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Beware of Corporations Bearing Gifts

Donating money is easier—and more fun—than supporting a fair economy.


Tuesday, February 26, 2013

This month General Motors donated $400,000 for breast cancer research. That’s a good thing, as far as it goes. And that act of giving is not tainted by the same irony as, for example, British American Tobacco’s donations to enhance the wellbeing of people in Africa who are dying from the effects of its products.

But corporate philanthropy, and the talk of “generosity” and “giving back” that so often accompanies the announcements of it, leave out of account that people wouldn’t need so much charity if money were distributed fairly in the first place, and if they were protected from today’s rampant profiteering.

When Bank of America, whose lending practices have led to legions of foreclosures and evictions, donates to homeless programs, the catch phrase about “giving back” isn’t worth taking seriously.

When Goldman Sachs, which along with its subsidiaries has been reprimanded by the feds for cheating investors, and which stands at the head of a Wall Street cabal that has compromised the economy of the Western world, bankrolls a school in Harlem, the term “generosity” doesn’t take into account the real ratio of $20 million—admittedly a lot of money to the recipients—to the kinds of numbers that are meaningful to Goldman Sachs. Of course, all these acts of giving are announced with the fanfare that comes from the excited beneficiaries’ sense of scale, not the donor’s. Nor is anything said about the tax writeoff there may be for the donor, or the political or social benefits the donor realizes.

And “charity” from companies that underpay their workers isn’t worthy of the name. Casa Maria Free Kitchen in Tucson gets it. Last November the Catholic soup kitchen and survival center for the poor turned down a $2,000 gift from Walmart because its board understood that Walmart pays such poor wages that its workers are forced to accept food stamps; the company has even been caught assisting its employees to apply for food stamps, some of which are used at its own grocery stores.

Then there is David Koch, the right-wing billionaire industrialist who has helped fund public television’s distinguished Nova series and for whom the David H. Koch Theater, formerly the New York State Theater at Lincoln Center, is now named. As the American Ballet Theatre hosted a gala in New York in 2010 to celebrate its own and Koch’s seventieth birthdays, mothers living near two Koch Industries refineries in Corpus Christi, Texas were desperate to get their asthmatic children away from the toxin-filled air [UMass Amherst’s Political Economy Research Institute has ranked Koch Industries as the tenth worst polluter in the country]. Yet Koch has funded groups that fought the Obama health care plan.

Koch-funded organizations also systematically attack Social Security and Medicare, programs that have played a part in mitigating the growing income gap that is rapidly turning the U.S. into a two-tiered society. At this point it’s worth quoting World Bank economist Branko Milanovic, who has written in his book The Haves and the Have Nots that the very wealthy are more interested in alleviating poverty than in tackling the problem of inequality “because ‘my’ concern with the poverty of some people actually projects me in a very nice, warm glow: I am ready to use my money to help them. Charity is a good thing; a lot of egos are boosted by it and many ethical points earned when when only tiny amounts are given to the poor. But inequality is different: every mention of it raises in fact the issue of the appropriateness or legitimacy of my income.”

Speaking of corporate philanthropy, though donations from large companies tend to get a lot of play in the press—which is part of the reason for making them—it’s important not to overestimate the volume of them in the total picture of American giving.

Research by Giving USA has shown since 1955 that the overwhelming preponderance of charitable giving here is done by individuals—73 percent in 2011, with about half of that coming from the economic tiers below the top 3 percent. If bequests and family foundation gifts are counted in, 95 percent of charitable contributions come from non-corporate sources. In other words, individual givers not in the top 3 percent give around 36 percent of the dollar total, much more than corporations. (And according to Giving USA, last year people with annual incomes below $200,000 collectively gave about 40 percent more in dollars than those with higher incomes.)

So if we want to know what’s good for charity, large numbers of individuals with enough income to make gifts are better for it than rich corporations or their CEOs.•

 

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