How Philanthropy Threatens Democracy

By Susan McWilliamsApril 29, 2017

How Philanthropy Threatens Democracy

The Givers by David Callahan

IN SURVEY AFTER SURVEY, the vast majority of Americans agree that there is too much big money in politics. Those Americans don’t know the half of it.

By the time David Callahan observes, more than halfway through The Givers, that most citizens — “even your average reader of the New York Times” — cannot identify the biggest-money donors in American society, “much less say what they’re doing,” he has already proven the point. The Givers is a book filled with people you have never heard of and the social-engineering projects those people are funding to change the terms of your life.

Consider Art Pope, the CEO of a discount retail chain, who spread his money around North Carolina in a way that all but ensured passage of the state’s infamous “bathroom bill,” which required transgender people to use bathrooms matching the sex listed on their birth certificates.

Or consider Chuck Williams, the businessman behind the Williams Institute, a center for LGBT rights at UCLA Law School. As soon as Williams made his founding donation in 2001, the Williams Institute became central to the push for marriage equality. When a US District judge struck down California’s Proposition 8 in 2010, he cited Williams Institute research more than 30 times.

It will not surprise any American to know that there are beaucoup bucks out there, shaping both the terms of “our” debates and their outcomes. But what is surprising is that tax law treats most of those bucks as charitable donations. The nation’s charitable income tax deduction laws, which have not been reviewed by Congress since 1969, count giving to ideological groups that are essentially indistinct from PACs as a form of giving to charity. You receive the same tax benefit whether you donate to a true charitable cause, like a soup kitchen, or to a think tank that advances your personal agenda by engaging in political warfare. (Callahan puts it this way: “The IRS makes no distinction between funding minority voter suppression and, say, giving for civics education.”)

Quite literally, every American who pays taxes today is subsidizing the attempts of fabulously rich people to dominate our public policy.

The wealthy, as Callahan says, “get a tax break when they buy megaphones that often drown out the voices of ordinary people.” And as they shout into those megaphones, we call them “philanthropists,” as if the friendship (philo) of humanity (anthropos) is something you buy. As if the way to show that you love your fellow human beings is to impose your will on them, to pay money to keep them in the shadows.

Note that this means, among other things, that Citizens United could be repealed tomorrow — in fact, all the Supreme Court’s money-is-speech decisions dating back to 1976’s Buckley v. Valeo could be repealed tomorrow — and it would not lessen the political chokehold that the have-too-muches have on the have-nots (not to mention the shrinking middle class of haves). Art Pope could still donate unlimited amounts to Civitas, to the John Locke Foundation, to the North Carolina Family Policy Council, and to all the other nonprofits that serve as his personal policy network, lending legitimacy and visibility to his views. Williams could give as many more millions of dollars to his eponymous legal institute as he would like, helping to fund litigation that bypasses democratic and legislative processes.

Moreover, big-money donors are not as ideologically diverse as the examples of Pope and Williams suggest. While Callahan works really hard to stress the plurality of big-donor interests — there are environmentalist donors! feminist donors! velodrome-obsessed donors! — his proclamations along these lines seem a bit desperate. It feels like he is squinting in order to pretend a draining glass is half full, or that he is trying to put a positive spin on something that one might as well spin positively, because it’s going to happen no matter how hard you try to stop it (given that nobody in Washington seems to want to change the charitable-deduction laws). But try as he might, even Callahan cannot tell a pluralism-makes-it-all-balance-out story: “There’s no denying,” he admits, “that wealthy donors are far more likely to align themselves with think tanks that side with corporations and Wall Street in policy fights.”

Wealthy Americans have always created and backed nonprofits that have advanced particular cultural and political goals. (Andrew Carnegie, for instance, funded free public libraries in part because he, a religious skeptic, thought those libraries would lessen the hold of religion on the popular mind.) But as Callahan notes, today’s big donors are richer, better organized, and more eager to make a huge and immediate impact than ever before. They’re also, in many cases, more secretive than their predecessors; today’s top givers increasingly funnel their money through organizations like DonorsTrust, an organization that channels giving — in the case of DonorsTrust, conservative giving — in ways that leave no public record.

And, of course, all of this is taking place within the context of the major bifurcation of wealth in the United States, not to mention the growing “nudge economy” that promotes the behavioral and psychological manipulation of workers.

In that context, the rise of mega-giving by mega-donors has the effect of creating what Callahan calls “civic inequality” on top of economic inequality. Callahan’s term is far too polite. It’s clear that he wants to avoid more charged political phrasing because so much of what these donors are doing is so earnest and well intentioned. Largely because “there is no plutocratic plot” behind this sea of big money, Callahan wants to avoid calling this big-money system plutocratic (though at one point he does suggest we are on “the road to benign plutocracy”).

But there’s an old saying about the road to hell, and the content of the pavement that leads to it. Big-money donors may have the best of intentions, but just because you don’t want to think of yourself as a plutocrat doesn’t mean that you’re not a plutocrat, or that your actions aren’t contributing to the decline of democratic governance.

Democracy and philanthropy need not be at odds. It is perfectly possible for a people to be self-governing and for wealthy individuals to donate their money to public causes at the same time — even causes that promote and enhance self-governance. Callahan profiles at least a few rich folks who have devoted their energies and dollars toward such ends. Those include Peter and Jennifer Buffett (the son and daughter-in-law of Warren), whose NoVo Foundation is premised on the desire to avoid what they call “philanthropic colonialism” — the tendency of wealthy outsiders to imagine they understand local people’s problems and needs better than the people themselves — and to instead provide support for people who have identified their own needs to come up with their own solutions. The NoVo Foundation promotes local economies and has several initiatives that foster the civic empowerment of marginalized peoples, particularly young women.

Yet under current legal rules, even donors as well heeled as the Buffetts are — like the rest of us, with our more thinly lined pockets — swimming against more powerful political and legal currents. As Callahan shows, American laws currently define philanthropy in ways that disable, rather than enable, the governance of the people, by the people, and for the people.

Aristotle taught that regimes tended toward a ruling principle, and that you can determine the ruling principle by figuring out who — the many, the few, or the one — holds definitive power. By emphasizing the possibility of reforming the tax code and encouraging Americans to advocate for a better-financed government, Callahan reminds us that the United States remains a place where the many still have the capacity to rein in the influence of the few. Whether that power is exercised may well be the ultimate test of what the people of this nation have to give.


Susan McWilliams is an associate professor of Politics at Pomona College in Claremont, California. She is the author of Traveling Back: Toward a Global Political Theory (Oxford, 2014) and an editor of several books, most recently A Political Companion to James Baldwin (Kentucky, forthcoming).

LARB Contributor

Susan McWilliams is an associate professor of Politics at Pomona College in Claremont, California. She is the author of Traveling Back: Toward a Global Political Theory (Oxford, 2014) and an editor of several books, most recently A Political Companion to James Baldwin (Kentucky, forthcoming). Her writing has been published in journals including Boston ReviewBustCommonweal, Front Porch Republic, The Nation, Perspectives on Political Science, Political Science Quarterly, and The Review of Politics.


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