What to Do About the Philanthropic Motivations of the Uber Rich—Yes, They Are Different from Ours

October 29th, 2017; The Wire

Why do people give to charity?

It’s a question that nonprofits ask for a variety of reasons, including to motivate people to give more. But the answer may have wider implications for nonprofit organizations than just suggestions for the development staff.

When studies ask why people give to charity, half of donors say things like “personal fulfillment,” “a sense of purpose,” or “a sense of duty.” But studies that don’t ask donors directly why they give show a more nuanced motivation.

An article in Scientific American claims that “people who earn less money are more likely to donate to charity when presented with a request that emphasizes social connection and community. In contrast, wealthier individuals are more likely to give money when presented with a request that appeals to their sense of independence and self-reliance.” People with wealth gave more when the donation reinforced an identity they found desirable. Whether a fortune is self-made or inherited doesn’t seem to make a difference; the data from a Wealth-X study found that 76 percent of the ultra-wealthy made their own fortunes, and these people make up nearly 70 percent of major donors.

In addition to reinforcing personal identity, charitable giving offers help the ultra-wealthy burnish their image in the eyes of the world. Wire author Jacob Burak quotes playwright George Bernard Shaw, who “quipped that a rich man ‘does not really care whether his money does good or not, provided he finds his conscience eased and his social status improved by giving it away.’” NPQ has noted when those accused of distasteful or even criminal behavior try to improve their reputations through public charity, but less extreme cases of social climbing through giving are also common. Burak notes that “In several documented cases at US universities, only around 1% of donors requested to remain anonymous…And when donations are publicly listed by category, most people donate equal to or slightly above the minimum amount required to secure their spot.”

This need to prove oneself generous may be related to negative perceptions of the ultra-wealthy, which have grown as inequality increases. In a thoughtful and insightful article for which she interviewed dozens of elite Manhattanites, sociologist Rachel Sherman points out that “wealthy people must appear to be worthy of their privilege for that privilege to be seen as legitimate,” and they are judged by popular opinion about “do they work hard enough, do they consume reasonably enough, do they give back enough.” A foundation or a university building sends a clear message about the donor’s generosity.

Of course, there are tangible benefits as well. NPQ has written about the “philanthropy” of giant companies like Facebook, attempting to bring internet access to those without while conveniently getting first access to a gigantic, largely untapped market. And donating to charities, particularly the “right” charities, is a habit of the inconspicuous consumption that marks today’s elite. It’s a way of communicating belonging to a class. As Elizabeth Currid-Halkett puts it for Aeon, this class “cements its status through prizing knowledge and building cultural capital, not to mention the spending habits that go with it—preferring to spend on services, education and human-capital investments over purely material goods.”

Some giving more directly reflects givers’ values, like the art lover who donates to galleries or the fisherman who donates to ocean protection charities, or the animal lover who donates to the Society for the Prevention of Cruelty to Animals. In addition to helping causes that donors believe in, these gifts help communicate the identity of “someone who cares about X.”

Burak and Sherman posit that if furthering a cause were the primary goal, it would be more effective for philanthropists to “get involved in public policy, [rather than] make donations that counteract the government’s shortcomings.” Maybe, but it also might exacerbate a problem NPQ has mentioned before, which is that someone who can fund an entire city budget wields an enormous amount of sway over decisions that affect everyone, without ever having been elected or providing a mechanism of retaliation (like getting voted out of office) should their decisions prove unpopular.

Furthermore, Sherman points out that judgements about whether the wealthy merit their privilege “distract us from any possibility of thinking about redistribution…With every such judgment, we reproduce a system in which being astronomically wealthy is acceptable as long as wealthy people are morally good.” NPQ’s Steve Dubb adds that “the purpose of US philanthropy has increasingly shifted from funding innovative new solutions to plugging holes in city services.”

Thinking about philanthropic motivations can be both a practical and an existential exercise for nonprofits, and on the practical side, perhaps it would be smart to start a campaign to urge the “pledger class” to direct those impulses to communicate an identity in more democratically appropriate directions; that’s one way to spread the privilege.—Erin Rubin