Stinking Rich Pierces Myth of the Generous Billionaire

Carl Rhodes’ forthcoming Stinking Rich: The Four Myths of the Good Billionaire is among the better of several recent aggressive, populist, progressive critiques of, well, billionairehood, in and of itself. More particularly, it argues well against those who anti-democratically exercise the power that can come with, if not outright be purchased by, being a billionaire.

“Much has been said about the inequities in wealth and power that the growing horde of billionaires represent,” acknowledges Rhodes, dean of the UTS Business School at the University of Technology Sydney, in Stinking Rich. “This book joins and complements those discussions by seeking to understand how these inequalities are maintained through a cultural moralization of the ultra-rich.”

In that complementarity, Stinking Rich generally sets out to pierce “four myths of the good billionaire.” Billionaires have carefully constructed and continually cultivate these myths, repeating them to themselves, the people, and their elected policymakers. Too many willingly “buy” these myths, to ill effect, believes Rhodes—who previously authored 2021’s Woke Capitalism: How Corporate Morality is Sabotaging Democracy.

Specifically, the myths are of: the heroic billionaire, the generous billionaire, the meritorious billionaire, and the vigilante billionaire. The book’s covered billionaires are many, and they are from around the world. Those Americans among them include familiar ones like (merely alphabetically): Mark Benioff, Jeff Bezos, Michael Bloomberg, Warren Buffett, Yvon Chouinard, Michael Dell, John Doerr, Larry Fink, Bill Gates, Kylie Jenner, Phil Knight, the Kochs, Elon Musk, and Mark Zuckerberg, as well as “Davos Man” as a category. It is not complimentary.

Conversely and Perversely

The supposedly heroic billionaire, according to Rhodes, basically has expropriated the original, proper understanding of the American dream. “That billionaires are the poster children of the new American dream is less about the real possibilities for the advancement of ordinary citizens, instead ironically serving as justification of obscene inequality by heroizing the rich,” Rhodes writes, typically bitingly. “To believe the contemporary version of the American dream, where anybody can be rich if they just apply themselves, implies that those who are not rich deserve not to be. This dream reflects a merciless moral system.

“Following this cultural logic,” he continues, “being poor does not come about from structural inequalities, minority discrimination, class position, educational opportunities or family wealth, it is simply because the poor are losers.” Conversely, “billionaires are deserving of their wealth because they made it in the world while others did not. They are heroes.

“The original American dream may have reflected a democratic aspiration for a fairer society,” Rhodes rightly recognizes, “but perversely the new billionaire version of the American dream is a scam designed to provide a cloak of moral legitimacy over a political and economic system rigged for vast inequality.”

The meritorious-billionaire myth “reveals the reality of systematically generated inequality, the beneficiaries of which are unwilling to recognize or admit to its own privilege,” according to Rhodes. “The poorly kept secret is that the distribution of wealth across society is a rigged game. Central to the rigging is getting people not in the elite group to believe that the same principles of merit and reward apply to rich and poor alike.

“Accepting meritocracy,” he writes,

as the moral bedrock of democratic and capitalist societies provides billionaires with a perfect escape route from accusations that they are undeserving of their wealth. By claiming to have achieved their obscene wealth meritoriously as self-made men, billionaires specifically exploit the idea of meritocracy to provide a moral justification for their excess.

Overlaps and Pivots

Comparing and contrasting the two myths of the heroic and meritorious billionaire, as Rhodes puts them forward, shows considerable conceptual overlap between them. Perhaps understandably, this actually exists among all four of his presented myths. They are related.

The vigilante-billionaire myth is sometimes difficult to comprehend, which Rhodes seems to realize—at times seeming almost apologetic for having to (re-) define, describe, explain, and interpret it. The vigilante billionaire is a plutocrat that sees himself as above and beyond the law, I take it, which is fine to him because of the moral ends he pursues and is more qualified to achieve than legally bound lessers—us.

I’m not quite sure I fully get this one, honestly. Is this even really a myth per se? As articulated, it seems reliant on a higher level of philosophical abstraction, which does at least usefully for allowing for pivots to other, narrower critiques—maybe its purpose?—including a good extended one of “Davos Man,” complementary if not duplicative of others’.

Ownership and Associates

Introducing Stinking Rich’s myth of the generous billionaire, Rhodes accurately writes, “From the advent of 1980s globalization through to the wake of the Global Financial Crisis of 2008-2009, a new form of big philanthropy has developed as the world’s richest people hand over more and more of their fortunes to support charitable foundations, public causes and political activity.”

The industrialization of the Gilded Age that brought about what we might think of as the first mega-philanthropists has been succeeded by the globalized neoliberalism of our age that brought about even bigger givers, and larger inequality, Rhodes laments. His generous-billionaire chapter’s two principal examples of our latter time’s larger givers are Chouinard and Australia’s Gina Rinehart.

Chouinard, who founded the overwhelmingly successful recreational-clothing and -equipment company Patagonia, publicly announced in 2022 that he and his family were giving the company away to two entities. The first, the Patagonia Purpose Trust, received the family’s voting shares in Patagonia. It has effective control over the company and ensures that Chouinard’s values as a progressive businessman continue into the future. The second entity, The Holdfast Collective, is a tax-exempt, §501(c)(4) organization devoted to stopping climate change. Both the trust and the (c)(4), which can engage in political activity, have Chouinard’s family and close associates on their boards.

At the time, a Giving Review article by senior fellow Craig Kennedy wondered, “Where’s the outrage about Yvon Chouinard?” Well, admirably, Rhodes isn’t afraid to express some. “It would appear that while Chouinard was giving away the ownership of the company, he was not giving away any control,” according to Stinking Rich. “If anything, these changes would immortalize his life’s work by preserving the values and purpose he has long espoused and by providing a legal vehicle for political activity. In practical terms, it is unclear what exactly he was giving away” with the gift, if that’s what it was—which also “promised to be pretty good for business, too,” Rhodes passingly notes, “with Patagonia’s competitive advantage wrapped up in its climate activism.”

Part and Parcel: Politics and the People

As well, the “transaction” exemplifies “the relationship between billionaire power and [] political power that is key to understanding the myth of the generous billionaire,” Rhodes further notes. “Part and parcel of the changes that are afoot is that billionaire business owners are taking over as society’s moral agents and political actors, using their apparent generosity to address what they see as society’s greatest problems.” In the contemporary setup, “people’s lives and futures are increasingly dependent on the power and generosity of the self-elected rich elite rather than being ruled by the common will of the people.”

Rinehart is executive chairman of the also-overwhelmingly successful Australia-based mining and agriculture business Hancock Prospecting. Her philanthropy has included millions of dollars’ worth of support to the Australian women’s netball team. When a team member refused to wear Hancock’s logo her uniform because of many negative remarks Rinehart’s father made about indigenous Australians, including suggesting that eugenic measures be taken against them, high-profile controversy ensued.

Giving Review co-editor William Schambra has labeled eugenics the “original sin” of America’s progressive, “root-cause” big philanthropy, which was slow to apologize for its role. In Australia, amidst the controversy, Rinehart downright withdrew its major sponsorship of the netball team. To the further and strong chagrin of many in Australia, including Rhodes, Rinehart also met and publicly appeared with Donald Trump, including as he announced his 2024 candidacy for president at Mar-a-Lago.

“The cases of Chouinard and Rinehart are strikingly different examples of the myth of the generous billionaire,” Rhodes realizes. “The two cases do, however, share one key feature. For both, putative generosity is coupled with a desire for control.”

Power and Control, and Their Preservation

“When considering the apparent generosity of the ultra-wealthy in funding charitable foundations and causes of their choosing, it is naïve to assume that this is simply a matter of selfless do-gooding altruism,” according to Rhodes. “The question is, what do billionaire philanthropists expect in return for their economic largesse?”

In return for the transactional “exchange” of a gift, in Rhodes’ thinking, they expect political and social power and control over it. That’s what they’re “buying.” Essentially, they’re buying they’re way out of democracy—out of the healthy to’ing and fro’ing to which democratic processes would otherwise inconveniently subject the spending.

“Undermining the myth of the generous billionaire surfaces how billionaire giving is a ruse to secure the wealth, power and privilege of the billionaire class,” he writes. “Philanthropy is not designed to change the system but to preserve it,” he later adds. “Elite philanthropy is not something to be lauded, and the idea that it is the best way to solve the world’s problems is a myth that is both false and dangerous.”

Rhodes is on a roll here, though not a new one, for either the book or progressivism. “When billionaires make sizable gifts to charity, they are not channeling their money through [] a socially controlled process” of general taxation to fund projects for the common good and benefit society, “but rather through one that is largely privately controlled by them. The billionaires decide how much is spent and they decide what it’s spent on. The added sweetener is that, in most countries, charitable donations are tax deductible, serving to further impoverish the public purse.”

Increments, Allies, and Attitudes

In Rhodes’ Stinking Rich, it seems, pretty much almost everything billionaires do causes economic inequality and comes at the expense of democracy. He certainly doesn’t seem too worried about overstating it, actually—often with a little enjoyable academic bombast—but it’s an impressive case.

It could be both more nuanced and broader, one supposes. There aren’t many specific incremental policy solutions that are advanced, ones behind which a coalition could perhaps be built—thinking here of addressing the abused tax-incentivization of billionaire’s only arguably “charitable” giving. Since the book is borne of such laudable passion, maybe contemplation of those proposals and seeking that set of unorthodox allies is for others.

More largely, though—while Rhodes writes that “[t]he issue is broader than the spectrum of political differences drawn between right and left,” and maybe because of that belief—there isn’t much specific appeal to non-progressive populists. I think they would likely be receptive to his arguments against the myths of the good billionaire. That kind of directed appeal, too, may be for others.

In the democracies that Stinking Rich shows are being rigged, these citizens have a voice, too, however rarely exercised. In fact, recent electoral results in America and elsewhere arguably evidence wide agreement with his same healthy attitudes about those doing the rigging—including the mega-wealthy, moralized by myths, through their massive giving—and the deeper problems of which they are merely a symptom.

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This article first appeared in the Giving Review on December 12, 2024.

Source: https://capitalresearch.org/article/stinking-rich-pierces-myth-of-the-generous-billionaire/