How Billionaire "Philanthropy" Is Fueling Inequality And Helping To Destroy The Country

Peter Buffett, the second son of billionaire investor Warren Buffett, worries that the state of philanthropy in America “just keeps the existing structure of inequality in place.” At meetings of charitable foundations, he says “you witness heads of state meeting with investment managers and corporate leaders. All are searching for answers with their right hand to problems that others in the room have created with their left.”

Describing the stunning growth of what he calls a “charitable-industrial complex,” his recent New York Times op-ed reads in confessional style: “People (including me) who had very little knowledge of a particular place would think that they could solve a local problem.”

An insider’s critique from someone like Peter Buffett is certainly welcome. Charitable giving, after all, has seen a meteoric rise in recent years, virtually unchanged amid a historic global recession. In what the National Committee for Responsive Philanthropy calls a “New Gilded Age of Philanthropy,” the ballooning fortunes of the 1% seem to mirror levels of giving by foundations:

As Buffett suggests, this growth in elite largesse, totaling $316 billion in 2012, has done little to combat economic inequality. But the problem isn’t just one of ineffectiveness. A recent paper published in the Journal of Economic Inequality shows philanthropy hasn’t simply failed to meet its goals; it’s made the situation worse.