production which normally comes through as the stagnant or lower wages which we have seen over the last 50 years or by adjusting their business practices to make their production capacity more efficient, usually by introducing some technological implement. That of course has the consequence of lowering the need for additional human labor. This and this alone, is how the rich, and all other wealthy people, make their fortunes. It is important to say that all that wealth that is being used to promote charitable causes comes from money that was stolen from the very people who now need their services. In that since, Warren Buffett and Bill Gates, are essentially responsible for the ills that they supposedly are working to eliminate.

If they truly want to make a difference they would use their vast wealth to argue for systemic change in our economic system and to foreclose the possibility of the kind of exploitation that they engage in and has made them ungodly amounts of money. There are obvious reasons why they do not do such a thing. It would make them an enemy of their own class. It is neither rational nor justifiable for them to do so. Why indeed would the rich argue against the system that made them rich, even if it demands countless others to be poor? There is decidedly no good reason for them to do so.

Given this state of affairs, we can see that being truly beneficial would necessitate more systemic transformation that would prevent the kinds of difficulties charities are in the business of assisting. By using their vast resources to focus not on the systemic problems but on individual issues, philanthropists get to have their cake and eat it too. They are allowed to exploit and to oppress the vast majority so that they may one day be remembered, not necessarily as a baron of industry, as we do Rockefeller and Carnegie, but instead as “philanthropists.” One thing is very clear. Modern philanthropy is clearly not done for the love of humanity as the word may suggest, but instead for the love of themselves and their public image. For all the good that charities and foundations and philanthropic endeavors have done, which is ample, they have done nothing to prevent these problems from continuing ad infinitum.

Therefore, we should be compelled not to praise these charlatans but to expose them for what they are: self-serving, egotistical, oppressive, capricious, greedy, exploiters. The dark history of philanthropy casts a long shadow and makes charity something done for the image of the rich rather than for its own sake, or even in the service of God. This is decidedly actions which are not undertaken for the love of humanity.

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