Private Virtues, Public Vices Private Virtues, Public Vices Philanthropy and Democratic Equality emma saunders- hastings the university of chicago press chicago and london The University of Chicago Press, Chicago 60637 The University of Chicago Press, Ltd., London © 2022 by The University of Chicago All rights reserved. No part of this book may be used or reproduced in any manner whatsoever without written permission, except in the case of brief quotations in critical articles and reviews. For more information, contact the University of Chicago Press, 1427 E. 60th St., Chicago, IL 60637. Published 2022 Printed in the United States of America 31 30 29 28 27 26 25 24 23 22 1 2 3 4 5 isbn- 13: 978- 0- 226- 81614- 2 (cloth) isbn- 13: 978- 0- 226- 81615- 9 (paper) isbn- 13: 978- 0- 226- 81613- 5 (e- book) doi: https://doi.org/10.7208/chicago/9780226816135.001.0001 Library of Congress Cataloging-in-Publication Data Names: Saunders-Hastings, Emma, author. Title: Private virtues, public vices : philanthropy and democratic equity / Emma Saunders-Hastings. Description: Chicago : University of Chicago Press, 2022. | Includes index. Identifiers: lccn 2021034597 | isbn 9780226816142 (cloth) | isbn 9780226816159 (paperback) | isbn 9780226816135 (ebook) Subjects: LCSH: Charity organization—Political aspects. | Humanitarianism— Political aspects. | Democracy—Social aspects. Classification: lcc hv70 .s48 2022 | ddc 361.7—dc23 lc record available at https://lccn.loc.gov/2021034597 ♾ This paper meets the requirements of ansi/niso z39.48-1 992 (Permanence of Paper). Contents Introduction 1 chapter 1. Donations and Deference 18 chapter 2. Equality and Philanthropic Relationships 41 chapter 3. Plutocratic Philanthropy 63 chapter 4. Philanthropic Paternalism 93 chapter 5. Ordinary Donors and Democratic Philanthropy 122 chapter 6. International Philanthropy 143 Conclusion 163 Acknowledgments 173 Notes 177 Bibliography 225 Index 245 Introduction Nearly two thousand years ago, the Stoic philosopher Lucius Annaeus Seneca lamented that “among the numerous faults of those who pass their lives recklessly and without due reflexion . . . I should say that there is hardly any one so hurtful to society as this, that we neither know how to bestow or how to receive a benefit.”1 Seneca’s questions, and the normative and practical challenges they pres- ent, remain with us today. A person who wishes to bestow a benefit on par- ticular persons or on society must decide what and how much to give and with what expectation of reward; how to choose among possible recipients; and what terms (if any) to attach to the gift. Potential recipients must de- cide how to greet the proffered benefit; what conditions to accept; what atti- tudes to take toward the giver; and what expressions of gratitude (or attempts at repayment) to make. And political communities must decide how (if at all) to regulate the exchanges of benefits among members. Seneca, like many champions and critics of what we now call charity or philanthropy, focuses on the virtues of givers, of recipients, and of individ- uals seeking to live a good life. These virtues and questions of individual ethics will play a role in my account of philanthropy as well. Any contem- plation of philanthropy must give due consideration to its wide- ranging value for givers, recipients, and communities, as well as due respect to the serious moral purposes that acts of philanthropy often express and promote. But my larger purpose is to ask how the individual virtues expressed in acts of philanthropy interact with the virtues of democratic institutions and egalitarian social relations— hence the different questions implied by my designating philanthropy as a problem of “private virtues and public vices.” Is some charity less private (and less virtuous) than it seems? Can it create objectionable hierarchies and subordinating relationships? Can 2 introduction genuine private virtues like generosity and compassion threaten justice and democratic equality? Does this give citizens reason to regulate exchanges of benefits that are permissible and even praiseworthy at the level of indi- vidual ethics? Or is the attempt to regulate private virtues itself a public vice? The title of this book is also, of course, a transposition of Bernard Man- deville’s famous maxim that private vices yield public benefits.2 In alluding to this capitalist article of faith, I do not mean to endorse an ethic of ego- ism or selfish indifference in the place of philanthropic benevolence. Nor do I wish to deny that philanthropy and its associated virtues can yield im- portant public benefits. But just as private greed may sometimes generate public wealth, personal generosity can contribute to objectionable inequal- ities of power and status. I invoke Mandeville as shorthand for the insight that the relationship between individual ethics and the quality of public outcomes is complicated and often counterintuitive.3 Philanthropy Today The definition of philanthropy that I will use in this book is simple, inclu- sive, and nonmoralized: by philanthropy, I mean voluntary contributions of private resources for broadly public purposes and for which the giver does not receive payment.4 “Private resources” can include goods and services as well as money. “Public purposes” exclude most gifts to friends and fam- ily members, but otherwise I adopt a wide view of what counts as a phil- anthropic purpose.5 On my definition, philanthropy need not arise from or express a particular motive (e.g., altruism, love of humanity, or concern for the public good).6 This stipulation allows us to classify acts as philan- thropic (or not) based on more accessible and less controversial factors than a donor’s motives. Finally, except where otherwise noted, I use the terms philanthropy, charity, and voluntary giving interchangeably. While these sometimes have different connotations (outside of religious tradi- tions, charity often has more negative or pejorative rhetorical baggage), I do not distinguish between them by definition. Philanthropy today is largely directed toward nonprofit organizations— that is, organizations that are prohibited by law or barred by internal gover- nance rules from distributing profits to their members (the so- called non- distribution constraint).7 But I will be using the term more broadly to also cover donations to (or time volunteered toward) governmental and inter- governmental institutions, to public agencies, and to individuals. Though introduction 3 I will focus on philanthropy by individuals, associations, and private foun- dations, much of what I say applies to corporate philanthropy as well. Philanthropic giving amounts to some $450 billion a year in the United States alone.8 Billions more are given worldwide or held in trust and in phil- anthropic foundations. This giving fuels a tremendous variety of organi- zations and an enormous range of activities. It may be helpful to provide some examples of the kinds of philanthropy that will concern us in the chap- ters that follow. In January 2014, federal mediators involved in Detroit’s bankruptcy pro- ceedings announced that nine local and national foundations had commit- ted $330 million in grants to shore up the city’s pension program; by re- lieving some of Detroit’s debt obligations, the philanthropic commitment helped avoid the necessity of selling off parts of the art collection of the city- owned Detroit Institute of the Arts.9 This was a rare case of private foundations moving to fund public- sector pensions, and the deal came with conditions attached: the money would be earmarked for city workers’ pen - sions, control of the museum would pass to a nonprofit, the state of Michi- gan would be required to contribute to the pension fund, and property taxes that local counties had enacted to help fund the museum were to re- main in effect.10 Partly because of these conditions, and partly because of the novelty of private foundations so explicitly taking over public programs, praise for the philanthropic commitments was mixed with discomfort. Wil- liam Schambra, a Chronicle of Philanthropy columnist and director of the Bradley Center for Philanthropy and Civic Renewal at the Hudson Insti- tute, expressed his own ambivalence: “On the one hand, you have to ap- plaud the foundations for being willing to step into something of a vacuum in public leadership. . . . On the other hand, have we really arrived at this point where foundations can dictate terms and conditions to state and city government?”11 This mixed reaction captures important features of the debate about both the Detroit case and contemporary large-s cale philan- thropy more generally. Recognition of good intentions and even good ef- fects mingles with misgivings about donors’ exercise of power. The worry here is that philanthropy could function as a Trojan horse for elite influence in an unusually exact sense: that acceptance of some gifts could involve ced- ing control of a city to the givers. Philanthropic action in the Detroit case was exceptional, but in other areas it has become routine. In particular, philanthropy has played a vis- ible and influential role in shaping not only higher education but, increas- ingly, primary and secondary education as well. Grants in the area of U.S.