What should a wise wealthy person do with his or her money?
I have been a foundation president and a foundation executive several times. I have also been a consultant to many dozens of heirs and heiresses. There is no reason for me to defend my views that wise people already know. Inheriting money or expecting to inherit money is debilitating. Wise people also know that philanthropy seldom has positive social outcomes.
Skip to the chase.....
Skip to the chase. Knowing the above, a wise monied person doesn't
want to pass on their money wastefully and has doubts about giving it
to charity, (except for post mortem name recognition and good seats at
the opera while alive).
So we come up with the Buffett solution which is a good start...give the money to a foundation you respect. The people who made the money never have the social or emotional attributes to give it away. (Buffett knows that and mistakenly thinks Bill Gates might have the skills to give it away, or he is just having fun with his friend and doesn't care about the money.)
The theoretical problem with philanthropy of any sort is that it
rewards social systems that are antithetical to the commercial system
that generated the money in the first place.
Commerce is meritocratic, open and supports diversity. Philanthropy does none of these things.
A successful business person giving money to philanthropy is like a successful chicken farmer leaving all his money to save the foxes.
The top people at charitable organizations are invariably bureaucrats
from the old elite class. Bureaucracy does not support meritocracy nor
does charitable begging and funding generate meritocracy.
Foundations are rarely open about their successes and failures and have no metric (such as a financial statement) to evaluate their programmatic work.
Worst of all, there is virtually no diversity in philanthropic organizations. Think college administrations, civic cultural organizations and medical research....nearly all lily white Anglo bastions. They don't look like your local bank or utility company.
My main suggestion is to pass the money generated by non-moral commerce
on to the type of institutions that created the money in the first
place. Give to commerce promoting organizations and other non-moral
institutions. I call this approach the giving back to commerce form of
philanthropy.
The five areas of foundation work that would be appropriate for
philanthropy would be ones that encourage commerce and commercial
values, expand technology, develop judicial skills, enhance legislative
political talents and reward compassion.
I've written about these four other non-commercial non-moral systems elsewhere. My point here is that modernity is created by non-moral institutions and they should support each other where possible. Money generated by non-moral commerce can support other non-moral charitable worlds.