June 4, 2020; Washington Post
What does it mean to be generous? If you heard that the 50 wealthiest people and families have given $1 billion to charity since the pandemic began—in other words, $20 million per person—would you call them generous?
What if you knew, as is in fact the case, that their net worth was nearly $1.6 trillion, meaning their contributions are less than one tenth of one percent of their net worth?
When Jeff Bezos gave $100 million to Feeding America, the nonprofit dutifully sent out the requisite press release, quoted by CBS News as saying, “We are deeply grateful for Jeff Bezos’s generous $100 million contribution to Feeding America’s COVID-19 Response Fund. Countless lives will be changed because of his generosity.”
Except that $100 million for an individual with a net worth estimated at $148.6 billion is chump change—0.07 percent of net worth, observes CNBC. Note that 46 million Americans rely on food banks. That means the donation from Bezos came to a little over $2 per hungry person, at a time when Bezos could’ve afforded more.
In fact, Bezos today has a net worth of $148.6 billion, but his wealth was “only” $115 billion on January 1st. Yes, that’s right, Bezos has seen his wealth climb about $33.6 billion since the start of 2020. Bezos could have shared far more of those gains with the hungry and still seen a sizable rise in his net worth.
As Roxanne Roberts and Will Hobson point out in the Washington Post, median net worth in the US is $97,300. So, in other words, if your family has a net worth of $100,000 and you give $75 to Feeding America, you’ve been every bit as generous—in fact, a little more so—than Bezos.
We’ll wait to read the press releases for their $75 donors.
In the meantime, let’s give some well-deserved props to Roberts and Hudson, who show—with just a bit of basic math—how many philanthropic billionaires maybe aren’t quite as great as standard press coverage would suggest.
Here are some of the numbers:
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Top 50 Billionaire Donors: Giving during Pandemic
|Donor||Median wealth equivalent of donations|
To be fair, some billionaires donated large amounts before the pandemic, some donate through companies they run, and some, like Bill and Melinda Gates, run foundations. It is also true that many wealthy individuals have signed a giving pledge, although upticks in donations due to the pandemic and the economic shutdown have been conspicuous in their absence.
Moreover, the giving pledge, note Roberts and Hudson, falls short in some key ways: While 15 of the 50 wealthiest Americans have signed on, the pledge, they note, “is a public gesture, not a binding contract, and it lets the rich decide when, how and why to give away their fortunes.”
Can the wealthy give real money in the midst of our emergency?
The exception that proves the rule is Jack Dorsey of Twitter, who doesn’t make the above list because his fortune “only” rates 147th on the list of wealthiest Americans, according to Forbes. In early April, Dorsey pledged $1 billion of his shares in the mobile payment company Square—about 28 percent of his then-$3.6 billion net worth—to COVID-19 relief and nonprofits.
For the median American, Dorsey’s giving equates to more than $27,000. So far Dorsey has disbursed 8.8 percent of that—the equivalent of $2,375, and tracks his giving in an open-source spreadsheet.
“Why now?” Dorsey rhetorically asked when making the pledge, “The needs are increasingly urgent, and I want to see the impact in my lifetime…. I hope this inspires others to do something similar.”
Nearly two months later, Roberts and Hudson report, Dorsey’s call has been largely ignored. David Callahan, founder of Inside Philanthropy, notes that the wealthy donate a modest one percent a year on average. Callaghan tells Roberts and Hudson that the low pandemic donations are “shocking but not surprising.”
What are the options? One would be to tax wealth. Last year, Emmanuel Saez and Gabriel Zucman, University of California at Berkeley economists, published The Triumph of Injustice. Saez and Zucman find that in 1970, “the richest Americans paid more than 50 percent of their income in taxes, twice as much as working-class individuals. By 2018…that figure had dropped to 23 percent, on par or less than the rate paid by steelworkers, schoolteachers, and retirees.”
Today, the richest one percent of Americans own more wealth than the bottom 90 percent combined. The rise of the megadonor, note Roberts and Hudson, is a product of this inequality, not the wealthy’s modest “generosity.”
Robert and Hudson concede that the pandemic isn’t the only way to measure giving, but it does measure contributions during a national emergency. “It’s not an either/or,” they point out. “Billionaires could give away 90 percent of their money today and still live lives of unimaginable luxury.”—Steve Dubb