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Sunday, September 26, 2010

The $100 Million Status Symbol

The $100 Million Status Symbol
by Rebecca Dana
September 23, 2010 | 10:54pm
BS Top - Dana 100 Million Mark Zuckerberg is donating millions of dollars to the NJ school system. Credit: Justin Sullivan / Getty Images From Zuckerberg to Koch to Gordon Gekko, $100 million has become the figure du jour for jaw-dropping philanthropy. Rebecca Dana on the sudden raft of nine digit newsmakers.

What do you get for $100 million these days?

If you’re the Newark Municipal School District, beneficiaries of a gift in that amount from Facebook founder Mark Zuckerberg, you may finally get to claw your way up from the lowest ranks of the public-school system.
If you’re Zuckerberg himself, that money will buy you a news cycle, a turn on Oprah’s couch and a torrent of good press coverage, coinciding with the release of a fictionalized movie about your life, which you reportedly hate.

If you’re Gordon Gekko, on the other hand, resurrected this weekend in Oliver Stone’s Wall Street 2, that’s precisely the amount you’ve managed to squirrel away in Swiss banks. It can buy your professional comeback—or help your bleeding-heart-liberal blogger daughter realize her alternative-energy dreams.
It used to be $1 million was enough to induce gasps in a banquet hall. These days, just a seat on the board of the Met costs a cool $10 million, and to really drop jaws—as Zuckerberg did Thursday with a carefully placed story in The Wall Street Journal previewing his new education initiative, which he’s set to officially announce Friday on The Oprah Winfrey Show—you’ve got to hit nine digits.
The first $100 million gift in modern history was awarded in 1966, by businessman James A. Chapman to a variety of education institutions. Giving at that level shot up in the last decade, led by awards from the Bill and Melinda Gates Foundation in 2001 to combat AIDS and a pair of donations in 2002 from pharmaceutical heiress Ruth Lilly to her family endowment and the Modern Poetry Association.
“But it’s still quite exceptionally rare,” said Patrick Rooney, director of research at the Center on Philanthropy at Indiana University. “It is sort of a mind-boggling and attention-grabbing number. At that level, the media is willing to pay attention.”
“What is clearly striking here is that he’s making such a large donation at such a young age,” said Francie Ostrower, a professor of public affairs at the University of Texas and the author of Why the Wealthy Give. “Would people be writing about him if it were $50 million?”
Insider: Zuckerberg Wanted to Delay $100 Million DonationYes, certainly, given that people write about Zuckerberg, worth an estimated $7 billion, when he ventures into the men’s room. But if the donation were just $50 million, who could have helped but notice that his gift, while enormous, paled in comparison to other recent examples of philanthropic largesse?
The first $100 million gift in modern history was awarded in 1966, by businessman James A. Chapman.
In September, billionaire George Soros gave $100 million to Human Rights Watch, earning a story in The New York Times. In August, Saudi Arabia promised $100 million to help Pakistani flood victims, a donation that made headlines worldwide because it beat the United States’ promised $76 million. Last year, the Gates foundation awarded $100 million to Tampa’s Hillsborough County School District to fix its system for training and evaluating teachers.
The last few years have seen a raft of high-profile $100 million donations. In 2008, billionaire Tea Party enthusiast David Koch gave $100 million to renovate the New York State Theater at Lincoln Center, which now bears his name. That same year, Wall Street financier Stephen Schwarzman gave that much to the New York Public Library, which now bears his.
But why $100 million? Why not, say, $97.5 million, as the Orthodontic Education Community gave the University of Colorado School of Dentistry in 2003?
“At the most elementary level, we all do this. We all round up,” said Eugene Steuerle, an economist at the Urban Institute who has studied charitable giving patterns of the wealthy. “You want it to be large enough so that people can’t dodge what you’re trying to achieve.”
And it’s not just the status figure du jour in philanthropic circles—$100 million is now the going rate for a certain kind of tabloid dignity. People cheered at early, incorrect reports that Elin Nordegren’s divorce settlement from her philandering golfer husband Tiger Woods netted her $100 million. This week, Lindsay Lohan withdrew a $100 million lawsuit she filed against online brokerage firm E-Trade, claiming they defamed her in a Super Bowl ad that featured a “milkaholic” talking baby named Lindsay. The troubled starlet, currently back in jail, reached an undisclosed settlement with the company, presumably valued much lower than her initial asking price.
In the territory of scandals, $100 million feels like the ultimate affront to decency. In the winter, bankers were spreading rumors around Davos that Goldman Sachs CEO Lloyd Blankfein would take home that much in salary and bonus this year. At the height of the Gulf oil spill, BP executives estimated the company was spending $100 million per day on cleanup and containment efforts. In the scramble to pass health-care reform late last year, ABC News reported that a single congressional vote, that of Louisiana senator Mary Landrieu, had cost $100 million in pork funneled to her state. And just this spring, a thief waltzed out of Paris’ Museum of Modern Art with five paintings, including a Picasso and a Matisse, valued at an estimated… you guessed it.
Zuckerberg’s donation comes less amid scandal than personal nuisance: the pre-release hype for Aaron Sorkin’s The Social Network, a fictionalized account of his time at Harvard and the founding of Facebook, which is already drawing raves from reviewers. Zuckerberg’s visit with Oprah will air just hours before the movie premieres at the New York Film Festival, a week before its wide release.
With his gift to New Jersey schools, Zuckerberg joined the ranks of Soros and Gates—and beat the movie to a big $100 million announcement. But if the critical praise is any indication, The Social Network is headed for the ranks of Twilight: New Moon and Iron Man 2, which hit the current box-office benchmark for a big-screen hit: $100 million on opening weekend.
Rebecca Dana is a senior correspondent for The Daily Beast. A former editor and reporter for The Wall Street Journal, she has also written for The New York Times, The New York Observer, Rolling Stone, and Slate, among other publications.


The $100 Million Status Symbol

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