In 2010, Warren Buffett and Bill and Melinda Gates launched the Giving Pledge to obtain commitments from the world’s wealthiest individuals to help address society’s most pressing problems. Pledgers commit to donating more than half their wealth to charitable causes during their lifetimes or by their wills.
It’s a noble effort, but it’s small change for addressing problems in the United States. Subscribers to the Giving Pledge reportedly are worth $500 billion. The $250 billion they commit to give away is equivalent to what the state governments combined spend every month.
As Paul Volcker, the former Federal Reserve chairman, and Richard Ravitch, a former lieutenant governor of New York, explained in a January report, states are on the front lines of our country’s most pressing problems. They spend $3.2 trillion per year educating children, dispensing welfare, administering justice, maintaining infrastructure, protecting environments and more. They spend $600 billion on K-12 education alone and make all the rules governing classrooms and curriculum. In contrast, charities spend just $6 billion on education and set no rules. The Robin Hood Foundation raises $75 million per year for social services. In the meantime, California has reduced social services spending by $2 billion per year.
About $250 billion donated over lifetimes will neither end poverty nor solve the United States’ most pressing problems. For those we need effective state governments and economic growth. This is why my wife and I have made a Political Giving Pledge under which we commit to donate at least 10 percent of our annual income to qualified candidates for the California Legislature. We think of it as tithing to democracy.
Political donations to races for the Legislature have extraordinary leverage because a tiny number of elected officials write thousands of laws and spend billions of dollars. This year, the governor and 120 state legislators will spend $240 billion if the proposed budget is adopted, educate 9 million students, write laws affecting 18.7 million workers and job seekers, incarcerate 187,000 prisoners, build and maintain roads, railways, parks and levees, determine outlays for health, universities, courts, parks, the environment and welfare, consider 5,000 bills and pass 1,000, and much more.
How are they doing? Not well. Since 2007, they’ve increased spending on salaries, pensions, debt and health care by 38 percent, cut spending on universities, courts, welfare and parks more than 20 percent, raised taxes and fees 30 percent, and allowed retirement debt to rise by 149 percent. Despite economic activity in some parts of the state that is the envy of the world, 25 percent of Californians live in poverty, the highest rate in the country.
Those are the results because too many of those legislators are owned by special interests that benefit from those outcomes. But they can be beat.
Together, altruistic political donors – a special interest for the general interest – could help elect legislators serious about addressing poverty and our most pressing problems, and do so at a fraction of the amount they spend on charity.
Donating no more than the legal limit of $8,200 per candidate, a coalition of individuals could provide enough campaign funding to liberate candidates from special interests. No PACs are required, and neither is a majority of legislators, because under California’s system of governance, a minority of lawmakers can have outsize leverage in certain situations. (That’s how a single legislator was able to get an unwilling Legislature to put a powerful political reform known as “Top Two Primary” on the 2010 ballot.) If backed by altruistic donors, a minority of well-meaning legislators can have enormous impact.
But also, political giving must be informed to be effective. Too often, donors contribute to politicians who take actions contrary to donor intent. For example, some friends who had contributed to state Attorney General Kamala Harris were surprised and disappointed to learn she had crushed an initiative giving citizens the opportunity to protect services from rising public pension costs and promoted an initiative to raise medical malpractice awards. Harris is the recipient of campaign funds from special interests who benefit from those actions but also from altruistic donors who, if more vigilant about their contributions, could and should hold her more accountable. There are countless examples of candidates acting contrary to donor intent.
Political donors also need to understand that legislatures are a co-equal branch of government. A governor can stop things but can’t get anything done without the Legislature. Races for the California Legislature are just as important as races for governor.
Recently, I attended a charity event in San Francisco that raised $12 million to help end poverty. That’s a great mission, but if the attendees spent one-fifth as much backing good candidates for the Legislature, they could get a thousand times the impact and change the course of public education, which is key to ending poverty.
Thomas Jefferson said, “We do not have government by the majority. We have government by the majority who participate.” You should participate by making informed donations to well-meaning candidates for the Legislature.