No surprise, progress is slow
In 2010, forty of America’s mega rich joined together in a commitment to give away more than half their wealth to charity in their lifetime. The Giving Pledge – as it was called – was the brainchild of billionaire Warren Buffet, but Microsoft founder Bill Gates and his wife Melinda took very little persuading to join him, as did a number of other high profile billionaires, including Facebook’s creator Mark Zuckerberg.
The Giving Pledge has two main goals: to give the level of philanthropy the large scale boost needed to confront current global problems, including world poverty, population displacement, and climate change – without waiting until the donors had died to do it. As for the second goal, The Giving Pledge website argues that “giving in an open way” creates “an atmosphere that can draw more people into it.”
From the start, the founders of the Pledge have limited donors to billionaires – or those who would have been billionaires before giving away half their wealth. But with the Pledge’s tenth anniversary around the corner, what has been its real response among the world’s super-rich?
By 2019, Pledge membership had reached 200 worldwide, which the originators would be justified as regarding as a disappointment – at least, so far. Why? Over the same period, the number of billionaires on Forbes magazine’s annual list has increased steadily and now stands at 2,153. So less than 10 percent of billionaires have joined the moral commitment; and given that the Pledge started with 40 members, it has attracted 160 newcomers over almost a decade, or 17 per year.
The richest man in the world, Amazon’s Jeff Bezos, is among those who have so far stayed aloof from the Giving Pledge, but his newly divorced wife MacKenzie Bezos, now the owner of $36 billion worth of Amazon stock, joined in May saying, “I have a disproportionate amount of money to share…I will keep at it until the safe is empty.”
So why not join? For one thing, foreign billionaires derive less tax advantage from charitable giving than their American counterparts, in some European countries none at all. German shipping magnate Peter Kramer argued in Der Spiegel magazine that “the (American) rich make a choice: Would I rather donate or pay taxes? The donors are taking the place of the state. So it’s not the state that determines what is good for the people, but rather the rich want to decide.”(American philanthropists insist that the tax incentive plays a minor role in U.S. philanthropy.)
The view that the state should have the primary role in dealing with the least privileged is widespread outside the United States – and a strong argument against joining the Giving Pledge. But each region holds its own challenges. The Arab World has its own version of the saying “You can’t take it with you” and that is “The coffin has no pockets.” But when it comes to giving, the extended family has prior claim on the billionaires’ fortunes. Arab philanthropists tend to have long established ties to Arab charitable organizations, such as the Saudi commitment to the Wahhabis.
Leading Pledge members acknowledge its slow growth, but continue to encourage billionaires to join. And criticism of the Giving Pledge tends to puzzle members who see it – with considerable justification – as the biggest philanthropy event in a decade. Bernard Marcus, the co-founder of Home Depot and a Pledge signer told the New York Times, “All this money is going for charity, to help people – what kind of numbskull would find something wrong with that? Would they rather we bought yachts and built mansions?” The point is, of course, that 50 percent leaves enough to do that as well.