Philanthropy Daily: Was Carnegie right? — Kara Beer



Andrew Carnegie
Andrew Carnegie, three-quarter length portrait, seated, facing slightly left, 1913-crop.jpg


Andrew Carnegie November 25, 1835 – August 11, 1919) was a Scottish-American industrialist who led the enormous expansion of the American steel industry in the late 19th century. He was also one of the highest profile philanthropists of his era; his 1889 article proclaiming “The Gospel of Wealth” called on the rich to use their wealth to improve society, and stimulated a wave of philanthropy.




Was Carnegie right about philanthropy? New Yorker takes a look at list of top 50 givers and the combined $7.7 billion they gave away in 2013.

“The Philanthropy 50 list suggests that rich donors spend less on causes having to do directly with poverty alleviation than on other areas. The categories that got the greatest amounts of funding from the fifty highest givers were foundations, colleges and universities, and hospitals and medical centers. A 2008 study commissioned by Google suggests that less wealthy people tend to give more to causes focussed on the poor than their wealthier counterparts: as much as thirty-six per cent of giving by households with incomes of less than a hundred thousand dollars “focuses on needs of the poor,” compared with twenty-two per cent of giving for households with incomes of a million dollars or more, the study found.” — Russ Jukalian, the New Yorker


Carnegie wrote “The Gospel of Wealth”  — an article in which he stated his belief that the rich should use their wealth to help enrich society.

The following is taken from one of Carnegie’s memos to himself:

Man does not live by bread alone. I have known millionaires starving for lack of the nutriment which alone can sustain all that is human in man, and I know workmen, and many so-called poor men, who revel in luxuries beyond the power of those millionaires to reach. It is the mind that makes the body rich. There is no class so pitiably wretched as that which possesses money and nothing else. Money can only be the useful drudge of things immeasurably higher than itself. Exalted beyond this, as it sometimes is, it remains Caliban still and still plays the beast. My aspirations take a higher flight. Mine be it to have contributed to the enlightenment and the joys of the mind, to the things of the spirit, to all that tends to bring into the lives of the toilers of Pittsburgh sweetness and light. I hold this the noblest possible use of wealth.





In 1889, Andrew Carnegie wrote in “The Gospel of Wealth,” “The contrast between the palace of the millionaire and the cottage of the laborer with us today measures the change which has come with civilization. This change, however, is not to be deplored, but welcomed as highly beneficial.” Carnegie felt that even the poor could be shown that public giving, which benefits the masses, is “more valuable to them than if scattered among them through the course of many years of trifling amounts.”

Our own time has increasingly been called a New Gilded Age. A few weeks ago, after Oxfam International published a report showing that the richest eighty-five people in the world have the same combined wealth as the poorest half of the population, Slate’s Will Oremus wrote: “Global capitalism, we have a problem.” On Monday, the Chronicle of Philanthropy added another angle to the debate, with a report showing that the fifty most generous philanthropists in the U.S. gave a combined $7.7 billion to charity in 2013. This was a modest rise from $7.4 billion the previous year, but almost double the amount given in 2009 during the recession. “I think now that we’re coming into this age where the inequality issue has become so serious it seems very reminiscent of the way people, I think, felt about Carnegie and Rockefeller,” Stacy Palmer, the Chronicle’s editor, told me.

Mark Zuckerberg, the founder of Facebook, and his wife, Priscilla Chan, the youngest people on the list, were also the biggest donors, with a gift of nearly a billion dollars to the Silicon Valley Community Foundation, which provides grants to other recipients, often with the input of its donors. Next were the oil tycoon George Mitchell, the Nike founder Philip Knight and his wife, Penelope, and the Bloomberg L.P. founder and former New York mayor Michael Bloomberg.

Does philanthropy by the most affluent among us make up for the negative consequences of inequality? This is a vexing question. Peter Buffett, Warren Buffett’s son, wrote in an op-ed for the Times last year:

As more lives and communities are destroyed by the system that creates vast amounts of wealth for the few, the more heroic it sounds to “give back.” It’s what I would call “conscience laundering”—feeling better about extreme wealth by sprinkling a little around as an act of charity.

But this just keeps the existing structure of inequality in place. The rich sleep better at night, while others get just enough to keep the pot from boiling over. Nearly every time someone feels better by doing good, on the other side of the world (or street), someone else is further locked into a system that will not allow the true flourishing of his or her nature or the opportunity to live a joyful and fulfilled life.

At the center of this debate is how to quantify the positive impact of philanthropy by the world’s wealthiest people on the world’s poorest, along with the negative impact of inequality—both tasks that are difficult, and perhaps impossible. Giving by the ultra-rich is significant but makes up only a small proportion of total giving. A recent report puts total annual giving by individuals in the U.S. at around two hundred and thirty billion dollars—about thirty times the amount given last year by the people on the Philanthropy 50 list.

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