Asuncion, Paraguay   Be still my heart!  It is probably a distant dream, but is it just possible that that the philanthropic tax dodges of massive tax evasion and, even more abhorrent, the impunity of the rich and their patronizing rationale that they know better and are “solving our problems” is finally being called to account?  Probably not, but at least there are chinks in the vaults of their treasure chests.

Recently there was some erosion near the moat around the rich’s castles when the New York Times took at least a glancing look at how “donor advised funds” or DAFs have become the go-to giant tax dodges for the new superrich of Silicon Valley when they cash in on their startups.  They honed in on the scandals involving the Silicon Valley Community Foundation where top executives have been forced to resign based on charges of bullying staff and overly aggressive development practices, but those are just pebbles falling down the mountain of real problems with the lack of transparency, accountability, and of course loss of tax revenue from these cash dumps.  The donors get a deduction for years, but since it’s a donor-advised-fund, they also get to call the shots on their money and contributions, as if it is still in fact theirs, rather than controlled by tax-exempt entity.

Once aggregated, no one can track the actual expenditures from these hoards or whether there are any expenditures at all, since the individual funds do not have the same requirements for annual outlays that the foundation itself has.  Drummond Pike, the founder and former CEO of the Tides family of philanthropic enterprises, wrote a scathing opinion piece in the Chronicle of Philanthropy on the corporate hijacking of DAFs that will soon be reprinted in the coming issue of Social Policy as well.

There’s more though.  Elizabeth Kolbert, the Pulitzer Prize winning journalist of The New Yorker, published a recent essay that was tellingly not simply a criticism of one method of the donor community’s tax avoidance, but of the warped nature of philanthropy and the “new” Gospel of Wealth and pomposity that has been bred in our “new” Gilded Age.   She correctly nails the self-serving and destructive nature of the philanthropic circle where billions of taxes are avoided because they claim to “know better,” starving the government’s ability to provide services more equitably, and forcing government itself to depend more on nongovernmental actors among the rich tax avoiders to supplement the shortfalls.

Simply put, even if the rich actually do donate their money, it’s a bad trade to rely on the unaccountable whims and priorities of the rich, rather than those we elect to govern for all of the people.  There’s also reasonable cause to doubt that there is anything other than their self-interest involved.  Kolbert’s piece includes an estimate of $10 billion in tax deductible contributions to impact public policy as an example.  The charade that these contributions are not political is also exposed clearly, including by many people that have supped at their table and ridden in their limos.

Perhaps it is too much to hope that the current Congress will fix this problem since their legacy is more tax breaks for the rich, but we can still hope that change is coming and the deluge is still possible.