The New Philanthropy
What I mean by “the New Philanthropy” is the cultural change afoot that is leading more and more of us to believe and act on the belief that we can make a big impact, in our lifetime, with or without large amounts of capital. The New Philanthropy has three classes of people.
John Wood is a model example of someone who had accumulated massive resources and lived a full and busy life, but had some experiences that shifted his perspective to the point where he could no longer continue on his previous path. In the old days, independently wealthy philanthropists like Rockefeller saw their role as to “make as much money as possible, and then use it wisely to improve the lot of mankind.” John Wood and his ilk believe “what kind of man am I if I don’t go face this challenge directly”, and to their peers who say they are crazy or having a midlife crisis they respond “wouldn’t it be a crisis to not follow my heart… at age 35, I’m too young to not do that”. Bill Gates (Woods’ old boss, the man who made him rich) might be seen as old guard, but unlike his industrialist counterparts he lives in a globally connected world of mass communication (that he largely helped create). And when you convince people like Warren Buffett to let you give away all their money too, then you fall into the category of Amplifier.
The patron saint of Amplifiers is Oprah. She and her brethren like Bono, Brangelina, and Leonardo Di Caprio, leverage their personal capital but more importantly they leverage their even more valuable social networks. They focus massive amounts of media attention to mobilize the masses to action. They trade on their capital of celebrity and political power for what they perceive is the greater good. Rather than sit imperially at the top of their thrones and decide which courtesans receive cash, they choose their causes and when others who would take advantage of their sympathies come calling — and they inevitably do in droves — Amplifiers think about how these outside interests help or distract them from their own mission and act accordingly.
The value of cash is dependent on how it is spent. The value of human capital (all the non-monetary activity that goes into a project) would be an order of magnitude greater than the cash involved, assuming one could accurately measure it. The potential amount of human capital that could be raised and spent on any given project is several orders of magnitude greater still. This potential human capital (PHC) is what the Average Citizens as a group bring to the table. An individual Average Citizen can make an immediate and enormous impact by (a) mobilizing their peers, (b) attracting Amplifiers to their cause, and (c) convincing the Independently Wealthy to adopt their cause. All three activities have the additional impact of catching discretionary capital from philanthropists* in their “dragnet”. Genevieve Piturro and Barbara Franklin are perfect examples of Average Citizens who are changing the world for the better right now.
So how do traditional charities fit into the New Philanthropy? It is a complex situation. On the one hand, we have all heard about how bad some charities squander their donations in administrative costs. Even grass-roots initiatives can be comically misguided, like the charitable parachutists who raise less money than than it costs to care for their parachuting injuries. Then there are charities that have been operating for over 20 years with very low overhead rates, like the Cancer Research & Prevention Foundation.** Celebrity charitable foundations can act as effective Amplifiers like or they can just make the celebrities look charitable without raising much money at all, as in the case with most celebrity golf tournaments. Ultimately though, we must consider the non-monetary benefits of any charitable endeavor, given the difference in scale between dollars and PHC.
Here are some questions you can ask yourself if you are considering giving money or your time to an existing charitable cause (whether it’s a formal legal charitable organization or a grass-roots initiative):
- Do I believe in the stated Mission and its importance or relevance?
- What kind of PHC exists for this effort?
- How are they currently leveraging their cash to convert PHC to human capital?
- What opportunities exist for me to help contribute meaningfully in ways other than my cash?
- What are the opportunities for attracting Amplifiers to the cause?
- In the case of formal organizations, what do the various watchdogs say about them?
More generally, we should all be thinking about ways we can become Amplifiers for the New Philanthropy. It starts by sharing your thoughts below.
* non-activist givers as well as corporations
** conflict disclaimer: I serve on the CRPF Board of Directors. My choice to join them was in part because of their low overhead rate.