SANF June 2008 : 115

JUNE 2008 SAN FRANCISCO 115 WILL ANYTHING TRULY GOOD COME OF ALL THIS? FANTASY THOUGHT: The Bay Area’s recently rich, fresh from creating the new economy over the past decade, will devote their winnings to building a more perfect world (once they remodel their places in Kona and B.C., of course). And why not? This is the home of Messrs. Hewlett, Packard, and Moore, who turned their loot from the region’s last Gilded Age into three of the 11 largest foundations in the U.S. REALITY: Not everyone around here likes to give their money away. We track the promise and pitfalls of relying on trickle-down economics. GOOD $IGN: Thanks to the powerful examples of Bill Gates and Warren Buffett, suddenly you are expected to give away at least some of your hundreds of millions, and to do it intelligently—long before you die. Says fi nancier Warren Hellman, one of San Francisco’s biggest givers: “I think it’s a sea change.” BAD $IGN: “Signifi cant pockets” of new tech wealth remain “cautious” and “untapped,” concedes Emmett Carson of the Silicon Valley Community Foundation. Imagine being 27 and waking up to the sound of a dump truck unloading bags of $100 bills onto your front porch. You’ll probably need some time just to adjust to the fact that your car now features a pleas- ant female voice offering directions—and they already want you to start thinking about Habitat for Humanity? Ultimately, though, she isn’t too hard on anyone. “We’re comfortable, and we feel blessed with what we have,” Gia says, mentioning their house in the hills of Redwood City. “This time around, we don’t want to delude ourselves,” she adds. “We’re a little more hesitant about letting our emotions get ahead of us. But we still believe.” If were to wind up making Bill and Gia wealthy—truly wealthy—“that would be the most thrilling thing in the world.” ■ A FORMER REPORTER AND EDITOR AT THE WALLSTREET JOURNALAND LOSANGELESTIMES, RICK WARTZMAN IS DIRECTOR OF THE DRUCKER INSTITUTE AT CLAREMONT GRADUATE UNIVERSITY AND AN IRVINE SENIOR FELLOW AT THE NEW AMERICA FOUNDATION. GOOD $IGN: More wealthy Bay Area residents of all ages are forming ambi- tious private foundations than ever before. Contributions to community funds like Carson’s and the San Francisco Foundation, where assets recently passed $1 billion, are stead- ily rising. BAD $IGN: As a group, the really rich remain pathetically parsimonious. If they gave away as big a percentage of their dough as the rest of us do, one estimate found, an extra $25 billion per year would go to good works. GOOD $IGN: The newest philanthropists are following personal passions and giving enormous sums to institutions they know and love. Alumna Meg Whitman gave $30 million to Princeton to build a residential college; at Stanford, alum Jerry Yang’s $75 million will create an environmental center; while golf nut Tom Siebel’s $3 million built the Stanford golf team a wonderland of practice greens modeled on the world’s fi nest courses (and he didn’t even attend the school). BAD $IGN: Unfortunately, giving to a wealthy university isn’t effective phil- anthropy, say some foundation experts, because universities can legally just park their money forever—and places like Princeton and Stanford already have the PHOTOGRAPH BY THOMAS BROENING means to buy all the new buildings they want, anyway. (Their endowments are now an obscene $15.8 billion and $17 billion, respectively.) Too bad the super-rich don’t know anyone in West Oakland or Richmond. GOOD $IGN: The ultrawealthy used to shy away from global issues, but now micro- fi nance is all the rage, personal foundations are contemplating how to throw millions a year at slowing down climate change, and malaria vaccines have become a safe—even sexy—cause. BAD $IGN: Local nonprofits that serve the poor or combat pollution right here in the Bay Area continue to struggle mightily, largely unsupported by new money. “The further from home, the easier it is to look at social justice,” notes one foundation executive. GOOD $IGN: More younger philan- thropists are running their operations like startups—fi nding a niche and demand- ing results. BAD $IGN: Few of them are taking what’s often the fastest route to real change: directly funding political and lobbying organizations that can yank on the levers of power. You don’t get a tax break that way, but how else are you going to win manda- tory mileage standards or get guns off the streets? GOOD $IGN: Do-gooder entrepreneurs now build philanthropy into their business models. Marc Benioff’s con- tributes 1 percent of profi ts, 1 percent of equity, and another 1 percent of its employee hours to community organizations; Google puts 1 percent of profi ts and equity into its foundation, BAD $IGN: Big business still instinctively fi ghts new taxes—even though public schools are falling down, healthcare is in shambles, and the Bush tax cuts have given the top 1 percent of earners an outrageous $100,000 per year of extra cash they don’t need, while the poor get next to nothing. It’s been said that philanthropy is a safety valve to protect the rich against revolution. Fund- ing a government that doesn’t invite revolt is probably a smarter hedge. ■ BRUCE KELLEY

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