Dying rich – a disgrace? What philanthropists do for a free society

10.10.2026

Autor: Tobias O. R. Alke · mit Claude (Anthropic)

A standpoint, not an encyclopedia entry. This article is an expressly subjective statement, dated 2026. The neutral background knowledge is in the encyclopedia entry Responsibility.

Quotations from Steffen Sigmund and the German Federal Criminal Police Office are given in the original German, the one from Marcel Mauss in the original French, each followed by our own translation (“our translation”).

Andrew Carnegie wrote in 1889: “The man who dies thus rich dies disgraced.” The disgrace falls on the person who hoards a great fortune instead of using it for others during his lifetime – not on wealth itself. Founders of foundations turn wealth earned in the market into institutions that work independently for the common good. Our view: voluntary endowment is a gift. Whoever earned a fortune decides about it and about passing it on – and a family foundation can combine Carnegie’s concern about heirs who have achieved nothing themselves with this freedom.

What did Carnegie mean by “dying rich is a disgrace”?

The meaning rests on one small word: thus. It refers to whoever leaves behind millions “which was his to administer during life” – wealth he could have administered and put to use in his lifetime (Carnegie 1889: 664). The widespread German rendering drops this “thus”, for instance in the motto in Steffen Sigmund (2000: 333). Without the word, the sentence sounds like contempt for wealth. The opposite is meant.

Carnegie calls “Individualism, Private Property, the Law of Accumulation of Wealth, and the Law of Competition” the “highest results of the human experience” (1889: 657). The wealthy man should live modestly, provide moderately for his own (661) and administer the surplus as a trustee – as “the mere agent and trustee for his poorer brethren” (662). He rejects indiscriminate alms; he wants to help those “who will help themselves” (663).

In the first edition of our book on altruism (2017) we adopted the sentence without “thus” and read it as praise of poverty. That was wrong: Carnegie does not demand poverty but active giving during one’s lifetime.

What should heirs receive?

Carnegie asks: “Why should men leave great fortunes to their children? If this is done from affection, is it not misguided affection?” Wife and daughters should receive “moderate sources of income”, the sons “very moderate allowances indeed, if any” – for “great sums bequeathed oftener work more for the injury than for the good of the recipients” (1889: 658). A living sufficient for the family’s maintenance and education he calls “not wealth, but only competence” (657). So he wanted to disinherit no one; what he did not want was to bequeath great fortunes.

The motive holds. Whoever merely inherits a fortune without building anything himself often lacks a sense of responsibility for it. It is the same thought as in the old saying: give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime. That applies within the family too.

But the testator decides. What happens to an estate is for the person who earned the wealth to decide – not the state. A fortune passed on as a business is, moreover, not idle wealth but a means of earning a living. Carnegie’s criticism targets the idle great fortune, not the craft business or the family firm.

Our guiding model is the family foundation. It secures a basic income for the family, may within a defined framework also be used beyond that, and always remains committed to the family’s welfare. In this way it combines Carnegie’s concern, the testator’s freedom and the cohesion of the family. (This is a guiding model, not legal or tax advice.)

Carnegie’s distinction between daughters and sons no longer holds today. In 1889 women had hardly any opportunities to earn their own living. Today, how inherited means are handled is not a question of sex: responsibility and waste are found among heirs and heiresses alike.

One observation belongs here for us: where inherited means finance campaigns against a “capitalism” that does not even exist as a free market in a thoroughly regulated economy, the ancestors’ success is turned against the order in which it arose. What is being fought as the market there is, in our view, often the result of state steering – more on this in the standpoint Who really exploits – state or market?.

Why do successful entrepreneurs set up foundations?

The sociologist Steffen Sigmund often describes founders of foundations as „kreative Zerstörer“ (our translation: “creative destroyers”) who owe their economic success to innovative, unconventional action (2008: 95). Endowing, then, presupposes earning. Sigmund calls the founder a boundary crosser (Grenzgänger): he mediates between economy, culture and community, and his action moves „zwischen altruistischen Absichten und dem Wunsch nach symbolischer Anerkennung“ (2001: 215; our translation: “between altruistic intentions and the wish for symbolic recognition”).

One example is the Hamburg entrepreneur Kurt A. Körber. According to Sigmund, he wanted „innerhalb der Gesellschaft das ethische Pflichtgefühl zur stärksten Säule der Marktwirtschaft aufzurichten“ (2001: 228; our translation: “to raise, within society, the ethical sense of duty into the strongest pillar of the market economy”), without which a free community could not endure. That is exactly how we understand endowing: as responsibility that grows out of free earning.

Research on giving knows many motives side by side. Bekkers and Wiepking (2011) group them into eight mechanisms, among them altruism, reputation and one’s own values.

What makes a foundation independent?

Endowment foundations live on the returns of a capital stock. Foundations funded from ongoing income, by contrast, depend „ständig vom Stifter und dessen Kapitalzuflüssen“ (Sigmund 2004: 104; our translation: “constantly on the founder and his inflows of capital”). Sigmund regards the foundation under private law as „die autonomste Organisation …, die das deutsche Recht kennt“ (ibid.; our translation: “the most autonomous organisation … known to German law”); the state exercises only legal supervision (ibid.). Between the state and the voluntary associations Sigmund sees „ein, teilweise konfligierendes, Kooperationsverhältnis“ (2008: 90; our translation: “a cooperative relationship, partly a conflicting one”) – not a permanent conflict.

Our conclusion: independence arises from property. Whoever wants independent foundations cannot despise the earning from which they emerge. To be distinguished from them are organisations that live predominantly on tax money – see the encyclopedia entry NGOs and advocacy (in German).

Is giving worth less if the giver receives recognition?

Newman and Cain (2014: 648) demonstrated a strange effect: someone who does good and benefits from it himself is rated worse, when judged on his own, than someone who does no good at all. They call this tainted altruism. If both cases are seen side by side, the effect disappears; then they are rated equally (650). The finding was confirmed in a pre-registered study (Alcala et al. 2022).

Sigmund states: „Das Reziprozitätsprinzip ist konstitutiv für das Stiften“ (2008: 94; our translation: “The principle of reciprocity is constitutive of endowing”). Endowing can also secure status and has „nicht per se und ausschließlich solidaritätsfördernde Motive und Wirkungen“ (2004: 101; our translation: “not per se and exclusively solidarity-promoting motives and effects”). Visible giving earns reputation (Van Vugt & Hardy 2010).

For us, honour and benefaction do not exclude each other – they keep each other alive. Marcel Mauss already described the gift as something that confers standing and expects a return (see The Gift (Mauss) and Reciprocity).

Give voluntarily or redistribute by law?

Our thesis: free exchange is individualistic, and it is the foundation of altruism. Voluntary endowment is a gift; an inheritance tax is allocation by the state. We therefore reject inheritance tax on principle – not least because tax money in the hands of professional politics is too often used neither responsibly nor to the purpose. There is evidence for this: in the main volume of its 2025 Observations, Germany’s Federal Court of Audit (Bundesrechnungshof) records 22 individual cases, among them the expansion of seven locks on the Moselle for 855 million euros, which it considers neither necessary nor economical; the German Taxpayers’ Association (Bund der Steuerzahler) documents a further 100 cases in its 2025/26 Black Book (Schwarzbuch).

This is not a peculiarly German problem but one of public purses in general. The European Court of Auditors has, for the sixth year in a row, not confirmed the EU’s 2024 spending without reservation; the estimated error rate was 3.6 per cent, and 5.7 per cent for cohesion funds. In the USA, Congress’s audit office, the Government Accountability Office (GAO), put the federal government’s improper payments in fiscal year 2025 at around 186 billion dollars and the annual losses from fraud at 233 to 521 billion dollars; the Department of Defense failed its full financial audit at the end of 2025 for the eighth time in a row. Of the US coronavirus economic aid, the Inspector General of the responsible agency considers over 200 billion dollars possibly obtained by fraud; the agency itself puts the figure at around 36 billion. Where a great deal of money is handed out quickly and without cross-checks, it seeps away – whatever the country.

On corruption the picture is less clear-cut. In 2024 Germany’s Federal Criminal Police Office (Bundeskriminalamt, BKA) registered only 2,926 corruption offences, with established damage of 36 million euros; two thirds of those bribed were public officials. The office itself infers an „erhebliches Dunkelfeld“ (our translation: “considerable dark figure”, i.e. many unreported cases), because legal procedures are misused for illegal purposes. For the EU as a whole, the European Parliamentary Research Service estimates the loss from corruption, including its indirect consequences, at 179 to 990 billion euros a year (EPRS 2017: 7). In the international comparison of perceived corruption, Germany ranks 10th with 77 out of 100 points (Transparency International 2025). That corruption can be not only punishable but also legal was shown by the mask deals of 2020: according to the Federal Court of Justice (2022), commissions that members of parliament received for them were not punishable as bribery; only since 2024 has a new criminal offence (§ 108f of the German Criminal Code) closed this gap. How much tax money is lost to corruption in Germany is therefore known to no one exactly. For us, that is precisely the point: money whose whereabouts cannot be traced does not belong in a purse without accountability. Our criticism is directed at power without accountability, not at individual persons or parties.

The counter-positions stand openly alongside. Carnegie himself wanted hoarded great fortunes to be heavily taxed: “By taxing estates heavily at death the State marks its condemnation of the selfish millionaire’s unworthy life” (1889: 659). Marcel Mauss wished that the rich would come to see themselves as treasurers of their fellow citizens – „librement et aussi forcément“ (our translation: “freely and also by compulsion”), with laws on the ancient model (Mauss 1925: 165). Both share our conviction that wealth carries obligations. We part ways on the path: responsibility that is enforced is responsibility no longer.

More background: Responsibility · Community that strengthens us · Tauschen statt Schenken – und das Moment der Eigeninitiative (in German: exchanging instead of giving, and the moment of personal initiative)