In attendance were many people from organisations featured in Philanthrocapitalism, including New Profit Inc, Ashoka, Echoing Green, the Skoll Foundation, Harlem Children’s Zone, Robin Hood Foundation, KIPP Schools, Bridgespan Group, City Year, Salesforce Foundation, Sea Change Capital Partners, meetup.org, Nurse Family Partnership, Atlantic Philanthropies, Edna McConnell Clark Foundation, WalMart, the Gap, the Ford Foundation, the Gates Foundation and so on.

As President Obama made clear, he has been thinking about this challenge for a long time – at least since a conference he was at with, among others, New Profit’s Vanessa Kirsch 15 years ago. “Government can’t do everything and be everywhere – nor should it be,” he said. “If anyone out there is waiting for government to solve all their problems, they’re going to be disappointed. Because ultimately, the best solutions don’t come from the top-down, not from Washington; they come from the bottom-up in each and everyone one of our communities.”

“The bottom line is clear: Solutions to America’s challenges are being developed every day at the grass roots — and government shouldn’t be supplanting those efforts, it should be supporting those efforts,” the president continued. “Instead of wasting taxpayer money on programs that are obsolete or ineffective, government should be seeking out creative, results-oriented programs like the ones here today and helping them replicate their efforts across America.” Hear, hear!

Melody Barnes has been appointed to run the Innovation Fund, which will be used to scale up the best non-profit ideas. This has much in common with the $650m “What Works Fund” launched by another longtime partner of philanthrocapitalism, Arne Duncan, the education secretary. Encouragingly, given the danger that money in this sort of initiative can end up being misdirected by the political process, President Obama said that decisions on which are the best non-profits will be fact based: “We’ll examine their data and rigorously evaluate their outcomes. We’ll invest in those with the best results that are most likely to provide a good return on our taxpayer dollars.”

Most encouragingly of all, the intention is to get a second-opinion from the private-sector before taxpayer money is invested – a second opinion that must put its money where its mouth is. The Innovation Fund will require that non-profits “get matching investments from the private sector – from businesses and foundations and philanthropists – to make those taxpayer dollars go even further.”

As we argue in Philanthrocapitalism, to solve the pressing problems facing the world today, a new partnership is needed between the government, business, non-profits and philanthropy. But this new partnership will not work well if it is just a cosy huddle with everyone trying to do everything. There must be a new division of labour, in which each of government, business, non-profits and philanthropy do what they can do best, and get out of what they do not do well.

The encouraging thing about President Obama’s announcement today is that he clearly gets it: “All of this represents a new kind of partnership between government and the non-profit sector. But I can tell you right now, that partnership isn’t complete, and it won’t be successful, without help from the private sector. And that’s why I’m glad that there are some deep pockets in the audience here – foundations, corporations, and individuals. You need to be part of this effort, as well. And that’s my challenge to the private sector today.

“Our non-profits can provide the solutions. Our government can rigorously evaluate these solutions and invest limited taxpayer dollars in ones that work. But we need those of you from the private sector to step up, as well. We need you to provide that critical seed capital to launch these ideas. We need you to provide those matching funds to help them grow. And we need you to serve as a partner, providing strategic advice and other resources to help them succeed.”

Of course, implementation is going to be challenging, to say the least. There is not much of a track record of scaling up non-profits to draw on for guidance. And $50m is a drop in the ocean compared to the scale of the problems (and to the federal budget – the fund should be far bigger, or at least be scaled up fast if things go well).

Yet this is a most encouraging first step. Here’s hoping philanthropists respond to the president’s leadership by rising to meet his challenge. After all, as he put it, “If we work together – if we all go all-in here – think about the difference we can make.”

Healy, the eminence grise of Irish philanthropy after a long career at the helm of Chuck Feeney’s Atlantic Philanthropies, felt that Matthew’s call for more, and more thoughtful, philanthropy would certainly have appealed to longtime philanthropy executive Murphy, who died two years ago. We would love to have met Murphy, judging by his famed belief in the inherent goodness of people and his fondness for Guinness.

There seems to be plenty of interest in philanthropy in Ireland, judging by the turnout at the lecture organised by Philanthropy Ireland. That is despite the economic crisis which, one top banker told Matthew, could leave the Irish economy one-sixth smaller than before the crisis began, and which has wiped out the fortunes of some of the erstwhile Celtic Tiger’s new rich.

Ireland was starting to become more philanthropic, but it has a long way to go to catch up with other European countries, such as Britain and Holland, let alone America, pointed out entrepreneur Liavan Mallan in response to Matthew’s lecture. She pointed out that on a per capita basis, Ireland should have around 850 foundations to be equivalent to America; currently it has 26.

Mallan also worried that the bulk of the 85 million euros currently given away annually in Ireland comes from three foundations that together pump out maybe 70m euros a year. These three, which include Atlantic Philanthropies and the One Foundation (established by Declan Ryan, of the RyanAir family), are limited-life foundations, that will go out of business within five years.

We are generally big fans of limited-life foundations, as they tend to involve an engaged founder who wants to ensure the money is well spent, rather than being led by a philanthrocrat with a personal agenda. Yet in this case, there is a danger of a huge hole being left in Irish giving. All the more reason, then, for Ireland’s remaining wealthy to rise to the philanthrocapitalism challenge, and start giving.

Has his growing fortune turned Mr Paulson into a philanthrocapitalist, as we would hope? In an interview with The Economist, he said he has given $15m to help families facing foreclosure to keep their homes, by paying for lawyers to exploit the sloppy documentation that accompanied the often-hurried pooling of subprime mortgages into securities. He said he also supports many other causes, but that to talk about them would “take away the altruism”. Really?

Ironically, a billionaire who was once so secretive about his massive giving that he became known as “The Anonymous Donor” has just gone public with the biggest single gift so far this year. Chuck Feeney, who we write about in the book, and whose story is told at length in Conor O’Clery’s terrific biography, “The Billionaire Who Wasn’t”, has pledged $125m to the University of California San Francisco Medical Center.

Feeney, whose Atlantic Philanthropies had already donated $145m to the UCSF Medical Center, has gone public because his gift is contingent on other wealthy donors matching it within five years. They would hardly be likely to come forward if the gift was made secretly – but with the usually reticent Feeney urging on his fellow tycoons, hopefully they will. This is exactly the sort of sacrificial leadership that the rich should be showing to the rest of society in these tough times – and, although giving in secret has its virtues, Feeney’s example of public altruism is one that Paulson and others would do well to follow.

Yesterday, a coalition of two philanthropic organisations who we write about in the book, Atlantic Philanthropies and George Soros’s Open Society Institute, and the left-of-centre political activism network, MoveOn.org, announced an imaginative scheme to provide emergency funds to four non-profits hit by the Madoff affair. These are the Brennan Center for Justice, Advancement Project, the Center for Constitutional Rights, and one of our favourite non-profits, Human Rights Watch – an organisation that first drew the attention of the world to the genocide in Darfur and is now highlighting the alarming problems in Congo and Zimbabwe.

The philanthrocapitalists have devised an approach to leveraging mass-market philanthropy that deserves to succeed. Here’s the deal. Atlantic Philanthropies and OSI will each match dollar for dollar any gift (up to $300,000) made to any of these four non-profits between now and the end of the year. So every dollar you give is worth three dollars to the non-profit. You have until midnight.

Despite a strong Irish charitable tradition, major philanthropy has not kept pace with the booming ‘celtic tiger’ economy over the last 10 years.  There was some good news for the gathered representatives of leading nonprofits, when the Minister responsible for charity affairs, John Curran TD, gave a strong endorsement to promoting giving.  But will the economic crisis stifle further development in Irish philanthropy?

John was upbeat – predicting a doubling of giving over the next 5 years, if the philanthropic sector can lay the groundwork by improving the infrastructure so that donors are better supported, talking more about outcomes and impact (the things that really matter to philanthrocapitalists) and changing public attitudes to the rich, which tends to default to cynicism. (John, who spoke very kindly about the book, noted that we had acknowledged this problem by changing the subtitle for the European edition that comes out on 17 November to ‘How the rich can save the world and why we should let them‘.)

John argued that further tax breaks for giving are not the way to get more rich people to give – the case for philanthropy should be that the rich can make a difference.  We think he’s right – it’s the desire to solve problems rather than avoid taxes that really motivates today’s philanthrocapitalists.  And with the government budget squeezed in Ireland like everywhere else, there will be plenty of opportunities for the celtic billionaires to play their part in saving the world.  If we let them!