Happy New Year (it began January 20 this year)! When Lady Gaga, JLo, Garth Brooks and the President of the United States can be upstaged by a young black female poet, Amanda Gorman, you know you are witnessing something amazing. I suspect that if we could bottle all the tears that flowed that morning we could fill at least one drought-ridden state’s reservoir.
Drought, fires, COVID, racial injustice, the economy…the Inauguration made clear we have so much work to do. The Crisis Charitable Commitment (CCC) was created to encourage more support for nonprofits in this time of crisis and to recognize individual donors and foundations who are stepping up to the plate. We launched last Bastille Day by noting that July 14, 1789 was a turning point in French history: a revolution brought about by economic depression, high unemployment and famine, and perhaps most importantly, a desire by ordinary citizens to have a voice in their government. Now, President Biden and Congress have their hands more than full in addressing the harm caused by 2020, which includes 19 million un- and under-employed workers; perhaps as many as 50 million people facing food insecurity; and a democracy we almost lost.
The parallels between now and then are striking and real. While the quote “Let them eat cake” likely was not spoken by Marie Antoinette (and the actual translation is “let them eat brioche”), the disdain and rule by the rich that animated Bastille Day and the French Revolution echo eerily today. Let me suggest a modern-day version.
Imagine if you will that for the last forty years, as wealth inequality escalated, it was a White House tradition to send a 6” cake to thank wealthy donors. But on Melania’s last day in her palace (the White House, not Mar-a-Lago) she decides to remind her court, the 150,000 taxpaying households who comprise the wealthiest 0.1%, the riche, how much her husband has done for them, including the Tax Cuts and Jobs Act (TCJA), by sending each not the 6” cake but “the biggest ever” 8” cake (orange icing of course). These 0.1%ers could easily share some of the cake with people less fortunate, but few of them do. More often they put a large piece in their second home, private foundation or DAF (donor- advised fund) freezers.
Thanks to a decades-long history of inappropriate tax and economic policies, the 0.1% have been getting fatter and fatter eating cake, while the federal government and society suffers. And because the federal government doesn’t have the tax revenues, the void of filling society’s needs falls to philanthropy. But the donor class prefers to keep their cake frozen in case…what?
Against the backdrop of 650 billionaires making a total of $1 trillion since the pandemic began, Monsieur Biden offers a plan to raise $3 trillion in new taxes over ten years to provide child care and early childhood education for every child in America; repair our infrastructure; promote clean energy and make housing more affordable. But only half of the money he intends to collect is from the riche. All told, the riche–individuals earning $2 million per year or more or those who have $30 million or more in assets–have a total net worth today of $12 trillion ($12,000,000,000,000), so the cost of Biden’s program over ten years is 25% of their net worth, the equivalent of taking back a quarter of the Trump bestowed orange cakes, still leaving the equivalent of lavish 6” cakes. The average riche household sitting on $80 million would end up with $60 million, which should be sufficient to get by on unless…food prices skyrocket? In other words, the total Biden plan could be funded by taxing only the riche and they could still have their cake and eat it, too!
While we wait for legislation, the CCC’s immediate short-term goal is to get as much of that cake out of the freezer as soon as possible and into the hands of the nonprofits who need it. The $1.9 trillion stimulus package is not going to solve all the problems the pandemic has caused or unmasked. It will take years to recover from the impact of business closures and unemployment, which includes one million nonprofit workers. But longer term, Congress must insure through legislation that all of the excess cake is fairly distributed by requiring higher foundation and DAF payouts and tax policies that reasonably move money from the riche to the government and common good.
Especially in this time of crisis, far too many foundation trustees and 0.1%ers are echoing the sentiments ascribed to Marie Antoinette. Dictionary.com says, “Let them eat cake” is “a saying that shows insensitivity to or incomprehension of the realities of life for the unfortunate.” The antithesis is “stepping up to the plate” and making the Crisis Charitable Commitment. As President Biden said in his Inaugural Address, “Our ‘better angels’ have always prevailed. In each of these moments, enough of us came together to carry all of us forward.” Are there enough of us?
P.S. Read into this what you will, but first lady Jill Biden’s first official act was to hand out chocolate chip cookies to National Guard members!