Charitable giving, radical utilitarianism and democracy

Over on The Nonprofiteer, I grapple with the justification for philanthropy which fails (as mine does) to increase Disability-Adjusted Life Years in the developing world. Not entirely satisfied with my arguments and would welcome any and all assistance.

Stupid Billionaire Tricks: Give Charity to MBAs

The Nonprofiteer is at it again, gently suggesting that a Sun Microsystems billionaire isn’t necessarily the world’s authority about how to combat poverty.  But maybe fighting poverty isn’t what he had in mind after all.

Who taught people to say “charity” with a sneer?

Public school funding: perhaps the public could help out?

I hold forth on/as the Nonprofiteer on the idiocy of our debating who should pay for public schools, and the extreme idiocy of our thinking it swell that the cradle of a democratic society should be controlled by individuals whom nobody elected.

Poverty, Meet Cash Transfers

In my guise as The Nonprofiteer, I suggest that the solution to poverty might be money.

dorothea lange depression era photographs 13

Alert the media.  No, really.

News Flash: Philanthropy Is Wealth Solving Problems of Its Own Creation

Warren Buffett’s son has figured out that the proud towers of philanthropy are built on the rotten foundations of inequality and excessive wealth accumulation. I give him credit for being willing to say this aloud–it’s usually left unsaid, one of those things everyone in the club understands but which might be resented by the polloi so we just won’t mention it.

I don’t grok the end of the piece, though, where Buffett calls for a “new paradigm.” Like “thinking outside of the box” or “disruptive technology,” that’s always a safe bet in the rarefied world of TED talks and innovation gatherings. But I dare to argue that what we actually need is the original paradigm–namely, that in a democratic society we come to consensus on the problems to be solved and then tax ourselves to solve them, rather than permitting accumulations of extreme wealth and letting wealthy people create their own social policies.

And I also dare to argue that for the moment, while living under the reign of Big Capital and Big Philanthropy, maybe we should be a little less grateful.

 

Of interest to Chicagoans (possibly)

As some of you might know, I was one of a pair of “Dueling [theater] Critics” unceremoniously bounced from Chicago Public Media for being too expert.  (I am not making this up.)  However, you can’t keep a good battle down, and my colleague Jonathan Abarbanel and I have resumed our role as the Bickersons of Chicago theater on a podcast of our own design and creation.  You can hear us on soundcloud every Friday morning and/or subscribe to us on iTunes.

See you at the theater!

What Detroit means

The first thing I thought about Detroit is that the state’s appointment of a receiver demonstrated the Republican governor’s profound indifference to the democratic process of a Democratic city, not to mention a white governor’s profound indifference to a black city.   This may be true, but it’s also true that Detroit’s finances are such a catastrophe that, like New York in the 1970s, it seems to need an outsider to get its house in order. It helps that the trustee is African-American, though not very much: even temporary government without the consent of the governed should cause us alarm.

The second thing I thought about Detroit is that selling off the collection of the Detroit Institute of Art, which the trustee estimates would be sufficient to retire all of the city’s debt, is the best of a number of bad options. Museums nationwide are hyperventilating at the prospect, but they also think it’s sensible to keep on hand huge numbers of items that no one ever sees.  I don’t quarrel with the need to have a deep collection for research purposes, but I also don’t see why it’s considered bad form verging on unethical to sell the parts of the collection you’re not using in public to sustain the parts of the collection you ARE using in public, and at the same time not coincidentally making the sold pieces available to the public, albeit in a different location.

If there had been a Great Fire of Detroit, and the whole city destroyed, no one would argue that recreating the city’s art collection should take priority over food and shelter for the city’s people.  The years of financial mismanagement have incinerated Detroit just as surely as a physical fire; why shouldn’t we pay more attention to basic needs than to cultural institutions?

And isn’t the whole function of assets to provide financial security when income doesn’t suffice? Again, I wonder about the racial composition of those who champion the inviolability of the collection as against the racial composition of those who think it might be necessary to dispose of it. The state’s Attorney General has opined that the city may not sell them because they’re held in trust for the citizens.  But “The United States shall guarantee to every State in this Union a Republican Form of Government,” and I don’t notice anyone’s raising a ruckus about the loss of that part of our patrimony.

The third thing I thought about Detroit is that the bondholders’ interests are being given absolute priority over the interests of current and former employees, whose pensions are at stake. This is the case in Illinois as well, where at least some portion of the pension “crisis” could be solved by refinancing the debt and stretching out repayment but where that solution is not even considered because the bondholders don’t like it. I understand the value of the municipal bond market to cities’ ability to expand infrastructure but municipal bond investors are investors and should be prepared to accept some pain when they toss their dollars into what’s obviously a money pit.

And the fourth thing I thought about Detroit is that it’s Americans’ closest analogue to what’s casually referred to as “the European debt crisis,”  throughout which salvaging the Euro has meant satisfying bondholders at the expense of people who’d like to work or collect their pensions.   Very few commentators seem aware that the real crisis is one of self-government (or its destruction), or that the Germans have managed to do through economics what they couldn’t do through war, that is, run Europe.  When externally-imposed austerity hit Greece, all I could remember was the bumper sticker from the era of the junta: “Greece: Democracy born 508 BC, died 1967 AD.”  Or, this time around, “reborn 1974, killed again 2011 or -12 A.D.”  As the saying goes, same s**t, different day.

Back to Detroit: if I were trustee, I’d sell off DIA’s assets in a heartbeat and use the proceeds to protect employee pensions. If there was anything left for the bondholders, fine; if not, too bad: it’s the pensioners who paid their share and are entitled to what they were promised. Even after years of trashing public employee unions (brought to you by the Heritage Foundation and other fronts for wealthy people who don’t like to pay taxes or see working people make reasonable money), there must be some court somewhere willing to recognize that the obligation of contracts shall not be impaired.

Of course, I would never be chosen trustee, but that’s not the point. The point is, my solution is what would happen if Detroit were still governed by its people. Detroit: Democracy died 2013 A.D.

Community Reinvestment Comes to Health Care

I have no idea what the nonprofit community would do without Rick Cohen of the Nonprofit Quarterly: if there’s an issue affecting nonprofits he’ll have a fresh and useful perspective on it, and this article about the Community Health Needs Assessments required by the  Affordable Care Act is no exception.

What struck me most was Cohen’s point that CHNAs could do for health care what the Community Reinvestment Act did for real estate lending: make large institutions pay attention to the communities where they do business.  Whatever its weaknesses, CRA did make a serious dent in the once-common practice of red-lining, refusal to lend in poor neighborhoods, and we can expect CHNAs to make a similar change in the culture of nonprofit hospitals.  Simply providing an emergency room isn’t sufficient community service, and if a nonprofit hospital fails to grasp that it jeopardizes not only its Federal health-care dollars but the tax-favored status of the rest of its income.   We know that because the provision calls for enforcement by the IRS as well as the Department of Health and Human Services.

This sort of positive pressure from the legislature to improve community health services is far more effective than the purely negative pressure courts can supply by rejecting a hospital’s claim of charitable status (as in the Provena case in Illinois). Because the point isn’t to play “gotcha” with nonprofit hospitals—it’s to supply communities with the maximum benefit possible from the health care resources already available.

Once again the more you know about the Affordable Care Act, the better you like it.   And “Obamacare,” intended as an epithet, sounds more and more like a well-deserved tribute.

cross-posted with The Nonprofiteer: www.nonprofiteer.net

The last word (don’t we wish) on venture philanthropy

This is the smartest, ballsiest response I’ve seen to the omnipresent nonsense about how what’s wrong with philanthropy and charity is that they’re too soft-hearted and how all the problems of the world could be solved if they were just more rigorous and did their “due diligence” and brought other failed concepts and consultant buzzwords over from the for-profit sector. What refreshing thoughtfulness and appropriate humility. Bravo, Mr. Scanlan!

cross-posted with nonprofiteer.net