Tim Cook's $800 Million Giving Pledge: Why It's So Important
Apple AAPL -0.3% CEO Tim Cook's decision, revealed in his interview with Fortune Magazine, to join the so-called Giving Pledge and give away the vast majority of what is to date an $800 million fortune, is as important philosophically as it is financially. The dollar amount itself, in other words—which pales beside the multi-billion pledges made by Giving Pledge pioneers Bill Gates and Warren Buffet—is less significant than the assumptions underlying the pledge.
We are seeing some of America's most successful people—of which Cook is one, notwithstanding the fact that he had, in Steve Jobs, perhaps the hardest CEO act to follow in history—act on the following assumption: that philanthropy is legitimate and can accomplish things that cannot be accomplished by either government or the private sector.
Although it's a view that was embraced by John D. Rockefeller and Andrew Carnegie, it had, in the post-World War II era, withered as government grew, on the assumption that social needs could be foreseen and financed publicly. The re-emergence of philanthropy reflects an alternative view—that government, although it may be good at distributing social security checks and food stamps—does not do as well at imagining and supporting ideas that are unconventional—but may be important. Silicon Valley types know better than anyone else that that imagination and counter-intuitive thinking can be crucial to success. So it is that the new-era philanthropists, whose ranks Cook is now joining, have been the key supporters of both U.S. charter schools and biomedical research.
One is tempted, of course, to say, that if the ideas are good enough to work on a small scale, then government should be the means to bring them to a larger scale. And this trajectory should not be ruled out. But it is also the case that philanthropy can play the key role in doing something with which government has trouble: not just helping those in difficulty but changing social norms for the better. One of Cook's Silicon Valley colleagues, Peter Thiel, has, for instance, played a key role in the debate over the future of higher education—by offering to pay prospective entrepreneurs to drop out of college. In the wake of the announcement of his offer, Americans broadly realized that four-year colleges may not be the right path for everyone to follow. We're seeing a resurgence of short-term technical education as an alternative—and a new era of imaginative approaches to career planning and credentials. Thiel used a relatively small amount of funding to validate a new norm.
The same thing had occurred a generation earlier when a philanthropically-supported organization, Mothers Against Drunk Drivers, effectively changed the norm which had winked at drunk-driving. Their efforts led to the widespread adoption—and social acceptance—of the idea of a designated (non-drinking) driver for a group. It's an approach which has helped lower traffic fatalities—and which clearly makes more sense than, for instance, government-mandated alcohol education classes for those convinced of drunk driving.
Smart guys like Tim Cook look at that sort of thing—-or the outstanding results some U.S. charter schools are achieving in educating disadvantaged children– and sign up for the Giving Pledge. Of course, there has always been a social status dimension to philanthropy and that cannot be discounted in the growth of the Pledge to include more than a hundred super-wealthy donors—especially in an era in which the 1 percent are cast as villains. Indeed, one imagines the Giving Pledge as a sort of super-exclusive club. But it is one that is itself influencing norms among the wealthy. The fact that Jack Ma of Alibaba regarded it as appropriate to make a similar pledge underscores the point. Not making such a pledge could well be regarded as a mark of greed and a less-developed sense of ethics. That's no small irony, in light of the fact that China, after all, once represented itself as a revolutionary society in which government would take care of all human needs.
This is not to say that Steve Jobs, who was not public about his philanthropy during his lifetime, did anything less for the social good that will Tim Cook. A world of app developers and users enabled by the IPhone have created vast financial, social and human capital. The Jobs fortune today, however, like Tim Cook's, is being directed philanthropically. It's hard to believe that Jobs, Cook, Buffet, Gates and Zuckerberg, among dozens of others, think they're going to waste all that money.
You can listen to my BBC interview about Tim Cook and the Giving Pledge here:
https://www.manhattan-institute.org/multimedia/podcasts/mi.htm?id=11336
This piece originally appeared in Forbes
This piece originally appeared in Forbes