“Lower than ever.” Latest Forbes rankings show extent of billionaire philanthropic greed – Inside Philanthropy
From day one here at Inside Philanthropy, we’ve been clear on the fact that while many super-rich Americans support interesting and vital nonprofit work, billionaires as a class are very stingy. ForbesThe latest list of America’s 400 richest people clearly tells this story. This is now the fourth year that Forbes assigned a âphilanthropy scoreâ to each billionaire on the list, and in year two, this score reflects real money, leaving out pledges, funds allocated to CFOs, and so on.
âThe scores are lower than ever. So recognized Forbes reporter Hank Tucker in a detailed look at how the publication came up with scores, which range from a score of five at the top – “ceded 20% or more of the wealth” – to a score of one – ” ceded less than 1% of the wealth.
Of the full 400-member roster, only eight billionaires received a score of five, down from 10 in 2020. A similar drop occurred across the board: the number of roster members receiving scores of four, three, and two. all declined as well, while the âoneâ category fell from 127 billionaires to 156 billionaires last year in 2021.
From a purely digital perspective, the reason for this daunting decline is obvious. The wealth of billionaires continues to skyrocket, pandemic and all, and it has been doing so at a breathtaking rate since last fall. Giving did not follow. Forbes estimated that the richest 400 Americans have seen their collective wealth increase by 40% since last year’s calculation, it now stands at $ 4.5 trillion. There have been a few attempts to position himself among the top contenders, with Elon Musk’s rise being a remarkable story, as well as the rise of newcomers like young crypto winner Sam Bankman-Fried, whom we have. interviewed not long ago.
When it comes to Forbes‘top philanthropists, the top five list hasn’t changed much from last year. It contains most of the same names: Warren Buffett, George Soros, John Arnold, Lynn Schusterman, Gordon Moore, Julian Robertson, and Amos Hostetter. Eli Broad, who scored a five last year, died in April, while CNN founder Ted Turner, also five in 2020, failed to reach the Forbes 400 this time.
The only newcomer to the Club of Five is First Premier Bank founder T. Denny Sanford, whose quest to “die broke” has precipitated nearly $ 2 billion in donations over the years. The more recent generosity may or may not be related to the flood of negative press he received following reports that he had been investigated for possible possession of child pornography. Either way, Sanford’s wealth continues to rise as well, along with most of his ultra-wealthy peers on the list.
Even MacKenzie Scott, the most exciting philanthropist of recent years, has seen a slight increase in her overall wealth since last fall, despite unprecedented $ 8.6 billion in mostly unrestricted donations so far. . Scott got a score of four this year (between 10% and 19.9% ââof total wealth), although Tucker noted that “at this rate it won’t be long before he hits the top spot.”
Bill Gates and Melinda French Gates also scored a four, the latter being a newcomer to the list (separated from her ex-husband) with $ 6.3 billion in assets. Jeff Bezos, first on the list and first on the ranking Forbes 400 with over $ 200 billion in assets, still scored a bang for the buck, despite a $ 10 billion climate commitment and other flagship giveaways. Elon Musk, in second place, was also one. Third place Mark Zuckerberg scored a two.
As far as I can tell, George Soros and John Arnold were the only people who got a five or a four whose overall wealth has actually declined or remained stable since last year, according to Forbes‘ account. Interestingly, one is a venerable progressive philanthropist whose sprawling donation operation appears to pave the way for his departure, while the other is a much younger donor who also happens to be the wealthiest advocate of charitable law reform.
What are we to do with all of this? On the one hand, the failure of the super-rich to increase their giving in proportion to their growing wealth is nothing new. Both here at Inside Philanthropy and across the industry, we’ve spent years debating why billionaires don’t give more and how to get them to do so, unsettling as the implications of the massive increase may be. donations from billionaires.
The difference this time around – and it was also true last year – is that the world is still in the grip of an era-defining and paradigm-shifting pandemic, a pandemic that has created or exacerbated a whole host of crises. and crossed needs. Forbes’ The 2021 philanthropy scores paint a picture of a class of American billionaires who remain almost totally out of touch with this reality, content to sit on stock market gains and make only minor adjustments to their charitable giving while the world is on fire, often literally. At the risk of sounding melodramatic (OK, maybe I already did), this phrase commonly attributed to Marie-Antoinette wouldn’t be too out of place here.
The billionaires’ lackluster response to the pandemic (with few exceptions) was the subject of a series of reports by Candid and the Center for Disaster Philanthropy, released late last year and early this year. With the exception of people like MacKenzie Scott and Jack Dorsey (who have only scored a two out of Forbes‘due to his own rising net worth), the COVID-related donations of most super-rich Americans in 2020 have hovered between 1% or less of their net worth, often significantly below.
As we learned from a document leak to ProPublica not too long ago, the effective tax rates for many super-rich Americans aren’t that high. By taxing income instead of wealth – and giving the rich ample opportunity to legally evade tax – the federal government has allowed many of these gargantuan fortunes to accumulate largely under the shelter tax. And despite talks about a wealth tax, the Biden administration and Congressional Democrats have so far opposed any significant additions to what the ultra-rich owe.
It is always possible that this will change at some point. But until he does, philanthropic giving remains the only other long-term viable siphon on the soaring wealth of billionaires. As frustrating as their lingering reluctance may be, it is nonetheless true that, in the longer term, we are living a new golden age that will give rise to philanthropic dynasties far more numerous and diverse than those of yesteryear.
Billionaires who decide to give in a particularly expansive or innovative way have a lot to gain in terms of reputation, with Scott being the most prominent example. John Arnold, at 47, is the only Forbes list member scoring a five who is not 80 or older. There is plenty of room for young billionaires to join Scott in the ranks of pioneering philanthropists as figures like Buffett, Gates and Soros enter into old age or lose their luster.
Reading through the Forbes 400, it’s hard not to think how much these modern titans have been praised for their innovative thinking, risk-taking, organizational genius, even as geniuses or oracles. With the caveat that donations from billionaires don’t always bode well for democracy, one wonders why these virtues seem to desert so many when it’s time to give money.