Ten years ago, an all-star team of philanthropists, including Bill and Melinda Gates, Warren Buffett, Ted Turner, Michael Bloomberg, Charles Feeney, George Soros, Eli Broad, and Oprah Winfrey, came together for a private dinner in New York. Their collective net worth: roughly $130 billion. The question on the table: how to give it away — and how to persuade others to do the same.
Bill and Melinda Gates and Buffett had drawn up the guest list. The late David Rockefeller served as host. They laid the groundwork that night for the Giving Pledge, an effort that, when it was announced a year later, was hailed as “the biggest fundraising drive in history.” The Giving Pledge is a public, nonbinding promise made by rich people around the world to dedicate more than half of their wealth to charitable causes during their lifetimes or in their wills.
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Ten years ago, an all-star team of philanthropists, including Bill and Melinda Gates, Warren Buffett, Ted Turner, Michael Bloomberg, Charles Feeney, George Soros, Eli Broad, and Oprah Winfrey, came together for a private dinner in New York. Their collective net worth: roughly $130 billion. The question on the table: how to give it away — and how to persuade others to do the same.
Bill and Melinda Gates and Buffett had drawn up the guest list. The late David Rockefeller served as host. They laid the groundwork that night for the Giving Pledge, an effort that, when it was announced a year later, was hailed as “the biggest fundraising drive in history.” The Giving Pledge is a public, nonbinding promise made by rich people around the world to dedicate more than half of their wealth to charitable causes during their lifetimes or in their wills.
The founders were Gates, the co-founder of Microsoft, and his wife, Melinda, and Buffett, the renowned investor and their friend of many years. Buffett had already pledged to give away the vast majority of his wealth — at $37 billion, one of the largest gifts in history — with most of it going to the Bill & Melinda Gates Foundation.
The Giving Pledge was to become the capstone of their philanthropic partnership. Hopes were high. The pledge “has the potential to dramatically change the philanthropic behavior of Americans,” Carol Loomis wrote in an exclusive, semiofficial account in Fortune magazine. Brad Smith, then the president of the Foundation Center, said: “Any way you look at it, the Giving Pledge can turbocharge philanthropy for decades to come, and that is great news.”
That has not happened.
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Daniel Biskup/laif/Redux
Jeff Bezos, the richest man in the world, recently pledged $2 billion to charity, but he has declined to sign the Giving Pledge. His ex-wife, MacKenzie Bezos, recently announced she was signing on, promising to give thoughtfully — and quickly.
There was an initial burst of enthusiasm. More than 90 families had signed on by the end of 2012. After that, the number of donors taking the Giving Pledge slowed. In late May, the latest group of new signatories was announced, including MacKenzie Bezos, the ex-wife of Amazon founder Jeff Bezos and one of the richest women in the world. The new additions brought the total to 204. Meanwhile, the vast majority of the ultrarich, in the United States and abroad, have taken a pass.
Nor has the pledge inspired greater generosity among all Americans. While charitable giving in the United States has grown along with the economy, total giving by individuals, foundations, and business adds up to about 2 percent of gross domestic product. It’s been stuck at that level for decades.
Donor Type
THE OLD GUARD
Some pledge members started giving big long before they signed the pledge.
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Ted Turner (pictured)
Signed pledge: 2010
Estimated net worth: $2.2 billion
Giving to foundation: $90 million
The media mogul is probably best known for his $1 billion pledge in 1997 to help establish the United Nations Foundation. His own foundation has been spending down its assets faster than Turner has been replenishing them. Assets have dropped from $210 million in 2000 to $5 million.
Eli and Edythe Broad
Signed pledge: 2010
Estimated net worth: $6.7 billion
Giving to foundations: $455 million
The couple began their art foundation in 1984 and their family foundation in 1999. They say they’ve invested more than $4 billion in philanthropy.
Gordon and Betty Moore
Signed pledge: 2012
Estimated net worth: $9.7 billion
Giving to foundation: $0
In the early 2000s, the Intel co-founder and his wife endowed their foundation with about $5 billion in stock. Though they haven’t added a penny in more than a decade, assets are now just under $7 billion.
Thomas Monaghan
Signed pledge: 2010
Estimated net worth: less than $1 billion
Giving to foundation: $7.1 million
Created in the mid-1980s, the Ave Maria Foundation of the Domino’s king is a shell of its former self, with $5 million in assets. In 1998, the grant maker held $250 million and spun off $18 million in grants, many of them supporting Catholic churches, schools, and other organizations. Foundation giving figures are for fiscal years 2010-17, except where noted.
Amassing Wealth
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There’s no evidence that the superrich are giving more, either. Data on their philanthropy is thin, and there’s no agreed-upon definition for the very wealthy. Some researchers have found that increased giving by the rich has offset anemic giving by those who have less.
But a 2018 report from the Bridgespan Group focusing on about 2,000 of the very wealthiest American families — those with assets of $500 million or more — found that they donated about 1.2 percent of their assets to charity in 2017. That’s a lot of money: $45 billion, give or take. It’s not enough, however, to keep pace with the growth in their assets.
The result is that these very wealthy families, as a group, are piling up wealth faster than they are giving it away, even in the face of pressing problems that philanthropy could tackle — climate change, global poverty, a tide of refugees, neglected tropical diseases, and the suffering caused by dementia and mental illness, to name just a few.
Benjamin Norman/The New York Times/Redux
Katherine Lorenz, who oversees a $250 million family foundation, says the Giving Pledge has inspired the children and grandchildren of the wealthy. “Hands down, the learning sessions have been wonderful.”
“We have arrived at a decisive moment,” wrote Susan Wolf Ditkoff, Alison Powell, and Kyle Gardner of Bridgespan, authors of the report. “The ultrawealthy, having amassed resources of unprecedented magnitude, have the capacity to support innovative initiatives that could benefit millions.”
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Money that could go to good works is being left on the sideline, they wrote.
The Bridgespan report, which was commissioned by the Bill & Melinda Gates Foundation, recommended ways to encourage significantly more giving by the rich. It’s a sign that the Gateses would like to see their peers give more.
The couple declined to speak with the Chronicle. In a recent interview with the New York Times, Melinda Gates acknowledged that some people join “because it looks good.” She didn’t name names.
The Gates Foundation, which employs a staff of seven to manage the work of helping the pledge signers, has never conducted a formal evaluation of the effort and makes no grand claims about its impact. “We will never be able to measure how much the group gets people to do more giving, or do it in a better way,” Bill Gates told the New York Times shortly after the program began.
While no one questions the good intentions behind the Giving Pledge, the most frequently heard criticism is that no one holds the donors accountable. Indeed, it is not possible to do so since they need not publicly disclose their giving. While the Foundation Center (now called Candid after it merged with GuideStar) collects information about the pledgers, little is known about what difference their giving makes.
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“You get the benefit of the publicity without the accountability,” says Benjamin Soskis, a historian of philanthropy.
Donor Type
EARLY ADOPTERS
A few pledge members have a public track record of giving away a large share of their wealth. John and Laura Arnold (pictured)
Signed pledge: 2010
Estimated net worth: $3.3 billion
Giving to foundation: $1.1 billion*
Since their foundation launched eight years ago, the former hedge-fund titan and his wife have contributed about $1.5 billion.
* 2017 figures not available
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Seth and Beth Klarman
Signed pledge: 2013
Estimated net worth: $1.5 billion
Giving to foundation: $707 million
The two are rarely included in discussions of major philanthropists, yet the value of assets in their foundation is approaching $1 billion. It made nearly $50 million in grants in 2017.
Barron Hilton
Signed pledge: 2010
Estimated net worth: less than $1 billion
Giving to foundation: $246 million*
In 2007, the top executive in the famous family’s hotel business said he was putting $1.2 billion into a trust to benefit the Conrad Hilton Foundation, his father’s grant maker. Forbes estimated his wealth at $2.5 billion when he signed the pledge; last year, he didn’t make the magazine’s billionaires list.
* 2017 figures not available
A ‘Low Bar’
A pivotal moment in the history of the Giving Pledge arrived early on when the Gateses and Buffett differed on what they would ask of their fellow billionaires.
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Bill and Melinda Gates contemplated launching the Giving Pledge with four pillars: Give big. Give smart. Give now. Give to inequities.
Buffett demurred.
“I don’t like being preached to. I don’t like to preach to others,” Buffett said, according to Jeff Raikes, who was then CEO of the Gates Foundation.
Buffett prevailed. The goal of the pledge became simply to promote more giving. Bill Gates described the 50 percent threshold as a “low bar” to encourage participation.
It’s hard to judge how that has worked out. No one set numerical goals for the Giving Pledge. The Gateses and Buffett have worked hard to make it a success, traveling the world to personally recruit new donors.
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“Bill Gates was after me for a couple of years to join,” recalls Denny Sanford, a South Dakota-based credit-card mogul who decided long ago to give nearly away all of his $2.6 billion fortune. (His motto: “Aspire to inspire before you expire.”) Sanford signed the pledge after Gates assured him that he, too, would give away the vast majority of his wealth.
Like Sanford, many who signed on during the early years of the pledge were older, well-known philanthropists who had already given away vast sums. Michael Bloomberg, Eli and Edythe Broad, Mike and Lori Milken, Gordon and Betty Moore, David Rockefeller, and Ted Turner all fall into this group.
Some younger signatories, too, were simply formalizing existing commitments. Soon after eBay went public in 1998, its co-founder Pierre Omidyar and his wife, Pam, publicly said that they “intend to give away the vast majority of our wealth during our lifetime.”
The big-tent approach worked well at first. Some big names came aboard even after the early excitement waned. Salesforce.com founder Marc Benioff and the co-founders of Airbnb — Nathan Blecharczyk, Brian Chesky, and Joe Gebbia — announced they were taking the pledge in 2016. That year, Saudi Prince Alwaleed bin Talal became the first Arab Muslim to sign the pledge, promising to eventually give away his entire fortune.
Still, fewer than one in six billionaires in the United States have taken the pledge.
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Those who have not include the world’s wealthiest man, Jeff Bezos, as well as Google founders Larry Page and Sergey Brin, former Microsoft CEO Steve Ballmer, the children of Walmart founder Sam Walton, and the Koch brothers, all of whom rank among the 20 richest people in the world, according to Forbes.
Neither Oprah Winfrey nor George Soros, who attended the founding dinner in New York, has signed on.
Charlie Munger, Buffett’s longtime partner at Berkshire Hathaway, declined to sign, and while he has been a generous donor to his alma mater, the University of Michigan, he has expressed misgivings about philanthropy. “I believe Costco does more for civilization than the Rockefeller Foundation,” he once said.
Donor Type
QUIET SUPPORTERS
The philanthropy of some pledge members doesn’t get much notice.
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Paul Singer (pictured)
Signed pledge: 2013
Estimated net worth: $3.2 billion
Giving to foundations: $750 million
Giving by this hedge-fund manager includes his donations to two family grant makers and $400 million in gifts from his firm, Elliott Management. The total tops all but that of 10 others in our analysis, including better-known Wall Street philanthropists Bill Ackman and Julian Robertson.
Liz Simons and Mark Heising
Signed pledge: 2016
Estimated net worth: n/a
Giving to foundation: $205 million
The daughter of legendary hedge-fund manager Jim Simons and her husband have quietly established themselves as significant philanthropists. Their foundation, which opened in 2007, saw assets grow nearly fourfold to half a billion dollars.
Success Overseas
The Giving Pledge has arguably had more success spreading the word about philanthropy outside of the United States, where traditions of giving are not as strong. “One of the reasons the Giving Pledge has been so important is that in some countries — in India, in China — we’re starting the discussion about philanthropy,” Melinda Gates has said.
While visiting China, Bill Gates contributed an op-ed about philanthropy to the People’s Daily, an official Communist Party newspaper that does not ordinarily showcase the views of U.S. billionaires.
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A dozen businesspeople from Asia have taken the pledge, including Azim Premji, the founder of the outsourcing company Wipro and the first Indian to sign. Premji has donated $21 billion to charity, putting him in the ranks of the world’s top givers.
“That has ripple effects that are almost impossible to quantify,” says Bridgespan’s Alison Powell. Altogether, about one pledger in five comes from outside the United States.
Shaun Curry/Financial Times-REA/Redux
Azim Premji, one of India’s wealthiest men, is among the 49 people from outside the United States who have signed the Giving Pledge. He has donated $21 billion to charity, putting him in the ranks of the world’s top givers.
The pledge is also inspiring the children and grandchildren of the signatories, according to Katherine Lorenz, the granddaughter of Texas fracking pioneer George Mitchell, who with Howard W. Buffett, Warren’s grandson, is organizing a group of next-generation pledgers.
“The next-gen group has been one of the most important communities that I’ve been a part of,” says Lorenz. “Hands down, the learning sessions have been wonderful.”
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The younger philanthropists tackle such questions as how strictly they should follow the charitable intentions of their elders who signed the pledge. Their conversations could have repercussions for years to come. Lorenz is president of the Cynthia & George Mitchell Foundation, which has more than $250 million in assets, and is very active in philanthropic circles. Howard W. Buffett is a trustee of his father’s Howard G. Buffett Foundation, which has more than $400 million in assets.
Donor Type
GIVING ENIGMAS
Some pledge members are seen as significant philanthropists yet don’t have much of a public track record of giving.
Sara Blakely (pictured)
Signed pledge: 2013
Estimated net worth: $1.1 billion
Giving to foundation: $12 million*
Blakely gives to the foundation for her apparel company, Spanx, but personally accounted for less than $150,000 of the contributions from 2011 through 2017. She also hasn’t made a splash publicly with large gifts. When she signed the pledge, she said she was dedicated to growing her business, suggesting significant philanthropy wouldn’t come soon. * 2010 figures not available
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Steve and Jean Case
Signed pledge: 2010
Estimated net worth: $1.3 billion
Giving to foundation: $25 million
The AOL co-founder and his wife have a high philanthropic profile, but their foundation awarded just $8.4 million in grants in 2010-17. In 2017, compensation for the organization’s top executives exceeded the $435,000 it gave away in grants. The Cases say the foundation is just one of their giving vehicles, adding they have donated $300 million altogether to date.
John Paul DeJoria
Signed pledge: 2011
Estimated net worth: $2.5 billion
Giving to foundation: $22 million*
The media lavish praise on the hair-care mogul for his philanthropy, but what he describes as the hub of his giving — his Peace, Love, and Happiness Foundation — is a relatively small operation. It awarded only about $15 million in grants in 2011-17. DeJoria says he put $50 million into it in 2018. * 2010 figures not available
Net Worth Keeps Growing
One thing that can be said definitively about the Giving Pledge: It has done little or nothing to change the distribution of wealth in America, which is highly skewed and becoming more so. In 2018, the net worth of the richest 1 percent of Americans accounted for 31 percent of all household wealth, up from 29 percent in 2010.
“The rise in wealth is far outstripping the amount of giving,” says Rob Reich, a Stanford professor and scholar of philanthropy. Those who signed the pledge appear to be well intentioned, he says, but “they are going to have to ramp up their giving dramatically” to keep their philanthropic promises.
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Consider Bill Gates, one of the most generous donors in history. Gates had a net worth estimated at $53 billion when the Giving Pledge was launched. Today, he’s worth $97 billion.
Buffett, too, has given away vast sums, but his net worth has grown from about $47 billion to $83 billion since the launch. The same is true for Michael Bloomberg, who in recent years has donated more than $8 billion to fight climate change, stop the spread of guns, and provide scholarships to needy students, among other things. His net worth, which stood at $18 billion when he signed the pledge, is now $56 billion.
The Giving Pledge neither obligates nor encourages pledgers to give away their money during their lifetime. That was a sticking point for Charles Feeney, a billionaire who initially declined to sign because he had already given most of his fortune away. “I cannot pledge that which I already had given,” he said. Feeney subsequently signed, in part to challenge other donors to bring a sense of urgency to their philanthropy.
“I urge those who are taking up the Giving Pledge example to invest substantially in philanthropic causes soon and not postpone their giving or personal engagement,” he wrote in his pledge letter. Feeney has practiced what he preached: He has given away nearly all of his $8 billion fortune to support higher education, public health, and scientific research.
Some have responded to Feeney’s challenge. Since 2010, John and Laura Arnold have given about $1.5 billion to their foundation, now called Arnold Ventures, which works in four areas: criminal justice, education, health, and public finance. Boston investor Seth Klarman and his wife, Beth, have contributed more than $700 million to their foundation, which gives to medical research and nonprofits that seek to strengthen democracy.
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The Arnold and Klarman foundations have, in turn, made substantial grants since 2010 — more than $1 billion in the case of Arnold Ventures and nearly $300 million from the Klarman foundation.
Others who took the pledge would appear to be in less of a hurry to share their wealth, public records indicate. Technology pioneers Steve and Jean Case have been visible advocates for philanthropy and impact investing — but the donations they have disclosed publicly have been relatively small. The Case Foundation has awarded just $8.4 million in grants from 2010 to 2017. In 2017, the last year for which a tax return is available, the grant maker paid out more in staff salaries than it gave to charities.
Steve and Jean Case told the Chronicle in an email that they are on track to meet their promise: “We do not publicize many of our efforts. … We have donated over $300 million to date, with the Case Foundation as just one of the tools we use to invest in people and ideas that are changing the world. In addition, we have put estate plans in place that solidify our Giving Pledge commitment.”
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John Paul DeJoria, the founder of Patrón and John Paul Mitchell Systems, is another whose pace of giving has apparently been slow. He has contributed just $22 million since 2010 to his Peace, Love and Happiness Foundation, public records show. But DeJoria says he put another $50 million into the foundation when he sold Patrón and that he has made numerous donations out of his own pocket. His net worth is estimated to be $2.6 billion.
The Richest Americans Who Haven’t Signed the Giving Pledge
Jeff Bezos
Michael Dell
Larry Page
Phil Knight
Charles Koch
Jacqueline Mars
David Koch
John Mars
Sergey Brin
Rupert Murdoch
Jim Walton
Laurene Powell Jobs
Alice Walton
Len Blavatnik
Rob Walton
Thomas Peterffy
Steve Ballmer
Donald Bren
Sheldon Adelson
Abigail Johnson
Source: Forbes Billionaires List
Then there’s Nick Hanauer, a Seattle investor who has made a name for himself as an outspoken critic of inequality, which he says is “at historically high levels and getting worse every day.” Yet Hanauer and his wife, Leslie, gave just $16.6 million to their family foundation from 2010 to 2017, the latest years for which data is available.
They have donated to progressive policy groups, but the biggest recipient of their charity has been the Seattle Academy of Arts and Sciences, a private school that their children have attended, to which the foundation gave more than $5 million in the past five years.
By email, Hanauer said that “only a small proportion of our giving is through the foundation” and that their giving is focused on policy and politics, supporting such issues as gun control and a $15 minimum wage. “I think our giving approaches $80 million over the past 10 years or so,” he wrote.
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While those who take the pledge can satisfy it through their bequests, some have not. In 2015, Bloomberg News reviewed the estates of 10 deceased signatories. It could identify only two who had given away more than $1 billion. Others may have given away large sums anonymously.
Donor Type
LOYAL ALUMS AND PARENTS
These pledge members favor schools and colleges where they have family ties.
Jonathan Nelson
Signed pledge: 2012
Estimated net worth: $1.8 billion
Giving to foundation: $21 million
Nearly three-quarters of the $27 million in grants awarded by his foundation in 2010-17 went to Brown U., where he graduated in 1977, much of it to pay for the Jonathan M. Nelson Fitness Center and the Jonathan M. Nelson Center for Entrepreneurship.
John “Jay” Jordan
Signed pledge: 2015
Estimated net worth: less than $1 billion
Giving to foundation: $6.7 million
After his $75 million gift to Notre Dame in 2014, officials noted that Jordan, a 1969 graduate, had donated $150 million to the university in his lifetime. By contrast, the Chicago business executive and investor contributed less than $7 million in 2010-17 to his foundation, which supports programs that help disadvantaged children participate in sports.
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Nick and Leslie Hanauer
Signed pledge: 2017
Estimated net worth: less than $1 billion
Giving to foundation: $17 million
In the past five years, the Seattle-area venture capitalist and his wife gave away about $5 million through their foundation to a private school where they have children enrolled — more than 40 percent of their grant making during that time.
Transparency Concerns
Many who sign the Giving Pledge choose to be extremely private about their giving; their websites, if they exist at all, say little or nothing, and they are hard to reach by email or phone. Many won’t accept unsolicited ideas or proposals from nonprofits.
The Chronicle contacted more than 70 U.S. pledgers and requested interviews from nearly 30 of them.
Most did not respond. Four agreed to talk by phone, and a handful answered questions by email.
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This absence of transparency is a problem, critics say.
“It’s a great first step to get people to commit publicly to giving,” says Phil Buchanan, chief executive of the Center for Effective Philanthropy and author of a new book, Giving Done Right. “A great second step would be to get them to be more specific and clear.”
Donor Type
PLEDGE MEMBERS TO WATCH
A few pledge members appear poised to do some big giving.
Patrick Soon-Shiong and Michele Chan (pictured)
Signed pledge: 2010
Estimated net worth: $7 billion
Giving to foundation: $287 million
They made the bulk of their foundation giving — $206 million — in 2015. Annual grant outlays climbed from $1 million in 2011 to $12 million in 2017.
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Elon Musk
Signed pledge: 2012
Estimated net worth: $22 billion
Giving to foundation: $258 million
In 2016, the Tesla co-founder made his first significant gift — $255 million — to his foundation since its 2002 launch. Grant making shot up from a few thousand in 2016 to $48 million in 2017, though $38 million went to Vanguard Charitable, presumably to a donor-advised fund.
John and Ann Doerr
Signed pledge: 2010
Estimated net worth: $6.9 billion
Giving to foundation: $51 million
Assets in their Benificus Foundation nearly quadrupled from 2010 to ’17, with grant awards reaching $19 million — the highest level in almost a decade.
Charlie and Candy Ergen
Signed pledge: 2018
Estimated net worth: $9.6 billion
Giving to foundation: $200 million
These newcomers to the pledge are among the group’s wealthiest. The couple started their Telluray Foundation in 2005 but put in only a few million before 2015, when they contributed nearly $200 million. Their grant making is growing quickly.
Feel-Good Opportunity
Because so little is known about the Giving Pledge, the entire enterprise runs the risk of looking like little more than a feel-good opportunity for billionaires, albeit one with the best of intentions.
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Brad Smith, chief executive of Candid, says that greater transparency would add tangible value to the Giving Pledge. It would help build trust in big-time philanthropy because outsiders could see clearly how the wealthy are giving back to society. It would enable big and small donors alike to learn from one another. “They should tell the story of what they do and why they do it,” he says.
Arguably, because Giving Pledge donors receive substantial tax benefits, they have a moral obligation to say more than they do about how they are serving the public good.
Without knowing a lot more about the Giving Pledge, though, it remains hard to say just how well it is serving the public good. It is clearly making a difference. Just how much is anybody’s guess.
Drew Lindsay and Maria Di Mento provided research for this article.