Masquerading as a form of benevolence, philanthropy continues to be a useful form of tax evasion for the mega-wealthy actively fighting against true equity.
Philanthropy is an anti-democratic institution that exists as a smokescreen and as the elite’s preferred private market mechanism to supposedly save the world from a variety of evils, in particular, poverty.
Guised as “change,” philanthropy ensures that underlying exploitative or oppressive systems continue to operate and that the elite’s own culpability in the creation of stark wealth inequality and resulting poverty is never addressed. Instead, they are positioned as “thought leaders.”
It is best evidenced by Bill Gates’ self-righteous remarks at the DealBook conference last week. Gates, billionaire and “philanthropist,” voiced skepticism over Democratic presidential candidate Elizabeth Warren and her proposed “wealth tax” — a six percent tax on wealth that surpasses $1 billion in net worth. With a net worth of approximately $108 billion, Gates would be taxed around $6.3 billion, under Warren’s suggested wealth tax. Higher estimates state $13 billion. Nonetheless, Gates’ would safely remain a billionaire.
His remarks at a November 6 conference, however, suggest that such a tax may cost him $100 billion — a false and gross exaggeration. Such a tax, according to Gates, would also limit “business innovation,” a claim that remains untrue. He also explained in the same conference, that he will vote for the more “professional” candidate in the 2020 election — in readable terms, Trump is still a viable candidate for Gates. This should not come as a surprise considering that Gates deemed it acceptable to meet with sexual predator, rapist, and trafficker Jeffrey Epstein and to honor Hindu Nationalist and “The Butcher of Gujarat,” India’s Prime Minister Narendra Modi, with a Gates Foundation award in September.
Gates can accept taxation of up to $20 billion, but a blatant attack on his freedom to accrue obscene wealth is “crazy,” “missing the picture,” or “so extreme.”
Gates is commonly seen as a changemaker. The Gates Foundation was initiated with $5 billion to “to improve global healthcare and reduce extreme poverty.” His wife, Melinda Gates, also makes headlines for vast donations made to ease blanket issues like “gender equity.”
Philanthropists, like the Gates’, are posited as deities. Best encapsulated by the novel Philanthrocapitalism: How The Rich Can Save the World, philanthropists exist in a transcendental realm, in which they are not subject to spend “vast amounts of time and resources to raising money,” to “the tyranny of shareholder demands,” or to elections. Freed from checks and balances, the average philanthropist is released “to think long-term, to go against conventional wisdom, to take up ideas too risky for government, to deploy substantial resources quickly when the situation demands it.”
A family like the Gates’, who funnel money into efforts to reduce extreme poverty or to accelerate gender equity, cannot be hindered in income generation or their ability to acquire wealth. Otherwise, their philanthropy would be similarly hindered.
In a world that is indoctrinated to depend on philanthropy for access to education, health care, or equal opportunity, Gates’ remarks are meant to evoke fear. If Warren or her more “extreme” counterpart Sanders are able to tax the elite, then there will be less capital for “change.” The elite, in a philanthropic worldview, are the arbiters of “change.”
There lies the falsehood of philanthropy.
Philanthropy is driven by private wealth. It cannot be seen as a replacement for a socially secure, welfare state, but globally, philanthropy has morphed to play the role of a pseudo-government.
The first private foundation, that of John D. Rockefeller, was built not for the purpose of charity, but rather as a cache for Rockefeller’s wealth accumulation. The legal structure of a charitable foundation ensured that his money remained outside the purview of taxation.
The present-day idolization and normalization of private foundations have resulted in historical amnesia; in the early 20th century, the sheer existence of such a foundation had been deemed a “menace to the future political and economic welfare of the nation.”
Political scientist Rob Reich explains that foundations “result in a loss of funds that would otherwise be tax revenue,” specifically $53.7 billion in 2011. Philanthropy, undoubtedly, is a tool of tax evasion for the 0.1 percent. But, more concerningly, philanthropy exists at a cost to average taxpayers.
Reich continues, “So foundations do not simply express the individual liberty of wealthy people. We all pay, in lost tax revenue, for foundations, and, by extension, for giving public expression to the preferences of rich people.”
It is important to include that Gates had not been the only critic of Warren’s wealth tax. Hillary Clinton, present at the same DealBook conference, described Warren and Sanders’ approach to universal healthcare, by way of a wealth tax, as “misguided.” Clinton and her husband, Bill Clinton, direct the Clinton Foundation. They have amassed an estimated $240 million fortune, since 2001.
I recently finished Where We Stand: Class Matters by bell hooks, which tracks her journey to class consciousness. Possessive individualism, in which the individual “is conceived as the sole proprietor of his or her skills [and property] and owes nothing to society for them,” has become a hallmark of American cultural rhetoric. It ensures that we see the marginalized, the poor with an agency that they do not possess; they are to blame for the condition in which they exist.
The elite have fused possessive individualism with racism and xenophobia to ensure that, at least in the United States, the white poor “blame their economic plight on black people or people of color globally.”
Published in 2000, hooks rightly observed, “Our nation is fast becoming a class-segregated society where the plight of the poor is forgotten and the greed of the rich is morally tolerated and condoned.”
The elite of the white supremacist capitalist patriarchy (as hooks labels it) have effectively disrupted the mobilization of the poor. The blame is either in a condition that the poor have willfully created or in the poor person of color that resides next door. Simultaneously, in the success that they supposedly represent under possessive individualism or the American dream, the elite ensure that they continue to be seen as capable decision-makers for the 99 percent.
Philanthropy undermines the possibility of a socialist government aimed at ensuring the welfare of all. From its genesis to its present function, philanthropy is a form of tax evasion. True “change” does not begin or arrive with the counsel of the elite, the rich, or the “thought leaders.” It arrives with wealth redistribution and the impossibility of millionaires and billionaires.