It’s hard to believe, but there was a time not so long ago when charity was going to save the world. The right argued for a “compassionate conservatism” that would transfer the care and feeding of the poor from government to churches, while liberals, who saw government funds for good works shrinking, increasingly relied on the kindness of foundations and NGOs. Bill Gates, George Soros and other titans became masters of a burgeoning nonprofit universe, donating huge sums for healthcare, education, antipoverty programs and the bolstering–or creation–of “civil society” around the world. Bono was its troubadour and Slate, with its annual list of the sixty most munificent donors, was its scorekeeper. Bill Clinton, who famously proclaimed “the era of big government is over,” was its impresario.
That philanthropic agendas might be skewed by pet enthusiasms or whims or ego was but a detail. Indeed, Warren Buffett was regarded as a mystifyingly self-abnegating saint because he gave $31 billion to the Gates Foundation instead of starting his own. Another detail: the use of philanthropy to mute criticism. Philip Morris used big donations to the arts to prettify its tobacco-stained corporate image. Rick Warren won acceptance, even from some progressives, for his work in Africa, even though that work also includes heavy proselytizing and alliances with pastors who stage condom bonfires and preach that faith in Jesus will cure HIV.
I’m for giving. I think tithing is wonderful. It’s not a good economic moment to say this, but millions of Americans spend too much money on stuff they don’t need and don’t even really want, which is why it ends up squashed at the back of the closet or collecting dust on a shelf. Wouldn’t it be better for everyone (except the makers and sellers of said stuff) if Americans gave more and saved more? After all, donating a book to a school library or a bag of groceries to a hard-up family generates as much economic activity as if you bought those items for yourself. If you have your shoes resoled instead of throwing them away, you save money and provide work for cobblers (a vanishing craft before this recession). I don’t have a lot of time for leftists who won’t give a quarter to a beggar on the street because it’s up to the state to provide for such people: that beggar should shape up and join the ISO!
Still, the global economic crisis is showing how wishful was the notion that large-scale amelioration of drastic conditions–poverty, illiteracy, infant mortality–could be achieved by freewill offerings from well-intentioned individuals, even if those individuals happened to be billionaires. Like consumer capitalism, which relies on more and more people buying more and more things, philanthropy is an unsustainable model. Even in flush times of humongous returns on investments and much exuberant throwing about of cash, it could never do the jobs asked of it. In a downturn, nonprofits suffer along with the rest of the economy. Easy come, easy go.
Now we are seeing how vulnerable our patchwork of individually funded good works is to the vagaries of fortune. The collapse of Bernie Madoff’s Ponzi scheme alone has caused at least $600 million in losses to Jewish charitable organizations, already struggling in the downturn. The Jerusalem Post calls the Madoff scandal “the most spectacular financial disaster to hit Jewish life since the Great Depression.” Important foundations have folded, including the Picower Foundation, which was among the few to give significant sums to reproductive rights. Planned Parenthood has already laid off around thirty people, 20 percent of its staff. The ACLU, also a beneficiary of Picower as well as the now defunct JEHT Foundation, laid off thirty-six employees, 10 percent of its staff. The toll on hospitals, universities and the arts has been enormous. As Brandeis’s major donors lost their fortunes to Madoff and shrank their pledges to the university, Brandeis decided to shut down its Rose Art Museum and auction off its entire collection to raise cash.
In the short run, more small donations can limit some of the damage: MoveOn.org appealed to its 5 million members for money to help four hard-hit organizations–the Brennan Center for Justice, Human Rights Watch, the Advancement Project and the Center for Constitutional Rights–and raised more than $630,000 in three days. Foundations that still have money are also pledging to help. But these are just stopgap measures; in major downturns, everyone, including small donors, eventually gives less overall.
The problem isn’t limited to foundations. The Global Fund to Fight AIDS, Tuberculosis and Malaria is being stiffed on pledges of around $5 billion from donor nations. It isn’t that there’s no money. The $4 billion in bonuses Merrill Lynch doled out in December (days before being taken over by Bank of America) could alone practically close the gap. In fact, as economist Jeffrey Sachs, who has powerfully advocated the responsibility of the rich North to the poor South, points out, Wall Street bankers have given themselves $18 billion in bonuses, paid for by government bailouts, to say nothing of parties, spa vacations, Super Bowl extravaganzas and, of course, their obscene salaries. Is there no way to get that money back and give it to help people who, literally, will die without it? If the awarding of fantastic wealth–in public money!–to a handful, no matter what happens to the rest of us, is really essential to the intrinsic workings of capitalism, the country is doomed, and so is the planet.
There’s got to be a better way, and there is: it’s called progressive taxation and enlightened social policy. The boom in philanthropy paralleled–and helped justify–tax cuts, shrunken government services and rising inequality. Appeals to the better angels of our nature are all very well. What we really need, though, are not random acts of kindness but concerted acts of solidarity. Perhaps the crisis will help us realize that poor people shouldn’t have to beg for rent money on the Internet, and plutocrats cannot be counted on to come to the rescue.
