The Magazine

Follow the Money

What people do with their wealth is whose business?

May 27, 2013, Vol. 18, No. 35 • By MARTIN MORSE WOOSTER
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Dalzell’s chief complaint about the younger Rockefeller is that he bought art produced by commission from rich people of earlier generations. But just because Qing dynasty emperors commissioned the vases Rockefeller bought does not mean the vases are not worth collecting! It’s unlikely that Rockefeller purchased medieval art from Europe and China to glorify the upper classes of the past; he bought art that he liked—and John D. Rockefeller Jr. had very good taste.

(Dalzell’s concluding chapter, on contemporary philanthropy, is superficial. He has grabbed the annual issue of Forbes profiling the 400 wealthiest Americans and supplemented it with Kitty Kelley’s biography of Oprah Winfrey and a few clips from Fortune and the New York Times.)

In Dalzell’s view, the “Giving Pledge” of Bill Gates and Warren Buffett is the central philanthropic issue of our time. Gates and Buffett have urged their fellow billionaires to devote at least half of their fortunes to charity, and have enlisted over 100 plutocrats to join them, including Michael Bloomberg, George Lucas, and Mark Zuckerberg. Dalzell is bothered that more billionaires haven’t agreed to sign this pledge, and faults both Oprah Winfrey and Steve Jobs for failing to give more to charity. But the history of nonprofits teaches that charitable contributions often do more harm than good. The donors who use their wealth to create perpetual foundations ensure that most of their fortunes will perpetuate the permanent class of the liberal mandarins, who require first-class air fares and five-star hotels as they travel to endless summits, communing with the great and good about the mighty issues that will remain unresolved after a lifetime of junketeering.

It is far better to judge the rich not on how much they give to charity, but on where the money goes. Does their money go to groups who help the poor become productive members of the labor force, or does it go to nonprofits who see their primary role as   lobbying to increase the size and cost of the welfare state? Does their money support artists whose work is heroic and life-affirming, or depressing and life-denying? The Good Rich and What They Cost Us adds very little to the debate over how the richest Americans should spend the wealth they have created.

Martin Morse Wooster is a senior fellow at the Capital Research Center and the author of Great Philanthropic Mistakes.