November, 17 2016, 01:15pm EDT
Report Warns of Increasingly "Top Heavy" Philanthropy
Concentrated Giving by Wealthy Donors along with Falling Donations by Non-Wealthy Pose Risks to Independent Sector and Civil Society
WASHINGTON
A new report, "Gilded Giving: Top Heavy Philanthropy in an Age of Extreme Inequality," authored by Chuck Collins, Helen Flannery, and Josh Hoxie of the Institute for Policy Studies and Inequality.org, raises the specter of a philanthropic sector dominated by wealthy mega-donors and their foundations, and donor-advised funds.
"The growth of inequality is mirrored in philanthropy," said report co-author Chuck Collins. "As wealth concentrates in fewer hands, so does philanthropic giving and power. We believe this poses considerable risks to both our independent sector and democracy."
The report warns that unprecedented levels of charitable giving in recent years mask a troubling trend. Charities are increasingly relying on larger and larger donations from smaller numbers of high-income, high-wealth donors. Meanwhile, receiving shrinking amounts of revenue from the vast population of donors at lower and middle-income levels.
The report also finds that increasingly top-heavy giving has significant implications for the practice of fundraising, the role of the independent nonprofit sector, and the health of our larger democratic civil society.
Risks to charitable sector organizations include increased volatility and unpredictability in funding, making it more difficult to budget and forecast income into the future; an increased need to shift toward major donor cultivation; and an increased bias toward funding larger or heavily major-donor-directed boutique organizations and projects. The increasing power of a small number of donors also increases the potential for mission distortion.
Risks to the public include the rise of tax avoidance philanthropy, the warehousing of wealth in the face of urgent needs, self-dealing philanthropy, and the increasing use of philanthropy as an extension of power and privilege protection.
Key findings:
Charitable contributions from donors at the top of the income and wealth ladder have increased significantly over the past decade. From 2003 to 2013, itemized charitable contributions from people making $500,000 or more--roughly the top one percent of income earners in the United States--increased by 57 percent. And itemized contributions from people making $10 million or more increased by almost double that rate--104 percent--over the same period.
The number of private grant-making foundations has shown similar dramatic growth. The number of grant-making foundations in the United States has doubled since 1993, from 43.956 to 67,736 in 2004, and to 86,726 in 2014. Between 2004 and 2014, the number of foundations increased 28 percent and the amount of assets held in those foundations increased 35 percent.
Over the past ten years, charitable giving deductions from lower income donors have declined significantly, at almost the same rate that contributions from higher income donors have increased. While itemized charitable deductions from donors making $100,000 or more increased by 40 percent, itemized charitable deductions from donors making less than $100,000 declined by 34 percent.
The number of donors giving at typical donation levels has been steadily declining. According to one estimate, low-dollar and midrange donors to national public charities have declined by as much as 25 percent over the ten years from 2005 to 2015. These are the people who have traditionally made up the vast majority of donor files and lists for most national nonprofits since their inception.
The rate of decline in small-dollar donors correlates strongly with indicators of overall economic security in the United States, such as wages, employment, and homeownership rates. This correlation indicates that donor declines are likely due, in large part, to changing economic conditions.
"Since the last recession, the charitable sector has seen tremendous growth in giving," said report co-author Helen Flannery. "That's a good thing, in theory. But the growth is from donors at the top of the giving ladder, while giving from small and midlevel donors is steadily falling. And more and more giving is going into warehousing vehicles like foundations and donor advised funds, instead of to charities on the ground."
"The trends in philanthropy may be less visible than trends in income and wealth inequality, but they are following the same trajectory. Without intervention, these trends lead toward multi-generational wealth dynasties on one side and widespread austerity on the other," added co-author Josh Hoxie.
The report tracks significant changes in philanthropic giving in recent years, puts forward a number of possible implications of these changes, and offers some solutions.
Institute for Policy Studies turns Ideas into Action for Peace, Justice and the Environment. We strengthen social movements with independent research, visionary thinking, and links to the grassroots, scholars and elected officials. I.F. Stone once called IPS "the think tank for the rest of us." Since 1963, we have empowered people to build healthy and democratic societies in communities, the US, and the world. Click here to learn more, or read the latest below.
LATEST NEWS
Abortion Defenders Decry 'Baseless' Attack on Mifepristone as SCOTUS Hears Case
"The overturn of Roe was just the first step in the far right's relentless campaign to restrict women's reproductive freedom," said one advocate. "We always knew they would come for medication abortion, too."
Mar 26, 2024
As the U.S. Supreme Court heard oral arguments Tuesday in a case brought by right-wing activists seeking to sharply limit access to a commonly used abortion pill, reproductive rights advocates renewed warnings that Republicans' endgame isn't just making abortion a states' rights issue, but rather forcing a nationwide ban on all forms of the medical procedure.
Thehigh court justices—including six conservatives, half of them appointed by former President Donald Trump, the presumptive 2024 GOP presidential nominee—are hearing oral arguments in Food and Drug Administration v. Alliance for Hippocratic Medicine, a case brought by the right-wing Alliance Defending Freedom on behalf of anti-abortion doctors. The case involves the abortion pill known by the generic name mifepristone, which was first approved by the FDA in 2000 as part of a two-drug protocol to terminate early-stage pregnancies.
"If the Supreme Court refuses to follow the evidence and imposes medically unnecessary restrictions on mifepristone, it will be just another stepping stone in the anti-abortion movement's end goal of a nationwide ban on abortion."
"Mifepristone has been used by millions of women over the last 20 years, and its safety and effectiveness have been well-documented," said Jamila Taylor, president and CEO of the Institute for Women's Policy Research. "The drug has taken on even greater importance for women's health since the Supreme Court overturned Roe v. Wade, and the far right has moved to block women's access to healthcare at every turn."
In a dubious practice known as "judge shopping," the plaintiffs filed their complaint in Amarillo, Texas, where Matthew Kacsmaryk, the sole federal district judge and a Trump appointee, ruled last April that the FDA's approval of mifepristone was illegal. Shortly after Kacsmaryk's ruling, a federal judge in Washington state issued a contradictory decision that blocked the FDA from removing mifepristone from the market. The U.S. Department of Justice subsequently appealed Kacsmaryk's ruling.
Later in April 2023, the Supreme Court issued a temporary order that allowed mifepristone to remain widely available while legal challenges continued. A three-judge panel of the right-wing 5th U.S. Circuit Court of Appeals ruled last August that the FDA's 2016 move to allow mifepristone to be taken later in pregnancy, mailed directly to patients, and prescribed by healthcare professionals other than doctors, was likely illegal. However, the court also allowed the pill to remain on the market pending the outcome of litigation.
In an analysis of the case published Tuesday, jurist Amy Howe explained:
There are three separate questions before the justices on Tuesday. The first one is whether the challengers have a legal right to sue, known as standing, at all. The FDA maintains that they do not, because the individual doctors do not prescribe mifepristone and are not obligated to do anything as a result of the FDA's decision to allow other doctors to prescribe the drug.
The court of appeals held that the medical groups have standing because of the prospect that one of the groups' members might have to treat women who had been prescribed mifepristone and then suffered complications—which, the FDA stresses, are "exceedingly rare"—requiring emergency care. But the correct test, the FDA and [mifepristone maker] Danco maintain, is not whether the groups' members will suffer a possible injury, but an imminent injury.
Destiny Lopez, acting co-CEO of the Guttmacher Institute, called the plaintiffs' claims "baseless."
"If the Supreme Court refuses to follow the evidence and imposes medically unnecessary restrictions on mifepristone, it will be just another stepping stone in the anti-abortion movement's end goal of a nationwide ban on abortion," she said on Tuesday. "As the court weighs its decision, let's be clear that the only outcome that respects facts and science is maintaining full access to mifepristone."
As more than 20 states have banned or restricted abortion since the Supreme Court's June 2022 Dobbs v. Jackson Women's Health Organization ruling overturnedRoe v. Wade and voided half a century of federal abortion rights, people have increasingly turned to medication abortion to terminate unwanted pregnancies. And while Republicans have often claimed that overturning Roe was not meant to ban all abortions but merely to leave the issue up to the states, GOP-authored forced pregnancy bills and statements by Republican lawmakers and candidates including Trump—who last week endorsed a 15-week national ban—belie conservatives' goal of nationwide prohibition.
Project 2025, a coalition of more than 100 right-wing groups including Susan B. Anthony Pro-Life America and other anti-abortion organizations, wants to require the FDA to ban drugs used for medication abortions, protect employers who refuse to include contraceptive coverage in insurance plans, and increase surveillance of abortion and maternal mortality reporting. The coalition is reportedly drafting executive orders through which Trump, if reelected, could roll back Biden administration policies aimed at protecting and expanding abortion access.
"The overturn of Roe was just the first step in the far right's relentless campaign to restrict women's reproductive freedom. We always knew they would come for medication abortion, too," Taylor said. "But conservatives seeking to block access to mifepristone are not concerned about women's safety; they want to block all abortion options for women and prevent them from making their own reproductive decisions, even in their own homes."
Right-wing groups including the Heritage Foundation have been pressing Trump to invoke the Comstock laws, a series of anti-obscenity statutes passed in 1873 during the Ulysses S. Grant administration. One of the laws outlawed using the U.S. Postal Service to send contraceptives and punished offenders with up to five years' hard labor. Named after Victorian-era anti-vice crusader and U.S. postal inspector Anthony Comstock, the laws were condemned by progressives of the day, with one syndicated newspaper editorial accusing Comstock of striking "a dastard's blow at liberty and law in the United States."
Slate senior writer Mark Joseph Stern said Tuesday that far-right Justices Clarence Thomas and Samuel Alito—who wrote the majority opinion in Dobbs—"are clearly eager to revive the Comstock Act as a nationwide ban on medication abortion, and maybe procedural abortion, too."
"That would subject abortion providers in all 50 states to prosecution and imprisonment," he added. "No congressional action needed."
Progressive U.S. lawmakers joined reproductive rights advocates in rallying outside the Supreme Court on Tuesday.
"Mifepristone is safe and effective and has been used in our country for decades," said Rep. Rashida Tlaib (D-Mich.). "These far-right justices need to stop legislating from the bench."
Rep. Ayanna Pressley (D-Mass.) asserted that "medication abortion is safe, effective, and routine healthcare."
"Over half of U.S. abortions are done this way and we have decades of scientific evidence to back up its safety," she added. "SCOTUS must protect access to mifepristone and we must affirm abortion care as the human right that it is."
Keep ReadingShow Less
Experts Warn of Toxins in GM Corn Amid US-Mexico Trade Dispute
"The Mexican government is both wise and on solid ground in refusing to allow its people to participate in the experiment that the U.S. government is seeking to impose."
Mar 26, 2024
Friends of the Earth U.S. on Monday released a brief backing Mexico's ban on genetically modified corn for human consumption, which the green group recently submitted to a dispute settlement panel charged with considering the U.S. government's challenge to the policy.
Mexican President Andrés Manuel López Obrador announced plans to phase out the herbicide glyphosate as well as genetically modified (GM) or genetically engineered (GE) corn in 2020. Last year he issued an updated decree making clear the ban does not apply to corn imports for livestock feed and industrial use. Still, the Biden administration objected and, after fruitless formal negotiations, requested the panel under the United States-Mexico-Canada Agreement (USMCA).
"The U.S. government has not presented an 'appropriate' risk assessment to the tribunal as called for in the USMCA dispute because such an assessment has never been done in the U.S. or anywhere in the world," said agricultural economist Charles Benbrook, who wrote the brief with Kendra Klein, director of science at Friends of the Earth U.S.
"The U.S. is, in effect, asking Mexico to trust the completeness and accuracy of the initial GE corn safety assessments carried out 15 to 30 years ago by the companies working to bring GE corn events to market."
The group's 13-page brief lays out health concerns related to GM corn and glyphosate, and the shortcomings of U.S. analyses and policies. It also stresses the stakes of the panel's decision, highlighting that "corn is the caloric backbone of the Mexican food supply, accounting, on average, for 50% of the calories and protein in the Mexican diet."
Blasting the Biden administration's case statement to the panel as "seriously deficient," Klein said Monday that "it lacks basic information about the toxins expressed in contemporary GMO corn varieties and their levels. The U.S. submission also ignores dozens of studies linking the insecticidal toxins and glyphosate residues found in GMO corn to adverse impacts on public health."
The brief explains that "since the commercial introduction of GE corn in 1996 and event-specific approvals in the 1990s and 2000s, dramatic changes have occurred in corn production systems. There has been an approximate four-fold increase in the number of toxins and pesticides applied on the average hectare of contemporary GE industrial corn compared to the early 1990s. Unfortunately, this upward trend is bound to continue, and may accelerate."
The U.S. statement's assurances about risks from Bacillus thuringiensis or vegetative insecticidal protein (Bt/VIP) residues "are not based on data and science," the brief warns.
"The U.S. is, in effect, asking Mexico to trust the completeness and accuracy of the initial GE corn safety assessments carried out 15 to 30 years ago by the companies working to bring GE corn events to market," the document says. "The Mexican government is both wise and on solid ground in refusing to allow its people to participate in the experiment that the U.S. government is seeking to impose on Mexico."
"The absence of any systematic monitoring of human exposure levels to Bt/VIP toxins and herbicides from consumption of corn-based foods is regrettable," the brief adds. "It is also unfortunate that the U.S. government rejected the Mexican proposal to jointly design and carry out a modern battery of studies able to overcome gaps in knowledge regarding GE corn impacts."
"The U.S. government's case against Mexico has no more scientific merit than its sham GMO regulatory regime, and should be rejected by the USMCA dispute resolution panel."
Friends of the Earth isn't the only U.S.-based group formally supporting the Mexican government in the USMCA process. The Center for Food Safety sent a 10-page submission by science director Bill Freese, an expert on biotech regulation, to the panel on March 15. His analysis addresses U.S. regulation of genetically modified organisms (GMO) along with the risks of GM corn and glyphosate.
"GMO regulation in the U.S. was crafted by Monsanto, now owned by Bayer, and is a critical part of our government's promotion of the biotechnology industry," Freese said last week, referring to the company known for the glyphosate-based weedkiller Roundup. "The aim is to quell concerns and promote acceptance of GMOs, domestically and abroad, rather than critically evaluate potential toxicity or allergenicity."
His submission notes that the U.S. Food and Drug Administration "does not require a GE plant developer to do anything prior to marketing its GE crop or food derived from it. Instead, FDA operates what it calls a voluntary consultation program that is designed to enhance consumer confidence and speed GE crops to market."
"When governmental review is optional; and even when it's conducted, starts and ends with the regulated company's safety assurance—what's the point?" Freese asked. "Clearly, it's the PR value of a governmental rubber stamp."
"The Mexican government's prohibition of GM corn for tortillas and other masa corn products is fully justified," he asserted. "The U.S. government's case against Mexico has no more scientific merit than its sham GMO regulatory regime, and should be rejected by the USMCA dispute resolution panel."
In a Common Dreams opinion piece last week, Ernesto Hernández-López, a law professor at Chapman University in California, pointed out that Mexico's recent submission to the panel also "offers scientific proof and lots of it," including "over 150 scientific studies, referred to in peer-review journals, systemic research reviews, and more."
"Mexico incorporates perspectives from toxicology, pediatrics, plant biology, hematology, epidemiology, public health, and data mining, to name a few," he wrote. "This clearly and loudly responds to American persistence. The practical result: American leaders cannot claim there is no science supporting the decree. They may disagree with or dislike the findings, but there is proof."
The Biden administration's effort to quash the Mexican policy notably comes despite the lack of impact on trade. While implementing its ban last year, "Mexico also made its largest corn purchase from the U.S., 15.3 million metric tons," National Geographicreported last month.
Kenneth Smith Ramos, former Mexican chief negotiator for the USMCA, told the outlet that "right now, it may not have a big economic impact because what Mexico is using to produce flour, cornmeal, and tortillas is a very small percentage of their overall imports; but that does not mean the U.S. is not concerned with this being the tip of the iceberg."
Keep ReadingShow Less
'Out-of-Touch Billionaire' Larry Fink Blasted for Calling 65 a 'Crazy' Retirement Age
"I love how rich people are treated as sources of great wisdom when they obviously don't know their ass from their elbow," said one economist.
Mar 26, 2024
Larry Fink, the billionaire CEO of the world's largest asset management firm, wrote in his annual letter to investors on Tuesday that it is "a bit crazy" that 65 is viewed as a sensible retirement age in the United States, drawing swift backlash from Social Security defenders and policy analysts.
Dean Baker, senior economist at the Center for Economic and Policy Research, replied that the CEO of BlackRock apparently doesn't know the U.S. already raised the full retirement age for Social Security to 67 under a law passed during the Reagan administration—a change that inflicted benefit cuts across the board.
"I love how rich people are treated as sources of great wisdom when they obviously don't know their ass from their elbow," Baker wrote on social media.
While Fink, who is 71, wrote that "no one should have to work longer than they want to," he argued that "our conception of retirement" must change, pointing specifically to the Netherlands' decision to gradually raise its retirement age and tie it to life expectancy. (Fink does not mention that life expectancy in the U.S. has been trending downward in recent years.)
"When people are regularly living past 90, what should the average retirement age be?" Fink wrote. "How do we encourage more people who wish to work longer, with carrots rather than sticks?"
Alex Lawson, executive director of the progressive advocacy group Social Security Works, told Common Dreams in response to the BlackRock CEO's letter that "Larry Fink is the definition of an out-of-touch billionaire."
"He is welcome to work as long as he wants to, but that doesn't mean that everyone else—including people who do demanding physical labor—should work until they die," said Lawson.
"Half of Americans age 65 and older are living on less than $30,000 per year. This is absurd. Congress must expand Social Security."
Roughly half of older Americans have no retirement savings, a fact that Fink acknowledged in his letter.
While progressive lawmakers such as Sen. Bernie Sanders (I-Vt.) have called on policymakers to expand Social Security benefits by forcing rich people like Fink to contribute more to the program, the BlackRock CEO argued that the private sector and federal government should team up to "ensure that future generations can live out their final years with dignity."
"What should that national effort do? I don't have all the answers," Fink added. "But what I do have is some data and the beginnings of a few ideas from BlackRock’s work. Because our core business is retirement."
Fink's letter comes days after the Republican Study Committee—a panel comprised of around 80% of the House GOP caucus—released a budget proposal calling for "modest adjustments to the retirement age for future retirees to account for increases in life expectancy" in a purported bid to "secure Social Security solvency for decades to come."
But progressives argue that rather than slashing benefits for new retirees to shore up the program, Congress should lift the payroll tax cap that allows the ultra-rich to pay the same amount into Social Security as someone who makes $168,600 a year.
Fink, for example, has a base salary of around $1.5 million. With the current payroll tax cap in place, Fink stopped paying into Social Security less than a month and a half into 2024.
"In the U.S. today, 12 million seniors are dealing with food insecurity," Sanders wrote on social media Tuesday. "Half of Americans age 65 and older are living on less than $30,000 per year. This is absurd. Congress must expand Social Security."
Keep ReadingShow Less
Most Popular