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September 2006

Preserving Dynastic Wealth in a Democracy

Richelieu Jay Hughes has been a trusted counselor of dynastic families for 40 years and a thought leader in our profession, helping wealthy families preserve themselves as going concern for many generations. Why should rich people go from shirtsleeves to shirtsleeves in three generations, when there are plenty of poor people around already who can barely afford a shirt? America needs an Aristocracy. Perhaps for a trusted advisor Richelieu or or Tallyrand might be the model. As a respected Morals Tutor to America's Wealthiest Families have been feeling the pinch a little, with the stock market down, and my tip jar empty. My loyalty to preserving the well-being of dynastic families even unto the seventh generation is unswerving; I am not an inheritor myself, and I do have to eat. 


Who Rules?

I found this a truly fascinating profile on The Philanthropy Roundtable posted at Right Web.

The offices of the Philanthropy Roundtable are found in the Washington, DC building that is also the home of such prominent neoconservative institutes and publications as the Weekly Standard, Project for the New American Century, and American Enterprise Institute. The Roundtable and the Project for the New American Century are closely connected, especially through their common connections to the Bradley Foundation and revolving door patterns of employment.

As you read through the profile you see how wealth, political power, public policy formation, punditry, media, and business are not so much separate sectors but different spheres of influence maintained at the highest levels by friends and friends of friends who move from one sphere of influence to another, building a resume, a network and a movement.  I am sure this has always been so, but gives pause to those of us who think of democracy as a matter of we the people.  In the context of this closed world, I suppose I can understand why William Schambra, funded by Bradley at Hudson is upset that Bill Gates has so much philanthropic money to give here and abroad. To me Gates is an insider, but his having been photographed with Bill Clinton may be giving Schambra concern.  It is not a question of whether the rich rule, but which rich people, I guess.  At election time we get to pick the rich person's candidate who best fits our image of ourselves. This one does NASCAR, that one like tacos, or whatever.  This one goes to Church and blows up toads with firecrackers. That one like yachts and tennis and is so polite it hurts. Either way, we are well represented assuming we are CEOs or heirs, or just plain fools.  My personal political return on investment has been pretty much nil, but I assume I could get what I want if I had more to invest.  I am going to return old soda bottles until I have enough to, as we say, "make a difference."  What would it cost, I wonder, to get big money out of politics? Pew tried, and Schambra didn't like that either.  Big money, in his view, should stick up for big money, as he does.  Wooster, of Capital Research Center, concurs. Even Fortune 100 corporations, according to Capital Research Center, can't be trusted to give their money for arch-conservative causes.

Well, maybe we need a transpartisan network of givers to broaden the base of philanthropy and to introduce a broader range of ideas, ideals, and agendas into the mix? Quite an interestingly diverse  steering committee at Reuniting America.  I notice too that they plan to open conversations around the country. I propose as a topic the role of wealth in public policy formation. 


Two Bottomlines: Four Quadrants

Seems, given two bottom-lines, we have four quadrants:

  1. Profitable organizations that do net social bad
  2. Profitable organizations that do net social good
  3. Unprofitable (or nonprofit) organizations that do net social bad
  4. Unprofitable (or nonprofit) organizations that do net social good

The organizations in category 1 tend to be big buyers of think tank white papers, public relations specialists, legal foundations, and congress. They tend to favor junk science, tort reform, and deregulation. They tend to have former regulators in highly paid executive positions or on their board of directors. They tend to advertise heavily in media who publish their puff pieces as news.  In all the hooha about forpofits that aim to do social good, like Google.org, why do we not hear more about category 1 orgs and what can be done to fix them? Well, maybe I answered my own question.

If we can indeed measure social good as a second bottom-line, let us publish the results for every company, and for every think tank, out there, and let's make sure, through regulation, taxes, fines, law suits, punitive damages, and criminal sanctions that the producers of net social bad, whether a company or a think tank, pay to clean up their own messes. Better yet, let's torture (under the alternative procedures) or imprison indefinitely, or hang all the knaves and their enablers, whether forprofit or nonprofit! Unless we make an example of them, taking the pain directly to them, them and their families, we will not get the category 1 orgs, and category 3 think tanks, to produce net social good. Right? Actions have consequences. I have heard our President say so.

Yes, I am a very bright man, trained in all the right schools.  And I don't come cheap. I do nothing pro bono publico. What do you think I am, a bleeding heart libertarian? An eleemosynary institution? Tell you what - for $25,000 in cash up front, I will spare category 1 orgs the cost of buying a think tank white paper, a few hours of a litigator's time, a perjured scientist,  or a politician. I will refute myself, publicly apologize, and sing hymns of praise to whatever profitable but socially bad company forks over the cash. Why should think tank intellectuals get rich and we who can tell the difference have to suffer? My sophistry could pay for my truth-telling. That way Gifthub would be fair and balanced, and you the reader could take your pick.  Excuse me. I have got a call coming in from Smoky Joe at Rooster Foundation: Crowing in the New American Century.

Thanks, Joe. You are a good guy.  Yes, I know I am a good investment.  I promise excellent social and financial return. No problem. You can trust me. Whenver have I ever taken your money and told the truth? I wouldn't do that to you. A deal is a deal. I know what side my bread's buttered on. I am honest and loyal, as you are yourself. Thanks, Joe.  Give my best to Candidia.

Sorry.  I am back. Well, it seems my prayers have been answered. Check for $25,0000 plus expenses is in the mail. Now, don't accuse me of blackmail. I am just doing well by doing good. Now where was I? O yes.

Wealth Bond*ge, to pick just one top peforming company to focus on the for the moment does tremendous net social good.  They employ millions in all walks of life. Without them our media would shut down, our halls of congress would be empty, think tank thinkers would be starving in Dumpsters. Pundits would walk around just muttering to themselves. Even television would not be free.  Our precious freedoms would be lost to liberal insurgents.  Even Gifthub, even my salary, even my Porshe, my Gucci loafers and filligreed gold cufflinks would vanish! The Constitution would be restored, and our actual existing democracy would perish. The world as we know it in our gated communities would end.  (That is as far as I can go for $25,000.  How about another cash infusion? For $50,000 I will team up with Bill Schambra to address the public policy aspects of philanthropy.)


New Progressive Coalition Wants Big Money and Will Deliver Political Return to Big Money - This is Progressivism?

While this may be a form letter from New Progressive Coalition, it spoke directly to my concerns,

Dear Phil,

Is it all about winning elections? It may appear that way, since most people prefer investing in campaigns and elections.

And why shouldn't they? Campaigns and elections provide a tangible method of measuring whether an investment is successful — you either win or lose.

What is still lacking is investment in the advocacy, idea, capacity building, leadership, and media sectors to ensure that electoral victories are translated into long-term strategic success.

NPC launched the Political Return on Investment (PROI) project to help end this problem that investors and organizations experience in the broken political capital market.

The PROI framework helps articulate the political value of investing beyond election outcomes or costs to reach a voter. While these metrics are important measures of success, they fail to fully capture the political value of an organization's work, especially those working outside the electoral sector.

Kristen Falk

Executive Director

Well, Kristen, if you are speaking to me I am disgusted at your answer.  Let's say because a Global War on Terror has been declared, in a propaganda coup, and accepted as reality by both parties and the media, that we are living in a state of exception in which constitutional guarantees have been superseded by those who break the rules from above and bully their way past all opposition, with the connivance or passive acceptance of both parties.  Let's say politicians of both parties are more concerned about winning, and about distributing favors to their investors who seek political return on their investment than they are with the public good.  Are we not then contributing to the problem by contributing to New Progressive Coalition, as locked as it appears to be into the paradigm of winner and loser, as blind as it appears to be, in its cuddling up to money, of the abuses by wealth of the public good? C'mon, Kristen, don't act dense on purpose. No, it is not about winning elections. It is about restoring the fairness of the process.  Whoever wins the next election, democracy will have lost before any of us reaches the polls. Political Return on Investment trumps democracy - shame on you! Make a market, please, in something other than our country.  I am sure your programs are fine. But I am truly shocked at your insensitivity to language, and ethos. You write as if buying and selling political influence were a good thing, as if that were the sty in which you nuzzle the hogs.  Why not return to first principles and defend the democracy of "we the people," of open debate,  of honest conversation, of public-spirited media, and the values of public service, rather than propaganda, pitch selling, and political influence peddling? 

"What is my political return on investment?" asked Marie Antoinette, tossing a coin to her Courtier, while her Fool danced in a frenzy, pantomiming gratitude.

I can see towards the end of your letter that you seem to express some vague and ambivalent second thoughts. I sincerely hope your better judgement prevails.  We must do more than translate political victory in elections into policy. We need to do more make political capital out of  organizations who work outside the beltway.  We must translate repeated defeats into principles that are worth fighting and dying for, as our precedessors did, the patriots of old.  We must awaken ourselves.  You can do it. Please. Your note stirs with suppressed thought. Dare to think past markets, money, and political power and influence. Imagine that you were above all that, and could restore real democracy. Would you? A democracy that is not for sale? Would you? Or would that be counter-productive from your "investors" perspective?


The Gift of Foolish Fun (Towards a Festival for 9/11)

If you were an angel who could make to our soured democracy one of the following gifts, which would you choose?

  1. A well reasoned essay
  2. A rationally calculated three point plan with suitable time table and metrics
  3. A poem that might move readers to tears
  4. An inspired sermon
  5. A political speech based on a focus group using fine frame words
  6. A prayer that would bring us to our knees
  7. A wreath to be laid by a solemn leader on the edge of a great hole
  8. A day of feasting,  laughter, and rejoicing that might bring us together in friendship

I vote for #5 8.

In the giving field, I am afraid that jackanapes are under-represented. We take ourselves very seriously, that and framing the issues, and driving wedges, and managing results, and invoking God or Aristotle on behalf of our squint-eyed motives. But fun is another thing altogether.  When is the last time that you as a philanthropist dressed up as a Fairy Godmother and ran through the streets with a sparkler? You know, it might do more good than what you are doing now.  The metrics might move towards good will, as the crowd formed to laugh and dance together. We could hold such festival at the lip of the crater in NYC.  Life will be served, not just flowers in a wreath, but life demands the truth of laughter, good food, beer, ribaldry, and song.  At such a festival our politicans and think tank weasels, our shapers of public opinion,  would be laughed to scorn.  The gift, the offering needed, is sacrificial. And someone has to pay.  Let the debt be paid by those whose skin is most precious, the chalice turned upside down, and may the goat dance as the crowd laughs.   Such, I believe was the joyous message of Christ, let alone Dionysus.  From death whether of Christ, or Dionysus, comes fertility, new life and endless laughter in the face of terror.  You will not find this ancient and honorable point of view expressed on TV, nor by pundits, nor from the pulpit, nor from the funders and founders of philanthropy. Art and Carnival well up from a people the leaders have betrayed. Beware! There is such a thing as too much fun. And you might find yourself the one skinned alive.