Antonio Olmedo wrote this analysis of Philanthro-Capitalism.
VENTURE PHILANTHROPY & THE NEOLIBERAL ECOSYSTEM: WHO NEEDS A MINISTRY OF EDUCATION?
By Antonio Olmedo, University of Roehampton
Coinciding with this year’s World Social Forum in Davos, Oxfam released a report based on Credit Suisse Global Wealth Databook [1], denouncing that the top 1% richest people have gained more income than the poorest 50% altogether[2]. The tendency seems to be worsening.
In 2010, the combined assets of the 388 multibillionaires were required in order to equal the wealth of the 50% at the bottom, however, in 2016 only 8 of them would be needed to reach the same situation[3].
The counter narrative claims that, while the richest become richer, the average wellbeing of the population increases correspondingly. However, even the friendliest statistics (ie. the Brookings Institution has recalibrated poverty indicators according to new data available on prices for goods and services [Purchasing Power Parities] in every country in the world) show that while in some regions the new calculations seem to suggest an improvement in the percentage of people living in extreme poverty, that is not the case in other areas, where such proportions seem to aggravate[4].
Moreover, the think tank signals that there is a large concentration of people whose living standards are virtually similar to the global poverty line, which epitomises the fragility of such estimates.
All in all, the situation seems far from resolved and the number of deadlines missed by international declarations, multilateral agreements, development goals, etc. continues to amass.
Capitalism, the elephant in the room
Nevertheless, far from engulfing policy makers in a deep and self-reflexive critical exercise, within mainstream politics Capitalism remains as the solution to such stagnant social and economic crisis, rather than its central cause. The fact that the richest are even richer seems to be a good news rather than cause for concern.
As Bill Clinton (2010) acknowledges: “The 21st century has given people with wealth unprecedented opportunities, and commensurate responsibilities, to advance the public good”.
Back in 2008, right after the latest global collapse of the capitalist system, Bishop and Green published their Ode to (what they baptised as) the Philanthrocapitalism. In the preface of the 2nd edition of the volume, the authors celebrate the fact that the global economic crisis does not seem to have endangered, but rather fortified, the wealth of the wealthiest on Earth:
The world has changed since the financial meltdown of September 2009, but in ways that make the ideas in Philanthrocapitalism more relevant than ever. According to the annual rich list compiled by Forbes magazine, the collapse of the stock and other asset prices reduced the global number of billionaires by over 300, nearly one-third, from 2008 to 2009. The average charitable foundation saw its assets shrink by at least one-quarter. Yet the world still has plenty of super-rich people. Indeed, overall, the super rich are likely to emerge from the crisis in better financial shape than anyone else. The reservoir of wealth to fund Philanthrocapitalism is still there. [emphasis added] (Bishop & Green, 2010, p. xii)
The book preaches the renaissance of giving and philanthropy. It portrays how a group of new philanthropists give, by applying business techniques and ways of thinking to their philanthropy and also describes the growing recognition by the leaders of capitalism that are giving back much of their fortune to improve society is as much a part of the system as making the money in the first place (2010, p. xii).
A study commissioned by Education International (the final report will be publicly released later this year) considers the general implications of the involvement of new philanthropists in global education policy communities in different countries across the world.
The Venture Philanthropy neoliberal ecosystem
More concretely, this piece of work concentrates in tracking the investments and agendas of a group of Venture Philanthropic organisations, which openly promote market-based solution and dynamics of privatisation of education at all levels: funding of private and charter schools, developing new public management schemes, incubating new edu-tech businesses, advocating for new forms and methods of accountability and evaluation, etc.
When brought together, their portfolios configure a full neoliberal ecosystem. From chains of private schools operating within public-private partnerships or fully independent, teacher training programmes and countless tools for evaluation and school management, to curriculum development, electronic materials, new funding channels for both school providers and students and families, the options are all-encompassing.
It would not be an overstatement to say that the sum of investments of the philanthropic ventures analysed above offers the possibility of running a complete educational system through the services that their investees offer.
Moreover, though most of those tools and models and programs have been designed for specific countries or continental regions, it is also clear that they are ready to be scalable. As the case of Bridge International Academies shows:
The first Bridge International Academy opened in the Mukuru slum in Nairobi, Kenya in 2009. Today there are hundreds and Bridge continues to expand across Africa and Asia. With a mission of Knowledge for all, Bridge plans to educate 10,000,000 children across a dozen countries by 2025.[5]
As a result of the detailed selection processes of their scrupulous funders, the majority of the companies in their portfolios are prepared to follow similar pathways. Varthana, for instance, started as a microcredit venture operating in India, but they are already examining the possibilities to go beyond their current field of operations reaching new markets:
We see the loan as the starting point of a long association and believe in working with those school owners who are committed to quality. In the future, we plan to hold seminars and workshops for the school owners; get people in the field of teacher training to engage with the schools and connect them with vendors and solution providers who have innovative, state of the art solutions for schools. By nurturing a long term relationship with our clients and working with the school entrepreneurs and teachers as a team, Varthana believes we can create value and make a difference.[6]
There are multiple examples of companies that are looking into expanding their operations, either by moving into new geographies, adventuring into new markets, or targeting new populations.
They are the icebreakers at the forefront of privatisation dynamics, paving the way for deeper and more significant changes. In a clinical exploratory way, they are testing the temperature of national and local governments, of politicians and civil society groups, of individual citizens and consumers. They bring new ways of doing things into the public policy arena, new solutions and techniques, but more importantly a new vocabulary based on new forms of knowledge.
[1] https://www.credit-suisse.com/uk/en/about-us/research/research-institute/global-wealth-report.html
[5] http://www.bridgeinternationalacademies.com/company/about/
Diane Thanks for posting this. Offhand, it seems to me that
(1) the U.S. situation with education (as discussed here on this site), along with many “western” quasi-democratic countries, is quite different from many other political-to-education situations. And so what philanthropists do in a democratic political situation needs to be clearly distinguished from what they do in other kinds of political situations–for any legitimate critique to be offered.
(2) the fundamental question that emerges for me when I hear about philanthropy and education in a quasi-democratic country is this: Are philanthropists, well-meaning or not, trying to separate the educational institutions in a country from their democratically-based political foundations? As you know, that IS what’s happening in the US.
However, I don’t think the question is quite right when applied to other kinds of governments and the movements of education within their country and culture. Also, the DIFFERENT relationship of religious institutions to a particular culture and its politics makes all the difference: secular (or not) makes for a huge difference in our understanding of the right-or-wrong influence of philanthropy everywhere in a culture, and not only in the education of a country’s children. FWIW
Americans are famous for thinking that everyone else in the world thinks like we do.
Q Americans are famous for thinking that everyone else in the world thinks like we do. END Q
I have spent 16 (sixteen) years of my career, working in foreign countries. My first wife was Chinese, and I am now married to a Russian. I have travelled all over this globe.
I have not encountered the phenomenon you cite. I have known many Americans, and Americans do not generally think that everyone else in the world thinks like we do.
It is my experience, that Americans are generally ill-informed and naïve about what people around this world think. Especially when it comes to matters like Islam. We are woefully ignorant and clueless about the religion of 20% of this world.
Charles You are talking about the same “phenomenon” that I was. What often follows from (as you say) such “naivete” and being “ill-informed” is unthinking projection. We are bulls in china-shops.
But because you seem unable to understand similar meanings similarly, the projection I speak of is often manifest in Americans’ failing to recognize huge differences (their, as you say, naivete and being ill-informed)–for instance, how history, religion, and long-held cultural habits differ and influence our own and others’ thinking, social customs, and our/their relationship to education and their political framework.
And, sometimes, our own experience is not the measure of all things.
“It is my experience, that Americans are generally ill-informed and naïve about what people around this world think. Especially when it comes to matters like Islam. We are woefully ignorant and clueless about the religion of 20% of this world.”
Enlighten us Charles, please expand on this Idea . I am woefully ignorant and need an education.
It is an interesting post, but I wish you would elaborate.
For example when you state “the DIFFERENT relationship of religious institutions to a particular culture and its politics makes all the difference”, I think immediately of the Netherlands culture & its 100-y.o. 100% school-choice system developed to allow religious choice in ed– which is not particularly vulnerable to philanthro- capitalism, having measures in place to exclude corporate & individual ownership.
And when you ask — “Are philanthropists, well-meaning or not, trying to separate the educational institutions in a country from their democratically-based political foundations?” — I cannot help but mentally substitute African nations where there are no consistent longtime democratic institutions, but there are culturally-based political foundations… & how are philanthrocapitalist ed initiatives faring, w/their paltry grasp of the culture & hence miniscule community buy-in [not well, I gather, w/Bridge Academy et al thrown out of some countries, & in others suffering the usual issues of massive teacher absenteeism].
Philanthrocapitalism in the ed sphere strikes me as peculiarly suited to the US, w/our unique combination of individualism [including religious]/ don’t-tread-on-me attitude toward govt– & complementary trust/ hope in unfettered free market [the illusion that each individual has the opportunity to become rich].
bethree5 To be brief, if we start with understanding “secular” as having institutions in a culture that are clearly distinct but related, for instance, religious and political institutions, you can use that distinction to ask significant questions of any particular culture or nation-state. As a pair of examples, the U.S. is fully differentiated in that respect–even having our religious and political institutions distinctly regarded in our Constitution; whereas many Middle-Eastern and (from what I understand) African cultures do not distinguish these institutions, or at least not completely.
From that set of questions you can ask, of any particular culture, how the institution of education relates to the other institutions both in their history and in now-real-time. On that basic analytic analysis alone, any philanthropic entrance into a culture, for whatever reason, will necessarily differ in its affects of implementation on principle. There is no one-size-fits-all as many Americans and tech-brains still seem to think.
The point of my note was only to say that, what is certainly threatening in this USA culture–where education is being drawn away from its democratic roots and reinstalled under corporate and even religious principles- may be helpful in SOME regard in non-democratic or dictatorial regimes–insofar as some education is accepted and insofar as education understood as authentic development of the child actually occurs. My thought is that the new philanthropy is not all bad, even though we still seem to go at it as bulls-in-a-china-shop and waiver between trying to develop real educational opportunities in the world and worshiping the dollar.
But you are right to sense the resonance with other nuances and forms of government and their educational establishments. There are four institutions that are GENERALLY all present in all cultures, but that manifest in more (secular) or less differentiated stages and stages. Those institutions are family, education, polity, and religion. The question of how these basic institutions relate to one another in each situation gives us a good beginning for understanding what’s going on in each cultural/nation situation.
Betsy Devos for instance, is trying to destroy the hard-won distinction between religion and polity in the United States.
Very interesting & helpful, thank you CBKing. I especially learn from: “There are four institutions that are GENERALLY all present in all cultures, but that manifest in more (secular) or less differentiated stages… family, education, polity, and religion” — & your note that “how these basic institutions relate to one another in each situation gives us a good beginning for understanding what’s going on in each cultural/nation situation.”
That’s a good template for beginning a discussion of what might work for ed policy in any nation, including the US– & obviously, philanthrocapitalism (tho it is anathema to democratic principles), while it is allowed to exert influence during this period of lax regulation– needs to take these factors into account if it hopes to make any headway/ profit.
bethree5 Big money COULD support public education in many ways and, therefore, support the generational movement of democracy as such. Some things are worthwhile purely because they enrich us–no pun intended on the use of “rich.”
When did we become a nation so gullible as to believe in the “benevolent” logic behind a word such as PHILANTHROCAPITALIST? “Capitalism, the elephant in the room…”
I am a weak student of history, so correct.me if I am off-base, but I believe DeToqueville wrote about the unique individualism of Americans. We have always had a tension between individualism & governing for the common good– extended because the individualists could simply head West. That strength– what allowed them to tame wild territory– would eventually, but much later, become a liability as folks were settled more closely & needed to plan for the common good.
We are a very young country. Our elder politicians have w/n childhood memory grandparents who were still settling what would become the states of OK, NM, AZ.
And all those folks– the grand- & great-grandkids of pioneer settlers, who make up a large swath of older American voters– see untrammeled capitalism as the kind of govt that bought them their land and their way of life. Government for the common good means giving away, via taxation, pieces of what their forefathers gained w/no help from govt, to share w/folks who made no such effort. “Philanthrocapitalists”, to them, is just a name for a few guys who reached [like them] for the gold ring– & got it.
“who make up a large swath of older American voters– see untrammeled capitalism as the kind of govt that bought them their land and their way of life. Government for the common good means giving away, via taxation, pieces of what their forefathers gained w/no help from govt, to share w/folks who made no such effort.”
First, if those “older” American voters” see capitalism as a kind of government, they are wrong. Capitalism is a descriptive name for an economic system, that is aided and abetted by many different types of governments. Is that confusion helpful for those who practice this supposed form of goodwill-philanthrocapitalism? I believe it is and is meant to be deceiving.
And, those “forefathers [who] gained with no help from govt” never existed. Another falsehood purposely maintained. Those “settlers” were aided not only by military protection against those who were fighting to the death to preserve the land and open spaces upon which they lived and survived but through land grants by said government. Again a false meme of self-sufficiency and “I did it on my own” in contrast to those “who made no such effort”.
False memes, ones that fit a certain “American Patriot” story don’t die easily, eh!
“It would not be an overstatement to say that the sum of investments of the philanthropic ventures analysed above offers the possibility of running a complete educational system through the services that their investees offer.”
I think that control of social and educational programs is on the wish list of profit seekers who have philanthropic ventures on the side. Philanthropic investments in education might run a “complete education system” if you offer up a very narrow definition of who shall be educated, how, when, for how long, and set up criteria that exclude a whole lot of expensive-to-educate people.
Bridge International is not properly viewed as philanthropic. It is operated strictly for profit, targeting the poorest of the poor but leaving behind many who are unable to muster the modest costs. The Bridge curriculum is delivered by tech. It is written by employees in the US. It is a designed as program where students “find the right answer” to questions asked by others. It is as “teacher-proof” as possible, with fully scripted lessons and industrial strength tracking of teacher and student performance.
There can be no doubt that billionaire philanthropic organizations in the United States get tax breaks for being “generous” but it is also true that many of the tax rules are being used to advance ideas that undermine public participation in key decisions bearing on the common good. In the United States, thiry foundations have formed the “Education Strategy Group,” intent on controlling public policy for education from infancy through postsecondary education and into the workplace.
Consider the philanthropic backing of social impact bonds (SIBS), also known as pay-for-success contracts. SIBS and variants are financial products, not charitable operations. Investors “bet” on receiving public funds plus a fairly high rate of return if a social or educational program meets the criteria and performance benchmarks set out on behalf of the investors. The Utah and Chicago preschool programs are being financed by these schemes, so are some programs intended to reduce the rates of return to prison after serving time.
The social and educational programs financed by SIBs are subject to the control of “intermediaries” who represent the interests of the investors. In theory, the “success” of the program is measured by independent evaluators who determine if the terms of the contracts, including performance benchmarks, are met on time and in a manner that “meets expectations” (e.g., enter Kindergarten without the need for special education services; read by grade three,metting a standard for “proficiency”).
These financial products are designed to forward the belief that public benefit programs, including education, should be judged by criteria set by profit-seekers. The whole world is really “capital” just waiting to be exploited for gain… human and social capital is no different from more conventional capital. In the case of SIBs, there is no role for philanthropies other than backing the “risk” to investors and being well poised to push these ideas: Capitalists know best. Business knows best. The public is dumb. Government-funded ventures are wasteful. All worthy social and educational benefit programs that do work, can and should be scaled-up in order to produce the most bang for the buck.
Here are some links on how preschool investors expect to make money. The contracts do not publicize that students with a major need for special education are either excluded from the programs or from the groups used to judge the success of the program and ROI for each cohort.
Click to access SIB-RBFFact_SheetUtahVersion.pdf
Click to access fact-sheet-pdf.pdf
Here is one of the most elaborate set of metrics on the “economic” benefits of preschool. In this demonstration, the value is set at about $53,000 per child. https://www.robinhood.org/metrics
Laura,
THANK YOU! Makes me ill. GREED is a disease.
I couldn’t make sense of the RobinHood link. But the two Utah links are very clear. All the state need do, in order to collect the $, is to deny that the incoming K student needs SpecEd. Looks very easyto game.
Philanthro-capitalism should be called villainthropy. While it benefits corporations and the 1%, it generally undermines middle class jobs and causes a lot of chaos and deliberate disruption. Setting up LLCs to attack a particular public service in order to privatize and profitize it is hardly a philanthropic gesture. Unfortunately, it is generally accompanied by a tremendous amount of collusion between corporations and the government in order to clear path for corporations to prevail. It also requires an extreme amount of feigned naivete on the part of government officials that pretend to be shocked and dismayed about the targeting of a public service. Simultaneously, they pretend to still serve the interests of the people as they fill up their war chests and look the other way.
I like that. “Villainthropy.” Excellent.
It is going to get worse once they finish crushing labor unions, doing away with minimum wage laws, strip health care from tens of millions, get rid of all due process legal protections for workers, do away with what few tax write-offs many in the working class still have: mortgage interest, sales tax, state income tax, and property tax – all tax write offs that Trump has said he wants to strip from the 99-percent, as he also does away with most of the taxes for the rich so they don’t need write offs and don’t pay any tax.
Then there is the end of food stamps with odds that if successful to this point, they will do away with unemployment tax, do away with Social Security tax, Medicare tax, and any other social safety net program that the rich never use.
Meanwhile, the billionaires will continue to buy up most of the media that they don’t already own and continue reporting how great life is for workers while scarring the same people daily with stories of conspiracy theories and terrorist threats that never happen, and never report about the poverty and suffering of the working people.
They are already doing it, expanding the lying, misleading, racist, hate filled, Alt-Right media machine, but they don’t control all of the media yet. Once that goal is achieved, the next step will be to control social media with algorithms designed to delete and censor anyone and anything that doesn’t meet with their approval. That’s why they are working hard to do away with net neutrality.
Lloyd, Thanks for the heads up. Sounds like the junk that Trump watches.
Also the insinuation of propaganda into the local news as if the news is originating there is really out of the Bernays playbook–“father of modern PR.
I am reminded of the formation of “Baby ALEC,” the American City County Legislative Exchange. Baby ALEC offers ready to use local ordinances to elected officials who become members. Members are inticed both by a willing acceptance of ALEC’s agenda and a lot of perks that promise to advance their political connections and line their pockets.
You can make money or you can give money to others. If you’re getting others to do something you want when you give money to them, it’s not called philanthropy; it’s called purchasing or investing. There is no such thing as philanthrocapitalism. The coining of that word is just the wolf calling himself a lamb. There are no pholanthrocapitalists. There are no wolflambs. They don’t exist.
LeftCoastTeacher: I share your pessimism–but only as a first reaction; that is, NOT as a “given” where the human spirit is concerned.
I don’t mean there is no philanthropy, just not with capitalism attached.
LeftCoastTeacher Thank you. Exactly my point also . . . two masters . . . .
If I am a powerful person and do bad things from the principle: Because I can; so I can do good things on that same principle.
If I give money to UNICEF, that’s charitable. But if I give money to a shipping company that competes with the Postal Service, that’s not charity. And that’s what billionaires do. They give money to companies that compete with the public service. Their investments should be taxed, and at a high rate.
Wolf lambs. I like it.
From a commenter at another site, “The nonprofit industrial complex prevents progressives from unifying around an effective strategy.”
I try to keep these political goals in mind(in priority order):
Campaign reform:
(1)reverse/ legislate the overturn of Cit-United Decision
(2) all elections publically & equally funded
(3) delete all PACs
Lobbying reform:
(1)enforce minimum 5-yr moratorium on elected politicians taking lobbyist/ consultant jobs
(2)require 1-for-1 industrial/ civic action group lobbyist representation
Non-profit org reform:
Completely re-vamp 501c(3) & c(4) law so that non-profits are pure charity orgs
Like your list
Adding- 1. Common goods (a) Preservation of existing commonly held goods (b) Expansion into areas like healthcare (c) Elimination of privatization in education, K-12 and college, water and power supply, communications, prisons, etc.
2. Roll back of tax statutes and legislation at state and federal levels that concentrated wealth to its current unsustainable levels.
Act Blue continues to raise money for the hedge funds of DFER. That transgression is a bellwether for people who were formerly Democrats.