Second, the Initiative to Accelerate Charitable Giving estimates that over $1 trillion is locked up in private foundations and donor-advised funds, most of which don’t provide any transparent way to apply for funding. Indeed, the major firms that manage DAFs (e.g., Schwab) are highly incentivized by management fees not to facilitate transfers out to actual charities.
Open Philanthropy and associated efforts in EA have focused on how to optimize the philanthropy that already occurs. But what if a focused public campaign and some policy work on DAFs etc. could vastly increase the amount ofphilanthropy available to optimize? Getting DAFs and Giving Pledge members to distribute 5% of their assets a year could be worth at least $50 billion a year.
I submitted an entry to Open Phil (not sure if it came through) that was short and sweet. Reprinted here:
This essay will be short and simple.
The problem at hand is this: Far too much potential philanthropy isn’t happening at all.
First, when you look at the list of Giving Pledge signatories (https://givingpledge.org/pledgerlist), all of whom are billionaires who have promised to give away half their wealth, most of them haven’t set up foundations or made any significant effort to actually follow through on their pledge. Indeed, even the Pledgers that have engaged in serious philanthropy have often been able to increase their net worth by more than they gave away (see https://www.marketwatch.com/story/giving-away-money-well-is-very-hard-the-giving-pledge-turns-10-and-its-signers-are-richer-than-ever-2020-08-08).
Second, the Initiative to Accelerate Charitable Giving estimates that over $1 trillion is locked up in private foundations and donor-advised funds, most of which don’t provide any transparent way to apply for funding. Indeed, the major firms that manage DAFs (e.g., Schwab) are highly incentivized by management fees not to facilitate transfers out to actual charities.
Open Philanthropy and associated efforts in EA have focused on how to optimize the philanthropy that already occurs. But what if a focused public campaign and some policy work on DAFs etc. could vastly increase the amount of philanthropy available to optimize? Getting DAFs and Giving Pledge members to distribute 5% of their assets a year could be worth at least $50 billion a year.