As you read this month’s letter, it is helpful to keep in mind:
- There is over $200 billion sitting in donor-advised funds
- There is over $1.3 trillion sitting in private foundation endowments
- There is over $18 trillion being held by the top 0.1% of US households (those with $30 million or more in assets)
We’re in the middle of summer and millions of Americans all over the country, not to mention people all over the globe, are feeling the heat. Bastille Day has passed again, the third one since we launched the Crisis Charitable Commitment. Regrettably, the crises that spurred the launch of CCC have only gotten worse: not just climate change, but the threats to democracy, racial justice, wealth inequality, gun safety, women’s rights….
The Fourth of July has also ceremoniously passed. Back on July 4, 1966, the Lovin’ Spoonful released “Summer in the City” with these lyrics:
“Hot town, summer in the city
Back of my neck getting dirty and gritty….
All around, people looking half-dead
Walking on the sidewalk, hotter than a match head.”
They had no idea then how hot! Exactly fifty-seven years later Planet Earth entered the Guinness Book of World Records (in a manner of speaking) by being the hottest it has possibly ever been. As the New York Times reported, “The overall warming of the planet is ‘well within the realm of what scientists had projected would happen’ as humans continue to pump vast amounts of heat-trapping greenhouse gases into the atmosphere, said Zeke Hausfather, a climate scientist at Berkeley Earth…”
Putting aside that the leaders of one of our political parties, for all intents and purposes, chalks the heat records up to bad luck, it should be obvious to everyone that we’re heading to a climate disaster that can best be modified by immediate actions addressing the causes. But it doesn’t appear that most of the wealth-hoarding philanthropists are feeling the heat and stepping up to the plate.
Did I miss billion-dollar foundations announcing that they are going to eat into their growing endowments to address the problem? These ultra-rich foundations–I call them the hubris foundations–announce commitments to fight climate change while arguing for building their endowments to save for the future. I’m confused. What future?
Do the ultra-rich think they can yacht their way out of this problem (at the risk of being spray-painted–even the orcas are not happy about these yachts)? Have you noticed that the S&P 500 has climbed over 18% this year?! Yet charitable giving to fight climate change, estimated by the Chronicle of Philanthropy at $7.5 billion last year, is only 0.5% of the money sitting in private foundations and donor-advised funds, and about 0.04% of the assets of the ultra-rich.
The World Bank and others have put out estimates that it will cost $3-10 trillion per year to limit warming to a 1.5°C increase relative to preindustrial levels (more on why 1.5°C is significant). It would take extraordinary collective action for philanthropists to pony up enough money to fix the climate problem. Only governments (funded by taxes on the ultra-rich) can effectively do that. The philanthropic investments being made are necessary, but not sufficient.
And therein lies the bigger, let me say biggest problem: we must have a functioning democracy to address society’s largest problems, among them climate change. But as Heather Cox Richardson writes, “A story in the New York Times…outlined how former president Donald Trump and his allies are planning to create a dictatorship if voters return him to power in 2024.” A liberal democracy can summon the will to address the concerns of its populace; but an oligarchy uses the government to consolidate power in the hands of a few (white men) and their financial interests at the expense of everyone else.
The effort to destroy democratic government is being organized by something called “Project 2025,” a coalition of more than 65 right-wing organizations, and led by the nonprofit Heritage Foundation. In other words, this attack on democracy is being paid for with tax-deductible dollars (i.e., taxpayer money), some of which is funneled through private foundations and donor-advised funds. You can’t sugarcoat this: These are bad, dangerous philanthropists.
By some estimates $1 billion was given in the last election cycle to c3 and c4 organizations that worked on voter protection, integrity, and engagement. In other words, democracy–the most important issue of our time, the one that impacts the outcomes on virtually all other issues–received just .006% of the assets in foundations and donor-advised funds! We are at a tipping point (no, I am not crying wolf). We desperately need the good philanthropists (yes, Virginia, there are good philanthropists) to invest in the organizations that can counter the most serious attacks on our freedoms and do it now.
Fortunately, there are many examples of good philanthropists–those who spend more than what is considered the norm to invest now to secure our future. Woods Fund Chicago chair L. Anton Seals, in announcing the foundation’s commitment to an 11% payout, writes “the time is over for economic austerity and growing endowments while restricting or decreasing funding to grantee partners working on the front lines.”
I’ve long operated with the belief that “if it’s easy, it’s probably not worth doing.” Protecting our democracy, saving our planet, is not easy. It is most definitely worth doing. I hope you agree.