Why Mackenzie Scott’s $6 Billion Rapid-Fire Donations Could Change Charitable Giving
Resource type: News
Robb Report | [ View Original Source (opens in new window) ]
By Lucy Alexander
As the pandemic and its restrictions strangled businesses large and small, an estimated 8 million more Americans fell into poverty from June to November last year, increasing the rate to almost 12 percent, or 22 percent for those without a college education. Meanwhile, the bank balances of the 600-plus American billionaires rose by more than $1 trillion in the 11-month period ending in mid-February, inflated by record-breaking stock markets. Elon Musk’s theoretical piggy bank is now $158 billion heavier than it was in March of last year, while Jeff Bezos became $76 billion richer, despite ceding a quarter of his Amazon stake to his ex-wife, MacKenzie Scott.
Yet it would be unfair to characterize America’s billionaire class as dragons sleeping out the crisis atop their glittering treasure mounds. Some have been stirred to action by the aggregate effect of Covid, extreme political dysfunction and stark inequalities in wealth, health and race. Scott best encapsulated the new mood of urgency by putting her divorce windfall to good use, donating nearly $6 billion to about 500 nonprofits over the course of last year, an unprecedented rate and scale of philanthropy. Scott, in effect, threw down the gauntlet to her fellow billionaires.
The pressure is now on, not only to give but to give fast, rather than endow a perpetual foundation that exists, at least in some part, to burnish the legacy of its founder after death. But is faster really better? And if it is, why do so many find it so hard to do?
The giving-while-living idea is best personified by Feeney, who turns 90 this month and who set up his spend down foundation with the explicit purpose of parting with his entire fortune during his lifetime. The Atlantic Philanthropies closed last year, having successfully distributed its billions to causes ranging from higher education to the Irish peace process and Vietnamese health care. Warren Buffett has described Feeney as “my hero.”
Feeney was inspired by robber baron turned philanthropist Andrew Carnegie’s decree that “the man who dies thus rich dies disgraced.” Oechsli, who oversaw the dispersal of Feeney’s final grants, says the philanthropist had never considered giving his children more than a “modest provision,” in addition to a separate charitable foundation for them to manage.
He also insisted on anonymity. Grants “were accompanied by very strict confidentiality agreements,” says Oechsli. The foundation was incorporated in Bermuda in part to avoid US disclosure requirements, which would have revealed Feeney’s identity, and his donor status was made public only in 1997 as part of a court case.
Feeney’s secrecy served several purposes, Oechsli says. “He’s not comfortable being the center of attention, and also, publicity around wealth is not always helpful to families.” He avoided unsolicited requests, and because his grants were secret, beneficiaries could continue to attract donations, including those bestowed in exchange for naming rights, from other sources. For a while, Oechsli says, “I worked from an office in London called Gerard Atkins, which was just a meaningless name taken from the phone book. My kids thought I worked for the CIA.”
Oechsli admires Scott, whom he describes as “extraordinary and terrific,” and predicts her gifts will be “transformational.” “You don’t have to drag it out over 20, 30, 50 years,” he says. “She made smart investments immediately—like historically Black colleges and universities—that will have lasting impact in what they do. There may be an immediacy to the funding, but the impact will be long term. It’s not about ending soon. It’s about starting soon.”