Why I'm Sort of Optimistic That Mark Zuckerberg Won’t Mess Up This Philanthropy Thing

To mark the birth of their baby daughter Max, Facebook founder Mark Zuckerberg and his wife, Dr. Priscilla Chan, announced today that they will give away 99 percent of their Facebook stock to philanthropic efforts over their lifetimes. At the moment, said stock is worth $45 billion.

This is admirable. Some of us might be a tad wary of megasized charitable gestures from billionaires because they a) tend to come at public expense via tax deductions; and b) often seem geared more toward satisfying the donor's ego that doing demonstrable good in the world. But I think that as a rule, we would all prefer that our modern overlords give away their riches rather than pass them on to their children. 

But the move is a tiny bit worrisome, because Mark Zuckerberg's record with philanthropy is somewhat checkered—and has arguably fueled some political havoc in one major American city. So, let's discuss: Should we be optimistic here about how that $45 billion is about to be used?  

To start, let's talk about what, precisely, the actual news is today. We already knew that Zuckerberg and Chan planned to give away most of their wealth. How? Because they signed onto the Warren Buffet's and Bill and Melinda Gates' "giving pledge," in which America's richest promise to donate most of their money to philanthropy. So the first story here is that Zuckerberg and Chan are, like Buffett, going to give away substantially all of their fortune, rather than just the majoirty of it. (Gates is aiming for a mere 95 percent, for some reason.) The second big story is how they're planning to distribute that money. Rather than, say, follow Buffett's footsteps and dole out their resources to other people's foundations, the couple is starting the Chan and Zuckerberg Initiative, an organization that will initially focus its efforts on “personalized learning, curing disease, connecting people and building strong communities.”¹ The upshot is that the couple see themselves as philanthropists in the Gates/Mike Bloomberg mold, using their money to fund very specific causes close to their hearts. 

Which is why it's worth recalling Zuckeberg's past charitable exploits. His first major philanthropic gesture, a $100 million gift in 2010 to help the city of Newark reform its public school system, has been described as something of a fiasco. As Dale Russakoff memorably reported in the New Yorker, Zuckerberg knew little to nothing about urban education policy before he met Newark Mayor Cory Booker at the Sun Valley Conference, an annual gathering for power brokers in tech, media, and finance. For that matter, he'd never been to Newark. But Booker impressed him, and eventually talked the young billionaire into the nine-figure gift. In Silicon Valley, it's common for venture capitalists to invest in people, not business plans. And ultimately, that seemed to be Zuckerberg's approach. When he appeared on Oprah with Booker and New Jersey Gov. Chris Christie, he explained, “Newark is really just because I believe in these guys.”

What followed was a fairly messy political drama, as Booker and Christie attempted to push a reform plan that involved closing low-performing public schools and expanding charter schools while transitioning teachers to a pay-for-performance system. Regardless of its merits, the program brought on an angry public backlash that eventually helped elect one of the effort's loudest opponents, Ras Baraka, as mayor once Booker left for the U.S. Senate. All the while, the city spent tens of millions of dollars on expensive education consultants, leading Vivian Cox Fraser, the president of the Urban League of Essex County, to memorably quip, “Everybody’s getting paid, but Raheem still can’t read.” Five years later, the argument about how effective Newark's school reforms have been is still simmering. For his part Zuckerberg argued in a Facebook post this month that the gift was a success, noting that graduation rates were up and that teachers had moved on to a new contract that gave bonuses based on student results, paid for partly through his donation.

Stepping back from the question of whether Newark schools are better off today than they were half a decade ago, though, the entire story should make it pretty clear that blindly plopping $100 million onto an unfamiliar city to tinker with its public institutions because you generally trust the public officials in charge is probably not a recipe for repeated or sustainable philanthropic success. And insofar as Zuckerberg thinks that's a good way to spread his wealth, I'd be concerned.

That said, I'm feeling guardedly optimistic, because it seems like Zuckerberg and Chan might have learned a few lessons from their adventures in New Jersey. Last year, they made a similarly huge $120 million dollar donation to improve Bay Area schools, but targeted the first installments at incremental changes like improved classroom technology and better teacher training. Meanwhile, his most high-profile public health move to date has been a $25 million donation to the Centers for Disease Control Foundation to fight ebola, which seems like a fairly sober and smart way to spend your philanthropic dollars.

Judging by their announcement today, it seems as if Zuckerberg and Chan are moving further away from the helicopter-drop approach to charity. In their joint letter (addressed, a little awkwardly, to their daughter) they talk about spreading Internet access, helping develop better personalized education technology, and building a “new type of school” better connected to public health centers and government services. (It's a bit vague, but sounds an awful lot to me like Harlem Children's Zone.) And, of course, they want to funnel money into medical research. Again, these seem like the sorts of endeavors that aren't going to cause a lot collateral damage, and may well do some actual good.

¹ Side-note: I'm honestly still puzzling over what, exactly, the Chan Zuckerberg Initiative is, but judging by this SEC filing it appears to be an LLC formed to manage Zuckerberg's philanthropic efforts while maintaining his personal control over Facebook, which would be pretty different than, say, the Bill & Melinda Gates Foundation.