Billionaires are great at invoking commendation. Even with a growing number of Americans growing resentful of the elite, the ultra-rich still manage to win praise, most of which comes from their donations to charities or organizations they founded. At face value, it seems like billionaires donate large sums of money. But don’t be fooled by all the zeros because in 2018 most billionaires gave away less than one percent of their wealth.
When we hear the word philanthropist, we usually think of someone extremely wealthy. This misleading idea comes from news stories such as Robert Smith paying off every student’s debt at Morehouse College or headlines from Forbes calling billionaires “America’s Top Givers.” While it’s true that people in Warren Buffet’s circle gave the most substantial dollar amounts relative to their overall wealth, billionaires contribute very little. In 2018, Jeff Bezos donated $131 million, a whopping 0.16 percent of that year’s income.
In contrast, the average American household gives about $2,000 to $3,000 to charity every year. Since the average household’s income is between $60,000 to $90,000, typical American families contribute about two to four percent of their earnings annually. An ordinary American family is (on average) more generous than the richest man in the country.
Blowing their charity out of proportion isn’t the only vile thing the ultra-rich do. They also use covert strategies to pay fewer taxes. One of the ways they do this is through Donor-Advised Funds, holding accounts that they use for charity. Once they put the money into a DAF, the donor gets a tax cut, even if the money does not make it to the actual charity. This way, billionaires get the benefit, but the nonprofit or organization doesn’t receive the funds for months or even years.
DAFs should not exist, and even donations that reach charities should not exempt someone from contributing their fair share to society. Billionaires have the money to improve infrastructure, healthcare, public safety and wellbeing. Yet without a progressive tax, their wealth will never be put to good use. Donating to art museums does not give a billionaire a free pass from contributing to Medicaid or welfare.
Many of the elite seem to think their status gives them the power to decide how to run our society. Allowing people who are extremely out of touch with working-class struggles to have so much influence is dangerous and undemocratic. Many people oppose the wealth tax because the government moves slowly. However, having large amounts of wealth concentrated in the hands of a few rich white men can be far more dangerous.
Last year, Mark Zuckerberg argued that billionaires should decide where the money goes rather than the government. Why should a single person have much power over all our fates, surpassing elected officials chosen by the people? Take Bill Gates, for example. Yes, Bill Gates, the golden boy billionaire beloved by all for his “selflessness.” When a charter school bill did not pass in Washington, Gates funnelled millions of dollars into campaigning until it got approved. A billionaire used his wealth to support his interest against every voter in the state.
Another argument in favor of billionaires is the Giving Pledge, which may seem noble. However, it does nothing to help those who are struggling today. While people like Warren Buffet sit on billions of dollars, millions of working-class people struggle to make ends meet. The non-wealthy live in fear of losing their homes or not being able to afford proper healthcare. We could be using their money right now to feed the hungry, solve homelessness and reform the healthcare system. We can’t keep waiting for rich people to willingly give up their fortunes to put their money to good societal use.
No one should be allowed to hoard billions of dollars when Americans are struggling to survive every day. The rich make charitable donations mostly for the sake of personal benefit, either to save face or to pay fewer taxes. These are not excuses for keeping more money than one person could spend. It’s time to stop being fooled by “philanthropy” and hold the upper class accountable.