In October 2011 dozens of homeless people slept outside the US$500 million headquarters of the Bill and Melinda Gates Foundation, the largest private philanthropic foundation in the world. For 11 nights they curled up on plastic sheets and dirty blankets to protest a funding cut to a local organisation for the homeless.

The Gates Foundation did nothing for them. No, that’s not quite right. It issued a press release. This pointed out that the Foundation “cared deeply” about homelessness and had spent $100 million in the area. But for the people on the sidewalk, it offered nothing except a theory about how to spend money wisely.

“We’re trying to move upstream to a systems level to either prevent family homelessness before it happens or to end it as soon as possible after it happens,” a spokeswoman told the New York Times.

This disconnect between real people with immediate needs like shelter and hot meals and cashed-up philanthropies with ambitious theories about changing the world is the theme of The Philanthropic Revolution: An Alternative History of American Charity, by Jeremy Beer.

The scale of American philanthropic foundations is immense. In 2012, there were 86,000 active private foundations with $715 billion in assets. In 2013-14, donations from Americans totalled about $335 billion, which is roughly equivalent to the GDP of Denmark.

Not surprisingly, foundations want to disburse their funds in the best way possible. In recent years the slogan of “effective altruism” has caught on. Based on the ideas of utilitarian philosopher Peter Singer, effective altruists believe that they have a moral obligation to give wherever it will do the most good, regardless of geographic location, kinship or loyalty. Or as the Gates Foundation puts it, “every life has equal value”. The ultimate goal is social change, not the relief of one person’s pain. 

But the big foundations only account for 15 percent of all American giving. Many people prefer to give to their alma mater or the local baseball team or even to panhandlers. Beer says that the effective altruists are exasperated by the extent to which Americans are motivated by the warm inner glow of charity rather than the steely logic of philanthropy. As Peter Singer put it in his criticism of the Make-A-Wish foundation for kids with cancer:

“Effective altruists will feel the pull of helping an identifiable child from their own nation, region, or ethnic group but will then ask themselves if that is the best thing to do. They know that saving a life is better than making a wish come true and that saving three lives is better than saving one. So they don’t give to whatever cause tugs strongest at their heartstrings. They give to the cause that will do the most good, given the abilities, time, and money they have.”

Nor would Singer countenance giving to an arts centre or an Ivy League university, at least not until world poverty has been conquered.

What Beer shows is that Singer is actually a Johnny-come-lately in the story of scientific philanthropy. He traces it back to Benjamin Franklin, “the founding father of American philanthropy”. In his eyes, “the best way of doing good to the poor, [was] not making them easy in poverty, but leading or driving them out of it.” Casual charity was nonsense.

Protestant organisations in the early 19th century were cut from the same cloth. Imbued with an Enlightenment faith in the steady advance of progress, they believed that technology and efficient organisation could solve social problems. Christian notions of personal charity seemed old-fashioned and almost pointless.

“The new philanthropic institutions reduced charity to a token act,” in the words of one scholar. “Now, an individual could contribute funds to a house of industry for the poor or to a refuge for unwed mothers, secure that he or she would never come into contact with any of the inmates.”

Major social reformers from Andrew Carnegie to Margaret Sanger joined the bandwagon of scientific philanthropy. Theodore Roosevelt, later US President, said that an effective social worker should understand that “the soup-kitchen style of philanthropy is worse than useless, for in philanthropy as everywhere else in life almost as much harm is done by soft-headedness as by hard-heartedness.”

Not everyone was beguiled by the rhetoric of improving the world with science, not charity. Orestes Brownson, the Transcedentalist turned Catholic philosopher, penned a stern critique of philanthropy in 1865. As he pointed out, loving mankind was fully compatible with detesting people. The French Revolution, inspired by the highest ideals of fraternité, had turned Europe into “one vast slaughter-house”. Beer says that “He feared that radical humanitarians would make war on the people in order to perfect mankind. Their vaunted altruism was the opposite of genuine love and charity—for it often veiled pride and the will to power.”

Brownson’s predictions quickly came true. Leading philanthropic foundations embraced the cause of eugenics, including the Carnegie Foundation and the Rockefeller Foundation. Beer has uncovered some chilling citations. One is example is the Rev. A. O. Wright, secretary of the Wisconsin State Board of Charities and later president of the National Conference of Charities and Correction. He proposed quarantining the “defective classes” in “state-sponsored colonies.” “Unless we are prepared for drastic measures of wholesale death or equally wholesale castration,” he wrote, “we must cut off defective heredity by the more expensive but more humane method of wholesale imprisonment.’”

These attitudes have persisted, as many of the largest foundations have supported contraception and abortion as a means of family planning in developing countries.

Beer’s hero is the American social activist Dorothy Day, the co-founder of the Catholic Worker movement in the 1930s. (Pope Francis highlighted her example in his speech to the US Congress last week, side-by-side with Martin Luther King Jr.) “What else do we all want, each one of us, except to love and be loved, in our families, in our work, in all our relationships?” she wrote. “Even the most ardent revolutionist, seeking to change the world, to overturn the tables of the money changers, is trying to make a world where it is easier for people to love, to stand in that relationship to each other.”

There is no necessary conflict between the Christian vision of charity, a one-to-one, personal encounter with the needs of another person, and philanthropy, which deals with faceless populations. But in practice – as the story of the homeless camped outside the Gates Foundation HQ shows– philanthropy tends to become bureaucratic and impersonal.

So Beer advocates a course which he calls philanthropolocalism – an awkward word for giving within your own community. “We have a primary responsibility to look after that which is closest to us,” he says. “Certain obligations and duties are not chosen but are nevertheless ours by reason of birth and propinquity. That may not be fair, but it is still something that we all instinctively understand, even when we rebel against it.”

Peter Singer would sneer at this, but connecting with those around us, not those who are 10,000 miles away, corresponds to a deep-seated need in human nature. It’s probably more difficult, as well, because its cost is measured in personal commitment, not just dollars.

Jeremy Beer concludes, eloquently:

“To rebuild our communities and replenish our social capital, it is hard to believe that we need more of the technocratic ideas on offer from contemporary philanthropic institutions. Instead, we need more people to ask themselves just a few questions before giving from their resources or of themselves: Will this gift help to strengthen human communion? Does it witness to the reality of human communion—of the truth that we are not our own? Does it help me come into a closer personal encounter with others, or does it act only as a substitute for doing so? Will it contribute to the building of local community that is so necessary for human flourishing? Does it express gratitude to a community to whom I owe, in part, my being? And does it reflect the relative strength of the moral claims that others have on me? These are questions inspired by love—charity—rather than ideological ambitions to remake the world.”

Michael Cook is editor of MercatorNet.

Michael Cook

Michael Cook is the editor of MercatorNet. He lives in Sydney, Australia.