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Local Investing Opportunities Network – Charity: how effective is giving? | The Economist

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Today’s super-rich are putting record sums into tackling the world’s most pressing problems. But how altruistic is this golden age of charitable giving? Read more here: https://econ.st/3aHRmjc. Film supported by Mishcon de Reya

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Today’s super-wealthy are richer than ever. And they’re giving away their billions like never before. Philanthropists are putting record sums into tackling the world’s most pressing problems. And unlike the mega-donors of the past today’s philanthropists want to see the results in their lifetimes. But how altruistic is this new golden age of giving? Have these mega-donors become too powerful?

The way charities work is increasingly under the microscope. Donors large and small are demanding better bang for their buck. This is leading to innovative new approaches to doing good which are redefining notions of altruism.

Hilton Douglas is an outreach worker for Urban Pathways, a non-profit benefiting from a recent explosion in charity amongst wealthy Americans. There are record numbers of homeless people in New York and every day Hilton tries to help some of the worst affected. In 2018 spending by charitable foundations reached a record $75bn in America. The charity Hilton works for is one of 250 that are backed by New York’s largest and best-known foundation Robin Hood.

Robin Hood provides a small percentage of Urban Pathways’ total income. But the foundation also donates strategic and operational assistance. Urban Pathways runs outreach programmes and a drop-in centre and provides a roof for around 850 men and women each night.

Every year Robin Hood stages America’s biggest, glitziest fund-raising gala where it raises over 60% of its annual funding in three hours. While the average annual donation to the foundation is $108 the gala has helped Robin Hood become renowned as the charity of choice for hedge-fund managers and bankers. Over the past 30 years it’s raised and spent around $3bn fighting poverty in New York.

Paul Tudor Jones founded Robin Hood. An investor and hedge-fund manager worth around $5bn, he believes private philanthropy leads the state in dealing with society’s problems. Journalist Anand Giridharadas spent three years exploring the motivations of America’s wealthy philanthropists. He has concluded that some of their business practices create the very social problems their philanthropy tries to address.

Since 2011 former mayor of New York, Michael Bloomberg has donated over $500m to campaigns to replace coal with clean energy in the US by 2030. But in taking on the battle against climate change Mr Bloomberg has also taken on other billionaire philanthropists on the opposing side of the debate. For decades oil barons Charles Koch and his late brother David have given billions of dollars to non-profit organisations in order to promote scepticism about global warming. The Kochs’ donations have had a huge impact on strengthening the climate-change denial lobby in America. But Michael Bloomberg’s donations to his campaign Beyond Coal have proved an influential counterbalance. So far these have helped retire 289 coal plants, more than half the countries total.

America has witnessed the spectacle of its most-renowned philanthropists battling it out over one of the world’s most important political issues. It raises a fundamental question. How much political power should wealthy but unelected philanthropists wield?

While powerful and wealthy philanthropists are increasingly giving away their money. Fewer people on average are giving in the developed world than two decades ago. It’s a decline that’s coincided with scandals that have rocked some of the world’s best-known charities. Little wonder charities are now experimenting with innovative new approaches to persuade donors to part with their cash.

In the past ten years effective altruism has contributed over $100m in donations towards Against Malaria Foundation. The charity says this has helped fund the distribution of 50m bed nets worldwide, protecting 90m people and saving around 30,000 lives. But effective altruism, EA, has its critics who say giving is not a science and that there is more to charity than cold hard numbers. This scientific approach to charitable giving and work is on the rise and is assuming innovative new forms. It’s being used by some of today’s class of billionaire philanthropists. How this plays out alongside their rising power will help to redefine the impact of altruism. And how it’s perceived.

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27 Comments

  1. Qiu Qiu Channel
    July 30, 2021 at 8:30 am

    You cant call it charity when rob 100 and then give 1

  2. bobwatson
    July 30, 2021 at 8:30 am

    British protestors are so much nicer then American ones

  3. Ernesto Badillo
    July 30, 2021 at 8:30 am

    We don't need more charities, what is urgent is less millionaires and more redistribution, but the few want galas and +PR to show they care so much… for their money in tax havens.

  4. Craken Flux
    July 30, 2021 at 8:30 am

    Lets have some help for the animals, how about it? Makes me sick all the interest and emphasis is on the human being which is causative on 150 million murders a day just to feed their gullet.. as their ecosystems are being depleted by the same species. No. JUst because they cannot defend themselves you cannot ignore them… that is precisely what got humanity in this mess today.

  5. yghdjsnbx Jdjdjbdyhahzh
    July 30, 2021 at 8:30 am

    Homelessness can never stop in america.. why? Drugs!!

  6. william Johanns
    July 30, 2021 at 8:30 am

    Bloomberg giving millions and millions to anti vape organisations and people in the goverment.
    Spreading lies and demonising vaping and at the same time 8million people die every year from smoking.
    Killing a industry that is making a 97% safer than smoking harm reduction product.
    That is criminal.

  7. Sweet Suite
    July 30, 2021 at 8:30 am

    The $$$ they donate goes back into their pockets/business. Not a dime goes to the community that foots their tax bill.

  8. Brenda Tenorio
    July 30, 2021 at 8:30 am

    Malaria is a focus of Gates Foundation so why are the smaller foundations having to weigh in with additional programs?

  9. glenn alexon
    July 30, 2021 at 8:30 am

    Anand Girirdharadas is wrong in every way. Nobody becomes homeless because their employer put too much pressure on them. Nobody is forced into poverty by the practices of their employer, or employers generally. The rich don't donate money to get a small part of it back as a tax refund (or, at most, donate $100 to get a $38 tax refund). The government does not raise taxes on the working class to compensate for the tax breaks given for charitable donations. Anybody who has read an econ 101 textbook would laugh at his suggestions, and it's weird that The Economist has given his pronouncements a voice.

  10. Ruben Verheij
    July 30, 2021 at 8:30 am

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  11. SueDenim
    July 30, 2021 at 8:30 am

    You're morons. "Mark Zuckerberg promises to give away x amount" is merely a statement. If he was actually serious and not just placating you idiots he would simply have done it rolls eyes

  12. andrej cerjak
    July 30, 2021 at 8:30 am

    Most of the donations of super rich probably aren't real altruism – they get tax deductions for their donations. And what they give away (if anything after the tax break) is only an almost invisibly small part of their wealth.

    And most of the charity organisations and so called NGOs (Non-Governmental Organisations) really disgust me – big part of the money they collect goes for the comfortable life they are living. Basically they are using the misery of poor people for their personal gain. You really want to make the world a little better place – You need to make an effort – help people in need DIRECTLY, not through Unicef, Red Cross, Caritas ….

  13. Mark Powers
    July 30, 2021 at 8:30 am

    Mike Bloomberg needs to be sued as well he is controlling the narrative instead of letting others have their own voice by using the airways he is suppressing American opinion on his own narratives

  14. Da roi Tm
    July 30, 2021 at 8:30 am

    Lol…the indian dude is really bitter…well it is their money afterall…not yours.

  15. B R
    July 30, 2021 at 8:30 am

    👍

  16. Lilly Adu
    July 30, 2021 at 8:30 am

    Please, they give to themselves. All this money but nothing gets solved.

  17. Indira Veldi
    July 30, 2021 at 8:30 am

    A song on Real hero and great donor Sonu Sood
    Watch in ""INDIRA VELDI""

  18. No waäy
    July 30, 2021 at 8:30 am

    They get it back with tax breaks, how are ppl so fooled? This is the biggest lie

  19. shah Khan
    July 30, 2021 at 8:30 am

    You say they have given 3x more obviously not why has it got 3x worse simple and as for the pledge the billionaire's have made its BS a lot ov difference between giving and given

  20. J Stone
    July 30, 2021 at 8:30 am

    Charities are simply used to absolve the guilt of ruthlessly earning money by exploiting the lesser human beings and paying zero tax.
    They are cunning, and seeking self- engrandisement and approval.
    BILLIONARES PAY YOUR TAXES!!!!

  21. bigjohn697791
    July 30, 2021 at 8:30 am

    how much in tax breaks do they get I know the UK. government gives tax breaks.

    I hate the emotional blackmail TV Ad's I usually just turn over straight away.

  22. Peter Smith
    July 30, 2021 at 8:30 am

    “Charity is false, futile, and poisonous when offered as a substitute for justice.”

    — Henry George

  23. Tiktok PUB
    July 30, 2021 at 8:30 am

    Yij

  24. Cyrus A. Emmanuel
    July 30, 2021 at 8:30 am

    So I watched an entire video on charity and didn't see and hear anything about The Bill and Melinda Gates Foundation?

  25. J D
    July 30, 2021 at 8:30 am

    Effective Altruism is as based as it gets.

  26. James Walker
    July 30, 2021 at 8:30 am

    The point of democracy is to LIMIT individual power?!?!?! Absolutely not!!! Western democracies were founded on a value of individual rights! This is Marxism in a cloak: the "collective" over the individual.

  27. Babatunde Oniyide
    July 30, 2021 at 8:30 am

    okay