Cross-posted from my personal blog.
Defending Philanthropy Against Democracy
Scott Alexander has a good post on why he does not find criticisms of mega-philanthropy convincing. This post adds some additional arguments for that position. I suggest readers read Alexander’s post first, since I largely agree with it and will assume readers have read it.
The Democracy Criticism of Philanthropy
A criticism of mega-philanthropy is that it’s anti-democratic. This excerpt from Anand Giridharadas’s book Winners Take All is perhaps representative:
When a society helps people through its shared democratic institutions [as opposed to private charitable foundations], it does so on behalf of all, and in a context of equality. Those institutions, representing free and equal citizens, are making a collective choice of whom to help and how. Those who receive help are not only objects of the transaction, but also subjects of it—citizens with agency. When help is moved into the private sphere, no matter how efficient we are told it is, the context of the helping is a relationship of inequality: the giver and the taker, the helper and the helped, the donor and the recipient.
I do not find this criticism compelling for several reasons.
Framing: Two Reasons Democracy Might be Valuable
I start from the presumption that there are two reasons “democratic control” of any given resource might be good: (1) because democracy is procedurally valuable (i.e., the fact that a decision was made democratically gives it moral value), and (2) because democracy is instrumentally substantively valuable (i.e., it tends to produce substantively good results).
The second point—substantive legitimacy—is essentially an empirical question: Do resources disposed of through private philanthropy, all things considered, do more good than resources spent via democratic control? The empirical question is well worth debating, but in my view it is both less interesting and less central to existing discussions than the procedural question. So, for the rest of this post, I focus on the procedural question: Is private philanthropy procedurally objectionable? I argue that in most cases it is not.
Why Heightened Scrutiny of Philanthropy?
A key premise of this debate is that philanthropic disposal of resources needs to be justified in a democratic society. Insofar as any action needs to be ethically justified, this is trivially true. But I think most critics have a more demanding standard in mind than this. Consider Rob Reich’s remarks in Vox:
Big philanthropy — more than ordinary small donations that most people make — is an exercise of power. It’s an attempt to direct your private assets for some public influence, often with a naked aspiration to change public policy. And in a democratic setting, wherever power is exerted, it deserves our scrutiny, in order to understand whether it’s serving democratic purposes or undermining them. And philanthropy shouldn’t be exempt from that examination.
The underlined assertion deserves more scrutiny. Any decision is an exertion of power: specifically, the power to make the actual decision made instead of some other decision. Whenever one spends money (to take the clearest case), one exercises power insofar as one directs that money to one of many possible ends, either philanthropic (give the money to GiveWell), “democratic” (give the money to the United States government, whose budget is supposedly determined democratically), or selfish (spend the money on candy).
To be clear, I agree that these are morally weighty decisions. I am not convinced, however, that (from a public policy standpoint) philanthropic dispositions ought to be subject to greater moral scrutiny than selfish dispositions. Such added scrutiny seems to perversely disincentivize altruistic dispositions.
In a liberal society, we typically presume that government scrutiny of certain decisions is suspect. If I decide to spend my next $10 on a book rather than donating it to GiveWell, we do not typically presume that that decision needs to be democratically ratified, even though it is an “exercise of power.” Insofar as liberalism is a standard starting assumption for our discourse, I think philanthropy critics have failed to argue why philanthropic decisions deserve greater scrutiny than other private decisions of similar magnitude, such as how much money to spend on various personal goods.
Democratic Ratification of Philanthropy
In response, a critic might argue that the problem is not the philanthropy per se, but the subsidization of it. But this point decisively undermines the democracy criticism: the legal subsidization of philanthropy (by tax deductions and exemptions) was as democratic a decision as any in America. Thus, in a very real sense, Americans have democratically ratified (and incentivized!) the private philanthropy status quo.
Of course, one could (and maybe should) argue the current charity law system is flawed. But note that this is no longer a procedural criticism: it is a criticism of the substantive merits of a system designed by democratic forces. Our democracy could refuse to incentivize or even disallow philanthropy, but it has refused to do so. Instead, we have decided to incentivize it.
One could argue that the decision procedure for arriving at those incentives was flawed. Perhaps. But if so, this undermines the supposed legitimacy of using that process to control philanthropic resources instead.
The critic could also argue that the problem is the “whitewashing” effect of philanthropy. Like Alexander, I am not convinced that this is a real phenomenon, but even if it was, I don’t think the criticism holds. A democracy should be able to weigh the pros of philanthropy (solution of market and policy failures) against cons it might have (whitewashing a bad or unequal economic system). If the democracy decides that the pros outweighs the cons, that calculus deserves respect. Through the various policy subsidies of philanthropy, our democracy appears to have arrived at such a decision. Again, that might be a substantively bad decision, but it is not an anti-democratic one. And if the decision to subsidize philanthropy was substantively flawed, one wonders why we should expect better disposition of money that would have otherwise gone to philanthropy.
American Democracy is not “Democracy”
I find that in this discussion there is a very uncomfortable elision between “democracy” as an abstract virtue and “democracy” in practice, by which critics usually mean the American government.
To see why I find this objectionable, suppose I delegated my donation decisions to a demos of three: Jeff Bezos, Bill Gates, and Warren Buffet. Someone would rightly object that this is not a democratic procedure, since the demos is small and also extraordinarily unrepresentative of all Americans. Of course, I could and perhaps should expand my demos. But where is the proper stopping point? When does the relevant demos become large enough to call the decision reached by them “democratic”?
Critics appear to believe that the answer is roughly, “once the demos includes all eligible voters in America.” But note that this is not an obvious stopping point, since the set of moral patients includes at least all people in the world. Thus, allocation by the United States government is only more democratic than my demos-of-three as a matter of degree, not kind.
Furthermore, like my demos-of-three, Americans are disproportionately wealthy and powerful. They also, unsurprisingly, tend to favor themselves, allocating only about 1.2% of our governmental spending towards foreign aid. Thus, governmental control of would-be philanthropic resources would still favor the relatively rich and powerful.
The critic might respond, “yes, but surely control by a bigger demos is better than control by a smaller one. Sadly, no global democracy yet exists, so maybe the American democracy is the best available.” However, the Indian, not American, government has the largest demos of any existing democracy. Curiously, forcibly redirecting philanthropy dollars from American charities to the Indian government is not a top priority of philanthropy critics.
More seriously: in the absence of a global democracy, I think the right thing to do is not “delegate to the biggest democracy you can.” Instead, the best philanthropists try to identify the ways to do the most good while affording all moral patients equal weight in a democratic spirit.
Of course, many philanthropists are either negligently or intentionally not so democratic in spirit. This is a legitimate objection to raise to philanthropy, but the philanthropy critic would still need to show that moving resources from private philanthropy to American governments (or whatever the counterfactual is) would be better as evaluated from the viewpoint of all moral patients. I suspect that this is not the case, but in any case it is not an argument I’ve seen made. In the absence of such a showing, I do not think it is legitimate for them to act as tough US governmental control of resources is unqualifiedly “democratic” as compared to philanthropy.
I appreciate you taking the time to outline these and I am certainly very sympathetic to your view, but I find your arguments to be strawmen and I don't believe they succeed.
My understanding is that the view in question here is that philanthropy is subverting the proper role of government by enacting policy, such as designing private schools to replace public schools. Selfish spending may be a bad use of resources, but it doesn't affect other people's lives (at least not on conventional morality where "failing to act" is not considered a relevant issue) the same way philanthropy does. Philanthropy ends up uniquely suspect because of it replacing what is viewed as the role of government and affecting people from a policy perspective without giving them (democratic) representation.
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I don't think people in favor of democracy would argue that any system democracy has currently put in place is the ideal... they would allow for the idea that maybe things have gotten out of hand more recently as the rich got richer and the philanthropy got more blatant (note: I'm not sure if this is an actual trend but it certainly is a perceived trend) and so we need to intervene now. This view seems perfectly consistent to me.
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I don't think anyone is arguing that the goal is to delegate to the biggest possible democracy.
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My understanding is that the view in question here is that decisions being made in a community ought to be governed by that community. National government seems to be a perfectly reasonable level of view here, though it could (and would and should) involve state and local governments too. I think the pro-democracy people want governance by the people and communities affected, not mere democracy-for-the-sake-of-democracy.
Thanks Peter!
Yes, my point is derived from the fact that I don’t think there is a meaningful act-omission difference. So any omission of philanthropy has the same effect size as philanthropy, just in the opposite direction.
I agree that that’s a coherent viewpoint, but it’s also not procedurally cognizable. It’s a substantive claim about the goodness of the current balance of private and public power—a balance which has been democratically set. I agree with the critics that the balance is bad, but I don’t think they do a good job showing how it’s either procedural or substantively bad in the case of charity (see SSC).
Winners Take All tries to do this the most, since a key part of its thesis is that philanthropy masks the harms of the current system. But I don’t think the author actually shows this to be the case. And even if he did, it’s still a substantive point.
I don’t think my argument depends on asserting that the critics think democracy is perfect. It does depend on them thinking that democratic control is a virtue, but insofar as we have made a democratic decision not to intervene, the argument that philanthropy isn’t democratic seems misguided to me.
On your last two points together:
I think the find-the-biggest-demos argument is probably the strongest argument for government spending instead of philanthropy. I really disagree with the nationalism inherent in the premise of the last two defenses for reasons of equity. I also don’t think that the nation is an obvious level to spend philanthropy at when most very rich people made their money through a globalized market.
I think there's a mistake here. Yes it's partly about "democracy" in the nation-state sense but it's also a lot more specific than that, and it's about appropriate decision-making in and by communities that are effected by those decisions.
This is quite obvious in the education policy sphere, which is where this debate often comes up. The question is whether students, parents, teachers, and local communities should be front and center in setting the direction of an education system, or whether it's a good idea for individual rich people to set that policy agenda.
A similar dynamic happens a huge amount in the developing world, and it's criticised not only on the basis that it's anti-democratic and dis-empowering, but also because it rarely works out to decide from the outside what is best for a group of people without their input or buy-in.
I think some areas are more suited to philanthropy than others (Bill Gates for example does a pretty excellent job focussing on things that private philanthropy is unique well suited for). Philanthropy, national-level government, local government - all of these things are better suited to different things. The ultimate point is about accountability to your constituency/beneficiaries which I don't think is easily discussed in the abstract. What kinds of causes/actions are ripe for private philanthropic investment and which are in need of grassroots democratic intervention is something I'd personally love to see more discussion of.
PS. Sorry for bringing up such an old thread!
No need to apologize! I'm happy people are still interested in discussing this. :-)
(And I in turn apologize for taking a while to reply!)
A couple of responses to this general point.
First, I (and I think most EAs) would wholeheartedly agree that feedback mechanisms are important in charity governance generally: it seems to be an important measure to identify and solve problems, as well as accurately assess impacts of a charity. Indeed, GiveWell seems to include this in their qualitative assessment of top charities:
GiveDirectly does a very good job of this generally. One of their FAQs is "How do local governments feel about GiveDirectly’s presence?" GiveDirectly's response:
GD also operates local call centers to serve their constituents.
So there's nothing inherent about philanthropy generally, or as EA practices it, that precludes broad opportunities for feedback. To the extent that someone criticizes philanthropy on these grounds, then, it should really only apply to charities that somehow don't afford these opportunities, or do so inadequately. That's a much narrower case that the authors were making.
I do think that EAs may undervalue certain types of feedback mechanisms, though, which is why I give somewhat higher weight in my own charity selection to charities that either enhance recipients' autonomy (by giving them resources they can decide what to do with, as GD does) or otherwise enable communities to choose the goods they feel they need most. I'm excited about charities that develop or use mechanisms like this, such as the quadratic funding mechanism promoted by RadicalxChange.
But I do think that procedural input of this kind is only one important input to an overall effectiveness assessment. A charity that has less-good feedback mechanisms but looks much more cost-effective "on paper" may be worth preferring despite the procedural shortcoming. Ultimately, community feedback has to be a proxy for effectiveness to matter, morally. If so, it can be weighed against other indicia/sources of effectiveness.
A bit on "community": I think that we/others/EAs should be willing to help people in some circumstances where their "community" does not approve of it. Communities are composed of individuals, and individuals have different and sometimes inconsistent preferences. Minorities within communities—or even just individuals who disagree with the communities values and judgments—are still people worthy of our moral consideration, and aid if we can give it safely and effectively. We should do this super humbly, and acknowledge that there may be good reasons why a particular situation exists in a particular area, even if nobody can articulate it. Individual recipients should almost always have the opportunity to deny aid, but I am less confident that always (or even largely) deferring to community judgments about what types of aid to give, if any, are systematically better than an approach that considers community judgments as one of many inputs. To do otherwise risks further marginalizing people whose own communities have neglected or excluded them.
This brings me to another point: part of the challenge here is that no country has perfect preference aggregation mechanisms, and unfortunately the quality of democratic input is negatively correlated with wealth. So if we want to help the poorest people, we will often be operating in communities with non-democratic governance structures, as well as corruption and human rights problems. Yet another reason to not rely solely on community feedback, as some philanthropy critics would do.
It's also worth contextualizing my blog post against the alternative to philanthropy that people like Giridharadas would seem to prefer, which is one in which resources are shifted away from charities and to the donors' democratic governments. It is this preference that strikes me as morally suspect, since it would deny people in aid-recipient countries much agency and resources. The fact that our current democratic governance systems systematically neglect them is rarely discussed, if at all.
As Scott Alexander put it:
Which brings me to my final point, which in part just restates the point of this post: even if community input is valuable, the meta point still holds: the balance of public and private initiatives has itself been set by communities. Almost every community allows for both private initiative and private charity, and so operating within that private space has been, in a sense, ratified by the community at the meta level. Some (like the people I quote) may dislike it, but their will is apparently not the community's.
Personal spending has a natural cap that philanthropic spending doesn't have.
Larry Ellison can spend $200 million on a giant yacht – I think that's approaching the limit of what an individual can spend on themselves while still getting utility from their purchases.
But there's no limit to how much someone can spend philanthropically (i.e. no diminishing utility from philanthropic spending). It'd be absurd to buy multiple yachts, but it wouldn't be absurd to double your donations, even if you're already donating a lot. (And from signaling effects, you probably get more personal utility from donating rather than buying a second yacht.)
Because its utility isn't limited, philanthropic spending has the potential to have a much greater impact on society than personal spending. Potential for greater impact implies greater scrutiny.
Good point!
This is a great post, which I think will be useful for the community!
Thanks!
I disagree.
I agree with the general point that large foundations are a force for good on net. But I also feel like you haven't engaged with the main point of critics like Rob Reich, which (as I understand it) is that philanthropic foundations are a powerful lever that wealthy people can use to build influence―a lever that can be weakened by regulating foundations.
To defend (not that they're in need of much defending) billionaire philanthropy I think you need to argue that foundations provide enough value that having them is worth empowering the wealthy. (fwiw I think this is very likely true)
I think I address that here:
Thanks for pointing that out! I should have read more carefully. I might still be reading you wrong here (if so, sorry) but it feels like this doesn't directly engage with the point.
The paragraph argues that since foundations are currently sanctioned by governments, Reich and other critics ought to respect that decision because it's democratic. I think this is a strawman of their argument; you're assuming an abstract notion of 'democraticness' that infuses everything the government does, whereas the critics don't care whether it's a democratic government that's making a bad decision―it's still a bad decision that leaves individuals with outsized power.
(And note that you can simultaneously believe that government makes some bad legislative decisions and that we would be better off by substituting private spending with gov spending).
Thanks for your reply!
Isn't this what commitment to democracy entails if you think that democratic governance is procedurally valuable? If a decision derives from a democratic body, then that decision at least prima facie deserves respect as a democratic decision.
If this was their criticism, they wouldn't bring up democracy, since it's irrelevant. This is a substantive criticism: our democracy has done the wrong thing here. This is not the same thing as being anti-democratic, which is what they seem to be arguing.
I think there is a steelman of this argument which is something like:
But the problem is I don’t think “making someone more powerful” is necessarily a procedurally objectionable outcome—I don’t think it necessarily undermines democracy. It seems perfectly reasonable to me for a democracy to decide that it will allow billionaires to make a lot of money if they give it away. What the critics have failed to do, in my estimation, is argue that this is not the type of decision that democracies can ratify. In the absence of such a showing, it seems reasonable to me to conclude that a well-known and easily stoppable pattern of mega-philanthropy has been democratically acquiesced to.
Most of the SSC post is arguing that philanthropy is substantively good (sections 1, 2, 4, 5, 7, 8, 9, 11). You're essentially expanding the SSC pro-big-philanthropy view to also argue that big philanthropy is also procedurally good, right?
Curious why you find the substantive-value question less interesting.
(The tension I feel here comes from the case where big philanthropy has been performing well substantively but has weird procedural implications, or vice versa.)
Yes, you are right.
I think it’s less interesting to EAs because we already buy the view that we should try to do cost-effectiveness comparisons of these things.
Yeah, I think the important tension comes out when there's a project that seems very cost-effective on the object level but may have degrading effects on the procedural level (and those effects are hard to roll into a cost-effect model).
Do you have a hypothetical example? It’s hard for me to imagine such a case. Seems like most things that are cost-effective would have a (gross, if not net) strong positive procedural effect by making a healthier, more active, smarter demos.
Quick examples:
Thanks, this is helpful. Not sure I agree that (1) has an overall anti-democratic effect procedurally, but I see the worry.
This is a deft rebuttal of a criticism that funds given philanthropically would be better given democratically. However the argument, as I have often heard it, is not for greater democratic control over just those resources that are being given philanthropically but for greater democratic control over the resources that aren't being given as well.
As you've argued, it's unlikely that any given government would make better use of, say, $10m of philanthropically given money than an educated philanthropist acting in genuine democratic spirit. But if we broaden our scope and see that the $10m is just 10% of, say, $100m that said philanthropist could conceivably (however defined) have given away, and that our philanthropist has decided to devote $90m to continued private wealth hoarding and a paltry $10m to philanthropic causes, then we might start to think that government could have done a better job with it.
Perhaps, but that’s just an argument for higher taxes (which I support), not an argument against philanthropy.
Is the argument actually "against" philanthropy though? As I read the original content, the argument is for greater democratic scrutiny of large philanthropic gifts, as well as potential measures to reduce inequality generally and the elimination or minimisation of certain tax breaks, which is a much narrower debate.
I've not really seen a serious argument that philanthropy should be done away with. In fact, I think the argument is really more about failures in democracy than failures in philanthropy - democracy's arguable failure to provide basic needs (thus charitable giving having to pick up the slack) and the influence of money in policy and politics.
My general impression of e.g. Giridharadas is that, right now, he would very much prefer charitable donations to go to the government instead.