Philanthropy can’t be the solution to inequality

In donating $4.2 billion in the past four months, and close to $6 billion total in 2020, MacKenzie Scott is doing that which is antithetical to capitalism: redistributing wealth.

Scott is an author and the ex-wife of Amazon founder (and owner of the Washington Post) Jeff Bezos, to whom she was married for 25 years. As part of their divorce settlement in 2019, Bezos transferred 25 percent of his Amazon stake — 4 percent of the company — to Scott, making her one of the richest women in the world. Around that same time, she publicly committed to giving away the majority of her wealth.

To donate so much, so quickly, when everything in our society supports the hoarding of wealth, is countercultural. There is no question her gifts will do good for the people who receive those funds — particularly those supporting anti-racism work and organizations led by people of color. Yet that cannot be the end of the story. We cannot applaud the gift without considering how it was made possible and why it was needed in the first place.

The fact that Scott and others like her have amassed such exorbitant wealth, while people who work hard every day will never achieve a fraction of what she and other billionaires enjoy, is an indictment of our current tax system and of philanthropy as a solution to inequality.

When we hear of massive donations from the superrich, we should consider it less a sign of goodwill and more an indication of a system that is far out of whack.

Billionaires have gained $1 trillion during the pandemic while nearly 8 million Americans have fallen into poverty. Now more than ever, we should be examining the system that props up some and suppresses others. Rather than seeing philanthropy solely as a benign force, we should examine the ways power, privilege and white supremacy reward some and not others. And let us tell the whole story.

We must never ignore the fact that our tax system advantages the superrich while disadvantaging people of color and people experiencing poverty. Should Fortune 500 companies pay their workers a living wage, pay their fair share in taxes and pay a greater share of health care costs, there would be less need for such massive gifts. Should elected officials decriminalize marijuana, eliminate unjust policies that lock away Black and brown bodies, and make health care and education more accessible and affordable, we would have more people able to work and care for themselves, their families and their communities. Corporations from Wall Street to Silicon Valley have been criticized by their own Black workforces for unfair compensation and toxic work environments. Should these entities do their own anti-racism work, work that is deeper than mere vocal proclamations of “Black lives matter,” we could reduce unemployment and possibly eliminate the gender and wage gaps.

Scott’s philanthropy is shattering archaic norms in the charitable sector by focusing on groups that have for too long been marginalized by philanthropy. Annual foundation funding focused on people of color has never exceeded 8.4 percent of overall grantmaking, according to research by the Philanthropic Initiative for Racial Equity. Native American communities have received the smallest share — only 0.4 percent of philanthropic funding. Scott’s giving has been inclusive of Native American-led organizations, including a historic $20 million gift to the American Indian Graduate Center — the largest in its history. And Scott even noted the real impacts of historical and systemic racism on the wealth gap in her first giving announcement — “there’s no question in my mind that anyone’s personal wealth is the product of a collective effort, and of social structures which present opportunities to some people, and obstacles to countless others.”

But while we celebrate unexpected generosity, we must continue to push. There is space to applaud and to question Scott for her attempts to right wrongs and support people in need. There is space to celebrate her boldness in funding reparations for Black and Indigenous communities and consider the ways that funding reparations is absolutely the right thing for someone who has benefited from race and class privilege.

When we tell the story of MacKenzie Scott and her generous gift, let us place the story within the broader context of giving and the significance of giving in communities of color. We know people of color tend to be the most generous givers, even if they have less wealth — let us not erase the contributions of people of color because someone with immense means, who had the capacity to give more, finally did so. While we applaud the gift, let us also consider the underlying work that must be done to support true transformation.

Edgar Villanueva is an author, activist and philanthropist. He is the founder of the Decolonizing Wealth Project. This was first published by the Washington Post.