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Illustration: Aïda Amer/Axios

If charity is giving alms to the needy, then philanthropy is charity's more high-minded and strategic relation.

The big picture: Philanthropists don't want to give a man a fish; instead they want to take credit for building a proof-of-concept that will persuade governments around the world to invest in large-scale programs of fishing pedagogy.

As Michael Bloomberg puts it: “It’s philanthropy’s job to take risks — and government’s job to scale solutions.”

  • Philanthropy is a central part of how the very rich turn their money into power. The extremely rich, by their nature, tend to be extremely ambitious: They want to change the world in certain ways, and are happy to use their wealth to do so.
  • That's sparked a backlash from anti-plutocrat gadflies like Anand Giridharadas. Extreme wealth creation has spurred giving among the nouveau riche, which in turn has conflated philanthropy and inequality in the public's mind.
  • Trump's tax cuts have removed philanthropic incentives for many Americans. That's because the standard deduction is so large that the middle class no longer sees any benefit from itemizing charitable deductions.

Philanthropy is increasingly looking to supplant or replace government.

  • Swiss bank UBS, in its fifth annual report on billionaires, says that many "are seeking new ways to engineer far-reaching environmental and social change."
  • Within our lifetime, we will see “the reemergence of a benevolent aristocracy," UBS's head of Ultra High Net Worth, Josef Stadler, told Forbes.

How it works: Individuals like Charles Koch, Mike Bloomberg and Bill Gates use their philanthropies to advocate for societal changes and interventions that they would like to see enacted by governments. Often they engage in explicit lobbying, and often that lobbying is successful, both domestically and internationally.

  • Older philanthropies may no longer be controlled by their founders, but care just as much about changing global public policy. The Ford Foundation, for instance, has focused on combating inequality around the world — something that can only be done if it gets governments on board.

What they're saying:

Foundations are an unaccountable, nontransparent, perpetual, and lavishly tax-advantaged exercise of power."
Rob Reich, Stanford University

Why it matters: Politicians are accountable to the electorate. Charitable foundations and the billionaires who fund them, on the other hand, are accountable to no one. As Reich says, their actions therefore deserve more scrutiny than gratitude.

The bottom line: Insofar as philanthropy has a positive effect, it does so via deeply undemocratic means.

Go deeper:

Go deeper

45 mins ago - Technology

Exclusive: Facebook's blackout didn't dent political ad reach

Photo: Valera Golovniov/SOPA Images/LightRocket via Getty Images

Americans saw more political ads on Facebook in the week before the 2020 election than they did the prior week despite the company's blackout on new political ads during that period, according to Global Witness, a human rights group that espouses tech regulation.

Why it matters: The presidential election was a key stress test for Facebook and other leading online platforms looking to prove that they can curb misinformation. Critics contend measures like the ad blackout barely made a dent.

Wall Street wonders how bad it has to get

Illustration: Aïda Amer/Axios

Wall Street is working out how bad the economy will have to get for Congress to feel motivated to move on economic support.

Why it matters: A pre-Thanksgiving data dump showed more evidence of a floundering economic recovery. But the slow drip of crumbling economic data may not be enough to push Washington past a gridlock to halt the economic backslide.

3 hours ago - Health

Moderna to file for FDA emergency use authorization for COVID-19 vaccine

Photo illustration by STR/NurPhoto via Getty Images

Moderna announced that it plans to file with the FDA Monday for an emergency use authorization for its coronavirus vaccine, which the company said has an efficacy rate of 94.1%.

Why it matters: Moderna will become the second company to file for a vaccine EUA after Pfizer did the same earlier this month, potentially paving the way for the U.S. to have two COVID-19 vaccines in distribution by the end of the year. The company said its vaccine has a 100% efficacy rate against severe COVID cases.