Posts Tagged ‘The Percent Club’

Anthony Sampson on the Meanness of the Rich

April 10, 2015

Anthony Sampson in his book Who Runs this Place? The Anatomy of Britain in the 21st Century has a passage discussing the way 21st century Britain is now far meaner and much less generous than in the 19th century, and America today. The people most willing to give money to charity, however, are the poor. The rich are the least likely and willing to give to charity. He states:

While the rich in Britain have become much richer, they have not given more away. Their incomes relative to the poor have increased, but they feel much less pressed than their predecessors to share their wealth, whether prompted by social obligations or by a religious conscience. The connections between business and philanthropy which were so marked among Quakers and other practising Christians have largely disappeared. ‘As inequality of wealth balloons back to nineteenth-century levels,’ wrote Will Hutton in 2003, ‘there is no sign of nineteenth-century levels of civil of engagement and philanthropy by the rich.’

It is a striking fact that 6 per cent of the British population provide 60 per cent of the money given to charity, but it is more striking that the poor give away proportionately more of their money than the rich. ‘It’s more surprising because the rich can give away without noticing it, while the poor make a sacrifice,’ said one charity chief. ‘But the poor have more empathy with less fortunate people.’

The big corporations have been equally reluctant, and most boardrooms have shown little interest in charities. In 1986 two leading businessmen, Sir Hector Laing, a committed Christian, and Sir Mark Weinberg, and ex-South African, set up the Percent Club to urge companies to devote 1 per cent of their pre-tax profits to charity, but they soon had to reduce the target to 0.5 per cent, and their results were still disappointing: by 2001 the top 400 companies were giving exactly the same percentage, 0.42, as ten years before. A few big corporations stood out above the average. Reuters gave £20 million in 2001, amounting to 13 per cent of its pre-tax profits, which were sharply down. Northern Rock, the mortgage company based in Newcastle, gave away £15 million, or 5 per cent of pre-tax profits. Other big companies provided gifts in kind, rather than money, though they were not always as generous as they looked. (Sainsburys gave away food that was past its sell-by date, which avoided the cost of dumping it in land-fill sites.) Most companies have shown little interest in more giving.

‘Corporate donations … are worth less now than they were in 1991,’ said Stuart Etherington, the chief executive of the National Council for Voluntary Organisations. ‘Clearly it is time for the government to get tough with the business sector.’ But the New Labour government showed little desire to get tough.

By 2000 the two chief overarching bodies for charities – the NCVO and the Charities AID Foundation – were so concerned about the lack of funds that they approached Gordon Brown at the Treasury. His budget provided major tax concessions to donors – which are now as generous as the Americans’ – and he also helped to finance a Giving Campaign, chaired by the former head of Oxfam Lord (Joel) Joffe, an unassuming but persistent South Africdan who worked closely with Weinberg. The campaigners have had some success in giving more prominence to charity, but donors have been slow to exploit the over-complicated system of tax relief; and the charities are still very disappointed by the response, both from corporations and from individuals – whether entrepreneurs, corporate directors or the million-a-year men in the City.

Joffe, like other heads of charities, is struck by the contrast between attitudes in Britain and America where giving is part of the culture. ‘If you’re rich in America and don’t give,’ he said, ‘you’re regarded as an outcast.’ Americans give on average 2 per cent of their income to charity, compared to the British figure of 0.6 per cent. The British have often argued that their governments have take over the roles of philanthropists in health, education and social services, to which Americans devote much of their giving. ‘People still expect the government to pay for the basic social and artistic causes,’ says Hilary Browne-Wilkinson, who runs the Institute for Philanthropy in London. But the expectation is much less realistic since the retreat of the welfare state and the lowering of taxes, while the rich in the United States remain more generous than the British, and more systematic and effective in attaining their objectives. ‘British charity is more reactive, sometimes responding quite generously to television coverage of famines and disasters,’ says Joffe. ‘The Americans have a more strategic sense of what they want to achieve and plan their giving accordingly.

Many of the American mega-rich a century ago, like Carnegie, Rockefeller and Ford, converted part of their fortunes into foundations which today provide a powerful counterweight to the prevailing profit motive. ‘He who dies rich, dies disgraced, ‘said Andrew Carnegie, who gave away his fortune to finance free libraries and a peace foundation. More recent billionaires like George Soros and Bill Gates, have continued this tradition. When Ted Turner, the founder of CNN television, gave a billion dollars to the UN 1997 he quoted Carnegie and mocked his fellow billionaires: ‘What good is wealth sitting in the bank?’ The rich lists, he said, were really lists of shame.

But there are only a few comparable British bequests, like the Wellcome, Sainsbury or Hamlyn foundations, and most of the old rich feel much less need to commemorate their wealth through charity. The British aristocracy have traditionally seen their main responsibility as ensuring the continuity of their estates and families, in which they have succeeded over the centuries, helped by the principle of primogeniture which allows the eldest son to inherit the whole estate. Their argument can appeal to anyone who values the timeless splendours of the countryside, with its landscapes of parkland, forest and downland which owes much to the protection afforded to large landowners. Old money in Britain has been interlocked with the environment as it has never been in most parts of America, where land is less valued, and where the rich have more urban and nomadic habits.

But the argument is less valid today, when much of the responsibility for the environment has been taken over by English Heritage or the National Trust. Many old families with large estates still have incomes which greatly exceed the cost of their upkeep, and they still have responsibilities to contemporary society. Many of the new rich are happy to follow the earlier tradition, but they are still less encumbered. Most people of great wealth in Britain today show a remarkable lack of interest in using their money to improve the lives of others.

Above all they feel much less need than their predecessors to account for their wealth, whether to society, to governments or to God. Their attitudes and values are not seriously challenged by politicians, by academia, or by the media, who have become more dependent on them. The respect now shown for wealth and money-making, rather than for professional conduct and moral values, has been the most fundamental change in Britain over four decades.
(pp. 346-8).

So the rich have become much meaner, while the poor are the most generous section of the population. Charitable giving has declined along with notions of Christian morality and an awareness of need. People still expect the government to provide, despite the attack on the welfare state. The aristocracy don’t give, because they’re still concerned with preserving their lands and titles. While the new rich are feted by the media and society, simply for being rich, without any concern for morals or charity. And because universities and the media are dependent on them, they are reluctant to criticise them for their lack of charitable giving.

This was inevitable. Modern Conservative ideology was all about greed, shown most acutely in the Yuppies of the late 1980s and 1990s. And because the Tory attacks on the welfare state concentrate on attacking the poor as scroungers, there’s no incentives for people to give to them either. If someone’s labelled a scrounger or malingerer, giving to charities to support them is just as bad as government tax money.

This marks another, massive failure of Thatcherism. She thought that if the welfare state was rolled back, charitable giving would increase. It hasn’t.

Thatcherism has made the rich meaner, and the Tories continue with the same attitudes and visceral hatred of the poor.

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