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Having Their Cake and Eating Ours Too

What are billionaires for? It’s time we sussed out a plausible answer to this question, as their numbers ratchet upward across the globe, impervious to the economic setbacks suffered by mere mortals, and their “good works” ooze across the fair land. The most recent count from Forbes reports a record 1,826 of these ten-figure, market-cornering Croesuses, with familiar North American brands holding down the top three spots: Bill Gates, Carlos Slim, and Warren Buffett. Esteemed newcomers to the list include Uber kingpin Travis Kalanick, boasting $5.3 billion in net worth; gay-baiting, evangelical artery-hardeners Dan and Bubba Cathy, of Chick-fil-A fame ($3.2 billion); and Russ Weiner, impresario of the antifreeze-by-another-name energy drink Rockstar ($2.1 billion). For the first time, too, Mark Zuckerberg has cracked the elite Top 20 of global wealth; in fact, fellow Californians, most following Zuckerberg’s savvy footsteps into digital rentiership, account for 23 of the planet’s new billionaires and 131 of the total number—more than supplied by any nation apart from China and the Golden State’s host country, a quaint former republic known as the United States.

What becomes of the not-inconsiderable surplus that your average mogul kicks up in his rush to market conquest? In most cases, he (and in the vast majority of cases, it is still a “he”) parks his boodle in inflation-boosted goods like art and real estate, which neatly double as venerable monuments to his own vanity or taste.

But what happens when the super-rich turn their clever minds toward challenges beyond getting up on the right side of their well-feathered beds? Specifically, what are the likely dividends of their decisions to “give back to the community,” as the charitable mantra of the moment has it? Once upon a time, the Old World ideal of noblesse oblige might have directed their natural stirrings of conscience toward the principles of mutuality and reciprocity. But this is precisely where the new millennial model of capital-hoarding falls apart. The notion that the most materially fortunate among us actually owe the rest of us anything from their storehouses of pelf is now as unlikely as a communard plot twist in an Ayn Rand novel.

Look around at the charitable causes favored among today’s info-elite, and you’ll see the public good packaged as one continual study in billionaire self-portraiture. The Bill and Melinda Gates Foundation, endowed by a celebrated prep-school graduate and Harvard dropout, largely made its name by promoting the sacred neoliberal cause of laying waste to the nation’s teachers’ unions.[*] The Eli and Edythe Broad Foundation is but the Gates operation on steroids, unleashing a shakedown syndicate of overcapitalized and chronically underperforming charter schools in the beleaguered urban centers where the democratic ideal of the common school once flourished. The Clinton Global Initiative, when it’s not furnishing vaguely agreeable alibis for Bill Clinton’s louche traveling companions, is consumed by neoliberal delusions of revolutionary moral self-improvement via the most unlikely of means—the proliferation of the very same sort of dubious financial instruments that touched off the 2008 economic meltdown. In this best of all possible investors’ worlds, swashbuckling info-moralists will teach international sex workers about the folly of their life choices by setting them up with a laptop and an extended tutorial on the genius of microloans.

This recent spike in elite self-infatuation, in other words, bespeaks a distressing new impulse among the fabulously well-to-do. While past campaigns of top-down charity focused on inculcating habits of bourgeois self-control among the lesser-born, today’s philanthro-capitalist seigneurs are seeking to replicate the conditions of their own success amid the singularly unpromising social world of the propertyless, unskilled, less educated denizens of the Global South. It’s less a matter of philanthro-capitalism than one of philanthro-imperialism. Where once the gospel of industrial success held sway among the donor class, we are witnessing the gospel of the just-in-time app, the crowdsourced startup, and the crisply leveraged microloan. This means, among other things, that the objects of mogul charity are regarded less and less as moral agents in their own right and more and more as obliging bit players in a passion play exclusively devoted to dramatizing the all-powerful, disruptive genius of our info-elite. They aren’t “giving back” so much as peering into the lower depths of the global social order and demanding, in the ever-righteous voice of privilege, “Who’s the fairest of them all?”

Noblesse Sans Oblige

There was plenty to deride in the Old World model of noblesse oblige; it dates back to the bad old days of feudal monarchy, when legacy-royal layabouts not only abjured productive labor entirely, but felt justified in the notion that they owned the souls of the peasants tethered to their sprawling estates. It’s no accident, therefore, that the idea of the rich being in receipt of any reciprocal obligation to the main body of the social order failed to make it onto the American scene. The sturdy mythology of the American self-made man didn’t really permit an arriviste material adventurer to look back to his roots at all, save to assure those within earshot that he’d definitively risen above them by the sheer force of an indomitable will-to-succeed.

But the relevant defining trait is the oblige part: the notion that the wealthy not only could elect to “give back” when it might suit their fancy, but that they had to positively let certain social goods alone—and assertively fund others—by virtue of their privileged station. Traditions such as the English commons stemmed from the idea that certain public institutions were inviolate, so far as the enfeoffing prerogatives of the landowning class went. The state church is another, altogether more problematic, legacy of this ancien régime; in addition to owning feudal souls outright, the higher orders of old had to evince some institutional concern for their ultimate destiny. There was exploitation and corruption galore woven into this social contract, of course, but for the more incendiary figures who dared to take its spiritual precepts seriously, there were also strong speculative grounds for envisioning another sort of world entirely, one in which the radical notion of spiritual equality took hold. As the Puritan Leveller John Lilburne—a noble by birth—put it in 1646, in the midst of the English Civil War:

All and every particular and individual man and woman, that ever breathed in the world . . . are by nature all equal and alike in their power, dignity, authority, and majesty, none of them having (by nature) any authority, dominion, or magisterial power, one over or above another.

Of course, the Levellers clearly were not on the winning side of British history, but this militant Puritan spirit migrated to the American colonies to supply the seedbed of our own communitarian ideal, expounded most famously in John Winthrop’s social-gospel oration “A Model of Christian Charity” aboard the Arbella in 1630. Throughout his sermon, Winthrop repeatedly exhorted his immigrant parishioners to practice extreme liberality in charity. “He that gives to the poor, lends to the Lord,” Winthrop declared in an appeal to philanthropic mutuality far less widely quoted than his fabled simile of the colonial settlement of New England as a city on a hill. “And he will repay him even in this life an hundredfold to him or his.” Citing a litany of biblical precedent, Winthrop went on to remind his mostly well-to-do Puritan flock that “the Scripture gives no caution to restrain any from being over liberal this way.” Indeed, he drove home the point much more forcefully as he highlighted the all-too-urgent imperative for these colonial adventurers to hand over the entirety of their substance for fellow settlers in material distress. “The care of the public must oversway all private respects,” Winthrop thundered—and then, sounding every bit the proto-socialist that his countryman Lilburne was: “It is a true rule that particular estates cannot subsist in the ruin of the public.”

The Accumulator As Paragon

The story of how Winthrop’s model of Christian charity degenerated into the neoliberal shibboleths of the Gates and Zuckerberg age is largely the saga of American monopoly capitalism, and far too epic to dally with here. But there is a key transitional figure in this shift: the enormously wealthy, self-made, and terminally self-serious steel-titan-cum-social reformer Andrew Carnegie. Born in rural Scotland in 1835 to an erratically employed artisan weaver, Carnegie grew up on the Chartist slogans that, amid the more secular social unrest of the industrial revolution, came to supplant the Levellers’ democratic visions of a world turned upside down. When he rose from an apprenticeship in a Pittsburgh telegraph office to true mogul status in the railroad, iron, and steel industries, Carnegie continued to cleave to the pleasing reverie that he was a worker’s kind of robber baron. Thanks to his own class background, he intoned, he had unique insight into the plight of the workmen seeking to hew their livings out of the harsh conditions of a new industrial capitalist social order. “Labor is all that the working man has to sell,” Carnegie pronounced just ahead of a series of wage cuts at his Pittsburgh works in 1883. “And he cannot be expected to take kindly to reductions of wages. . . . I think the wages paid at the seaboard of the United States are about as low as men can be expected to take.”

Look around at our charitable causes, and you’ll see the public good packaged as one continual study in billionaire self-portraiture.

It was vital to Carnegie’s moral vanity to keep maintaining this self-image as the benevolent industrial noble, and he did so well past the point where his actually existing business interests dictated (as he saw it) the systematic beggaring of his workers. When the managers of Carnegie-owned firms would sell their workers short, lock them out, or bust their unions, Carnegie would typically blame the workers for not obtaining better contracts at rival iron, steel, and railroad concerns. While he might sympathize with their generally weak bargaining position, Carnegie well understood that he couldn’t have his competitors undercutting his own bottom line with cheaper labor costs—and with cheaper goods to market to Carnegie’s customers.

Carnegie’s patrician moral sentiments were genuine; throughout his career, he erected an elaborate philosophical defense of philanthropy as the only proper path for the disposition of riches, and famously spent his last years furiously trying to disperse as much of his fortune as possible to pay for charitable foundations, libraries, church organs, and the like. As he saw it, the mogul receives a sacred charge from the larger historical forces that conspire in the creation of his wealth: the rich man must act as a “trustee” for the needier members of the community.

Because the millionaire had proved his mettle as an accumulator of material rewards in the battle for business dominion, it followed that he had also been selected to be the most beneficent, and judicious, dispenser of charitable support for the lower orders as well. In Carnegie’s irenic vision of ever-advancing moral progress, all social forces were tending toward “an ideal state, in which the surplus wealth of the few will become, in the best sense, the property of the many, because administered for the common good,” as he preached in his famous 1889 essay “The Gospel of Wealth.” “And this wealth, passing through the hands of the few, can be made a much more potent force for the elevation of our race than if it had been distributed in small sums to the people themselves.” The accomplished mogul was, in Carnegie’s fanciful telling, nothing less than a dispassionate expert in the optimal disbursal of resources downward: “The man of wealth,” he wrote, became “the mere agent and trustee for his poorer brethren, bringing to their service his superior wisdom, experience, and ability to administer, doing for them better than they would or could do for themselves.”

Such blissfully un-self-aware flourishes of elite condescension—and the intolerable contradictions that called them into being—point at the tensions lurking just beneath Carnegie’s placid, controlling social muse. For as his own career as a market-cornering industrialist made painfully clear, precisely none of Carnegie’s fortune stemmed from serving out a benevolent trusteeship in the interests of the poor and working masses. Indeed, something far more perverse and unsightly impelled the business model for Carnegie’s commercial and charitable pursuits, as his biographer David Nasaw notes: Carnegie used the alibi of his own enlightened, philanthropic genius as the primary justification for denying collective bargaining rights to his workers.

Since he was clearly foreordained to serve the best interests of these workers better than they could, it was ultimately to everyone’s benefit to transform Carnegie’s business holdings into the most profitable enterprises on the planet—all the better to sluice more of the mogul’s ruthlessly extracted wealth back into the hands of a grateful hoi polloi, once it was rationalized and sanctified by the great man’s “superior wisdom, experience, and ability to administer.” In the sanctum of his New York study, where he spent the bulk of his days once his wealth disencumbered him of direct managerial duties at his Pittsburgh holdings, Carnegie found thrilling confirmation of his enlightened moral standing in the writings of social Darwinist Herbert Spencer. Yes, the wholesale of workers, widows, and orphans might seem “harsh,” Spencer preached to his ardent business readership. But when viewed from the proper vantage—the end point toward which all of humanity’s evolutionary struggles were ineluctably trending—this remorseless process of deskilling, displacement, and death was actually a sacred mandate, not to be tampered with: “When regarded not separately, but in connection with the interests of universal humanity, these harsh fatalities are seen to be of the highest beneficence.”

And so, indeed, it came to pass, albeit a bit too vividly for Carnegie’s own moral preference. At the center of the Carnegie firms’ labor-bleeding business model was a landmark tragedy in American labor relations: the 1892 strike at Carnegie’s Homestead works. Carnegie’s lieutenant, Henry Clay Frick, locked out the facility’s workforce after the Amalgamated Association of Iron and Steel Workers pressed management to suspend threatened wage cuts and pare back punishing twelve-hour shifts for steel workers. Frick clumsily tried to ferry in Pinkerton forces on the Monongahela River to take control of the plant; Homestead workers, backed by their families and local business owners, fought to repel the Pinkerton thugs. Gunfire was exchanged on both sides, killing two Pinkertons and nine workers. Eventually, Frick got the state militia to disperse the crowds of workers and their supporters; with his field of action cleared, the plant’s manager proceeded to starve out the strikers, breaking the strike five months after it began. The Amalgamated Union collapsed into oblivion the following year. No union would ever again darken the door of a Carnegie-owned business, no matter what sort of lip service he continued to pay to the dignity of the workingman in public.

Homestead was a bitter rebuke to Carnegie’s self-image as the workers’ expert missionizing advocate—but tellingly, it didn’t do any lasting damage to the larger edifice of his charitable pretension. Partly, this was a function of Carnegie’s genuine generosity. More fundamentally, though, the steel mogul’s outsized moral self-regard endured in its prim, unmolested state thanks to the larger American public consensus on the proper Olympian status of men of wealth, especially when gauged against the demoralizing spectacle of industrial conflict.

Strings, Attached

The desperate intellectual acrobatics of the self-made Carnegie were never viewed as pathological, for the simple reason that they mirrored the logic by which American business interests at large pursued public favor. In this scheme of things, the lords of commerce were always to be the unquestioned possessors of a magisterial historical prerogative, and the base, petty interests of a self-organized labor movement were always the retrograde obstacle to true progress. What else could it mean, after all, for the owners of capital to always and forever be acting “in connection with the interests of universal humanity”? Following the broad contours of Carnegie’s founding efforts in this sphere, a long succession of American business leaders would proceed to claim for themselves the mantle of enlightened market despotism, from GM CEO Charlie “Engine” Wilson’s breezy midcentury conflation of his corporation’s grand good fortune with that of its host nation to the confident prognostications of today’s tech lords that we are about to efface global poverty in the swipe of a few well-designed apps.

So how does the philanthropic debauching of the public sphere unfold today, now that Carnegie’s bifurcated model of exploitation for charity’s sake has receded into the dimly remembered newsreel footage of the industrial age? Well, for one thing, it’s become a lot less genteel. Trusteeship isn’t the model any longer; it’s annexation.

Take one especially revealing case involving our own age’s pet mogul crusade of school reform. Just five years ago, Mark Zuckerberg made a splashy, Oprah-choreographed gift of $100 million to the chronically low-performing Newark public school district—an announcement also timed to coincide with the national release of the union-baiting school reform documentary Waiting for “Superman.” The idea was to enlist the Facebook wizard’s fellow philanthro-capitalists in a matching donor drive, so that the city’s schools, already staked to a $1 billion state-administered budget, would also pick up $200 million of private-sector foundation dosh, to be spent on charter schools and other totems of managerial faux-excellence. With this dramatic infusion of money from our lead innovation industries, it would be largely a formality to “turn Newark into a symbol of educational excellence for the whole nation,” as Zuckerberg told a cheerleading Oprah.

And sure enough, all the usual deep-pocketed benefactors turned out in force to meet the Zuckerberg challenge: Eli Broad, the Gates Foundation, the Walton Foundation, and even Zuckerberg’s chief operation officer, Sheryl “Lean In” Sandberg, all kicked into the kitty. At the public forums rolling out the initiative—organized for a cool $1.3 million by Tusk Strategies, a consultancy concern affiliated with erstwhile New York mayor Michael Bloomberg’s own school-privatizing fiefdom—Newark parents more concerned with securing basic protections for their kids in local schools, such as freedom from gang violence and drug trafficking, exhorted the newly parachuted reform class to focus on the mundane prerequisites of infrastructure support and student safety. But try as they might, they found their voices continually drowned out by a rising chorus of vacuous reform-speak. “It’s destiny that we become the first city in America that makes its whole district a system of excellence,” then-mayor Cory Booker burbled at one such gathering. “We want to go from islands of excellence to a hemisphere of hope.”

But for all these stirring reprises of the Spencerian catechism on “the interests of universal humanity,” the actual state of schooling in Newark was not measurably improving. The leaders of the reform effort (which was, of course, entitled “Startup:Education”) couldn’t answer the most basic questions about how the rapidly deployed battery of excellence-incubating Newark charter schools would coexist beside the shambolic wrecks of the city’s merely public schools, where a majority of Newark kids would still be enrolled—or even how parents of charter kids would get their kids to and from school, since these wise, reforming souls neglected to allot due funding for bus transportation. Not surprisingly, the new plan’s leaders were also cagey about explaining how all the individual school budgets, charter and public alike, were to be brought into line.

Andrew Carnegie used the alibi of his enlightened, philanthropic genius as the primary justification for denying collective bargaining rights to his workers.

So in short order, the magic Zuckerberg seed money, together with the additional $100 million in matching grants, had all vanished. More than $20 million of that went to pay PR and consultancy outfits like Tusk Strategies, according to New Yorker writer Dale Russakoff, who notes that “the going rate for individual consultants in Newark was a thousand dollars a day.” Another $30 million went to pad teachers’ salaries with back pay to buy off workers’ good will—and far more important, to gain the necessary leverage to dismiss or reassign union-protected teachers who didn’t project as the privatizing Superman type. The most enduring legacy of Startup:Education appears to be a wholly unintended political one: disenchanted Newark citizens rallied behind the mayoral candidacy of Ras Baraka, former principal of Newark’s Central High School and son of the late radical poet Amiri Baraka, who was elected last year on a platform of returning Newark educational policy to the control of the community.

With all due allowances for the dramatically disparate character of the underlying social order, and the shift from an Industrial Age economy to a service-driven information one, it’s nonetheless striking to note just how little about the purblind conduct of overclass charity has changed since Carnegie’s time. Just as Carnegie’s own sentimental and imaginary identification with the workers in his employ supplied him with the indispensable rhetorical cover for beggaring said workers of their livelihoods and rights to self-determination in the workplace, so did the leaders of Startup:Education evince just enough peremptory interest in the actual living conditions of Newark school families to net optimal Oprah coverage. And once the Klieg lights dimmed, the real business plan kicked into gear: a sustained feeding frenzy for the neoliberal symbolic analysts professionally devoted to stage-managing the appearance of far-seeing school reform. These high-priced hirelings were of course less brutal and bloodthirsty than the Pinkertons Frick had unleashed on the Homestead workers, but their realpolitik charge was, at bottom, equally stark: to discredit teachers’ unions and community activists while delivering control of a vital social good into the hands of a remote investing and owning class. If the parents and kids grew restive in their appointed role as stage props for the pleasing display of patrician largess, why, they could just hire Uber drivers to dispatch themselves to the new model charter schools, or maybe scare off local gang members by assembling an artillery of firearms generated via their 3-D printers.

In truth, no magic-bullet privatization plan could begin to address the core conditions that sent the Newark schools spiraling into systemic decay: rampant white flight after the 1967 riots, which in turn drained the city of the property-tax revenues needed to sustain a quality educational system, combined with corruption within the city’s political establishment and (yes) among the leadership of its teachers’ unions. To make local education districts respond meaningfully to the needs of the communities they serve, reformers would have to begin at the very opposite end of the class divide from where Startup:Education set up shop—by giving power to the members of said communities, not their self-appointed neoliberal overseers. In other words, common schools should rightly be understood as a commons, not as playthings for bored digital barons or as little success engines, managed like startups in the pejorative sense, left to stall out indefinitely in beta-testing mode until all the money’s gone.

Andrew Carnegie, at least, had the depth of character to recognize when his vision of his world-conquering destiny had gone badly off the rails. In the last years of his life, his infatuation with the stolid charms of mere libraries and church organs seemed to fade, so he adopted a quixotic quest to recalibrate human character entirely. Starting with an ardent—and quite worthy—campaign to stem the worst excesses of American imperialism in the wake of the Spanish-American War, Carnegie then turned to the seemingly insoluble challenge of stamping out altogether the human propensity to make war. When this latter crusade ran afoul of the colossal carnage unleashed in the Great War, he became an uncharacteristically depressed, isolated, and retiring figure, barely reemerging in public life before his death in 1919.

In today’s America, however, no one learns from our mogul class’s leadership mistakes and moral disasters—we just proceed to copy them faster. So when New York’s neoliberal governor Andrew Cuomo tore a page from the Zuckerberg playbook and launched a system of lavish tax breaks for tech firms affiliated with colleges and universities—surely these educational outposts would be model incubators of just-in-time prosperity—nemesis once again beckoned. Indeed, when Cuomo’s economic savants unleashed tech money to do its own bidding in the notional public sphere, the end results proved to be no different than they had been in the Zuckerberg-funded mogul playground of Newark charter schools. Cuomo’s ballyhooed, billion-dollar, five-year plan for way-new digital job creation—called, you guessed it, “Startup New York”—yielded just seventy-six jobs in 2014, according to a report from the state’s Committee on Economic Development. This isn’t a multiplier effect so much as a subtraction one; it’s hard to see how Cuomo could have netted a less impressive return on investment if he had simply left a billion dollars lying out on the street.

Just as Newark vouchsafed us a vision of educational excellence without the messy parents, neighborhood social ills, and union-backed teachers who louse the works up, so has Cuomo choreographed a seamless model of tax breaks operating in a near-complete economic vacuum. Say what you will about the abuses of Old World wealth; a little noblesse oblige might go a long way in these absurdly predatory times.


[*] Correction: An earlier version of this essay mischaracterized the priorities of the Bill and Melinda Gates Foundation, stating that the foundation “devotes the bulk of its endowment” to laying waste to teachers’ unions. Laying waste to teachers’ unions is only one of several initiatives pursued by the foundation. We apologize for the error.