Counterpoint: On Hugging Hedge Fund Guys

Posted by Andrew Price



This morning, Joe Ippolito, who covers a business beat for GOOD, put up a piece explaining "why you should hug a hedge fund guy."

Some [finance folks] are doing far more good than we might like to admit, and maybe even more good than some of the folks we hold up as role models. Take a look at the top charitable donors from last year. One thing that stands out is the number of people who work in financial services. A hedge fund guy here, a private equity dude there—the list is littered with them, and they’re doing some serious donating.

He goes on to list the specific donations made by a few people like Stanley and Fiona Druckenmiller ($25 million to the Harlem Children's Zone; $100 million for a neuroscience institute at NYU) and concludes:

No, simply writing a check doesn’t make you a great philanthropist. Except, actually, I’m pretty sure it does. Most of the causes out there don’t need your petitions or your joie de vivre anywhere near as much as they need money.

In general, I think it's a more productive use of my time as a blogger to encourage giving by applauding people who make big donations rather than nitpicking about their purity of purpose. I've written positive things about the Gates-Buffett plan to get billionaires to give away half of their money.

But I disagree with Ippolito's suggestion that giving away lots of money makes one an exemplary philanthropist in and of itself. Philanthropy shouldn't be measured by the size of the check alone. We should also consider a person's overall value structure. The Somali pirates are known for being really generous in the port towns from which they operate. They still kill and steal. I'm not saying Wall Street's richest money manipulators are as bad as pirates, but... well, maybe I am.

Acknowledging generous donations from people with ungodly amounts of money is fine with me. They do a lot of good. As Ippolito notes, worthy organizations often need cold, hard, cash more than warm wishes and volunteers. But at the same time, the world—and especially America, where we're all rich by global standards already—needs smart people to be less focused on amassing personal fortunes.

That's the danger with a piece like Ippolito's: That in congratulating these guys we convince ourselves that the way to live a good life is first making a billion dollars by whatever means necessary and only then prioritizing the health and well-being of your fellow humans. It's not.

That said, most people working on Wall Street, philanthropists or not, probably do need a hug.