From day one here at Inside Philanthropy, we’ve been clearheaded about the fact that while many super-rich Americans support interesting and vital nonprofit work, billionaires as a class are a stingy lot. Forbes’ latest list of the 400 richest people in the U.S. tells that story plainly. It’s now the fourth year that Forbes has assigned a “philanthropy score” to each billionaire on the list, and the second year that score reflects actual money out the door, leaving out pledges, funds allocated to DAFs and the like.
“The scores are lower than ever.” So acknowledged Forbes reporter Hank Tucker in a detailed rundown of how the publication arrived at the scores, which run from a score of five at the top—“has given away 20% or more of wealth”—down to a score of one—“has given away less than 1% of wealth.”
Out of the full 400-member list, only eight billionaires received a score of five, down from 10 of them in 2020. A similar decline took place across the board: The number of list members receiving scores of four, three and two all decreased as well, while the “one” category swelled from last year’s 127 to 156 billionaires in 2021.
From a purely numerical perspective, the reason for this disheartening drop is obvious. Billionaire wealth continues to skyrocket, pandemic and all, and it did so at a stunning pace since last fall. Giving hasn’t kept up. Forbes estimated that the 400 richest Americans saw their collective wealth rise by a full 40% since last year’s reckoning—it now totals $4.5 trillion. There’s been some jockeying for position among the top contenders, with Elon Musk’s ascent being a standout story, along with the rise of newcomers like youthful crypto winner Sam Bankman-Fried, whom we interviewed not long ago.
When it comes to Forbes’ top philanthropists, the list of fives isn’t much changed from last year. It contains most of the same names—Warren Buffett, George Soros, John Arnold, Lynn Schusterman, Gordon Moore, Julian Robertson and Amos Hostetter. Eli Broad, who scored a five last year, passed away in April, while CNN founder Ted Turner, also a five in 2020, didn’t make it onto the Forbes 400 this time around.
The lone newcomer to the fives club is First Premier Bank founder T. Denny Sanford, whose quest to “die broke” has precipitated nearly $2 billion in giving over the years. More recent generosity may or may not be related to the flood of negative press he received over reports that he was investigated for possible possession of child pornography. Either way, Sanford’s wealth also continues to rise, along with that of most of his ultra-rich peers on the list.
Even MacKenzie Scott, the most exciting philanthropist of the past several years, saw a moderate uptick in her overall wealth since last fall, despite an unprecedented $8.6 billion in mostly unrestricted giving so far. Scott scored a four this year (between 10% and 19.9% of total wealth), although Tucker noted that “at this rate, it won’t be long before she joins the top tier.”
Also scoring a four were Bill Gates and Melinda French Gates, the latter of whom is a new entrant on the list (separate from her ex-husband) with $6.3 billion in assets. Jeff Bezos, in first place on the list and the first on the Forbes 400 with over $200 billion in assets, still scored a one for money out the door, despite a $10 billion climate pledge and other headline gifts. Elon Musk, in second place, was also a one. Third-place finisher Mark Zuckerberg scored a two.
As far as I could glean, George Soros and John Arnold were the only people scoring a five or a four whose overall wealth actually declined or stayed flat since last year, according to Forbes’ reckoning. It’s interesting that one is a venerable progressive philanthropist whose sprawling giving operation seems to be preparing the way for his departure, while the other is a much younger giver who also happens to be the most vocal super-rich advocate of legislative charitable reform.
What are we to make of all this? On one hand, the failure of the super-rich to scale their giving in proportion to their rising wealth is nothing new. Both here at Inside Philanthropy and throughout the sector, we’ve spent years debating why billionaires don’t give more and how to get them to do so—as troubling as the implications of vastly expanded billionaire giving may be.
The difference this time around—and this was true last year as well—is that the world’s still in the grip of an era-defining, paradigm-shifting pandemic, one that has created or exacerbated a whole host of intersecting crises and needs. Forbes’ 2021 philanthropy scores paint a picture of a U.S. billionaire class that remains almost wholly disconnected from that reality, content to sit on stock market gains and make only minor tweaks to their charitable giving while the world burns—often literally. At the risk of sounding melodramatic (OK, maybe I already have), that one phrase commonly attributed to Marie Antoinette wouldn’t be too out of place here.
Billionaires’ lackluster pandemic response (a few excepted) was the subject of a set of reports from Candid and the Center for Disaster Philanthropy, released late last year and early this year. With the exception of MacKenzie Scott and Jack Dorsey (who still scored only a two on Forbes’ list due to his own surging net worth), super-rich Americans’ COVID-related giving in 2020 hovered at or below 1% of their net worth—often significantly below.
As we’ve learned from a document leak to ProPublica not long ago, many super-rich Americans’ effective tax rates aren’t all that higher. By taxing income instead of wealth—and giving the rich copious opportunities to legally evade taxation—the federal government has allowed many of these gargantuan fortunes to accumulate largely tax-free. And despite talk of a wealth tax, the Biden administration and congressional Democrats have so far balked at any meaningful addition to what the ultra-wealthy owe.
It’s always possible that will change at some point down the road. But until it does, philanthropic giving remains the only other viable long-term siphon on skyrocketing billionaire wealth. So as frustrating as their continued reticence may be, it’s also still true that over the longer term, we’re living in a new Gilded Age that will bring into being philanthropic dynasties far more numerous and diverse than those of yesteryear.
Billionaires who do decide to give in a particularly expansive or innovative way stand to gain a lot in terms of reputation—Scott being the standout example. John Arnold, at age 47, is the only Forbes list member scoring a five who isn’t 80 or older. There’s plenty of room for younger billionaires to join Scott in the ranks of trailblazing philanthropists as figures like Buffett, Gates and Soros enter advanced old age or otherwise lose their sheen.
Reading through the Forbes 400, it’s hard not to think about how much these modern titans have been lauded for innovative thinking, risk-taking, organizational brilliance—even as geniuses or oracles. With the caveat that billionaire giving doesn’t always bode well for democracy, one is left to wonder why those virtues seem to desert so many of them when it’s time to give the money away.