A new breed of super-rich is now facing the decision of what to do with their money and Matthew Bishop, US business editor of The Economist has been looking at their philanthropic activities.

They certainly have the potential to do a great deal of good, but they could easily pervert the current aid and development system (not necessarily a bad thing!).

They are rich
The new uber rich – Bill Gates, Warren Buffet and the Google boys, among others – say they will give away their money in newly creative and effective ways. In the last 20 years there has been a period of unprecedented wealth creation, with a huge portion of it collected by a small coterie of individuals. According to Forbes magazine, there are now 950 billionaires.

Correction: They are really, really rich
The wealth accumulated by these individuals goes far beyond the fortunes of previous famed philanthropists. In real dollar terms, Bill Gates is wealthier than Carnegie, Rockefeller or any of the great philanthropists of the past. Based on this, these super rich believe they can change the rules of the game.

But are they really doing good?
While Bishop agrees that skepticism is healthy when faced with claims of new forms of philanthropy and people doing good, the approach and style of this new generation is measurably different.

– They aim for change from the bottom, up…
These new rich approach their giving in a much more rigorous and demanding manner than earlier generations, Bishop says. “This is not about building a library with your name, it is about trying to educate people about things that we all take for granted,” Bishop said.

– …and they have time
Many of these super-rich are relatively young and can devote a significant portion of their lives to the task.

But the we are entering uncharted territory
This confluence of wealth, time and a desire to change things puts the current development model on notice: Things can and will change. This certainly could be good thing, but does require oversight.

The frightening result:
We currently expect governments, development-related institutions (The World Bank, UNDP, etc) or relatively ordinary people (voters in a democracy) to make decisions about public policy and the way forward, but these super rich can afford to make decision that will affect millions of people with little accountability.

“These billionaires genuinely think they are trying to make the world a better place, but they challenge the set of assumptions we base our politics on,” Bishop says. “We need a really good public debate about the way these people act so that we can allow them to do the good they wish to do, but not so that they act without accountability.”

Matthew’s book will be published next year.

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  1. They certainly have the potential to do a great deal of good, but they could easily pervert the current aid and development system (not necessarily a bad thing!).