A “behemoth of benefaction” is how my colleague Geoff Colvin describes Bill Gates’ philanthropic organization, the Gates Foundation. And indeed, it’s the largest private foundation in the world, built upon the staggering wealth Gates created at Microsoft, along with some $40 billion pitched in by his friend and fellow philanthropist, the investor Warren Buffett. Having spent an average of $5 billion a year for 25 years, Gates today promised the foundation will spend another $10 billion a year until 2045, the largest philanthropic commitment in modern history—at which point it will shut down its operations.
Those mind-boggling sums look small, however, in comparison with the annual largesse of another group: Americans as a whole. American individuals, corporations, and foundations reported a total of $557 billion in charitable donations in 2023, according to data compiled by the Giving USA Foundation—with $417 billion of that coming from individuals via donations or bequests. “The U.S. is a very generous nation,” the organization’s chair, Wendy McGrady, told me (and indeed, the World Giving Index has consistently listed it as one of the most generous countries). “We have a very philanthropically minded citizenry.”
That $557 billion, she pointed out, only includes reported monetary gifts to registered nonprofits (which, to be sure, is a category that encompasses some entities that are not strictly charities, such as universities and ideologically driven organizations). “It doesn’t include things like counter boxes, crowdfunding, giving to neighbors, or for funeral expenses, for example,” McGrady added. Nor does it include volunteering.
This scale of generosity might sound reassuring, especially as the Trump administration dismantles the United States’ international aid infrastructure and chops domestic spending on programs for vulnerable people. But there’s no way that donations can make up for such major cutbacks, warned Una Osili, a scholar of philanthropy and social innovation. “Philanthropy can play a role,” she said, “but obviously cannot fill the gap of the government aid.” Since many nongovernmental organizations rely on government funding or work alongside government programs, the federal cuts are wreaking havoc in the sector.
“With any change this drastic, there is the immediate short-term question, how do these organizations continue their lifesaving humanitarian work?” Osili, the associate dean for research and international programs at the Lilly Family School of Philanthropy, told me. “There’s also this medium- to long-term effect, and not just here in the U.S., but overseas: What does this development paradigm look like, with less government aid? Is this just a smaller sector, a different type of sector?”
And as with any moment of change, there may also be opportunity for improvement, Osili said. “Is there a chance to reshape how we approach this work, with a lot of the debates that were taking place prior to this particular cycle?” she asked. “You know, how can the sector be more effective, more efficient?”
American giving in flux
The world of philanthropy has been undergoing a slew of major changes, all while nongovernmental organizations are staring down the same economic uncertainty that companies and individuals are increasingly nervous about. “Giving, just like the economy, does not like recessions,” McGrady said.
Indeed, individual giving has still not recovered from the Great Recession. Even though overall giving has grown slightly, some 20 million households dropped out of charitable giving between 2010 and 2016, reported the Generosity Commission, a nonpartisan group of NGO leaders, in a 2024 report: “In short, the numbers of dollars and hours have gone up, but the number of donors has gone down.” They attributed this drop to “middle-class precarity” as well as “a rise in social isolation and a decline in social trust.” Then, of course, the COVID-19 pandemic accelerated polarization and distrust in institutions.
Meanwhile, at the top end of philanthropy, Gates is not the only corporate titan turned megadonor to signal that his generosity will, eventually, come to an end: Warren Buffett has said he will transfer 99% of his $170 billion estate to philanthropic causes before his death, at which point his donations will stop. Meta’s Mark Zuckerberg and his wife, Priscilla Chan, have pledged to give away most of their company stock while they’re still living.
“Spend down” foundations that plan to “sunset” their giving are becoming increasingly common. It’s a departure from the model that the captains of industry of yore—the Carnegies, Rockefellers, and Fords, for example—favored, of foundations meant to stand in perpetuity, delivering value for generation after generation.
Today’s ultrawealthy philanthropists, especially those who have led successful businesses or whose fortunes came from tech, tend to be less interested in museum wings or cultural institutions named after them. Having come from the business world, where speed and scale are the priorities, they tend to be eager to get things done in the present, Osili explained. Gates’ plans to blitz through $200 billion dollars and knock out several deadly diseases over the next two decades is arguably the case in point.
As business leaders, “many of them have, of course, been involved in solving problems, and they’ve achieved their success by actually seeing the results quickly,” Osili said. “So there’s some prioritization of results that one can measure and track in the present time.”
What kind of results are they looking for? Some prominent philanthropists have aligned themselves with particular causes—Gates with reducing global child mortality, for instance, or Mark Zuckerberg and Priscilla Chan to education and science. But the causes that the ultrawealthy are donating to can be opaque, as more opt to give via donor-advised funds, charitable LLCs, family foundations, and advocacy organizations, or to pour their funds into impact investing. Without the public reporting requirements of tax-exempt organizations, these allow donors to keep the specifics of their transactions private.
Nobody knows this better than Maria Di Mento, a senior reporter at The Chronicle of Philanthropy who has for 20 years chased down publicly available information about high-level giving to compile the “Philanthropy 50” list of the nation’s biggest donors. The causes that these philanthropists give to tend to remain consistent year after year, she said, though there was a temporary uptick in giving to social justice causes during the COVID-19 pandemic and following the murder of George Floyd in 2020. “We’re in a slightly different era now,” she said. “It’s not like it has gone away, but it doesn’t seem to be top of mind as it was then.”
Green shoots in philanthropy
Large-scale, Gates Foundation–style philanthropy has drawn the most attention in recent years—both positive and negative, with critics from both the left and the right deriding “billionaire philanthropy.” But with the Great Wealth Transfer well underway, and new fortunes being built across the world, the culture of philanthropy is bound to change. Whether the next generation of philanthropists can accomplish the grand feats of their predecessors is a question upon which millions of lives now depend.
Two quite different schools of thought have risen in philanthropy in recent years, which seem at first to contradict each other. One, known as effective altruism, zeroes in on data to identify the most effective ways to leverage donations for positive impact, with a strong focus on measurable results. (The movement took a major hit when one of its most visible proponents, the cryptocurrency exchange CEO Sam Bankman-Fried, was arrested and convicted for multibillion-dollar financial fraud.) The other philosophy, favored by philanthropist MacKenzie Scott and the organization GiveDirectly, holds that unrestricted giving—with no strings attached or requirements to prove results—allows people and in-the-trenches organizations the autonomy to spend the money as they see fit, based on their own experience and knowledge.
But these approaches aren’t as distant from each other as they might seem, Osili explained—and in fact a combination of a data-driven approach with some trust in aid recipients may be the best way forward for philanthropists. “There’s a debate about whether these two can coexist, and the answer I would give is actually, yes,” she said. “The idea is: Do the due diligence upfront … but then once you have made the investment, try to think about centering the organization and the work they’re doing, rather than the donor.”
McGrady agreed: “You’ve got to have metrics; you’ve got to have impact numbers,” she said. “But you’ve also got to have an understanding that this work is nuanced, and the outcomes are not always quantifiable.”
A call for collectivism
It remains to be seen how the American public will react at the ballot box to the dramatic cuts to foreign aid and domestic programs that the Trump administration is carrying out—and it’s possible that some of the funding will be restored, sooner or later. In an interview with Fortune about his plans for the Gates Foundation, Bill Gates suggested that there’s a disconnect between perception and reality when it comes to government spending on international aid: “Many people think aid budgets are much higher than [they are],” he said. “And when you say to them, ‘What do [you] think it should be?’ They’ll be like, ‘I think it should be 2%, not 5%.’ And we’re like, ‘Well, we have good news for you. Even before the cuts, it was less than 1%. So, you know—stick up for child survival!’”
Americans are still sticking up for a range of causes they believe in. As McGrady points out, Americans have historically been generous—whether giving at their church to earthquake relief efforts in a far-off land, or donating to a nearby center for transgender youth—and while this year’s figures are not yet available, there’s no reason to think they have changed dramatically. The nation’s philanthropic giving has stayed mostly stable—at about 2% of GDP—for the 69 years Giving USA has been tracking it.
Even as the pandemic created economic and social precarity and increased distrust in institutions, Osili pointed out, it also showed the power of thoughtfully applied philanthropy—from efforts to get tablets for kids attending school remotely to vaccination drives—and for some in the sector, that was energizing. “This is not just the billionaire philanthropists; it was people setting up community fridges,” she said. “We saw why we have a ‘third sector’—not just markets and government, but the innovation, the speed, the agility, the flexibility that a private donor has.”
There’s ideological common ground to be found in philanthropy, Osili said. “What is interesting from our data is when you look at all of the institutions together, private philanthropy is trusted more than any other institutional type,” she noted. Local organizations, in particular, seem to be a rare place of mutual understanding, she added. “Because you may be a Republican, you may be a strong Democrat, but you both care about a park for your children to play in, right?”
That offers some reason for optimism, McGrady believes. Even a massive gift like Bill Gates’ $10 billion a year to reduce childhood mortality and eradicate deadly diseases can’t plug the gaping hole left by the pullbacks in government spending. (In January, before the cuts, the U.S. was projected to spend $58.4 billion on international assistance programs in the 2025 fiscal year, for example.)
So maybe, she suggested, it’s time for the rest of us to dig a little deeper for the causes we care about most. “Could this be the year that Americans rise up and say, ‘Philanthropy is the difference maker, and we’re going to give more this year’?” she asked. “We can’t do it with just foundations, and we know individuals are still the primary drivers of philanthropy in this country—so it’s going to have to be all of us, not just the wealthy.”
This story was originally featured on Fortune.com
