Matthew Bishop defines ‘philanthrocapitalism’ as ‘some of the world’s most talented and successful people … turning their minds to problems like education, disease, climate change and terrorism’. In some ways that’s the problem. As David Hulme points out in his survey of international development assistance, the ‘world’s most talented and successful people’ have been ‘developing’ the rest of the world for a hundred years or more, through colonization, foreign aid, military intervention and now philanthropy, despite the fact that sustained change is always internally driven.
The experience of the East Asian tiger economies and other successful developers shows this to be true. The one thing that most of these outside efforts have ignored is the one thing that has been most needed – consistent, reliable, flexible, long-term support that enables people to find their own solutions to the dilemmas of development.
The way to help others is to recognize and support their own agency, even when it is used in ways that cannot be predicted or shoehorned into the predetermined plans and metrics of success. The world is full of ‘talented and successful people’, but most of them are not billionaires. Does that mean we have to depend on the noblesse oblige of philanthrocapitalists to solve our problems for us? In civil society we are not ‘clients’, ‘consumers’, or ‘subcontractors’, ‘objects of charity or pawns in a grand chess game’ as Caroline Hartnell and Barry Knight put it in their introduction – we are active citizens with equal rights. We are our own problem-solvers. ‘We are the ones we’ve been waiting for,’ as June Jordan puts it.
The world is not a blank canvas on which the rich and powerful can paint their own brush-strokes unconstrained. It is already full of the pictures created by ordinary people as they shape their own destinies through individual and collective action. Philanthropy’s role is to support their efforts, not to supplant them in a new display of top-down planning, masked by good intentions and a mania for misleading metrics. Philanthrocapitalism’s love affair with technocracy, control, prediction and standardization is yet another turn of the wheel that has been driving international development assistance since 1945 with little success.
An obsession with control
At first I was mystified by the philanthrocapitalists’ obsession with control and micro-management, packaging everything into neat and tidy boxes that can be assigned a name and number so that we can ‘save the world’ for $1.23 per head not $1.21. This seems so backward in a world that prides itself on innovation. But having delved a little more deeply I think it is understandable: in business, losing control over details is seen as the path to waste, inefficiency and eventually failure. The world is seen as a giant machine in which pulling the right levers will deliver the desired results, and subcontractors are exactly that, with tight discipline exerted down the supply chain to control for quality and pricing – and there’s nothing wrong with that.
Social change work, by contrast, relies on genuine empowerment, democratic negotiation and large-scale collective action, all by their nature uncontrollable. As Sheela Patel writes, ‘large numbers of poor people need to make their claims collectively’, not just individually in the marketplace. We all see the world through the lens of our training and experience, and for every nail there will always be a hammer, whether it is the hammer of business thinking, community development or civil society activism.
Perhaps one day the philanthrocapitalists might even acknowledge that they can learn something from others about management and organizational development, rather than dismissing civil society as the terrain of well-meaning do-gooders waiting for Silicon Valley to ‘breathe new life into the non-profit sector’ as Matthew Bishop puts it (memo to Matthew: the patient was never dead). The experience of SPARC, Mahila Milan and Shack Dwellers International shows that civil society groups often approach questions of governance and accountability in ways that are different from the business world, and that may be even more effective – less hierarchical and centralized, less oriented to the demands of those at the top of the system, more flexible in dealing with conflicting views and ambiguous relationships. Wolfgang Hafenmayer’s claim that ‘quality management … is rarely found in the non-profit sector’ is an oft-repeated mantra of philanthrocapitalism but a gross over-generalization that ignores the mismanagement of business as well as the remarkable achievements of non-profits that run complex operations on a shoestring.
An affinity for market-based solutions
This is not, however, the whole story of philanthrocapitalism, which is defined as much by its affinity for market-based solutions as by its affection for top-down planning. Potentially, these two affinities contradict each other: if broad swathes of society can secure sustainable livelihoods as workers and producers, they can use their growing resources to fund their own solutions to social problems, creating a philanthropic base that is diverse, locally rooted and citizen-controlled. Alex Pryor’s account of income-generation among the Guayaki Indians (p43) is a good case in point, and a useful corrective to the dependency that some foundation funding can create. Market-based interventions (including microfinance) have not yet achieved these broad-based gains, but this remains a significant line of argument, in part because it could support the development of indigenous philanthropy, a theme that runs through many of the pieces in this issue of Alliance, with organizations like TrustAfrica, the African Women’s Development Fund, the Dalit Foundation and the other members of Foundations for Peace leading the way.
Thus far, philanthrocapitalists have been reluctant to invest in ventures like these, perhaps fearful of the transfer of control they embody or believing that they are just ‘additional overhead’ (‘why give money to someone else to give it away?’ is an argument I have heard more than once from new foundation leaders). It is the much-decried ‘older’ foundations like Ford that have been the pioneers in this vitally important arena. However, recent investments by Humanity United (part of the Omidyar Network) and potentially the Gates Foundation in TrustAfrica show that ‘new’ philanthropy is also recognizing the long-term significance of building independent change-making institutions across the Global South with both the financial clout and the social legitimacy to make them powerful players in their own contexts and beyond. This is surely one of the highest priorities for philanthropy in the years to come.
A new conversation about philanthropy
The tremendous worldwide response to Just Another Emperor? suggests a hunger for a different kind of conversation about the future of philanthropy, one that isn’t cowed by the fear of retribution that has shielded foundations from criticism in the past and that is open to much more fundamental changes in the structure and direction of philanthropy than either ‘old’ or ‘new’ foundations have thus far envisaged.
In this debate, I think philanthrocapitalism will continue its upward trajectory for at least a few more years. It is backed by powerful interests and – in extending access to socially and environmentally useful goods and services – it should be able to generate real benefits for millions of poor people. This is a cause for celebration even if the broader social impact turns out to be less than their enthusiasts might hope.
In the longer term, however, I think the pendulum will swing back to recognize and celebrate other philanthropic traditions that are more democratic, less control-oriented, and more successful in levering deeper changes in society, whether we call them ‘citizen philanthropy’, ‘social justice philanthropy’, ‘transformational philanthropy’ or some other name. If the future, as Hartnell and Knight put it, lies in ‘finding where different types of intervention intersect’, we need much better information about when and where the synergies and tradeoffs lie, without pretending that there can ever be a perfect marriage. We need more rigorous and independent analyses of the strengths and weaknesses of different approaches to philanthropy and social change. As Matthew Bishop confirms, there is so much diversity in the ‘philanthrocapitalist’ universe, never mind the broader fields of philanthropy and civil society. Where is the proof that ‘strategic philanthropy’ produces better results and under what circumstances might it actually be damaging to the prospects of deep-rooted social transformation?
A debate like this could be the catalyst for a more fundamental reimagining, not just of philanthrocapitalism as the latest fashion to trot down the philanthropic runway, all strange clothing and fancy make-up, but of new and more effective systems for supporting the transformation of society. As Bhekinkosi Moyo puts it in his piece on philanthropy in Africa, the question is whether new philanthropic institutions ‘will at last transform social relations and tackle the supremacy embedded in all forms of philanthropy’. That is the ultimate test for both philanthrocapitalists and their critics.
Michael Edwards is a guest editor for this issue of Alliance. He leaves the Ford Foundation on 17 October after nine years as Director of its Governance and Civil Society Program. In the future he will be a Visiting Fellow at NYU’s Wagner School of Public Service, the Brooks World Poverty Institute at Manchester University, and Demos in New York. He can be reached at email@example.com