A publication of The Colorado Trust
Español Menu

By Kristin Jones

On Tuesday, Facebook founder Mark Zuckerberg and his wife, Dr. Priscilla Chan, announced that they will give away 99 percent of their Facebook shares—now valued at around $45 billion—to charity during their lifetimes.

The move sparked questions beyond the expected ones of how the money will be spent. (Zuckerberg and Chan said they’d take on disease, personalized learning, building strong communities and connecting people.) It also ignited a conversation about the role of billionaires in solving the great problems of the world, and philanthropy’s role in general—both what it is and what it should be.

While some defended philanthropy’s role in funding worthy goals that risk-averse governments might not take on, and others lauded Zuckerberg’s decision to spend his own money charitably rather than simply pass it on to his descendants, much of the immediate reaction was skeptical.

In Slate, David Auerbach wrote of the grand undertakings of rich men like Zuckerberg and Bill Gates:

“This magnificent magnanimity provokes two inevitable reactions: 1) What great guys! and 2) Wait—are they really so great? As much as we might appreciate the generosity of our software billionaires, their raining of money over good causes also highlights the direness of a world in which a handful of individuals, through a combination of skill and luck, end up with monetary resources beyond that of most small nations.”

Auerbach notes that the Bill & Melinda Gates Foundation’s huge investment in solving fixable public health problems (particularly his foundation’s efforts to fight communicable diseases in Africa) have been more successful than Gates’ endeavors in education (specifically, the backing of Common Core and charter schools). He attributes this difference to the underlying infrastructure, which was set up to receive a large influx of cash to fight disease in Africa, but unsuited to do so in the case of American public education.

But Auerbach goes on to argue that whether or not Zuckerberg or Gates spend their money well is somewhat beside the point. The real issue, as he sees it, is the massive public disinvestment that makes philanthropy necessary to begin with. It shouldn’t be left to billionaires to solve big problems like income inequality or climate change, he says; but the truth is, the government isn’t stepping in to solve these problems.

“We can’t set a safe emissions target, we can’t raise our debt ceiling without throwing a hissy fit,” Auerbach writes. “There’s only so much blame you can put on the billionaires for this.”

Writing in The Intercept last week—before Zuckerberg’s announcement—Michael Massing took on “hacker philanthropy” of the kind that’s born out of Silicon Valley wealth, in a review of sociologist Linsey McGoey’s new book No Such Thing as a Free Gift. McGoey is critical of the Gates Foundation; its championing of the school reform movement, in particular, is held up as a failed experiment whose premises (of performance-based pay, charter schools and increased student testing) are now deeply entrenched in U.S. public schools.

Massing notes the good that the Gates Foundation has done—cutting measles deaths by 90 percent in Africa since 2000, and decreasing new cases of malaria by a third in 12 years, for example. Massing’s main contention is that foundations are able to pursue grand experiments, and deploy huge amounts of cash, with little real scrutiny from the media. He attributes some of this to the fact that foundations are footing the bill for some news outlets that can no longer rely on viewers or advertising. (The Trust is among several Colorado foundations that, in recent years, have provided funding to help fill a void in reporting on health issues facing Coloradans.)

“The power of the new barons of philanthropy is only going to grow,” Massing writes. “The risks they take and the bets they make will no doubt become bolder. If journalists don’t hold them accountable, who will?”

The Washington Post took Zuckerberg’s announcement as a chance to examine the issue of outsized private spending on social welfare in the U.S. Citing the Organization for Economic Cooperation and Development, the newspaper writes that private spending by Americans on social benefits is four times the average of similar spending in advanced economies worldwide.

Is that a good thing? The Post revisits a 2010 interview in German newspaper Der Spiegel, in which shipping magnate Peter Krämer argues that it’s not: “You can write off donations in your taxes to a large degree in the USA. So the rich make a choice: Would I rather donate or pay taxes? The donors are taking the place of the state. That’s unacceptable.”

Krämer goes on: “Forty superwealthy people want to decide what their money will be used for. That runs counter to the democratically legitimate state. In the end the billionaires are indulging in hobbies that might be in the common good, but are very personal.”

At the heart of all of these critiques is a simple one: Philanthropy—especially the kind practiced by deep-pocketed billionaires—has too much power.

As a philanthropic organization, what do we do with that critique?

The Colorado Trust is in many ways a different—and smaller—animal than the initiatives created by rich men like Zuckerberg. But that doesn’t mean we’re immune to the criticism offered above.

First, the differences: The Trust was created from the sale of a nonprofit hospital group, PSL Healthcare Corporation, in 1985, and our resources are exclusively related to that initial sale; we aren’t led by donors. And compared with Zuckerberg’s $45 billion or the $37 billion in assets held by the Gates Foundation, The Trust’s $458 million (as of end of last year), while certainly enough to help create meaningful change in our state, looks like small potatoes. Our aim isn’t to solve all the problems of the world; it’s to improve health equity in Colorado—a big enough job.

There’s also been a fair amount of griping about Zuckerberg’s decision to structure his initiative as a limited liability company, which allows it to do the kind of lobbying and investments that IRS rules prevent foundations like The Trust from doing.

Nonetheless, tax benefits that shield the Gates Foundation and other U.S. philanthropies also protect The Trust. Our private funds are sheltered from taxes that would otherwise go to government, so long as we meet the IRS requirements for charitable expenditures.

And particularly in rural Colorado, we have the capacity to invest sums with an outsized impact on small towns—affecting their local politics, the distribution of resources, wealth and poverty.

Speaking of wealth and poverty, inequality is often at the very root of the problems we are trying to address. The Trust’s vision is to achieve health equity, meaning fair and equal opportunities for all Coloradans to lead healthy, productive lives, regardless of income, race or geography. We do that by addressing the social determinants of health—not just health care but things like child care, education, transportation. You can’t go very far down this road without slamming into the very fact of our institutional privilege—the fact that we have money to give away in places that are strapped for cash.

Do foundations have too much power? I know this is something with which my colleagues at The Trust and in other local foundations grapple. Some believe that we do.

The way we at The Trust have tried to address this lately is by attempting to upend some of the traditional rules of engagement in philanthropy. In our Community Partnerships work, four of our staff members have embedded themselves in rural communities around the state—not to detail and oversee The Trust’s plans for improving health, but to ask residents themselves what they want and need for prosperity and wellness.

Similarly, in our Health Equity Advocacy work, we bring nonprofits together to learn from each other and to set their own goals and objectives in promoting policy that improves health equity, with our financial support.

We’ve learned that approaching grantmaking this way takes much longer than simply giving away money to worthy nonprofits, but we believe that it is one way to honor the wishes and autonomy of the communities we serve.

In September, john a. powell, a professor of law and African American studies at the University of California, Berkeley and an intellectual leader in the movement for equity, spoke to audiences around Colorado as part of our Health Equity Learning Series. In his speech, he talked about what institutions and governments can do to achieve equity. Back in our office later that afternoon, we asked him what philanthropy can do.

“Philanthropy shouldn’t replace the role of government,” powell said. He used the example of Zuckerberg’s $100 million effort to remake Newark public schools as a cautionary tale; the private cash couldn’t make up for the failures of a system neglected and mismanaged by its public stewards, and besieged by poverty.

Instead, said powell, philanthropy’s opportunity is in taking on efforts that are otherwise ignored by government because they are too risky, too difficult or too costly, and providing models that can be replicated.

A few weeks ago, I visited southeastern Colorado along with Theresa Trujillo, who works as our community partner in that region. In the places where she works, including Avondale, a small town east of Pueblo, and Walsenburg, a bigger town in Huerfano County, the sense of political disenfranchisement is palpable. In a meeting at Avondale, volunteers at El Centro de los Pobres, which helps poor families with medical services, food and other basic needs, spoke about a lack of public services and a feeling that they weren’t represented by any government at all. At a coffee klatsch in Walsenburg, retired men said that power holders in Denver don’t know they exist.

Democracy is a great idea, and the truth is philanthropy is no substitute for it. The best we can hope is that by approaching our work with humility and transparency, we can invite the communities we serve to take the power from our hands. This is risky, difficult and requires substantial investment. And if it’s not followed by more public-sector attention and engagement with the issues that residents themselves raise, we will have failed.

Kristin Jones

Freelance writer and editor
Denver, Colo.

See all stories by this author

You Might Also Be Interested In

Sign up to receive our original stories by email.