If there’s one thing Wall Street titans were more devoted to than arranging shaky loans and risky deals, it was charity. After all, what better way for traders and i-bankers to convince people that they’re not snorting cocaine off of naked hookers in their free time?
But seriously, many charities relied heavily on donations and other forms of support from now-collapsed Wall Street banks and formerly wealthy moguls suffering massive losses this year.
NY Observer: The Wall Street Journal reports that many of the big names usually associated with the tops of donor lists and newly dedicated museum wings are cutting back on their charitable donations this year–including the Bill & Melinda Gates Foundation, David Koch of manufacturing giant Koch Industries, casino magnate Sheldon Adelson, and former AIG head Maurice “Hank” Greenberg.
According to the piece, the downturn has come at a particularly bad time for the charity circuit, which depends on large infusions of holiday season cash to get through the year. Surprisingly, it seems that rates of giving are usually resistant to economic strain. But this year is going to be different, and it’s not really a matter of choice on behalf of the donors: Collapsed banks Bear Stearns, Lehman Brothers, and Merrill Lynch were all known to have given generously (not to mention decimated mortgage companies Fannie Mae and Freddie Mac).
The aforementioned Mr. Greenberg, who is a major supporter of the Harlem Children’s Zone, admitted that “anyone with a foundation whose endowment is heavily invested in AIG stock is taking a bath,” referring to the insurance company’s recent well-publicised troubles. Meanwhile, the assets of Mr. Greenberg’s personal foundations have declined sharply, with his family foundation losing $43.7 of its $47.7 million over the last year; his Starr foundation’s coffers dropped from $3 billion to $1.5 billion. Mr. Adelson has lost around $30 billion in the past year, and plans to cut his slash his usual $67 million donation to the Israel Birthright Foundation down to $20 million.
In fact, some people are even saying that donations are so sparse that a number of charities may have to shut down.
Want to do your part (in a very focused, “make up for Wall Street” way)? According to New York magazine, these nine charities were particularly dependent on Wall Street dollars.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.