I vaguely recall that there are classic levels in Jewish philosophy regarding philanthropy, and among the highest is to give with no expectation of any return whatsoever: that means not only giving where it matters, but to do so anonymously, to organizations that don't benefit you (no opera companies), and to people with no ties to you. In this respect Chuck Feeney has been incredible.
This is not to dismiss the likes of Bill Gates: he has been very public with his donations, but in some cases (notably celebrity) notoriety in your donations may create a multiplier effect as it encourages others to do likewise. Even so, I think this is still on a lower-rung, philanthropy-wise, than Feeney's approach.
Nonetheless, we're sitting here praising someone who reduced himself from billions to $2M, but we must remind ourselves that this is unimpressive compared to the poor person who donates $25 to others while starving herself. The value of money is nonlinear. I'm sure that Feeney would say this as well: he no doubt sees himself as saddled with the burden of billions of dollars rather than someone doing something amazing.
I wonder if I ever will have the strength to do what he has done.
Maimonides defines eight levels in giving charity (tzedakah), each one higher than the preceding one.
On an ascending level, they are as follows:
8. When donations are given grudgingly.
7. When one gives less than he should, but does so cheerfully.
6. When one gives directly to the poor upon being asked.
5. When one gives directly to the poor without being asked.
4. Donations when the recipient is aware of the donor's identity, but the donor still doesn't know the specific identity of the recipient.
3. Donations when the donor is aware to whom the charity is being given, but the recipient is unaware of the source.
2. Giving assistance in such a way that the giver and recipient are unknown to each other. Communal funds, administered by responsible people are also in this category.
1. The highest form of charity is to help sustain a person before they become impoverished by offering a substantial gift in a dignified manner, or by extending a suitable loan, or by helping them find employment or establish themselves in business so as to make it unnecessary for them to become dependent on others.
On the one hand, I think your comment is correct, insightful and important.
On the other hand, I have a firm policy of always downvoting comments on HN that say things like "I know I'm going to get downvoted for posting this", because I think doing that should be strongly disincentivized.
I'm compromising by neither upvoting nor downvoting and leaving this reply.
Have my upvote as well. I was still frustrated by a similar observation I recently posted that went negative, much to my surprise, and made me imply a pretty libertarian bias.
Apologies for the bile, I‘ll engage in a more civil discussion tone going forward.
Not all taxes go towards improving people's lives- in the US, many safety nets only kick in once you are impoverished, and can disincentivise work. As an example, the recent coronavirus add-on payments to unemployment often meant people at the lowest levels of opportunity would make more by staying home than if they got a job.
This isnt to say tax funded social nets are bad; most aren't. They certainly shouldn't be confused with charity, though.
"often meant people at the lowest levels of opportunity would make more by staying home than if they got a job"
Considering how low the Coronavirus add-on payments are, doesn't your point really mean that those at the bottom of the scale, where minimum rates have barely budged in the US - are vastly underpaid on a normal basis?
Wasn't the payout an extra $600 / week? That's equivalent of an extra $20 / hour of a 40 hour workweek after tax withholdings. Around half of income earners in the US make less than that from working, my wife's included. It should also be noted that a little over 2% only make the federal minimum wage.
Aside from whether or not the minimum wage should be increased, it does seem to demonstrate easily enough that the stimulus is a perverse incentive.
Bringing this back to the original point I was replying to, it utterly fails the definition of the top level of charity by encouraging people to become dependent on the largess of others.
That's not to say it is therefore a bad thing, but it certainly isn't a reason to call paying taxes the highest level of charity.
Don't give fish. Give fishing rod, fishing right and fishing classes to people who need it.
Only morons think they are better off in society full of poor oppressed people. In a was a social net system is ultimate selfish move as it lowers crime increases productivity and so on. Instead of living in permanent danger akin to current Rep of South Africa.
There's one major difference: taxes and the social net only help those in your country. And if you're in a western country (where most people with wealth are), the people who most need your help are elsewhere.
Concretely, you can help a lot more people with the same amount of money if you focus your giving on the global poor (ex. Africa), rather than those in the US. One way to do this is https://www.givedirectly.org/
It's kind of a weird escalation -- steps 8->2 incrementally make sense (the more anonymized you are, the 'better'). But then the difference between step 2 and step 1 is totally different, the distinction is no longer anonymity, but some measure of efficacy of the support.
Maybe the axis is not anonymity per se but the dignity preserved by the recipient. Anonymity is not the goal, it's a means to an end. And providing employment achieves that end even better than anonymity does.
In this light the lower levels also make sense, each progressive level allows the recipient to feel less guilty (the donor is not annoyed that they have to help, or doesn't even need to be asked, etc). The really interesting bit here is that the levels are not about how much the donor sacrifices but how good the recipient feels.
That's an interesting point. To add to it slightly, maybe the goal is to create a healthier community. Without the guilt or annoyance you mention, it is possible for both the donor and the recipient to maintain a positive relationship going forward (less of an ongoing power dynamic or bitterness).
My guess would be that when these levels developed, most giving was within a close knit community.
Back in Maimonides' time it would be difficult to provide things other than a lump sum in an anonymous manner. If you employ someone, teach them a job or give them a loan they'll get to know you. So I think step 1 drops anonymity for long-term purpose.
I think the point is that the sustainability of preventing poverty and making someone self sufficient is nuanced and not just a simple transfer funds. It's such an improvement over the other donor -> recipient charity which _don't_ fix dependency that the anonymization and cheerfulness of the exchange doesn't even matter: fixing the core problem permanently is a higher goal by kind, not just degree.
I never understood why people keep pointing out that charity donations "might" qualify as tax brakes, as if that's something bad or even worse - some way to cheat the system. Can someone explain this to me?
As far as I understand - by donating X amount of money, the most you can possibly get, is an X deduction from your taxes. But the total amount of money spent at the end is still X. You haven't saved anything anywhere. You have sort of re-routed your taxes from the government to someone else.
The only way I can see fraud in this is when people set up a charity owned by themselves, then donate money to it and simultaneously have it as a tax deduction - that's just fraud. But I still don't see what's wrong with simply getting a tax break for donating - it doesn't save you anything, in fact, it's an added hassle at your tax return time(if you live somewhere where you have to do those at all).
If you buy X you pay tax.
If you donate to provider of X and get X in return as a gift you don't pay tax.
For example donating money to keep your local church running is paying for a service without paying taxes for it.
Another thing you can do is donate earmarked money that they will use to buy your products. For example Google donating chromebooks to schools. That is marketing dollars.
I didn't say it was "bad", I just classified it at the bottom of parent's list in terms of selflessness. I'm arguing that when you get the money back in tax it's less selfless than the other donation scenarios mentioned.
There's definitely an argument to be made about whether or not it's better for an individual to choose how to spend their tax dollars rather than a countries people to decide. It's definitely less democratic (I can't see how you can debate this), but I'm not sure the good of it is clear cut... That being said, as the class gap increases, individuals choosing how to spend a large portion of their taxes contributes to a concentration of power in the upper caste.
Libertarians seem to think that taxes and charity donations are two equally valid (but not necessarily equally effective) ways to help your community. They feel like they have a choice to assign a portion of their wealth to either. Oftentimes, they also believe that charity will be a more effective approach by bypassing the bureaucracy of the state.
Some people believe that taxes are the primary way to implement solidarity among citizens of a state. I believe that they are correct. Charity comes only second, and should in no way impact taxes. Charity, although a beautiful thing, is fundamentally in-egalitarian: it is not benefiting the Republic as a whole, but only a fraction of people who are in need, and typically fulfill certain criteria (e.g., being Christian, living in a given area, etc.). In most cases, charity targets very specific needs and people that are seen by the wealthy as being worthy of their help. It has a fundamental flaw insofar it keeps the power of wealth allocation to the wealthy.
Notwithstanding corruption and aggressive lobbyism, taxes are much more egalitarian and democratic.
> 10. When the donation gives you favors in return.
What if the "favor in return" is a reward after death? For a lot of people of faith, their motivation to donate is often post-resurrection reward... (The Bible is fairly against this attitude though. As Jesus for instance says "But when you give to the needy, do not let your left hand know what your right hand is doing" -- https://www.bible.com/bible/59/MAT.6.3.ESV ; and the general message seems to be that everything you have is a gift from God, so you're actually only just giving away what you've been gifted.)
Even though I disagree with the candidate for office. It may be legal and technically not a bribe, but it does have a really bad stench and is arguably one of the reasons why US politics are so fucked up.
Not sure why you're being downvoted, you actually do have a good point... I guess people are uncomfortable with directly acknowledging that social programs are funded by "donations" that are taken by force (i.e. taxes).
They're taxes, period. There's no moral benefit to paying them in the same way there's no moral benefit to obeying traffic laws. It's not a charity as it's not voluntary. It's the cost of playing the game.
I would argue there is a moral obligation to obeying traffic laws.
Historically, most societies considered maintaining social order as a moral obligation. Guest Rights and Obligations etc seem to disappear as society and governments became more effective. That’s somehow translated into the idea that not paying taxes is somehow perfectly ok. https://en.wikipedia.org/wiki/Hospitium
"Every tax, however, is to the person who pays it a badge, not of slavery, but of liberty. It denotes that he is subject to government, indeed, but that, as he has some property, he cannot himself be the property of a master."
It’s the cost for some. If you’re rich enough you pay far less tax because you have access to an army of people whose job it is to help you do that. They leave us suckers to pay.
That’s not right. I think more of people who pay their fair share. Feels like a moral issue for me.
Except that's not true at all. Vast majority of taxes come from the richest. They might pay less percentage wise than me and you, but they pay the most in absolute terms.
>>I think more of people who pay their fair share.
I think more of people who pay more tax, not of those who pay more percentage wise. Ie - someone who makes a million dollars and pays 100k in tax seems to be contributing far more to the system than someone who makes 20k and pays 4k in taxes - even though the second person paid more percentage wise. Which one of these is "a fair share"? Why is one person literally paying 25x as much in taxes? Do they use the roads and hospitals and prisons and the police 25x as much?
I mean, I can see both sides of this argument - but I do dislike when people just go "oh us suckers down here are paying all the taxes" - like, no, we just don't.
That’s far from accurate. Income taxes contribute ~$1.932 trillion, but payroll taxes add $1.373 trillion and are often ignored in these calculations. As social security is capped at relatively low income levels the tax burden on the rich is much lower than often suggested.
Further, the often quoted top 1% is hardly the rich in the US, if you compare the income vs taxes paid of the top 0.01% their paying a lower percentage of their income than the average programmer in federal taxes. State taxes have a similar breakdown with property taxes, fuel taxes, etc representing a vastly lower burden for the 0.01% of income earners.
This is further compounded when you consider tax free wealth accumulation of capital gains where taxing in sale mean zero tax on possibly decades of income, or possibly ever. You don’t deduct charitable donations from social security taxes.
PS: As to what the rich receive in taxes. They receive a functioning society which is economically worth far more to themselves than lower income earners.
CBO did an analysis of household income, all federal taxes paid, and transfers and services. On a net basis, the top 40% pay for everything at all levels of government. The bottom 40% pay for only a portion of what it takes to keep themselves alive. The middle 20% splits between the two groups, but the portion that are net payers, pay very little.
> They receive a functioning society which is economically worth far more to themselves than lower income earners.
This is not obvious. Historically, the lower classes have very little rights and are subjected to oppressive behaviors from the kings and nobles and other well to do.
That’s amazingly misleading, people receiving Social Security and Medicare benefits tend to have lower earnings than they did while working full time. Effectively, averaging people who pay lots of taxes and receive minimal benefits with others who are receiving massive benefits gives a very distorted view of what’s going on.
Similarly, lumping everyone in the top 40% with the Rich completely hides how little the rich pay by lumping them in with the highest effective tax rate groups.
PS: It gets even crazier than that when you consider Trump for example qualified as having zero income for multiple years.
Usually, yes, if you are paid like a normal employee. I'm jumping straight to the point that many people have an issue with - that once you're wealthy enough, you don't make most of your money through a salary, you make it through capital gains, dividends, and other financial tools that make your effective tax rate much lower than it would have been had you taken it as a salary.
In a huge oversimplification, let's say you're in UK and make £100k/year. If you take that as salary, you'll pay 20% tax on around £40k of it, then 40% tax on £50k, with the remaining £10k being tax free. On the other hand, if you open a limited company that makes £100k, well, you're only paying 10% corporation tax on any profits - but of course the way to play this game is to expense everything imaginable under the sun, so ideally you have close to zero profit at the end of the tax year. Yes, the money isn't "yours", it belongs to the company, but you can expense things like your rent, gas, electricity, "work meals" etc. Then take £10k salary from your own company which is within the tax-free allowance. Voila, in the eyes of someone external, you've made £100k but through "clever tricks" paid less than 10% tax on all of it. Of course most people don't realize that isn't not that simple, but things like this lead to very quick judgement.
It comes from the same pocket. The scale of charitable donations is usually inversely proportional to tax rates and redistribution in a country. When people are highly taxed in high redistribution countries, they feel less compelled to give directly since the state is doing it for them (in addition to having less disposable income).
Maybe there is also less need/causes to donate to if living in a high redistribution country (and yes proximity is important for a lot of people at least emotionally).
So wont private donations. I believe some forms of poverty are unavoidable if you want to have a free society (i am not saying I endorse either side). The country I live in has the rule you are not allowed to treat mentally ill people against their will (if they are considered harmless). There seems to be some evidence that quite a number end up homeless. So what can you do? Not realising being sick is one of the symptoms of some of these (treatable) diseases.
Maimonides was a smart dude, but I must say I don't understand the highest level here: do you have to know they are about to be impoverished? If so, don't you know their identity to give them a job, a loan, or a gift? Payday lenders might qualify? Maybe I need to consult a rabbi.
I would guess a loan is extended mostly so the one taking it can save face. Some people would choose to live on the streets rather than take a handout and a loan makes it palatable. There’s a (possibly apocryphal) story about George Clooney offering 15 friends $1,000,000 but only if they all take it, so that the friends who would say no out of pride could justify it.
The idea is that helping people become self sufficient is more important than the concerns about who knows what. Even if both parties know who the other is, it is still the highest form of charity.
Though probably it is possible to do both. I suspect there are many modern charities that help people become self sufficient where neither the donors not the recipients know who each other are.
This is sincerely meant, but if you consider 2 and 1, isn't that a description of progressive taxation in the modern, regulated-capitalist, social-democratic welfare state?
(btw, I made that description up to try and describe the kinds of states I'm referring to. e.g. the USA once was in that category and no longer is in my view, while many European countries probably are in that category).
EDIT: I'd like to point out, I'm assuming no/little corruption. i.e. the theoretical view of such a state.
Not really; taxation is compulsory. If you steal everything I own and distribute it to try to improve other people's lives, I don't suddenly have any kind of charitable moral high ground because of where my money went, and neither would I be complicit if it were used to hire puppy hitmen or whatever evildoers like to do these days. The end effect is similar, but intent matters.
I agree that intent matters, but insofar as a state governs with the consent of a majority (leaving aside questions of whether that consent is real), then taxation (incl. the level of taxation and its distribution e.g. welfare vs warfare) represents a broadly agreed mechanism of the state to provide the kind of safety net that OP described as levels 2 and 1.
Personally, I live in such a state (not the US), that has a safety net, and am happy to contribute via taxation. Not all my fellow citizens are happy to contribute and I accept that. I earn a decent wage and don't jump through hoops to minimise my tax. At the end of the day, people vote for governments that are more or less taxing.
IMO then the people happy to contribute to such a system would mostly fall under 1/2 (under the assumption that one's motivations are altruistic and not centered on the communal benefits they also receive), but the people who aren't happy to contribute would not qualify (at least, not via their taxes alone -- there might be other reasons for rejecting taxes, and they might contribute elsewhere in a way that still puts them in the 1/2 category).
> The highest form of charity is to help sustain a person before they become impoverished by offering a substantial gift in a dignified manner, or by extending a suitable loan, or by helping them find employment or establish themselves in business so as to make it unnecessary for them to become dependent on others.
This is also pretty much one of the ways a certain Shi'a Islam community, Dawoodi Bohra, administers loans which they call Qardan Hasana (the diginifed loan).
I haven't studied the original text myself, but I believe that #1 is slightly off. It's not necessary to do the charitable action before a person becomes impoverished. Rather, the idea is that:
a) teaching a man to fish is better than giving a man a fish
b) the former is also more dignified for the person receiving help
This applies whether a person is going to become impoverished or is currently poor. And this idea of dignity is strong enough that it outweighs other considerations, such as anonymity on either side (of course, there's the question of whether giving someone a job anonymously is better than doing it with one or both parties' knowledge... and I don't know what Maimonides would have said).
I appreciate this kind of discussion. It's interesting to understand the moral philosophy of different cultures (and hopefully getting at some fundamental universal understanding, or at least a consensus), and it's important to talk explicitly about it. Informative and useful.
I mentioned this in another comment, but I believe (no source, just speculation) that each progressive level does a better job helping the recipient maintain their dignity. Charity is not only about helping someone financially but also helping them feel good, too.
Just to take a specific example from the list: preventing people from becoming poor in the first place is better. How could it not be? They avoid the mental pain and stress of being poor and feeling like they are dependent on handouts to survive...
> How do you know that they will become poor if not for your action?
Here's a simple example. A mine closes down. You can start giving the ex-miners money on an ongoing basis to let them keep paying their bills, maybe. Or you could fund training for them to learn a new career.
How do you know they will become poor if you don't fund the training? You don't. Maybe they would have managed to change careers anyway. But chances are you are in fact helping people avoid poverty.
> If you need to do this over and over again, and we're talking about just that,
Ah, maybe this is the disconnect. No, we are precisely _not_ talking about doing this over and over again for any given person.
Or put another way, this is the "give a man a fish vs teach a man to fish" thing. The latter, if it's an option, seems evidently better to me.
Giving money to people is the best way to help them. It turns out that most people are generally entrepreneurial and will spend the money on what they think is the most important need for them at the moment. Maybe the person doesn't need training; maybe they already have a skill, and what they really need is some capital to buy equipment or materials to pursue that activity.
This idea is behind a the success of the Earned Income Tax Credit in the USA. Giving people in need a substantial capital injection at a single point in time is a very impactful to people without the means to save.
This isn't about whether help is provided in-kind or in cash; there is indeed good evidence that the latter is better. And there is evidence that a lump sum is better than an extended dribble: that was more or less my point in the comment you are responding to.
But also, this is about the fact that if you provide help when a person just starts needing it, it might not take much to get them back to financial stability. If you instead wait until they have been out of the workforce for a while, lost their house, and maybe ended up with a substance-abuse problem as a coping mechanism, a much larger investment will be needed to get back to "normal". And that's not even counting the suffering involved in the interim in the second option.
Muslims also have a similar tier system of giving charity, but because Islam mandates charity from its followers at a fixed rate (a flat income tax for charity), it places the "communal funds" very low in the totem pole.
Actually the Prophet Muhammad said a similar thing to what Feeney has said here about wanting to give charity while alive rather than after his death:
> A man came to the Prophet and asked, "O Allah's Apostle! Which charity is the most superior in reward?" He replied, "The charity which you practice while you are healthy, niggardly and afraid of poverty and wish to become wealthy. Do not delay it to the time of approaching death and then say, 'Give so much to such and such, and so much to such and such.' And it has already belonged to such and such (as it is too late)."
I guess Jewish "tzedakah" and Arabian "zakat" have anyway both the same linguistic root, both being Semitic languages and everything related happening in the same small part of the world (if the word itself has some other origins).
There is specific arabic word for it "Sadaqah" which means charity. Zakat is actually one of the Islamic pillar about charity to purifies. There is specific percentage or amount for different zakat. Zakat is the form of charity.
> we must remind ourselves that this is unimpressive compared to the poor person who donates $25 to others while starving herself
Is it? This is a very Christian way of looking at donations: personal sacrifice / self-deprivation is what matters. [1]
However, utilitarians – notably Effective Altruists [2] – would make the opposite argument: what matters is the impact that you make with the dollars you donate (both in amount and allocation).
Gates' wealth keeps increasing. Sure he gives a lot away but, but he is making 1+ billion per year above what he gives away.
It is great that money is going to charity, it is great that money previously belonging to Gates' is going to charity, but I would be far more impressed by you if you donated $100/year to the Internet Archive than I am if Bill Gates donated $100 million.
In other words, I don't think anyone claims that $100 will help more than $100 million, but there is no great personal moral achievement in giving away something you don't need and can't use.
Of course one could argue that we should not be dependent on the goodwill and grace of billionaires to choose to donate their wealth to good causes, but rather should tax fortunes at an onerous rate and put that money in public, democratic control, regardless. For each Chuck Feeny and Bill Gates how many Waltons OR Kochs do we have?
You could make that argument, and in doing so you are implicitly stating either:
(a) I believe that the government will use its money to impact the world in a better way than billionaires do, or
(b) I concede that (a) is false, but I don't care. It's not about the impact we make with the money, it's about dragging billionaires down.
Personally, I'm interested in impact. I have little faith that paying taxes to the US Government is a more effective way to generate positive impact in the world than personal charitable donations.
If I could pay my taxes to Bill Gates I would – my tax dollars would be used to eradicate polio or malaria, rather than on bureaucracy and starting wars.
You "concede" that (a) is false? That's quite a strong claim. At least with "the government" managing it, there's at least some degree of democratic control, accountability, scrutiny, and influence. When that management is left to private enterprise, that's not the case.
Then you're getting into a philosophical debate about how morally "right" democracy actually is. That's dangerous territory.
I'm not saying I have a better idea, I don't, but democracy has been the driving force behind some pretty heinous stuff over the centuries (most obviously the resistance to equality of race, gay rights and universal suffrage). It's just less terrible than the alternatives that exist in the world today (e.g. dictatorship).
At least in giving your money to a Buffett, a Gates or a Feeney you have some evidence that they intend to put it to good use.
I certainly believe (a), but there is a 3rd option
(c) I believe in direct wealth distribution (e.g. via a basic income) and that you believe 100m people with $10 will spend that money in a better way than 1 person with $1bn.
As someone who leans towards a general rule of government == inefficient but doesn’t necessarily like the logic of “billionaire individuals will allocate it better”, I really like your option C re-frame here.
Yes. I'm far less worried about government == inefficient (I've learned too much about AI and the genetic algorithm to have faith in human-based optimization strategies, and this is one reason I'm enthusiastic about population-based optimization along Basic Income lines) but possibly even more offended by the logic that specifically billionaires will allocate wealth better.
I feel like the very existence of billionaires demonstrates that they are a self-selecting pool of abusers and/or criminals running exploits that place their interests above the system they're in. Even the idea of 'the wealthy allocate money better' is ridiculous. Towards what, themselves? It's like saying cancer allocates body resources better, because cancer can get into a position where it conclusively 'wins'.
But you've got to aggregate a) over all the billionaires, not just the ones giving. We're not comparing Bill Gates to the US Govt for impact per dollar, we're comparing all US billionaires vs the US Govt.
You are forgetting or ignoring the damage to society caused by multi-generation accumulation of wealth and the consolidation of power that arises from that. These were the primary concerns when the founding fathers were debating estate tax..
If you give more money to the government, doesn’t that implicitly mean you are giving/donating about 15% of that money to the military industrial complex?
Billionaireness is profoundly extractive by definition. Leave class out of it and billionaires inherently benefit themselves against any and every system they are in, and that's including other billionaires (they're exceedingly competitive).
That means that billionaires also act against the interests of the donor class as a matter of course. If they were not the very definition of unaccountable power, you wouldn't see anybody defending them or their typical behaviors.
That is quite a short sighted and funny evaluation.
It is so benignly restricted since it excludes the possibility of charity and government funding can have a positive impact. Instead it is some fight against good and evil.
I don't know what it has to do with Christianity, but you are free to visit a church, maybe they can tell you something about the gospel you linked.
One could argue that there is probably some correlation between great wealth and good judgement about the effective use of money.
In that regard, perhaps it’s good to have social intervention performed by a mixture of democratic and individualistic entities. Perhaps one will address things that the other might miss.
> Two of the billionaires whose philanthropy I most respect, Dustin Moskovitz and Cari Tuna, have done a lot of work on criminal justice reform. The organizations they fund determined that many innocent people are languishing in jail for months because they don’t have enough money to pay bail; others are pleading guilty to crimes they didn’t commit because they have to get out of jail in time to get to work or care for their children, even if it gives them a criminal record. They funded a short-term effort to help these people afford bail, and a long-term effort to reform the bail system. One of the charities they donate to, The Bronx Freedom Fund, found that 92% of suspects without bail assistance will plead guilty and get a criminal record. But if given enough bail assistance to make it to trial, over half would have all charges dropped. This is exactly the kind of fighting-mass-incarceration and stopping-the-cycle-of-poverty work everyone says we need, and it works really well.
> If Moskovitz and Tuna’s money instead flowed to the government, would it accomplish the same goal in some kind of more democratic, more publically-guided way? No. It would go to locking these people up, paying for more prosecutors to trick them into pleading guilty, more prison guards to abuse and harass them. The government already spends $100 billion – seven times Tuna and Moskovitz’s combined fortunes – on maintaining the carceral state each year. This utterly dwarfs any trickle of money it spends on undoing the harms of the carceral state, even supposing such a trickle exists.
How do you know what the Walton's and Koch's are doing with their wealth? Perhaps they are doing the same thing as Feeny but without the fanfare. I think they are. Are you singling them out because of political differences?
Waltons and Kochs actually give a lot. I am very close to an organization that receives money from both of their foundations. They do have a political agenda with much or their giving but in certain areas it could be considered apolitical.
> This is a very Christian way of looking at donations: personal sacrifice / self-deprivation is what matters.
I don't think it's what matters necessarily, but I do think that this is why he is receiving praise here and elsewhere. That's a problem, because if we're going to praise him for his sacrifice, we should remind ourselves that his sacrifice is minor compared to other donations due to the nonlinear effect of money.
Now Feeney certainly has had more of an impact, and that's great, but he had that impact because he was fortunate enough to have billions of dollars to give away in the first place. Being lucky is not a valid reason to be praised, I think.
Indeed I don't think Feeney wants to be praised: he just wants to be rid of his wealth in a meaningful way.
> Perhaps someone with 25 to their name better serves the community by keeping it?
We have to assume that in the given scenario the other person needed it more and nobody else was stepping up.
> Why praise sacrifice at all?
You don't even have to praise the concept of sacrificing in general to praise caring enough to help those less fortunate even when helping has a cost. The alternative is for nobody to help except those for whom money no longer has any meaning, ie billionaires, and I don't see Jeff Bezos building homes for the homeless.
> Personal suffering/sacrifice adds no value to the community, and in fact reduces it. Maximizing positive impact should be the goal.
The first sentence is false. Donation is zero-sum in absolute dollar terms, no money is gained or lost, but money _does_ have diminishing utility to the individual, so the raised person can gain more than the lowered person loses. So a person can sacrifice AND maximize positive impact.
For what it's worth, I think the right approach is to eat the billionaires instead of waiting for the person with $25 to sacrifice even further for the person with $5. Clearly eating all of the billionaires would maximize positive impact.
This is a very utilitarian view, and it’s only considering the economic aspect at that. I’m not trying to argue that you’re wrong—I just want to suggest that there are other ways of looking at sacrifice that lead to the opposite conclusion.
Giving to help someone worse-off than you—ideally—engenders a feeling of gratitude and humility that makes our society a better place. Experiencing a greater sense of gratitude can help more than just money: gratitude helps one keep a positive mental outlook and can carry one through difficult times.
As a man of faith myself, I believe in divine blessings—both during and after this life—for sacrifice and generosity. That’s not my motivation for doing good, but I do believe that sacrifice does make a better community and a happier individual.
Now, as for the limit case of being utterly destitute (e.g. $25 to their name), a wise man once said “it is not requisite that you run faster than you have strength”—looking after yourself is noble, provided you continue to do what you can.
Some people see risk and sacrifice of the self as the foundation of heroism.
A fire code inspector might save more lives than a fire fighter, but nobody sells calendars of sexy fire code inspectors, or hands out medals for bravely insisting that tower block's staircase have a sprinkler system fitted.
Of course, an Effective Altruist / utilitarian would say who cares about feelings and medals? After all, altruism by definition isn't seeking medals.
I agree that sacrifice can be evidence of love and compassion. I would go a step further and argue that sacrifice is requisite for these things, especially in their highest forms.
Sacrifice exposes what is important to a person—both to external observers as well as the individual in question. A marital relationship—for example—requires immense sacrifice on both spouses’ sides for it to work out. Without sacrifice, affection wanes.
I don’t think sacrifice necessarily equals suffering. Sometimes it can. But based on my experience, when the sacrifice is made willingly and for a good cause, it serves more as a source of joy that I can get outside myself and aid someone in need.
Now, waisted or senseless sacrifice—yes, that doesn’t make much sense. I see a distinction between the two, but that could just be me. Does that make sense?
> Personal suffering/sacrifice adds no value to the community, and in fact reduces it.
What? How? If you see this extremely locally, like the community being, your country, sure, but I don't think that's apply when you consider the community has being the whole world.
> Perhaps someone with 25 to their name better serves the community by keeping it?
Does it though? We see this as a first world country, where even for the one starving a bit, still get a life much better than a good proportion of the world. That means that keeping that 25$ will help you surely, but would serve much better a few others, if given correctly.
I guess HN is probably a place where disproportionate ego exist in a higher percentage than anywhere else, that many believe that they are the 10x programmer which is worth more than everyone else, but I'm a firm believer that given the same opportunity as me, anyone else could have done the same as me, thus helping many reach the same opportunities as me, will help more than helping myself.
Sadly I'm still a bit selfish and still want a better life for myself. I still do self sacrifice, but it's extremely local.
As we are trying to judge someone's character or morality I would consider it along the lines of - if that poor person were in Feeney's shoes would they have done the same? If Feeney were in that poor persons shoes would he have done the same?
The forces on a wealthy person giving up almost all of his wealth are also pretty great, but in a different way, when compared to a poor person doing the same.
As #1 in the original list implies, it may be most important to be lifted out of poverty as this is what creates fulfilling civilisation. So one might argue that the poor person should invest what little money they have into their own future first, in a way which will improve their lot, as this will give them the opportunity to help many others (like Feeney did).
Time whitewashes everything. Bill Gates has spent many years doing good work as a philanthropist. I'm not sure this undoes the fact that much of his gain was from blatant cloning, ruthless abuse of monopoly, and substandard products.
I am very happy he donated all that money, and I greatly respect him for doing it without calling too much attention to himself, especially compared to others.
But it says a whole lot about Forbes that having at least $2M -- and I'm betting maybe a small apartment and a modest car and possibly even health insurance -- counts as "officially broke" in America.
Not just Christian, but other religions and philosophy as well. Utilitarianism isn't necessarily the default and is easy to subvert for selfishness. "See, really, me getting as rich as possible is justified because someday I'll be able to use this to solve some abstract problem I've decided is the REAL issue that needs to be solved..."
As long as you convince yourself that the returns to compound interest are higher than the returns to charity at any one point, it's easy to justify just pushing off your donation time to sometime arbitrarily far in the future, and high luxuries can be justified as "self-care" that enhance your own productivity or whatever. Utilitarianism can too easily become perverted to just being self-serving.
In what way does he still have everything? It looks like he’s got enough to sustainably generate about a median household income in my state. That’s a long walk from everything in my book.
> It looks like he’s got enough to sustainably generate about a median household income
Oh come on. He's 89 years old and has millions of dollars still. How long do you expect him to live? "Sustainably generating" a median household income in perpetuity is an interesting bar to set. You're aware that most of the country doesn't have any savings at all, yeah? That the current median _at_retirement_age_ savings for the US is around 150K? That he's still getting an actual income from social security payments because why not?
My challenge was to your hyperbolic claim that he "still has everything" and an insinuation that that makes giving away $8 billion (with a B) over his lifetime not as impressive because he didn't give away the last 0.025% of his wealth.
That he's getting payments from Social Security after a lifetime of contributions to Social Security is also of no concern to me (I view it as the overwhelming default and entirely proper).
Charity in Hinduism falls under 3 modes, as with pretty much everything else in Hinduism - Tamas, Rajas & Sattva
Tamas - given at wrong place/time, to wrong (unworthy) person, without respect/decency, with contempt.
Rajas - given with reluctance, expecting return (either from recipient, or praise)
Sattva - given at right time/place, to right (worthy) person, with humility, without expectation of return.
Note that while others religions mainly dwell on not expecting return and anonymity, Hinduism stresses not expecting return but does not stress anonymity as much as it stresses finding the right patra (bowl) i.e. right recipient.
Donating $100 to a poor person, who also happens to be wicked, and/or will definitely spend it on vices, is actually a bad donation, because it causes more harm to the recipient and society, than good.
Also, timing - a litre of blood donated to a save a life in urgent time, is worth more than a litre of blood spilled in war to gain territory.
Also, place - a donation done in holy land or temple is worth more than a donation from a local philanthropy club.
Also, the reward for donation is gaining goodwill in the heart of Bhagavan (God). And He dishes out goodwill proportional to the 'effort' rather than 'amount' - a $100 wage earner donating $10 is judged the same as $100 million donated by a billionaire.
That's a good point. And 'broke' isn't 100% broke just yet, he's not going to have to sleep under a bridge. But he's broke enough that the wrong accident can put him on the far side of the line easily enough. Obviously this goes for many people but they tend to end up in that situation by accident, not by design and as an example to other billionaires he's pretty impressive.
it's really hard to imagine someone at age 89, with 2 social security incomes and $2M, who is apparently more frugal than most technology workers, being one "wrong accident" away from "the far side of the line easily enough".
an 80% loss of that $2M cash leaves him with a paltry $400K which, assuming a rate of return == inflation, is 10 years of $40K/yr spending, to say nothing of 2x SS income.
people's idea of "being broke" is just ridiculous.
Healthcare in the United States is perfectly designed to take your every last penny in the last 6 months of your life. If Chuck Feeney isn't actually broke today, there is a fair chance that he will be on his death bed.
He'll never be "broke", because with his money he acquired something way more long lasting than cash, which is social acquaintances. Philanthropy has been used to this exact end throughout history, and is still today.
So of course his billionnaires friends will bail him out in the highly improbable event he should really need the money. The level of networking he reached means he doesn't need to spend a dollar until his last breath if he so wished.
>If Chuck Feeney isn't actually broke today, there is a fair chance that he will be on his death bed.
Aren't you forgetting that that he already "lost" the vast majority of his wealth? If he actually cared about the money he would have given it to his children. If he loses his last $2 million on healthcare he probably wouldn't care.
Nursing homes are only covered longterm if you are destitute. Good places will take your assets and use them all up until it’s gone then apply for Medicaid.
Won’t pay for personal in-home nurses either.
But 2 million should buy him plenty of elder care. I would have kept 10 million just in case.
Based on the famous Trinity study [0], $2M would be enough for he and his wife to draw $80k/year plus social security. That's certainly more than most people are able to retire on, but I wouldn't call it lavish, and I imagine the remainder will be donated after death. I find it hard to fault him for wanting to make sure he and his wife can enjoy their last few years without having to worry too much about the exorbitant cost of end of life care in this country.
You shouldn't compare expenses for someone at this level of networking with a standard one. At his level of social bonds, he can live without money anyway.
Wouldn't Chuck just receive donations from the thousands of people he personally knew and helped? I doubt people would let him go broke under any scenario... the man spent time with Bill Gates and Warren Buffet.
> but we must remind ourselves that this is unimpressive compared to the poor person who donates $25 to others while starving herself. The value of money is nonlinear.
There are other perspectives on this. Often, the very poor person does not hope he will ever get out of poverty, and that makes it much easier to have a sharing/charitable mindset. Keeping the $25 will help him for a few days, after which he'll be broke again and no better off. Giving it away will have the same end result, albeit a few days earlier - but it will be a charitable act he'll feel good about for life, and may also make a friend.
The person for whom it is most difficult to give is usually the one at the edge of poverty. If he keeps the money, he has a chance he'll escape the cycle of poverty. If he gives it away, he'll never change his station in life. For this somewhat wealthier person, that $25 has a lot more value (As an aside, I'm not sure I would respect him much if he gave it away).
To paraphrase from a popular movie: Put people in a pit with no hope of escape and what you get is fairly boring. But give them a glimmer of hope that they can escape, and then watch how they will destroy one another in their attempts to get out. Charity is generally cheap for those who have nothing: They know they are not losing much when they give it away.
Although the 'Billions' Chuck Feeney gave away would likely be the focus of his story, his greatest achievement IMO is creating the 'actionable model for philanthropy' which others have since followed creating a much larger impact from what was done through his wealth alone.
>this is unimpressive compared to the poor person who donates $25 to others while starving herself
I absolutely agree and think of this often when I see the philanthropy figures published each year when the top Billionaires have donated <0.2% of their wealth where as there are individuals like this gentleman[1] who donates 80% of his earnings from road side tea stall to educate underprivileged children[1].
I could easily retire on $2M so I think it wouldn't be that hard to give away $1998M if I get to keep $2M. It's not like $2M is poor, given it's post tax it's like being able to live on a salary of $75k a year for 40yrs and, he likely owns a house already (or is that part of the $2M, though even if it is he can sell it and live off the money).
I'm not trying to downplay him in anyway. I'm just saying that $2M in the bank is still an extremely comfortable life so there is not much hardship to be had in giving up everything over that.
Also, as for donating anonymously vs non-anonymously I do it non-anonymously as trying to add social proof that you should donate. The more it appears normal to donate the more people will donate, or so I believe. If I could do that anonymously I would but people read me (my blog or other things), they don't read anon's blog/tweets, whatever.
And He looked up and saw the rich putting their gifts into the treasury, and He saw also a certain poor widow putting in two mites. So He said, “Truly I say to you that this poor widow has put in more than all; for all these out of their abundance have put in offerings for God, but she out of her poverty put in all the livelihood that she had.”
I don't think that seeking to be starving and on the street should be the ultimate end goal of philanthropy. I much prefer to limit my generosity via the First Rule of Rescue: be careful not give away so much that now you need charity yourself.
This whole idea kinda loops back on itself and I wonder if wanting to donate your wealth in order to achieve “higher rungs” isn’t itself a perverse incentive than a rung system ought to penalize!
Why is it good that we let one, unelected man decide how wealth is distributed in the community?
If we had taxed him at the rate we have taxed people in the 40's and 50's maybe there would not be such a need for all these "philanthropists" to give "their" money away.
And give me a break, he is NOT broke. I live on 20K a year and I do not even think I am broke. When he is living like St. Francis of Assisi let me know.
>we must remind ourselves that this is unimpressive compared to the poor person who donates $25 to others while starving herself
While it is truly selfless, I'm not sure what is __really__ harder; for a person living a multi-billion-dollar lifestyle to change to a million-dollar lifestyle, or someone who is used to living on the penny, to give away most of what they have....
"This is an anglicized form of an Olde Gaelic name O Fiannaidh - composed of the elements 'O' meaning a 'grandson (of)' or 'male descendant' and 'Fianna' - a 'soldier'. The main O Fiannaidh clan was located in the parish of Easkey, Co. Sligo."
Not related to the article, however the third paragraph of your comment touches on a controversial idea, so I'll add another perspective.
On the idea of sacrifice as virtuous.
Sacrifice is only compatible with selfishness. This is because for an action to be a sacrifice, there is two criteria in which it must meet.
The first criteria are that the individual must love themselves.
She who has no value of her own life, cannot sacrifice it, just as she could not sacrifice a rock found in a cave. Vice versa, an individual which holds her own life as immensely valuable, is able to sacrifice it for an ideal, however this leads to the second criterion.
The second criteria are that the individual must hold no value in the ideal or cause in which they contribute towards.
This is because if you hold something as valuable, and you give it up for something of equal or greater value, you are not sacrificing, but rather trading.
Each trade has its own currency, and what that is I leave to the reader to investigate, but sacrifice is only possible for the woman that loves herself and does not hold any value in the ideal in which she sacrifices herself for.
Thus, if you do see virtue in sacrifice, it is only possible because of selfishness, and this is problematic.
Trades are not all selfish. A person trades selfishly if they are trying to get some benefit for themselves. Trying to benefit only other people is not selfish.
Every rational choice is made based on some personal values. A person with unselfish personal values can take action on those values. Do you think their action occurs because of their selfishness?
The comment I was replying to mentioned it being noble for a woman to starve herself to give $25 to a stranger.
I disagree, and I pointed out the contradiction of praising sacrifice while disparaging self-interest, when the two are not possible without each other. If you disagree with that, I would be interested in hearing why.
Trades are not all selfish.
I never made the point that trades are inherently selfish, only that in some trades monetary gain is not the only form of currency.
Are all rational actions selfish?
Yes. You state in your second paragraph that "Every rational choice is made based on some personal values". I agree. If you act on your own personal values, this is selfish. And as all rational choice must be in service of personal values, then all rational action is selfish.
I'm very open to the idea that I'm wrong on all of this, but I can not see how, so I thank you for engaging with my comment.
I’ve long argued for massive estate tax rates on large estates in order to incentivize behavior like this. I have no problem at all with Bezos being worth $200 billion (or whatever it is now), but it’s this dynastic wealth that I find borderline sickening. Why in the hell should the Rockefeller’s of today be billionaires??? Also, these giant charitable foundations/family offices are similarly off-putting, as they are setup as semi-perpetual institutions that often only make the minimum 5% distribution annually. (Another fix would be to jack that up to 25% upon death) Big estate taxes seem to solve for a lot of problems with appropriate compromises.
Spend your money on riotous living – no tax; leave your money to your children – the tax collector gets paid first. That is the message sent by the estate tax. It is a bad message and the estate tax is a bad tax.
The basic argument against the estate tax is moral. It taxes virtue – living frugally and accumulating wealth. It discourages saving and asset accumulation and encourages wasteful spending. It wastes the talent of able people, both those engaged in enforcing the tax and the probably even greater number engaged in devising arrangements to escape the tax.
The income used to accumulate the assets left at death was taxed when it was received; the earnings on the assets were taxed year after year; so, the estate tax is a second or third layer of taxation on the same assets.
The tax raises little direct revenue- partly because the estate planners have been so successful in devising ways to escape the tax. Costs of collection and compliance are high, perhaps of the same order as direct tax receipts. The encouragement of spending reduces national wealth and thereby the flow of aggregate taxable income. These indirect effects mean that eliminating the tax is likely to increase rather than decrease the net revenue yield to the federal government.
The estate tax is justified as a means of reducing the concentration of wealth. However, the truly wealthy and their estate planners avoid the tax. The low yield of the tax is a testament to the ineffectiveness of the tax as a force for reshaping the distribution of wealth.
The primary defense made for the estate tax is that it encourages charity. If so, there are better and less costly ways to encourage charity. Eliminating the estate tax will lead to higher economic growth, which is the most important variable in determining the level of charitable giving.
Death should not be a taxable event. The estate tax should be repealed.
> The basic argument against the estate tax is moral. It taxes virtue – living frugally and accumulating wealth
Only insofar as you believe taxation to be a moral commentary. If one thinks taxation is punishment for a decision, then I can see why one might see it this way.
I don't agree, though. Taxation is reinvestment into the society that makes the usage of that tool–money–possible in the first place. I think it's morally wrong to sequester a social tool in the hands of a few people who never made the investment to get that return in the first place, i.e. children of wealthy parents. I think it's morally wrong for anyone to get to pick and choose who will start out having already won the race. This is different from me being a bad business owner and people choosing not to do business with me.
Should parents be able to spend their earned money on their childrens' upbringing? Of course. If a wealthy parent dies should they be able to leave money behind for their children to have a decent shot at life? Absolutely. Does that require millions or billions of dollars to be hoarded, unused, passed from hand to hand, contributing to a skewed money supply that forces the fed to print more, play with interest rates etc to try to keep the system stable? No, I think there's a reasonable amount that the government can request returned.
Now, the _amount_ of tax is certainly debatable. But to take the extremist position of repealing the tax altogether is absurd IMO.
The thing is that it's both. In more appropriately neutral language we would say that any tax creates incentives and disincentives, and as a society we should be very mindful of what incentives and disincentives we are creating.
I would actually argue the government has a pretty bad track record when it comes to creating good incentives and "good" disincentives, so usually a better approach would be to try hard and avoid creating incentives or disincentives at all. Proponents of things like VAT, or other very broad, general, and hard to avoid taxes usually see it in those terms.
>Does that require millions or billions of dollars to be hoarded, unused, passed from hand to hand, contributing to a skewed money supply that forces the fed to print more, play with interest rates etc to try to keep the system stable?
I think you got cause and effect mixed up. Every dollar that the fed is printing is being hoarded because the fed decided to only give dollars to people that hoard money.
There's something virtuous about living beneath your means and ensuring that you can be self-sufficient in your retirement.
There's something virtuous about living beneath your means and ensuring that, at a minimum, you are not a burden to your family, but that ideally you provide them support rather than siphoning support from them. In order to do that, it's almost a given that you will die with money left over. (The alternative being feeding the bloodsuckers who sell annuities.)
One person's "hoarding of wealth" is another person's "natural outcome of frugal living and appropriate planning".
You speak of frugal living, but why live frugally amassing great wealth? There is a difference between having money to be self sufficient and sitting on billions of dollars
I think the frugal living they're talking about is not in the venn diagram overlap of those accumulating Billions of Dollars.
My understanding is that the point would be to not tax someone leaving a much less significant amount to their children, in the case of either an untimely or expected death, and rather using more targeted methods to prevent the accumulation of billions, like taxing those who accumulate billions.
Typically those billions aren't liquid, they're usually shares in some business you've built which you may not want to sell because it'll dilute your control in the business.
No, but our democratic institutions do. If I ended up parking my riches in a particular country, I'm OK with whatever I have to pay (or there're enough legal mechanism to make it less painful).
FWIW, it's not "obvious" that many poor people would decide that rich much pay a lot. That's not the case in US, for example. Sure, there're people who want to "make rich pay", but in general US system is already fair enough [1] (page links to multiple bipartisan sources).
> many poor people will decide that few rich people must pay more
I fail to see the problem, if you have more money than you could possibly use in a lifetime, why shouldn't that be redistributed through programs that benefit all of society, instead of whatever pet projects the rich person favors.
If the wealth was accumulated legally and fairly, as a result of creating such vast value for society that society willingly parted with their money for the goods/services from the company/ies that the wealthy person invested in and retained an ownership stake in, I don't find it obvious that society should have a further claim on the proceeds from the result of those transactions just because the owner "has too much money".
That person/family has shown some evidence that they're capable of investing money to generate an outsized return on that investment. I would tend to think they might be able to repeat that effect with the way they choose to reinvest the money, be it for societal value or charitable endeavors. I don't see evidence in balance sheets that governments have that same track record.
Society has made murder, theft, and rape illegal largely because of a fairly broad-based agreement that those are immoral.
Where there isn’t broad agreement on morality, I would prefer to avoid passing laws to regulate behavior and allow choice. (Roe v Wade/abortion being just one crystal clear case of this tension which I believe is generally best resolved in favor of individual freedom. I am free to follow my own morals where they are stricter than the law; I do not force others to follow them.)
> I fail to see the problem, if you have more money than you could possibly use in a lifetime, why shouldn't that be redistributed through programs that benefit all of society, instead of whatever pet projects the rich person favors.
Who decides that? The great and scholarly politicians we elect?
How many generations deep does "your family" run? Do you really think people with multiple billions of wealth were living beneath their means?
(I agree with your point if they are upper middle class or even have 10-50 million dollars of wealth). But when you are part of the top 0.1% of the population, there is no way you are living beneat your means to be self sufficient in retirement.
Those who "hoard" wealth do not do so by filling a swimming pool with gold coins like Scrooge McDuck. They invest in companies that provide jobs and the goods and services that the rest of us enjoy. Yes that is virtuous.
Sitting on billions of dollars in stock in a publicly traded company isn't really all that different from having a swimming pool full of gold coins. The day-to-day functioning of that company is not going to be affected if the billionaire sells shares to pay taxes rather than giving the shares to their children. An initial investment in a company is virtuous but once you have billions keeping that money in the family isn't really virtuous given that the alternative is contributing to the society that made the initial investment possible.
Investing in companies is contributing to society. Government is not society. Investing in Walmart so that the rural poor have more access to affordable goods is virtuous. And a whole lot of the contributions to government are absolutely not. Like the money that goes to build bombs to kill people in Yemen, or the money that funds your local police department's efforts to suppress protests against their unaccountable violence.
Do you mean supply of credit? Because additional money wouldn't drive demand for credit, it would drive supply as those with money look for places to lend it.
If you are saying an excess supply of credit leads to financial crises, I agree with you. But the federal reserve that intentionally pumps money into the big banks to make credit easy is a far bigger contributor.
I agree that Milton Friedman had his flaws, one of which is this very topic, he never properly connected the federal reserve, money expansion and easy credit to economic instability.
> They invest in companies that provide jobs and the goods and services that the rest of us enjoy. Yes that is virtuous.
They invest in companies and expect a return! If money was directly redistributed, then the people running and working for those companies might able to keep that value that they have created.
This is true to an extent, but in no way is someone worth $200 billion amassing the wealth the same way someone earning and saving $2 million over a lifetime.
This also implies that only the person investing would provide that function of providing goods, jobs and services. Since he government does the same (produce goods, jobs and services), does that the government is also moral? Why is one more moral than the other?
Not all jobs or service contribute to society. But if you invest in a company that provides goods and services that people don't want, that money is lost and you lose your ability to invest further.
When government provides a service that people don't want, that service can continue indefinitely, especially if the few who benefit can contribute back to the politicians who keep it going. Lockheed Martin and Boeing can contribute to some politicians to make sure that wars continue and they reap back way more than they contributed from the taxpayer who's only option is to vote between two pro-war candidates. Those jobs making bombs for Saudi Arabia to drop on Yemen don't contribute to society, they are a determent to society, yet they continue without end because nobody loses on that investment as long as the taxpayer can be forced to pay for it.
The same could be said about people who want to take other's money away. People are spend-thrifts enough as it is, a wealth tax just dis-incentivizes being fiscally responsible.
Suddenly 99% of the world is no longer discouraged from being fiscally responsible. Do I really care if a billionaire is fiscally irresponsible? Maybe for a single generation. After that, we're good.
What GP proposed was a Wealth Tax which is an additional tax on _living_ people who have a net worth over a certain amount.
What you linked is an Estate Tax (aka death/inheritance tax) which only applies when someone passes wealth on after death. If they decide to give all their money away to charity or otherwise spend it while they're alive it does not apply.
What we now recognize (and decry) as greed looks very similar to the force that created intelligent life from primordial soup. Greed, ambition, and Darwinian fitness seem close to synonymous.
Also, there's nothing uniquely American about considering greed virtuous[0].
Virtuous is subjective, but there is the age old goal of leaving the next generation better off than yours. It seems like a personal choice of whether to spend money responsibly, spend frivolously, give it away, or pass it on to whoever you want at any time to do any of those options.
I'm not sure where I stand on a wealth tax, but I would always be hesitant to tax money that in theory was already taxed when earned. I could certainly see the idea becoming more acceptable if the importance of community and a traditional, tight-knit family structure continues to erode.
> but there is the age old goal of leaving the next generation better off than yours
Hopefully we can strike a balance between leaving only your direct descendants better off and leaving everyone in the next generation better off.
> I would always be hesitant to tax money that in theory was already taxed when earned
This is incompatible with having an income tax and any other tax. Although, income tax isn't exactly well loved by economists, so maybe there is something to that.
>Hopefully we can strike a balance between leaving only your direct descendants better off and leaving everyone in the next generation better off.
You're thinking that taxing the wealth of a billionaire is guaranteed upon death. Therefore from your perspective there are two options: taxing the wealth or not taxing the wealth. Except taxation is the exception, not the rule.
If you know your wealth will disappear then you will try to get rid of it before it can disappear.
With the estate tax there is a strong incentive to just hand over your wealth to your children before you die or by spending it all on donations so the government can't take it.
I was just thinking in terms of the morality / virtuosity discussion there. In practical terms, there are of course massive problems with enforcement and the flight of wealth, for both estate taxes and wealth taxes.
There is lots of virtue in giving far more to society (remember that rational free markets are value exchanges, each party thinks they got a good deal).
Someone who has a lot of stored up value has given lots to society without receipt of anything but some electronic digits (yet). Plus if the government's rules were working they'd also have paid at least some taxes on all that stored wealth, leading to additional societal value.
in rational free markets sone does not need to give twice because the contribution to society is in the provision of things people want.
IMO most of the debate is missing that America doesnt have free markets and keeps trying to duct tape around it without fixing the actual bug.
I think it is virtuous to plan and prepare for your own security and the security of those who depend on you. But beyond that (like if you are rich enough for financial security to not matter much) I don't think it is inherently virtuous to save.
People used to argue that saving (investing) is better for the economy than spending (consumption). That's an argument for a lower capital gains tax. But you could argue the US has gone too far in favor of investors, at the expense of consumption. Presumably more $ in the hands of the 1% = more investment, more $ in the hands of the lower 50% = more consumption.
I don't have an answer, but to flip that question: If the very wealthy can live on passive income from accumulated wealth, then why can't all of society?
Let's liquidate all US billionaires and spread that money to every person in the US. Let's also set aside the question of how one could legally liquidate the billionaires.
OR, just parcel out land and give people seeds and allow them to trade with nearby neighbors... There's no longer a need for money and everyone gets to eat - which is all we really need. Beyond that, people can help each other build homes in smallish communities. Money, even on a planet with this many people, isn't necessary, because it's like people driving cars - the system works because everyone is operating to keep themselves alive. HN is not a fan of this take.
Because most people in society, across all wealth levels, refuse to live within their means. I was quite disappointed when I discovered this, because I thought that if I made enough money, I'd be able to support all my family. But then I started noticing that the people who were broke generally had newer cars and computers than I did, and that families with multiple six-figure incomes were spending their way into bankruptcy. And the government does it too, accumulating ever more debt.
You need a large amount of capital for it to do enough good for others (e.g. via investments into companies) that the returns you receive are enough to live on.
I can assure you the vast majority of billionaires did not become that by caring about creating jobs. They cared about the return. A return that does not have to come matched with creating good jobs.
Assuming you're American I believe you still have people in gov that got rich because of their family starting a pyramid scheme. I wouldn't call that a benefit to society.
Remember those guys in the 90's tanking company stocks and reputations then buying em up under the guise of saving them only to dismantle em and make their profit on the sale of the scraps? yeah they made money removing jobs.
Organizing is difficult. Wealth is created because they are able to appropriately organize people into the jobs they are most efficient. They are able to get people to work harder, produce more, and more efficiently use resources. You might not think efficiency is moral but it does result in a higher quality of life across the board. Why are tech companies currently the darlings? Because each was able to find efficient ways to do things, communicate, search, or combine or improve existing technologies. Instead of printing every book they can just be downloaded and on the same device you make calls. It isn’t a natural process, it requires leaders to make things efficient in order to make money. No one should care about “jobs” because they mean nothing. If one person could produce all the food needed to feed the world then we don’t need jobs. That is the progress these people bring and that is the only reason they are able to make money, by improving efficiency. If you are saying their are ways to make money that don’t improve efficiency, obviously that is true but rare, and even if the case where someone tanking company reputations, the owners of the company are not required to sell, look at Tesla which had the most short sellers of any company and a constant barrage of negative articles but that was all able to be overcome by Tesla’s owner Elon Musk.
Virtue should be paying your goddamn taxes, and donating the rest to the government (i.e. destroying it, to offset other inflationary measures the people elect to enact).
Anything else is either an affront to democracy, or at best is is morally neutral. E.g. what this guy did is morally neutral, and only good relative to the Carnegie knockoffs trying to launder their reputation.
I sort of agree with this in the sense that the estate tax seems like a distraction from the larger and vastly more important challenge of implementing a broadly fair, progressive, and efficient system of taxation.
With a better system, we shouldn't have to introduce one-off taxes for "special events" like death because extreme concentrations of wealth should already be heavily and unavoidably taxed--passing wealth to one's children (or anyone else... in any other country) shouldn't make a difference one way or the other.
Estate taxes stir up an irrelevant debate about the morality of inheritance, and puts the government in the role of deciding this moral question for everyone, when that debate isn't necessary and doesn't really matter.
All that really matters is 1 - how much we need to fund the prerequisites for a modern and decent civilization (which includes things like basic income, healthcare for all, housing for all, education for all, etc., imho), and 2 - what is the most progressive, efficient, and sustainable way to raise this money.
> extreme concentrations of wealth should already be heavily and unavoidably taxed
Unfortunately, government is already the most extreme concentration of wealth in the history of mankind, spending $8 trillion dollars a year in the USA alone, of which $1 trillion (that's 1,000 billionaire fortunes, or bankrupting Jeff Bezos 5x over, every year) goes straight to the military.
That's a good analogy, and explains how we ended up with banana republics. They were just hostile takeovers of competing companies in Central America, leveraging our superior military assets. When you phrase it in those terms, Jeff Bezos looks much more like David than Goliath.
And it's why I want government to use its monopoly on violence to stick to keeping the peace, and create an environment where actual companies can compete without violence.
Because when the men with bombs also own the means of production, they do whatever they want, and you get mountains of skulls.
That's a fair perspective, but there are also many essential or mundane aspects of life which don't lend themselves to competition.
Local roads, for example. You can have companies compete for contracts to perform the work, but ultimately the asset needs to be owned by the people, otherwise you inevitably get rent-seeking behaviour—which effectively replaces an elected Government with dozens of smaller unelected ones. Same goes for water, sewerage, and electricity distribution.
Public healthcare service delivery is another example. You can have companies compete for invention, manufacturing and certain boutique services, but for dealing with measles and broken arms, the profit motive does a hilariously poor job. Wealthy people get the absolute best service on this planet; poor people seem to get the most expensive service on this planet. (Yes, that's after factoring in the "cost" paid through taxes.)
Society works best when we all have healthy bodies, clean water and a decent education. Whether we all make good use of these resources is entirely up to the individual—Governments shouldn't mandate equality of outcome—but a functioning society is one where everyone has the opportunity to get a good education and not be a walking disease vector.
To have an economist leading off with a moral argument tells you how strong the economic argument is. (not strong)
A view toward growing the economy would prefer the riotous living, because it moves more money around. Note that in almost any other context, Friedman is concerned with impediments to economic activity. Yet here, we are led to believe that high levels of economic activity are bad or immoral for some reason?
And of course "riotous living" throws off all sorts of tax revenue in addition to revenue and profits. And since such tax revenue is realized earlier than the death tax, it is more efficient.
The irony of this letter is that Friedman gets it right--the death tax exists to encourage the expenditure of wealth during life--but somehow thinks that is a bad thing.
The idea that inheritance tax is a 'death tax' seems like an inaccurate pejorative. The recipient of wealth is the one being taxed, there is no extant individual whose death is being taxed. In almost all large transfers of wealth we have some amount of taxation. If inheritance tax is the exception, it encourage dynasties to hoard wealth to confer the associate power and status on their families.
This wealth would be more efficiently allocated by the innovators of new generations. It is true that the economy isn't a zero sum game, but we can't pretend that so much new pie is created each generation that dynasties hogging the majority doesn't preclude new, more innovative money, from establishing the positions they might otherwise we allowed to, for the benefit of all participants in the economy. The velocity of money matters, and allowing dynasties to guard their wealth indefinitely is bad for everyone.
This also pretends that capital confers no significant power. The reality is that the inheritors of the ultra rich will also inherit their ability to influence society. While not ideal that the ultra rich themselves have this ability to the extent that they do, to be able confer it on an almost arbitrary set of individuals is additionally hazardous, as they have not set themselves apart from other individuals on any meritorious basis.
Why should wealth be taxed? Because inequality is a bad thing and society would be better with less of it. Inequality is bad because the marginal utility of $100 to a billionaire is nothing, but to the homeless it is everything. Egregious inequality is an inefficient distribution of humanity's collective wealth.
Wasteful spending should also be taxed. There is no dichotomy. Yes please, put tax on carbon, on plastic, on all the other things that are bad for society. Ideally the most wasteful spenders should be taxed the most - the ten-millionth dollar someone spends on a carbon-emitting activity should be taxed at 90%.
The letter is BS with the first line. It makes it sound like the options are giving money to your kids or getting drunk. But that makes no sense for the range of money we’re talking about.
Jeff Bezos could throw a $10 million party every night for a year and his net worth would go down 2%.
Thats not how networth works. No one has enough liquid capital to spend money like that. As soon as people found out Bezos was wasteful like that, his network would drop just based on stock price.
Maybe? That doesn’t counter my point. If anything it only enhances it. Estate taxes do not contribute to “riotous living” because cash on hand is not at all a limiting factor on how much they party. There are more important things, like the perception and how that affects them (like you pointed out).
“If I leave this hundred billion dollars to my kids, the government will take a portion. Better to spend it on hookers and blow instead!”
That makes about zero sense, so I don’t at all believe that’s the message the estate tax is sending or it would even matter if it was. The thing that keeps billionaires from partying isn’t the price tag.
Maybe it was the case, a long time ago, that the very rich accumulated their wealth by "living frugally", but it is certainly not the case anymore. Neither is the case that the estate tax discourages saving is just nonsense: at least in the US, the estate tax doesn't even apply is your estate is under $11M. [1]
> "As a result, only about 2,000 estates per year in the US are currently liable for federal estate tax." [2]
I find it shocking that someone of Milton Friedman's stature would begin his argument with something as flimsy as an appeal to virtue ethics. Hard to take the following statement seriously when it begins with such a baseless and by no means uncontroversial value judgment. That Friedman considers "accumulating wealth" a "virtue" in itself is a profound indictment of his worldview.
Ah, yes, such a shame that the only way to spend a fortune is on caviar and jetskis.
This is a purposefully obtuse take. We have specific tax structures to incentivize charitable giving, building businesses, creating things to benefit others.
The limits for the estate tax in the US are pretty high. It's over $20 million if you are married. That means those who are hard working and frugal will most likely never pay an estate tax. Hard work and frugality will allow you to slowly accumulate several million dollars over your life.
At the wealth levels at which the estate tax applies, a fair amount of luck has to factor in. Having been in the right place at the right time. That has little to do with morality because many other people had the same behaviors but never got lucky. The estate tax is more a tax on luck than it is on hard work and frugality.
I agree. The problem with the estate tax is that it does a poor job at what it tries to accomplish. There are better methods of wealth redistribution.
The primary way inheritances concentrate wealth is through the "firstborn son rule" where the first son simply receives all of the wealth. If you were to split the wealth among the children it would disappear within a few generations. So simplify the whole ordeal by codifying that no single person may inherit more than 50% of the wealth of the deceased. If son and daughter receive half the wealth of their parents they are unlikely to collaborate for the sake of maintaining generational wealth. Even if the son kills the daughter he will only receive 75% of the wealth of his father.
No liquidation is necessary and therefore it is easy to implement. Paying taxes on inheriting a family business is far more difficult than simply splitting ownership among the living who are still working in that business.
> The income used to accumulate the assets left at death was taxed when it was received; the earnings on the assets were taxed year after year
Neither of these are necessarily true. Although, an estate tax is probably a poor place to catch this. Typically, the real wealth isn't even directly owned by a human being anyways, but rather beneficial trusts, etc.
In my view, living within your means, and accumulating wealth beyond your needs, are two ways of saying the same thing. And I think there's a point of diminishing returns on it, in terms of virtue.
If a person lives on a million a year, but accumulates a billion, do they become more virtuous if they accumulate a second billion?
Without a large estate tax, oligarchy arises and destroys democracy.
If everyone lived virtuously, then society wouldn't need laws or taxes. Unfortunately, humans are inconsistently virtuous, so we use laws and taxes to help our society function well.
I understand you are not Friedman, so assume I'm using the general "you" below and that any questions I pose are rhetorical and not directed at you. I don't expect you to even attempt to answer anything below or even have considered the questions.
His argument is hilarious:
"We're going to try and avoid it anyway, so you might as well not try to collect it."
I'm sorry, but I'm not necessarily going to trust someone who has a vested interest in the removal of something that its existence was pointless in the first place. If it truly is meaningless, then why bother?
Another good question is why should a person's accumulated wealth go to that person's heirs upon their death? Those people did nothing themselves to earn that wealth. It is only through the accident of birth they were selected. They completely ignore that. It is assumed that passing their wealth down is natural and right and that any other outcome needs defense.
If that money changed hands via employment or purchase of goods and services, it would have been taxed, even if the exchange was between parent and child. Why is an exchange upon death special?
Passing wealth on to one's children is natural. It has been practiced time immemorial. The Jewish faith is predicated on the idea that promises made to Abraham can be fulfilled by giving the thing promised (land) to his descendants many generations after his death. Take away the idea that wealth should be passed down to one's children and the Jewish faith does not cohere. By extension, neither does the Christian faith.
The idea that you think needs to be defended - inheritance - lies near the root of Western mores. It is fine to question it, but it is the sort of thing that one cannot refute without a very, very strong argument.
I don’t see my estate going to my kids as their doing, but instead as my doing.
I have private property rights over my money and house during my life and it’s my choice to consume during my life or live more frugally and pass that property to people I love. When I give my kids money for school or give them dinner, that value is not taxed additionally because it benefits them and not just me.
The savings rate is an important contributor to economic growth because surplus permits investment.
However saving can hurt growth by reducing consumption.
Savings can be thought of as a steady state rate of saving that the economy has adjusted for. Saving is a higher order effect that causes an increase in the savings rate, temporarily depriving the economy of the level of consumption it expects.
I'm curious what portion of new investment goes into IPOs, additional issues, VC, etc., compared to the portion that just changes hands between fellow 'savers'.
If I buy $1mil of MSFT, I didn't contribute a cent to their payroll. I didn't create jobs, or grow anything. I just transferred $1mil to another investor, who will probably use that money to invest in AAPL.
Seems to me a huge portion of investment is just moving money around a relatively closed system akin to sports betting.
By buying $1mil of MSFT you helped set the market price for their stock and therefore value the company. Based on that value Microsoft can then go to the market and raise new capital.
That is presuming that MSFT ever issues more stock. They haven't appreciably done so in the past 15 years, and the same trend applies for most of the DOW.
If MSFT never issues more stock, what then? Furthermore, helping to determine the value for possible future issuance seems like a very marginal benefit relative to the overall volume of stock trading.
> The encouragement of spending reduces national wealth and thereby the flow of aggregate taxable income. These indirect effects mean that eliminating the tax is likely to increase rather than decrease the net revenue yield to the federal government.
Very arguable claims there - more “trickle down” economics I guess.
The main argument against the estate tax made by this letter is not “moral” as it claims, it is that few actually pay the estate tax - so how about we close those loopholes?
There are two reasons to support a hefty inheritance tax on wealth over $X million. First, it raises revenue to help fill the deficit. More importantly, it is friction against generational wealth. Bill Gates (and his father) have for decades supported inheritance tax and gave this as the explicit reason.
In a "free" society, what basis does society have a right to say how much stuff you can amass? That or we stop pretending we live in a free society. I want society out of my business... if I want to give it away that's my choice.. if I want my kids to live like kings that's also my choice.
Your definition of freedom is just anarchy. The obvious question: What's to stop somebody from murdering you and taking your wealth?
The same objective (or subjective, take your pick) morality that discourages robbery-murder can effortlessly extend to the distribution of wealth in society. An objective moralist once said: "Render unto Caesar...". A subjective moralist could say: "whatever minimizes human suffering and maximizes human opportunities" which leaves policy-makers with a broad canvas.
Personally I don't think this is a particularly moral issue, except near the extremes; but even if it were, the answer isn't what you're hoping for.
It was just a bald assertion that one should have freedom to do what they want because we live in a free society.
If we live in a free society then we should be free to do what we want to do, because otherwise we wouldn't live in a free society.
Any argument that justifies itself merely with "because freedom" can be used to argue for complete anarchy. After all, "rule" of any sort inherently implies restrictions on freedom. And if restrictions on freedom are inherently bad, then "rule" of any sort must be bad by definition.
Society is the only thing enforcing the private property laws that allow you to amass stuff in the first place. If society wasn't involved there would be nothing to stop anyone simply taking your stuff. Society enforces such rules because they are conducive to a good society for everyone. It has every right to stop enforcing them at the point at which that ceases to be the case.
> That or we stop pretending we live in a free society.
This is exactly what we should do. There is no such thing as complete freedom. All freedoms come at the price of restricting some other freedom.
The only thing enforcing private property is the threat of violence if you violate someone else's property. This enforcement can come via a socialized system like government and this is preferable. But you are delusional to think the truly rich need to rely on government. Without 'society' you get survival of the richest and most violent instead of just wealth inequality
>That or we stop pretending we live in a free society.
yes, let's do that. we don't - there has never been such thing as a free society, and we don't live in one now. all society has rules - without rules, it's not a society anymore. Let's once and for all take away this absurd escape-hatch where one can avoid defending an idea on it's merits by claiming it restricts their freedom.
If we truly lived in a free society, we wouldn't have estate law at all - wheover kills you should simply claim all your property.
In a "free" society, what basis does society have to say how much stuff you owe based on your income each year? Or that you have to keep your sidewalk clear of snow each winter? Or that you can't just leave your car wherever you want?
What about amassing as much stuff as possible selling controlled substances and brokering crime?
If you want society completely out of your business, you're going to have a hard time.
Taxation is basically a limit of property ownership. The inheritance tax comes to mind (also an estate tax although those are not well established everywhere in the world) but also income-taxation limits what you can earn as a person and therefore what you can own.
And taxation is also not the only parallel one could draw. For example, limits on the usage of you property is also highly regulated in various ways. Usage and ownership are very closely related.
You're making an assumption I ascribe any feeling whatsoever to what I described when in fact I was extending the comment to include things most societies currently do have a say in, without emotion.
For all you know I am a libertarian making the argument for a libertarian paradise.
Why should your kid have dominion over mine just because you became a billionaire? No society is truly free. That's antithetical the the idea of a society.
I don’t see how a society with dynastic wealth is free, especially when that dynastic wealth further accumulates.
The problem for me is not even that people amass such large amounts of money (do I think we should have some higher tax brackets on capital gains, sure) but that generational wealth creates power and economic structures which hurt the rest of us and ultimately impinges many more peoples’ freedom
Have you ever played monopoly? We are far along the path to the same type of conclusion -- one or a few people owning everything and setting all the rules, with everyone else living marginally and unable to avoid incurring further wealth extraction from the winners of the game.
The government is there, supposedly, for the benefit of a healthy society, not to enforce some capitalists' idea of what they think is fair. It is the same reason why the rules change for a company when it becomes a monopoly (there is that word again).
"I want society out of my business."
This sounds like the libertarian mindset that takes for granted all the benefits that come from being a business operating in a healthy society.
Although worker productivity has gone up tremendously over the past 40 years, nearly all of the incremental gains in wealth has accrued to a small fraction of the population. Yet that form of unfairness doesn't ruffle the people who think taxation is theft.
I find the support for inheritance taxes surprising. HN loves the social democracies, but most of them don't have inheritance taxes, with many abolishing them in the past few decades - Australia, NZ, Canada, Luxembourg, Sweden, Norway, Slovakia, Portugal.
Inheritance taxes raise insignificant amounts of money compared to others form tax. If you taxed all wealth at 100% you could only fund the government for a few months.
I understand your sentiment. But the highest marginal estate tax rate is currently 40%, for amounts above $1M (after deducting applicable exemptions). That seems high enough. The problem is that the estate tax system is so complex, so full of loopholes and tricks, that no truly rich person with 2 brain cells and a competent estate lawyer will pay a fraction of that 40% tax.
I don't know what the solution is, but it seems to me that the estate tax system is overly complex, too open to abuse, and needs to be simplified. It is unfortunately intertwined with Trust laws, Probate laws, Income tax laws, international tax treaties, etc. As far as I can tell, the estate tax exists only because of the "stepped up cost basis" feature in the US tax code, where all capital gains is zeroed out upon death by increasing the cost basis of the asset to the current market value. (Does any other country have this?)
I think it would be simpler to eliminate Stepped Up Cost Basis, and replace the estate tax with something like a "deemed disposition" tax, where the capital gains tax is paid upon death (above a certain exemption amount, say $5M/couple), or paid upon transfer to another non-pass-through legal entity (e.g. an irrevocable trust). Oh, we should also eliminate the long-term capital gains tax rate, and all capital gains should be taxed at the same rate as earned income. I think this would eliminate the "carried interest" loophole. Oh, and we should eliminate Dynasty Trusts, which can last as long as 365 years. It's hard to see how allowing a Trust to last 365 years is good public policy. Oh, and so many other loopholes need to be closed.
Unfortunately, I don't think there is much political will to tackle these issues. Estate tax law is a very obscure part of the tax code. Very few people care, except for the small number of ultra wealthy people and their lawyers who are taking full advantage of the current system.
An estate tax should be simple and Draconian to be effective. Simple is you have $10 million to distribute to anybody you so decide in your will. Only one blanket exception without restrictions or definitions attached. Everything else goes to the government. Any assets transfered out of country, as well as those derived thereof, are forfeit to the government, and any internally claimed jurisdictions, upon reentry.
A caveat to this is, what happens when we actually solve aging and involuntary death? Will the world eventually be owned by a single, Bezos like individual simply by the weight of time and compounding interest crowding out everyone else? Would we be ok with a situation where the racist slave owners of 200 years ago are still alive and control the vast majority of the world's wealth and power?
This is the kind of concern that isn't a problem right now, but will be one day. And it will happen in the blink of an eye.
> Why in the hell should the Rockefeller’s of today be billionaires???
I'm curious what the statistics are for a family remaining wealth over a long period of time.
Even with wealth evenly split between each generations kids, given a growth of just 4% it might end up with each generation getting a greater amount of wealth still.
In the past large familes prevented this, but if the average extremely wealthy person only averages 2 kids. The dilution through children just doesn't occur.
> I'm curious what the statistics are for a family remaining wealth over a long period of time.
I don't have statistics, but a fun factoid is that the Grosvenor family, who own many properties in the west end of London, were originally granted those properties because the grantee was the grand-nephew of William the Conqueror. So wealth can last a long time. For those families who are luckiest and canniest, the only major threat is social breakdown as a result of revolution or being conquered.
> Even with wealth evenly split between each generations kids
This is why primogeniture and entailments were invented. They were necessary to maintain dynastic wealth. In cultures where partible inheritance is more common, such as the US, dynastic wealth has a much shorter half-life.
Familial wealth disperses much quicker in the United States than other countries. Comparing modern american economics to the descendants of william the conqueror in feudal pre capitalist society with an entrenched aristocracy is disingenuous. You cannot seriously use that as an example of why wealth will last in american families like that.
The book The Son Also Rises makes a fairly compelling (albeit contested) case that extreme wealth continues to have beneficial impact for hundreds of years.
The author shows numerous examples but one of the most striking for English-speakers is that the Norman conquerors of 1086 are still, 31 generations later, over-represented at places like Oxford and Cambridge admissions and upper class probate court records.
> I have no problem at all with Bezos being worth $200 billion
Really? You have no problem one person owning so much money? That's around 30$ for _every_ person on the planet, can you even wrap your head around that? There's no reason why a single person should ever own this sort of wealth, none at all.
Curious, what exactly stops these rich families from simply moving their wealth off shore? I'm sure there are many other countries that would bend over backwards to have these uber rich families living in their country instead of the USA.
It doesn't matter if you live in another country. US citizens are still taxed by the US government regardless of where in the world they live. Moving to another country accomplishes nothing.
They would have to give up their US citizenship. Financial implications aside, few are willing to go that far. The financial implications are also large. You have to pay an exit tax, which would be substantial. And giving up US citizenship to avoid taxes is illegal, so there's that too...
I don't get it, the Rockefeller family has an estimated net worth of $11bn today. That's for 174 members of this family or around $63m per family. While not a small amount, it's not outrageous either; especially that it's an old family, so they haven't really accumulated lots of wealth. You'd think compound interest would have made them own much more than that.
On the other hand, Bezos, a single person, has control of a $1.58T company and you are totally okay with it?
Because it exacerbates the divide between the wealthy and the poor in this country, creating classes of wealth that is so far beyond a normal person as to live in a different realm. It creates a ruling oligarchy class that is passed down not on merit or by work, but purely through nepotism.
This would hurt family owned businesses. Under such a system, within a family, everyone would keep their money to themselves. Let's say your dad wants to open a restaurant, so you donate $1 million, and the business does well, but then he unexpectedly dies and the his net worth is assessed at $5 million. Now you are out $1 million due to the tax. pretty bad deal.
Why donate? Why wouldn't you invest in it and become part-owner yourself?
But you can also flip that around: Let's say your dad opened a Facebook, but then dies, why should you get $98 billion? You didn't do anything. Why is that now yours in the first place?
>Why in the hell should the Rockefeller’s of today be billionaires?
Because we live in a system which rewards good genes, and that is a very good thing. By instituting a generational wealth tax you will be killing the human desire for wealth on a generational timescale.
Where does the money go? To other people i assume, you have now created a system where the evolutionary incentive is to leech from the system contributing as little as you can get away with. We live in such a system today but at-least there are some benefits to contributing more, those benefits are inherently that you can turn wealth into more children and transfer that wealth to them.
This is a not good line of thinking. Good genes? What does that mean, greed? Competitiveness? What about positive human traits like empathy, compassion, generosity and contentment? The things that make society work in the first place? Plus it's not like billionaires have more kids. "Leeches" aren't poisoning the gene pool... Your "leeches" are the gene pool.
I agree we should strive for a system which incentivises empathy, compassion, generosity and contentment.
Billionares do not have more kids but wealthy people have the capacity to have more healthy offspring, irregardless if they actually do.
I have said nothing about poisoning the gene pool, i am not a eugenicist and far from it. But every system has free-riders (leeches) as game theory predicts, we should try to counteract this behaviour not reward it.
I'm very sceptical about the claim that the incentive to earn staggering amounts of money goes away if your great-great-grandchildren cannot profit from it. Caring about your own children and grandchildren makes sense because you actually get to meet them, but at some point most people probably don't care about their far-far relatives.
Also, is this really your main motivation if you're Jeff Bezos? To make even more money? Doesn't the money stop mattering after the first 100 million and you're simply staying at Amazon because that's what you actually like doing? (Including having influence, shaping the future of commerce, etc etc)
>I'm very sceptical about the claim that the incentive to earn staggering amounts of money goes away if your great-great-grandchildren cannot profit from it.
I'ts not that simple, we are talking about evolutionary timescales here. It's very easy to see that if we live in a universe where accumulating wealth will not benefit your descendants, then accumulating wealth is an energy and time sink which will be selected against.
As for the second point i have no idea what Bezoz's motivations are.
This is a role model I can actually appreciate. I can't figure out why this is the first time I've heard of him. I've seen lots of news about people buying expensive shit, but the fact that this has never come to my attention is a horrible indicator of what the media chooses to report on.
It is. Philanthropy exists to launder the reputations of the rich, on the one hand, and are paternalistic on the other. The only things that get funding are things that can attract the attention of our "betters." If we had taxed them on the front end to the point they couldn't become billionaires in the first place then people in general (through democracy) can decide what causes are valuable. And with the added bonus that the negative effects of they got to be billionaires don't cause more problems (Feeney worked in private equity. PE are strip & sell firms)
Sorry you're getting down-votes, because I think you bring up a very important point. We as a society should understand the trade-offs involved when we allow individuals to accumulate truly vast wealth. In general terms, this increases the variance in how the money can be spent. One guy might give it away, another builds rockets, another buys gilded toilets for his estate. Individual decision makers can do much better than government (the benevolent dictator...of their own money) and much worse (irresponsible or even damaging use of it). Government use is less efficient, but also has less variance: it will be spent on a similar range of things, but closer to the middle.
I'm guessing the comment text turned a shade of gray, which happens when the count goes negative. Though it's back to the normal shade currently, meaning it's back above negative territory.
I downvoted, not because of what he said or how he said it, but because there's basically no chance that the comment will lead to an enlightening conversation.
I’ve noticed this community is very bullish on the ends justifying the means, ie a founder that bends the rules and causes some damage and hurts some people but has a huge exit and gives some to charity is still a hero and role model.
You can't become a billionaire through honest earnings. The degree is variable but the presence is inevitable, becoming required more the more billions you amass. Of course, you can take the ethical route, but those people don't get the billions.
I know a billionaire who basically was in the right place at the right time during the biotech boom. He started a company as a side project (he was a professor), got a deal to supply a major pharmaceutical company, and expanded from there. I don't know every decision he ever made but I'm not aware of any unethical behavior. He lives fairly frugally and has made a point of staying under the radar (he's successfully avoided being put on Forbes's list of billionaires, for example).
I'm willing to argue that it is in fact possible to become a billionaire though honest earnings.
I probably shouldn't make such absolute statements, they do beg for counterexamples. I'd be surprised if your friend didn't engage in some anti-competitive or employee-exploiting practices, but of course I have no idea.
'CrazyStat answered the ethics part, but I also want to point out that "earning to give" doesn't mean you have to become a billionaire. It means you want to maximize your earnings to the degree you're capable and comfortable with ethically. "Ends justify the means" is not a part of "earning to give" philosophy, even though some people probably adopt this principle.
> Feeney worked in private equity. PR are strip & sell firms.
Chuck Feeney didn't work in PE, and he wasn't one of those creatures you despise. He invented Duty Free Shopping in WWII, selling booze, smokes and cars to returning servicemen. He pioneered airport shopping, doing all the hard, clever work himself, and spent the bulk of his life giving the billions earned to good causes anonymously.
Why? He didn't care about money or reputation. He wanted to make the world a better place.
> Philanthropy exists to launder the reputations of the rich
It can be used that way, but Chuck Feeney didn't need or want that. That's why he gave anonymously right up until international money laundering regulations post 9/11 forced him to reveal his identity.
Yeah, to put this in some context, giving to "education" sounds good, but then when you see over $1B or 12.5% of his fortune went to elite private universities (one of which, Stanford, already has the 3rd or 4th largest endowment in NA), that really stretches the definition of "philanthropy".
Doesn't it depend what the private universities do with the money? If it's spent on enabling people to attend who otherwise wouldn't be able to, that seems good (regardless of how large the endowment at that university is).
Instead of rationalising, try researching. Ivy League universities, for example, almost uniformly use "need-blind admission". Meaning they admit you first, and the decision comes with a promise to find a way to make it affordable for you to attend given your circumstances.
In the end, donations are a form of political power, If only deciding what gets funded, and what doesn't, even before all the other self promotion stuff surrounding them.
Whats a better model for deciding the distribution of political power, a democratic one, or a dictatorial one?
At the very least I don't think its an unreasonable position to believe that democracy makes more sense.
Except that government has a lot more political power than your average philanthropist. It's not even close. Tax money inherently involves political power, in a way that's simply not the case for philanthropic donations.
Strictly speaking, the U.S. is a republic not a democracy. Are you sure that your average congresscritter makes better decisions on money allocation at the margin than a private philanthropist would?
Microsoft and Amazon don't care what color my house is or how close my garage is to the property line so long as I keep paying them. Just paying my property taxes is not enough to prevent arbitrary violation of my property rights by my local government.
Why only democracy or dictatorial? There's no form of voting that involves more freedom than voting with your wallet.
If democracy gets involved in that process, suddenly there's only an obstruction to say "No...you can't spend it on that." It's just there to introduce a form of majority control.
I wonder if philanthropy is used sometimes to garner narcissistic supply as I suspect a lot of billionaires are narcissists or psychopaths (not necessarily malicious but these qualities help in wealth building). If so, I think we should respond positively to these and provide the narcissistic supply (and hold off from criticism even if it's hard to) so this becomes a trend among the billionares.
I doubt it. Real narcissists and psychopaths are incredibly self-centered; they have a lot of trouble even accounting for others' goals in, e.g. a business negotiation, which is why they usually resort to authoritarian or manipulative attitudes. A typical narcissist wouldn't even know how to start looking at good opportunities for philanthropy or charity. Now, I agree that philanthropy might come with selfish side-benefits for the person who donates, but true narcissism is most likely not involved.
>then people in general (through democracy) can decide what causes are valuable
Like lobbying their representatives to allow for loopholes and credits to allow them to keep their money and avoid the taxes that the lesser incomes must pay
Yes, the causes they fund are lauded but are not always the causes we really need funding for or actually want / believe in. In other words, they use their wealth to shape our society without our input.
I think the jist was that BrainInAJar believes that most people who get super rich do so, not by simply providing value, but by exploiting vulnerabilities in how society works so that they create a need for the value they are going to provide.
I'm not sure how accurate of a representation this is, but it certainly appears to work that way in some places. Realtors are a really good example of this, and of course, Butler's "War is a Racket" is a classic regarding the US military-industrial complex.
Cable originally started because people in valleys of PA and the like could not get antenna reception. So the CATV companies put up lines and started selling the service.
Sure, they were filling a 'need'. But I think when we look back at how the CATV Industry itself punishes 'piracy' there is more than a little irony. The only reason they started paying was because it was codified into law.
Also, the CATV Industry's general union-busting structure; lots of linework invovles 2-3 layers of contractor companies. By doing so, they help prevent unionizaiton (which is a thing in the Phone line side of things, their workers tend to get paid more and be happier in my experience) and also 'absolve' themselves of much of the responsibility when something goes wrong (especially in the contractor industry, that 'last layer' may not be around in 1-2 years.)
> The only reason they started paying was because it was codified into law.
Aye, there's the rub. The greatest evils are when the billionaires team up with the government. Shifting money from the villains with money to the villains in the legislature doesn't solve that problem, and the villains in the legislature already spend close to half the GDP.
> then people in general (through democracy) can decide what causes are valuable.
Conveniently, we can already see what causes we think are valuable, because the US government already spends about 40% of the entire GDP, $8 trillion per year.
Apparently we've decided that Donald J. Trump should manage it, and that $1 trillion per year should go to the defense industry (that's 600 Chuck Feeneys), with another $500B (300 Feeneys) to interest on the national debt.
The very first commenter on that article really says it best (and succinctly):
> I feel this is one of your lesser thought out pieces. I mean false equivalencies are rampant in it.
but... if we must, a few hard counterpoints:
> 1. Is criticizing billionaire philanthropy a good way to protest billionaires having too much power in society?
This point misrepresents how journalism & counter-criticism occur.
People criticize billionaires. Full stop. Criticism of their philanthropy is not selective: it's a criticism of the billionaire when they receive press due to their philanthropy, not because its philanthropy. Billionaires don't receive wide-reaching press because of their new yachts because those articles are only of interest to niche audiences, whereas philanthropy is promoted more broadly. THAT's the only reason it receives more criticism.
> 2. If attacks on billionaire philanthropy decrease billionaires’ donations, is that acceptable collateral damage in the fight against inequality?
This is cross-referencing the first point and doesn't hold water once the first point is debunked: the "attacks" on billionaire philanthropy are directed at billionaires because they receive positive press, not because they are philanthropic. This question only makes sense if you believe non-philanthropic billionaires should not be criticised for being billionaires.
> 3. Do billionaires really get negative reactions from donating? Didn’t I hear that they get fawning praise and total absence of skepticism?
(a) the question is bizarrely worded and I don't understand how any answer to this question would either confirm or debunk... anything.
(b) the author's "research" has sample sizes of 25 (Twitter search) and 10 (Google search) respectively. i.e. is basically junk.
> 4. Is it a problem that billionaire philanthropy is unaccountable to public democratic institutions? Should we make billionaires pay that money as taxes instead, so the public can decide how it gets spent?
This is again a poorly worded question but the content of the "answer" essentially amounts to a (rightful) critique of the current US government, and compares it to 3 cherry-picked examples of philanthropy that the author believes were better than what the current government would do.
Moving past the obvious point that... dear god what a low bar that is... as a general simple rebuttal: criticism of billionaire philanthropy generally centres around the fact that their philanthropy does less good than the negative impacts of their existence as billionaires. These negative impacts are absolutely the reason for the current state of the US government.
Arguing that billionaire philanthropy is inherently better than functioning democratic government in general is obvious nonsense.
> 5. Those are some emotionally salient examples, but doesn’t the government also do a lot of good things?
Same point as 4
> 6. The point of democracy isn’t that it’s always right, the point is that it respects the popular will. Regardless of whether the popular will is good or bad, don’t powerful private foundations violate it?
I mean this is slightly different but it's essentially 3 Qs on the same thing...
> 7. Shouldn’t people who disagree with the government’s priorities fight to change the government, not go off and do their own thing?
4 Qs on the same thing. This is a crafty technique to seem like you have more bullet points than you really do.
> 8. Is billionaire philanthropy getting too powerful? Should we be terrified by the share of resources now controlled by unaccountable charitable foundations?
We're now wandering off-topic from the original "should we criticise billionaires" to "is billionaire philanthropy dangerous in theory", and starts with the argument of whether they wield too much power. For this, they use their total philanthropy spend as the operating metric, rather than the actual resources at their disposal. Total net worth of US billionaires rivals the federal budget, and exceeds the mandatory spend. The wealth of just one of those billionaires is almost 1/16th of the federal budget and fast increasing.
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At this point the list of bullet points verges off into the land of vague discussion and is no longer a set of "counterpoints" and just a rambling conversation.
This author sure can write a lot, but none of the points seem to land.
> People criticize billionaires. Full stop. Criticism of their philanthropy is not selective...
And Scott's point is that non-selective criticism is dumb. If you don't want your dog to chew the carpet, criticizing your dog, full stop, as you say, is a terrible strategy.
If you're opposed to dogs or people richer than you in principle, then you can make that claim too I guess. But you won't get much sympathy if you do it when they're doing their most praiseworthy things.
Just out of curiosity, do you just think that billionaires are evil, or does that also extend to people in rich countries making six figure salaries in tech, who are also ridiculously richer than most of the rest of the world?
> And Scott's point is that non-selective criticism is dumb
That's a reasonable point to make, but... I don't think I saw Scott making it. Are you sure that was Scott's point, or is it yours?
> criticizing your dog, full stop, as you say, is a terrible strategy
I guess this depends on our definition of "criticising" and it's intent. If you're sitting at home, shouting at your dog, I'm not sure that's particularly productive. If you're having a conversation with a peer, and expressing your frustration at your dog chewing carpet, you may perhaps combine forces to arrive at some solutions to your carpet problems.
You can argue that perhaps discussing the plight of billionaires amongst peers (or even random folk on the internet) is equivalent to sitting at home shouting at your dog, but I think that's a debate for a different day.
Point being: I doubt many "criticising" the billionaires/dogs are expecting them to listen. They're discussing problems (and potential solutions?) in a more general sense by criticising a system/event that exists/occurs.
> do you just think that billionaires are evil
Are you proposing that dogs chewing carpets are evil? I presume not, but I presume you still want to save your carpet.
Billionaires are not necessarily "evil" in intent in the absolute sense. What I am proposing is that their existence is a problem needing solving in and of itself.
The existence of billionaires (or anyone who holds more economic resources than are needed to be content... I think that stands somewhere around the ~$150k mark according to some studies... certainly far short of whatever number of millions/pa leads to billion-level assets) necessitates that those resources have been withheld from someone who has less than are needed to be content (in many cases, to survive).
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It may be worth noting that Feeney has gone about solving this exact problem (the existence of billionaires), albeit in a very individual way (making 1 billionaire no longer a non-billionaire). Which is quite an remarkable and laudable achievement, even if that billionaire was himself.
(and that's before we get into the very far-reaching, and—in my own experience—enormously positive impact, of his philanthropy)
I am amazed at how easily you skip over the fact that this means government gets to spend that money. As if that were some ideal outcome which would solve all problems.
Which government exactly is it that you think is excellent at solving societal problems and spending taxes efficiently?
I tend towards the conservative side of center, which has been an uncomfortable place for the past 10+ years in the US -- both parties moving away from the center, but the GOP doing so much faster.
I thought for certain the level of hate the left has for the current federal regime would make my constant refrain of "do we really think the government will do a better job?[1]" finally make sense. However, the empirical fact that government agencies will be directed by those you don't like doesn't seem to deter people from wanting to increase the role of those agencies.
1: To be clear: I'm not an anarcho-libertarian; I think the answer to this question can very often be "yes" but living in coastal California, I too often seem to be surrounded by people who think getting the government involved is the only reasonable solution to any problem. Conversely there is a very large minority of the US right that seems to think that bombs, guns and walls is the only time the answer is "yes"
Seriously! Replace "government" with "Donald J. Trump" and all of a sudden it doesn't seem to appealing to have government in charge of healthcare, education, and Chuck Feeney's fortune, at least to a lot of the people making the argument.
I don't know much about Singapore, but it tops the Heritage Foundation Index of Economic Freedom, which implies it has a fairly low tax burden.
[edit]
The top individual income tax rate is 22 percent, and the top corporate tax rate is 17 percent. The overall tax burden equals 14.1 percent of total domestic income[1].
Those sorts of comparisons are always a three way tug of war between the letter of the law (what you can do on paper), enforcement (what you can do in reality) and taxes (the cut the .gov takes).
Depending on how much you value each one depends on the answer you get.
I wonder if a person was more involved in charitable giving if they would have heard about this guy before? Mainstream news coverage isn't going to cover him much but stories have been written, he worked closely with Gates and Buffet.
My takeaway from this story is to spend my time on things that matter to me. It's a reminder that our news sources are really just another form of entertainment, which is not something that can give your life meaning or a sense of accomplishment.
He gave anonymously until 9/11 forced his hand. In the wake of the attacks, international money laundering laws were tightened, and large international transactions were scrutinised.
Feeney donated some half a billion dollars to medical research in Brisbane, Australia, guided by an old friend from his young days in Hong Kong, the tennis player Ken Fletcher.
When Fletcher told former Brisbane Lord Mayor Jim Soorley he had a mate with millions to give away to good causes, nobody in Brisbane would take him seriously. It forced Feeney to come out with his philanthropy, and whilst he never cultivated a public profile, Feeney did at least speak in public on a few occasions when dedicating medical research centres that were built with his donations in Brisbane.
This one line
"While notoriously frugal in his own life, Feeney was ready to spend big and go for broke when the value and potential impact outweigh the risk."
Amazing life, made a ton of money and lived to see it all given away.
> I've seen lots of news about people buying expensive shit, but the fact that this has never come to my attention is a horrible indicator of what the media chooses to report on.
While weighing journalist's actions you might want to consider that Chuck Feeney wanted to remain completely anonymous and the media - the members of the media acting in accordance with your desires specifically - made that impossible.
(that some of us have known his name for many years might also indicate that this has never come to my attention is not a meaningful measure of the media's performance - perhaps it's a measure of your use of media)
Good example of why I really like HN. Quite keen to read up more on Feeny. Reading about anonymous contributions and selfless behavior like this is such a mood lifter when trawling through the day to day news and information floating around
For a great read, and to get a sense of who Chuck Feeney really is, track down a copy of Hugh Lunn's book The Great Fletch, the story of Chuck's mate Ken Fletcher from his Hong Kong days.
Buying "expensive shit" is an honest business transaction. Who do you think makes all this expensive shit? They all have families to feed, you know. If you're rich, buying expensive shit is probably the most beneficial thing you can do for society.
By contrast, charities and non-profits get this halo of being socially beneficial, even though they're often some of the most wasteful institutions of all. Cornell gets a billion dollars from this guy, as if they didn't get enough money from the racket that is higher education in the US.
> If you're rich, buying expensive shit is probably the most beneficial thing you can do for society.
That's not true. You can go and pay people a 50 million dollars to make a yacht for you. Or you can pay that 50 million to other group of people to build housing for the poor. In both cases, it provides jobs and puts food on the table of the people you employed. But, the yacht is just a toy for you, while housing will be life-changing for hundreds of families.
"Housing for the poor" is indeed life-changing, but not in the way you like. The government has spent billions on housing for the poor, and the result is usually called a ghetto.
If instead you hired some of these poor people to build something nice for you, they wouldn't be so poor anymore. They could even afford decent housing, if the government didn't prevent that from happening with zoning laws and various other regulations.
>If instead you hired some of these poor people to build something for you, they wouldn't be so poor anymore. They could even afford decent housing, if the government didn't prevent that from happening with zoning laws and various other regulations.
But their labor isn't worth that much, and no one would ever pay the poor that much when they could pay someone else less, or undocumented immigrants almost nothing under the table. "Pay the poor enough not to be poor anymore" is not how capitalism works.
You could do either. Real world economics and history, however, suggests you would do neither, because the incentives of the labor market mean you can get adequate work for far below the cost of a living wage, and you didn't get rich by throwing good money after bad, so to speak.
Jeff Bezos could give every Amazon employee $100,000 and still be the richest man in the world. He could also afford to pay every employee far more in wages than he does, and Amazon would still make money hand over fist. As companies go, Amazon is one of the more laissez-faire, so it's not as if he wants to, but his hands are tied by overburdensome regulations. He doesn't, because why should he? Why not spend a few million dollars on a ten-thousand year clock instead?
Many people living in low income housing are already employed, and the market has already decided the value of their labor is worth just enough to scrape by with government assistance, and no more. Depending on the free market or the magnanimous (and mostly nonexistent) charity of the capital class to lift up the poor doesn't work.
> You could do either. Real world economics and history, however, suggests you would do neither...
You digress.
> Jeff Bezos could give every Amazon employee $100,000 and still be the richest man in the world.
Jeff Bezos doesn't have that much cash. I guess he could award that much in stock though. True enough.
> He could also afford to pay every employee far more in wages than he does, and Amazon would still make money hand over fist.
Wrong enough. Amazon is already spending most of its income in the areas where it employs most people. Turns out shipping cheap junk for free across the globe isn't that profitable. That business is cross-subsidized by other more profitable areas like AWS.
If Amazon were to use those remaining profits and put them into fulfillment workers' salaries, the company would be pointless from an investment perspective, the stock price would tank, the company would have trouble raising capital, and Jeff Bezos wouldn't be the richest man in the world.
It's similar for other companies like Wal-Mart that work on razor thin margins but employ a lot of people. Sure, all of these people earn a low income, but at the same time they benefit from low prices.
> Many people living in low income housing are already employed, and the market has already decided the value of their labor is worth just enough to scrape by with government assistance, and no more.
Sure, but "the market" is society as a whole, not just some billionaires. Billionaires aren't forcing down their wages, it's the ordinary people consuming their labor, who only buy at the lowest price.
The least productive people are always going to be poor in relative terms. In absolute terms, the salary of an Amazon warehouse worker puts you close to the global 1%.
You may believe the narrative that all these profits go into the pockets of a few rich people, and if only those people left some of that money on the table, everybody would be way better off, and it's all capitalism's fault. It just doesn't add up. Capitalism doesn't tolerate high profit margins over an extended period of time, it drives prices down for everybody, which benefits those the most who don't have a lot of income in the first place.
I suggest that it does not align with consumerism/capitalist ideologies which are used in the feedback loop to promote themselves/further substantiate their existence and influence in culture. Philanthropy is great, but to some extent I think the argument that properly taxing such capitalistic gains could have greater effect on society when properly used by the system that can support massive scale projects (i.e. the government).
Tax dollars go vastly more to dropping bombs on civilians in the middle east and ICE and the NSA than they do to any positive social program (ignoring things like social security that are funded by a separate tax that billionaires wouldn't pay much into under most schemes). I don't love the outsized influence on society that billionaires have, I certainly don't love the Koch brothers -- but I think looking at the $X pool of money spent on philanthropy by billionaires per year, it is probably much better distributed than that same pool of money would be if it was paid as income taxes.
So the thing is... tax dollars go more to dropping bombs on civilians in the Middle East and to ICE and the NSA because that's what people overwhelmingly want. I guarantee you that if public opinion shifted hard against these things, we'd see less funding over the years toward them.
But it doesn't. Regardless of what we say here, the majority of the US wants a big military, and wants hard immigration controls.
Then it becomes a different argument: should we tax the wealthy more if it means the money will go to government initiatives that the majority seems to want, even though a minority of us believe that those things are largely bad for society and the world, and represent short-term thinking that is a result of bad risk assessment? Essentially, should we let the use of this money be directed by the will of the people (rather than a few ultra-rich people) even if we believe the will of the people is often wrong?
I don't have great answers to this. As another commenter mentioned, the billionaire-philanthropist system is good when we have people like Feeney, but fails when we have people like the Kochs. Do we have a net excess of Feeneys in the world, or Kochs? And even if we have the former, is that still a good thing; could we get more fair or equitable outcomes if we did let electorate decide how to allocate these funds? And even if we couldn't, is it antithetical to democratic values to go against the will of the people, even if the people are wrong? And if so, does that matter? I tend to think it does, but I can see the argument for both sides.
> So the thing is... tax dollars go more to dropping bombs on civilians in the Middle East and to ICE and the NSA because that's what people overwhelmingly want.
Support for the War in Iraq was 39% in 2004, 30% in 2006, 34% in 2007, etc. Despite massive PR campaigns on the part of politicians and the natural tendency to ("support the troops"), our various military adventures are actually not very popular among average Americans.
But they are very very popular among rich members of the military-industrial complex, and those people have enough money to win elections and buy politicians, so here we are.
> Do we have a net excess of Feeneys in the world, or Kochs?
Kochs, absolutely, unequivocally. There is no billionaire on Earth who could fix all of the damage caused to the environment by the Koch brothers, any more than a sufficiently well-intentioned German Chancellor could undo the damage Hitler caused.
This is one of the fundamental asymmetries of life: it is easier to destroy than build, easier to harm than heal. With a cheap kitchen knife and a fraction of a Newton of force, you can sever someone's head. Can you as easily put it back?
This is, I think, the core reason why inequality is dangerous. Because when you concentrate power in fewer people, the variance of the resulting outcomes increases. And if you increase that variance, the bad outcomes get worse more than the good outcomes get better.
Say what you will about hunter-gatherer societies, but they never dropped a nuclear bomb, caused a Holocaust, or filled the atmosphere with lead fumes. We obviously shouldn't dial inequality back to pre-industrial levels, but the existence of billionaires is essentially playing global-scale random wildcards in the game of life.
In other words: should we let the use of money be directed by the people who will actually pay with their own money for what they want, or should we let a vacuous "majority" pursue whatever goals they might seem to want, with money that's not even theirs to spend in the first place? I know what my answer would be. Even the Kochs are spending money for what they regard as the good of society. There's nothing inherently 'wrong' with that.
>If you let billionaires make the choices then sure you get some like Feeney/Gates/Buffett but you get Koch brothers.
You just disagree with the things the Kochs choose to fund. You could have easily said Murdoch instead (or Bloomberg if you wanted to pick someone who's hate crosses party lines).
Were the government funding the causes these billionaires fund the causes would still be controversial. We just wouldn't have a single person to have the lion's share of the blame.
That's kind of the point though. Whether you believe that decisions ought to be made by the people, or by whoever has the most money is sort of an axiomatic thing. It's not like we have any good way of testing which one is "better".
> You just disagree with the things the Kochs choose to fund.
Sure, and I'm also not a fan of Jeffrey Dahmer's taste in fine dining, but I don't think it is reasonable to chalk that up to a mere difference of appetite.
> Were the government funding the causes these billionaires fund the causes would still be controversial.
Were the government funding those causes we could stop funding them because they are horrible and people hate them.
And just to be clear, the Koch brothers fund things like efforts to end civil asset forfeiture, not just the things people like to get mad at them for in the media...
Indeed, the power goes to the person who can successfully manipulate the most people. Historically that tends to be people who blame minorities for all the ills of the group of people most likely to vote, and come up with what seem like easy solutions (tax the rich, ban the immigrants)
I for one don't have time in my life to be an expert on running an economy, creating an immigration policy, balancing the environmental and societal needs etc. I specialize in my area of expertise and use that money to employ others who specialize in their areas, and that includes government.
> Indeed, the power goes to the person who can successfully manipulate the most people.
Perfect the enemy of good, etc, etc. What I solved is the problem of relying on a potentially authoritarian government which is what was brought up, rather than all possible problems. What I suggest would be better, not perfect.
> I for one don't have time in my life to be an expert on running an economy, creating an immigration policy, balancing the environmental and societal needs etc.
That's the point of liquid democracy. You delegate but reserve the right to override your delegate if needed.
Mark Benioff donated $100M to the UCSF Benioff Children's Hospital and got his name on the INSTITUTION (not just a building). What many don't know is that donation was to complete a match of $125M offered by Chuck Feeney (who does not have his name on a building anywhere on the campus, AFAIK).[0]. That $125M was only part of the $394M Chuck ended up giving to UCSF.[1]
> And he gave it away anonymously. While many wealthy philanthropists enlist an army of publicists to trumpet their donations, Feeney went to great lengths to keep his gifts secret.
Donating anonymously is a way of avoiding ending up on the mailing list of every charity in the country.
While it wasn't so important in this case because as a former billionaire I assume he had people at a foundation who's job it was to handle his correspondence, but if you are a regular person looking to make a donation it's often a good idea to keep your name and contact info out of it as much as possible. Charities can be really bad about selling your name.
Not sure if it was the case for Chuck, but a small percentage Christians strongly believe that charity should be anonymous because it actually says as much in the bible.
I'm not a Christian myself and definitely not rich at all, but I do prefer anonymous donations.
1 “Be careful not to practice your righteousness in front of others to be seen by them. If you do, you will have no reward from your Father in heaven.
2 “So when you give to the needy, do not announce it with trumpets, as the hypocrites do in the synagogues and on the streets, to be honored by others. Truly I tell you, they have received their reward in full. 3 But when you give to the needy, do not let your left hand know what your right hand is doing, 4 so that your giving may be in secret. Then your Father, who sees what is done in secret, will reward you.
And Islam has similar, one of people that will be given shade on the day of judgement.
“…A man who gives in charity and hides it, such that his left hand does not know what his right hand gives in charity; and a man who remembered Allah in private and so his eyes shed tears.” (Abu Hurairah & collected in Saheeh al-Bukhari (English trans.) vol.1, p.356, no.629 & Saheeh Muslim (English trans.) vol.2, p.493, no.2248)
A Christian theologian would explain it this way: the point is what rewards the giver is seeking, because that is what reveals what’s in their heart as they do the outward action of giving. As one author observes, “The worth and excellency of a soul is determined by the object of its love.”
A gift given in secret is seeking the rewards truly worth having: the praise that comes from God. Those who seek that find it, because they loved what was truly worthy of love. But gifts given for others to see are seeking a reward on earth, not heaven—and that’s what they get. Either way, they’re not penalized if, say, the word gets out against their wishes. That’s not the point: God knows and judges the heart and rewards them based on what they were actually seeking.
So seeking rewards is not only categorically OK, it’s actually encouraged, but with the caveat that the seeker set their heart on what is eternally worthy of their love and desire.
That explanation doesn't require theology. I've seen Peter Singer make the case that it's only "true altruism" if you're just as happy when someone else does something good as when you do so yourself.
Sort of, but the difference is that Christian altruism results in an increasing expectation of being praised and rewarded by God on the other side for being his agent of love to others in this life.
The result is a lot of joy, knowing one has brought blessing and joy both to God and to other people.
Why? It sounds like you're misunderstanding something, perhaps what "reward" means in a biblical context.
This passage teaches people not to do things for show which is what many of us do in order to gain esteem and puff up our egos, often with still further gains in mind. This leads to enslavement to our egos, the approval of others, to things, and generally our constant grasping and our desires. Such false charity is pointless; it only leads to spiritual death. Allow your good deeds to remain a secret between you and the omniscient God. Charity is not loss. True charity produces spiritual "reward" by starving the monstrous, tyrannical ego that enslaves us to death. I would go so far as to say that it is even better for the giver than the receiver. The ego is Man's idolatry, and we cannot serve two masters. Thus killing the ego frees us to worship God and to live. The ego blinds us. It is like sitting in a bus at night with the lights on. All you see in the windows is yourself. Shatter the mirror and you will be freed.
That’s not sad at all. There are plenty of secular reasons for doing a good deed for the sake of the deed itself — not the reward or recognition. I mean, this is basically the entire underpinning of Kantian ethics.
That's exactly my point though. I'm an atheist, and I don't do good things out of a desire for "rewards in heaven", or rewards of any kind. I don't refrain from stealing because I'm afraid of hell or punishment. As you point out, they're done for the act itself.
This passage presents altruism as a tit-for-tat deal with God. Do good, and you'll get some of that back...later. I promise! It's almost tacky.
It is not about tit-for-tat, it is about trust.
A good parent often wants to give a child something they know will please the child more than what he/she is currently experiencing. Often the child will be angry and scream and hold onto the old, but the parent knows that as soon as the child let go and embrace what the parent has prepared the child will be happy and joyful.
God is more loving that any good parent: God IS Love, 1 John 4:8. I trust God's goodness and follow Him, I therefore don't have any reason to go into a tit-for-tat deal with God.
> This passage presents altruism as a tit-for-tat deal with God. Do good, and you'll get some of that back...later. I promise! It's almost tacky.
Correction: the passage makes no mention of "heaven."
I don't think you mean to say "tit-for-tat" as that means something else, but I do get the gist: it seems that there's some kind of contractual obligation on the part of God. The logical argument being: if you do [GIVE], then He does [REWARD]. This is a subtle argument, but flawed for a number of reasons (and why texts should never be taken out of context).
First, God isn't beholden to anyone. He does as He pleases, and the only "laws" He is bound by is His own nature (good, omniscient, eternal, etc.). There's many examples where Pharisees try to play these logical gotcha games with Christ, and they're always repudiated.
Secondly, the point of the passage itself is twofold: (1) avoid religious hypocrisy, and (2) avoid materialistic vainglory. Reading into the text deeper than that, brings us to my last point...
Finally, given that Christianity is a theist moral system, it makes sense that the ultimate arbiter of "goodness" is God -- in my opinion, that's why Chist brings up the "reward" -- which, for all intents and purposes, might just be God's approval (who knows what that entails).
Making a very public show of philanthropy as a means of self-promotion or self-aggrandizement isn't awesome, though frankly if letting people feel good with a little recognition results in more donations then that seems well worth it.
But there are other reasons to make a public show of philanthropy: to encourage others to give, to be a part of giving campaigns, to draw attention to an issue you consider important, to tell a personal story for why something matters for you, and otherwise to direct that attention towards the cause rather than yourself.
Yeah, there's a misconception that it is more morally righteous to give quietly than to give and take credit and that's debatable. $100M is a $100M whether the person is anonymous or not and if not, it can lead to more of the same, even if the motivation is self-aggrandizement. I mean, take that out to a long conclusion and you get a society who's competing to give away the most instead of possess the most.
I think the reason people suggest anonymity as a morally positive or superior action is because this isn't in trade. You've given it away (as noted above) without having your name in etched letters on a building, without a desire for notoriety and not in trade of previous or in fact continuous poor deeds. Consider for example the controversy around Bezos' donations.
It is very similar in fact to tithing instead of the practice of having your name called out in service in front of everyone so you can later trade on that donation for social standing.
Names everywhere could just as easily mean a culture that celebrates wealth and the wealthy as superior to others, because after all, their names are everywhere. A happenstance donation by a rich person in this society may mean far more than a significant donation by someone less well off. This may create a culture where people see helping others as a suckers game unless you get something back, rather than a moral obligation.
On the other hand, a culture of anonymous donations (and less wealth signaling) could indicate a culture where everyone, no matter how rich or poor, is expected to do their part to help others.
It depends a lot on what people's takeaways are from these acts, which are shaped by cultural expectations and norms. One should consider the cultural externalities of donations in addition to purely the dollar amounts.
Even if you'd like to pretend there is none, it doesn't change the fact that giving for the sake of giving versus giving for the sake of recognition are different things.
Giving anonymously can be a way for the giver to prove to themselves what kind of person they are.
Ultimately there are too many causes in need of support for me to take a strong stance on this, but it’s worth pointing out that many a tycoon has utilized philanthropy to maintain a positive image when business dealings run counter to the prevailing social concerns.
> though frankly if letting people feel good with a little recognition results in more donations then that seems well worth it.
I disagree. This is an attempt to buy legacy and erase their past. It benefits only those who make the donations, and whatever causes happen to pique their particular interests. It also creates yet another organization of people dependent upon the good will and whim of a single supporter.
> to encourage others to give
I would presume the tax breaks are enough.
> and otherwise to direct that attention towards the cause rather than yourself.
Large portions of non-profit budgets are specifically spent on awareness and on generating future donations. There is no need to slap your last name on the side of a building for this purpose.
Wouldn't the reduce the amount of donations greatly? Gotta think most people do it at least partly for recognition, otherwise there'd be nothing noteworthy about the article we're discussing.
We could also just tax the income used to make the donations at similar levels to prior top brackets and not depend on philanthropy as a means to fund public institutions or social safety nets.
That puts the decision on where to put public good will and non-profitable money sinks solely into the machine of government bureaucracy, which I don't think would be very effective.
Currently we incentivize private individual donations, and that lets a lot of things happen quickly and without the requirement of soliciting the permission of a bottlenecked council for anything to happen.
Government is often significantly more effective at spending money for charitable works than private charities due to all the overhead involved in running charities. Further, as a private individual I dislike that my tax money is used to in part fund charities that I strongly disagree with.
If you want to use your money to support some private crusade that’s fine, but why must we support anything anyone thinks as a worthy cause? It’s in effect a blank check without meaningful oversight. Their are for example homeopathy charities whose donations are tax deductible.
Isn't budget a part of elections platform, and so democracy? Because certainly when it comes to giving money to people bureaucracy becomes a factor, but then rather than redistributing money, things that you could spend tax money on:
(granted these last 2 are pretty much just redistributing money)
The question is whether you want the few billionaires to decide where to spend the money, or everyone (that is, people who haven't been disenfranchised).
AND THEN arguably given the polarization of the US today, I can understand that anyone feels frisky in raising the taxes to found the other side's ideas (being republicans not wanting to fund healthcare or democrats not wanting to fund a wall)
Perhaps a slight twist on that would be to be if society as a whole considered paying taxes as if it were "pay it forward" philanthropy.
In fact if the government recognized honest taxpayers as if they were forward thinking "philanthropic donors" (replete with award dinners for the million dollar donors) - perhaps there'd be more excitement for April 15th - and such people would not be so quick to figure out ways to avoid paying taxes.
It would help if we could decide what our taxes got allocated to directly. Like 50‰ nasa 0% racist border wall. I hate paying my taxes because it's going to bullshit like that federally. Or locally, funding mismanaged pensions.
I would get rid of all tax deductions period, but in the case of non anonymous donations, the chance of quid pro quo and inability to prove it is so high, that I just view it as a tax loophole for the rich.
If it lowers the amount people donate, then it proves my point...that people were intending to get something in return, hence not a donation.
Unless there's actual corruption involved (like giving to a "charity" that actually fuels your personal expenses), how could a deductible gift be used a tax loophole?
I've heard the misconception that one could use a deduction to bump yourself into a lower tax rate on your entire income, and therefore come out ahead, but that's not how U.S. federal income tax rates work.
It's like the government is matching your donations, and in the case of certain charities, that means the government is effectively funding lobbyists for you.
Get off the high horse. He didn't explain his original position at all, and frankly it's an ideal that seems very unrealistic. I agree that we should be taxing the ultra-rich a lot more, but "prohibiting donations that have names attached" is legislating morality as much as "don't buy liquor on Sundays".
The article mentions Buffet and Gates as being inspired by Feeney. They, in turn, further popularised the idea of giving away large sums of money.
I can't even say how a bit of fame for people giving large sums is harmful. And whatever people object to, I doubt it's anywhere close to the significance of the positive effects of giving.
Yes, absolutely. And if a certain General Hospital in San Francisco were not named after the tackiest of billionaires then maybe it could honor, I dunno, Hugh Toland?
Instead of dedicating most of its "about us" page to shining a youngish oligarch's already controversial reputation?
When I moved to SF and saw signs for Zuckerberg SF General Hospital, I thought to myself "Surely, that must be just a coincidence and it's not named after Mark Zuckerberg."
I'm not sure what the actual name of the phenomenon is but I've heard it call 'wife-name-last name' syndrome.
Basically, the uber rich want to be seen as something more than just money. Guys like Anschutz and whatnot. There seems to be a pattern where they get a new shiny glass and steel building with a bunch of sick kids in it, and then they put the wife's name, an ampersand, his name, and the last name in big 3-D letters on the side. Likely it's a tax writeoff.
Also, not to be too cynical, but it's not a bad thing overall. The money could be sitting in the Caymans afterall.
You can take $1 and pay the taxes on it and end up with $0.60. Or you can give away a dollar and not have to pay $0.40 in taxes. But you still gave away a dollar, so you're sixty cents in the hole.
> or hidden away as art investments inside of storage containers.
That doesn't make any sense. They pay for that art, and the money goes to the people that owned the art previously. Either they stick it into an account in the Caymans, or a regular/investment account, or they just have it available, but purchasing assets with it is not money hidden away as an art investment.
A significant amount of wealth may be in assets, but that's the same for most people that's aren't poor (i.e. that own a house). The money used to purchase those assets is still circulating though.
Not doubting you for a second[0], but I didn’t see anything anti-Semitic in that post, so am I missing some internet meme or American cultural reference?
[0] Footnote in case it is necessary: antisemitism must be stamped out wherever it is found.
Many delis are Jewish. He's saying that whenever he sees buildings named after people, he's in a Jewish neighborhood. In context, it plays into nasty stereotypes about Jews being obsessed with money.
I don't think that was the meaning of the gp post. If you're traveling, names on buildings or businesses tend to reflect the population of that area. Thus, if you're in an area with a large Jewish population, you can expect to see buildings/businesses that reflect that too.
Antisemitism is a real issue, but this is just not it.
I am Jewish by the way, if that matters.
The post didn't say "when I see a lot of jewish names on buildings I know I'm in a Jewish neighborhood," it said "when I'm in a neighborhood with a lot of names on the buildings I know I'm in a Jewish neighborhood" (both paraphrases to keep the dogwhistly deli->jewish link clear). The implication that Jewish people are uniquely interested in showing off their money and status through naming rights donations seems pretty blatant to me.
Ok, interesting. I would usually be willing to give much more benefit of the doubt, but given how unnecessary the comment seemed to the rest of the post, I guess the obvious conclusion is a dog whistle.
Wow, okay, that's not the response I expected to come back to. I'm trying to understand how you interpreted my comment that way.
To be clear, there were no intentional dog-whistles in my post. I thought I was saying something strongly positive, about a phenomenon which I've observed and have great admiration for.
However, your response and the thread that followed, reveals some things I clearly didn't consider. There is surely a lot of anti-semitism out there, and that my comment was mistaken for it, I think shows how pervasive it must be. And it's important, as has been said, to call it out wherever it appears. And I guess that means looking for even tiny hints of double meanings. Which, logically, includes meanings that someone may not be cognizant of when speaking with one meaning in mind. I honestly thought I was being "cute" with the deli thing.
I'm astonished and saddened to see a well-intentioned comment identified as just the opposite. I didn't mean to play into any negative stereotypes about money -- I didn't say anything about being obsessed with money, and if I got near it at all, I was talking about being recognized for _doing good things_ (with money), and how this cultural pattern does that. I think that's pretty clearly positive! (The whole point of the article, after all, was that more people with money should be committed to doing good things with it. Money's a pretty unavoidable aspect here.) But clearly my comment exists in a world where a lot of terrible things also exist, and I guess I can see how it could be mistaken for a vague hint towards one of those terrible things.
Especially on the internet, where tone and nuance are notoriously tricky.
So I'm honestly looking for input. Is there a better way to say what I was trying to say?
Regardless, I'm sorry that you saw something negative in what I said. I'm even more sorry that anti-semitism is so insidious that you had reason to look for negative interpretations in the first place. That sucks.
Many delis are Jewish. He's saying that whenever he sees buildings named after people, he's in a Jewish neighborhood. In context, it plays into nasty stereotypes about Jews being obsessed with money.
To be fair, cultures have characteristics and people should be permitted by their peers to talk about those characteristics in a thoughtful way.
I'm not familiar with what the other guy is describing, nor do I have any opinion on this particular topic. I'm just saying that "people of X culture tend to do Y thing more than the average person" is not in itself a hateful or disrespectful comment.
I think you're reading into it too much. He specifically said he thinks it is not a bad thing. In your opinion, is it possible to say anything about your culture without being anti-semitic?
The type of people driven to become super rich aren't usually the types to be satisfied with what they have, otherwise they would have stopped well before they got as wealthy as they did.
I think it's a cultural thing. In some countries it would be considered very poor taste for someone to pay to get their name on a building. If it's an academic building, I think it makes more sense to name it after someone who contributed to the field. Or it could simply be the "CS building".
> If it's an academic building, I think it makes more sense to name it after someone who contributed to the field. Or it could simply be the "CS building".
And sometimes the legacy is just that the world is a better place thanks to their efforts, and has not much to do with having your name all over the place.
You might care about your legacy while you're alive, but after you're dead, there is no you, so it's not possible for you to care about your legacy after you're dead.
John Harvard and Elihu Yale seemed to have avoided this fate. And Leland Stanford had the same name as his father, so maybe founding a university is the way to go here?
Because naming rights have a very real, tangible value and you can sell them to further your mission?
I guess Jerry Jones could have named his stadium "Dallas Cowboys Football Stadium" and that would have certainly told you everything you need to know. But instead he called it AT&T stadium and pockets $400 million. Both Jones and AT&T are happy. Same principle applies to colleges and hospitals.
Because they needed to raise a lot of money to build the new campus.[0] SF Children's was at the old location, Benioff Children's is at the new location.
Or, maybe, when we realize our society is set up to increase billionaires' fortunes, not happiness or well-being, his example of Giving While Living will become a standard for the very rich, and everyone will know his name. Why not make the word for a selfless act a Feeney?
Maybe we could be inspired by the soviets. IE a theater where musicals and plays are put on is called: House of Culture of State Ball-Bearing Plant Number 1
politicians do it all the time and sometimes they don't even wait till who they name it after has passed.
I would much rather someone have something named for them who donated their own wealth than a political party go around stamping their members names everywhere.
I would much rather have the naming of government buildings to be never named for any politician.
Sorry, I guess i interpreted anonymous donation as a Truly Morally Selfless act, and the fact that we're talking about it now would be some weird flex.
But sure, if you put out a call for solicitiations when you announced you were giving it all away, you probably also need a big announcement when you're done or you'll be dealing with development officers all day every day.
Well, sure, anonymous donation is that. Then we want to encourage that so we find anonymous donors, deanonymize them, and canonize them. That makes more people want to be anonymous donors, a thing we want.
I humbly encourage everyone to make giving a larger part of your life.
Consider giving at least 10% of your income to cost-effective charities -- because cost-effective charities can do thousands of times more good than merely regular charities. So your $1,000 donation can do as much good as $1 million, if given well.
I think thinking in terms of percentage of income doesn't work, because the lower your income, the lower a percentage you can afford to give away. I have found it better to think of it as a percentage of your non-essential expenses. e.g, if you spend $500 per month on non-essential things (eating out, movies, netflix, amazon impulse buys etc.), then you can afford giving away 10% of it ($50 per month) to charity.
As each of my children have left home I have had the following conversation with them:
You didn't get here by yourself. You know some of the people who have generously contributed to you. There are more than you know. The ones who stick out are relatively wealthy. Do you think they are generous because they are wealthy? I submit to you that normal wealth does not make it easier to be generous. A person rich enough to buy a boat has just created more demands on their wealth. A big house usually involves more ongoing financial obligations than a small house.
For most people, generosity is not a function of net worth. It is a matter of character. You can make it part of your character beginning today. You are about to leave my house and face the world on your own. There will be challenges. Money will be tight. "Starving college students" isn't always an amusing tagline. I encourage you to make a point of doing something generous. Maybe commit to giving $1 to a random person on the street every week. Maybe donate plasma. Maybe volunteer to be a Salvation Army bell ringer. But make a point to do something frequent. At least once a month. Even when tuition is due, or rent. Even if just an hour of your time. It's up to you. But do it regularly and relentlessly. If you ever get to where it is easy, it is probably because your circumstances have improved but your generosity has not kept pace.
Agreed, Some people are more generous by nature, some are not. For those who are not, one of the main reasons is that they are scared that giving away money now will put them at a disadvantaged position later. Putting donations in the terms of current spending helps alleviate some anxiety.
That's how I do it. I don't have a 6+ figure salary, or tons of disposable income, so I can't afford to give 10% of my income without reducing how much I put into savings. One thing I do have is more time on my hands than the average person. So for things like open source projects that I benefit greatly from, I always try to give some portion of my time with things like improving documentation, always submitting detailed bug reports, or writing updated versions of tutorials that are out of date.
On the other hand, it's easy to "cook the books" by classifying expenses as essential in your own mind. Or rather, most people (especially the sorts of relatively affluent people who could realistically give 10% of their income to charity) don't really budget that concretely. They just sort of have a lump of money left after paying basic expenses and then spend it on whatever strikes their fancy.
Making a commitment up front to donate 10% just creates a situation in which its not any sort of conscious decision to give $X to charity. You just operate as if your taxes were 10% higher or your income is 10% lower and go from there.
Jewish tradition says to give from 10%-20%. I have been giving 20% for the last few years and that is exactly how it works. The first thing I do when receiving my paycheck is putting 1/5 into a separate account which must be used for charity. It is anyhow all accounted for with monthly donations to various charities. I find it to be incredibly empowering personally, as I can support the charities I choose without agonizing over each donation. I already made that commitment a few years ago.
WRT income, I am thankfully able to afford my lifestyle, but I currently earn 5 digits a year and always have (I am still young). I don't regret a penny I gave.
Shouldn't it be a % of (income - essential expenses), rather than % of non-essential spending?
If you're very frugal, you'd end up giving away a very small amount of money, saving all the rest... Saving is super important, but giving money to effective charities is also a great way to use your money.
To take a typical example of someone that might be reading HN, any software engineer working in NY or the Bay Area can easily give away $10K a year while saving enough money to get a very cozy retirement.
I am not sure if you can easily give away that much money. If it were easy, people would already be doing it. Buying a nice home is a distant dream even for many software engineers in the bay area for example, and future education and healthcare costs are very unpredictable. Putting it in terms of money you are already spending helps put it in context.
There are many beneficial things people can do but are not doing. For example: investing your money. Many people aren't doing it (instead leaving cash in their bank account for a large part of their life) out of pure laziness/ignorance of its benefits.
Let's assume you're a junior SWE in the Bay Area, making $130K. Annual take home is ~$85,753 according to [1]
You pay $3K in rent (nice 1 bedroom apt in South Bay, or just a decent one in SF), $2K for various expenses, that's $60K and you're left with $25K.
This is for a junior engineer, and granted they might want to save $25K vs $15K (arguable; I would consider those savings don't matter much in the long run, the goal being to quickly increase your salary by advancing your career), but an engineer in a large tech company is making closer to $250 - $300K total comp, and you'll see that the $10K donation isn't making much of a dent in your savings at that point.
> but giving money to effective charities is also a great way to use your money
Those charities aren't going to help you when you're retired and subsiding on a meagre state pension. Or if there's a resurgent global pandemic and you lose your job and home.
I mentioned that you can do this on top of saving money. Just saving money with no goal in mind (or with the goal of buying a $1M house) is IMHO not always worth it.
Absolutely for saving to be able to survive ~1 year as life is very unpredictable, but we're talking about altruism here... Let's for a second assume we all want to have the largest positive impact on other people, is that $1M really the best way to spend your money to both improve your and other people's life? Could you instead buy a house/work elsewhere, pay $400K, and invest $600K in saving a hole bunch of people from certain death / extreme poverty?
I'll echo this sentiment and add that during my career I've experienced a number of ups and downs. During the downs, when it felt like I've wasted years of my life for something that went nowhere, what always felt worthwhile to me was the time I spent doing charity work and volunteering. You don't need to be a Feeney to make a huge difference. Many of the people on HN are insanely well educated and knowledgable and have skills and traits that can be put to good use helping others or inspiring a new generation, especially among the less privileged. Just spending an hour or two a week over a period of years can yield tremendous results in the lives of others.
That point about cost effectiveness is what always leaves a bitter taste in my mouth when donating. I didn't realize people put lists of recommendations together, that's nice to see.
But how would you go about verifying any stated claims?
It's very plausible to disagree with some of their choices. For instance, you might be interested in efficient charitable giving within your country, and bite the bullet of "this means I value starving africans a lot less." The important part is to prompt charities to document costs and outcomes in general (preferably to a scientific standard), so that people can make more informed choices about their donations no matter their values.
If an organization cures blindness for $20 through cataract surgeries in developing nations, and another spends $40,000 to train a seeing eye dog for a single individual, we are looking at ratios of 1:1000 in terms of effectiveness. The amount spent on 'overhead' is irrelevant!
I think a big part of the Feeney story is that he didn't just donate money. He got involved. He took an interest and made sure he was making a difference, or at least was doing his best to make a difference. He gave his time and his personal effort.
I remember watching a documentary on him some time ago. There was some issue he was interested in. I think it involved a community in Ireland. He put his money into the issue, but it didn't have the desired outcome. He looked closely at what they were doing and decided the strategy wasn't a failure, so he committed some astounding amount more with specific strings attached. His strings forced others to put skin in the game with him. Then they worked together towards their desired outcome.
How do you make sure that your donation to the blind center will get that roof repaired? Grab a hammer.
This assumes Feeney is more qualified to know where his money will be most effective and that no one else is out there already doing a ton of research validating the effectiveness of different charities. (both questionable)
I think this could be a convenient excuse that keeps some from donating more money (I'll wait until I can spend time creating my own charity / doing some hands-on vetting on who gets my money). There are already plenty of organizations (GiveWell, OpenPhil, etc.) that have very good research on the impact different charities have, often with RCTs on those interventions proving how much each $ buys (in terms of quality-adjusted life years or else).
If the roofing example didn't illustrate the point, let me try again.
Donate $100 to a literacy campaign, then volunteer for 30 minutes each week at a beneficiary elementary school to have a struggling reader read to you from one of the books your money purchased. You don't have to buy the book. You don't have to decide which books are purchased. You don't have to decide which student gets to read the books. But you can be involved enough to know that books were purchased and the students are benefiting. And your extra effort makes the $100 so much more fulfilling.
While it's great to get fulfillment out of your philanthropic activities, and it may incite you to do more; I hope you keep focus on the main goal: helping others.
A $3 donation (via Against Malaria Foudation) buys a bednet that protects about 2 people from malaria for 3-4 years. As a donor you don't get the satisfaction of meeting the individuals you help (though you can look at some photos). But is the fulfillment you seek important enough to donate to a charity that is a thousand times less efficient at converting dollars to benefits-for-others?
A good suggestion here is to "purchase your fuzzies separately". That is, give to the most cost-effective charities you can find, regardless of how fulfilling it feels. And then find the most fulfilling activity you can, and maximize that until you had your fill.
Agree whole-heartedly that everyone should give more. If you find a way to give automatically (ideally from your paycheck, not your credit card) you never even feel it.
It's important to recognize that some causes are not as cost-effective as others, but are still worthy. I'll use my own donations as an example:
1. Against Malaria Foundation - widely recognized as one of the charities that can do the most for a dollar. Malaria nets cost about $2-3 and it's estimated every ~$2500 given to them saves a life from Malaria.
2. Larkin Street Youth Services - helping homeless youth in San Francisco (where I lived). A very expensive city and they provide not just housing but education, job services, medical care, etc. Helping just one full-service client can cost $40,000 a year.
I don't think giving to both of these causes makes me inconsistent. After all, no number of malaria nets in Africa can take a person off the street in San Francisco. And I want both outcomes. I believe nobody should die of malaria, and nobody should be homeless. So I give to both.
Thank you for sharing that. I think at the outset, whenever we all discuss donations, no one should be bullied or told they are doing something wrong. Helping people should be encouraged, even if there are better ways to help.
I think it's a productive discussion when those involved learn something new. My hope is always to share the counterintuitive finding that in today's world we are able to help people a tremendous amount with (relative-to-our-lives) very little financial involvement.
I hope that when people learn about this remarkable fact, they reflect on their goals and consider giving to more-cost-effective charities, and to give more overall.
I'm thrilled to hear you too give to one of GiveWell's top recommended charities!
I mean, props for donating, and I believe that you want both outcomes, but for the sake of completeness the revealed-preferences meaning of your giving patterns is that the marginal badness of a SF youth being homeless is equivalent to 16 africans dying. Like, I'm not saying that to denigrate your choices, it's just an inherent fact of donation splitting.
> Bad Reason #6: I care about multiple issues! I want to end disease so I give to an anti-disease charity, I want to end crime so I give to an anti-crime charity, and I want to end poverty so I give to an anti-poverty charity.
> Yes, we have many different values. But at any given time, one of these will be the most pressing; one of them will be easiest to make headway on. And that's the one we should concentrate on. By focusing all our resources on one cause, we have the greatest chance of accomplishing our cause.
It's not bad logic, but I don't personally buy into it. It may be easy when dividing up a pile of cash, but it's harder when you take it down to a personal level. Imagine if someone on the street says "Can you spare a dollar, I am hungry?", could you look them in the eye and say "No, I gave your dollar to end malaria in Africa. It's more effective". I certainly can't do that! And having met so many of the clients at Larkin Street and knowing how deserving they are of a better life, I can't do it to them either.
Furthermore it's a pretty slippery slope to say that every dollar I spend reveals my marginal preferences when compared to every other dollar I spend. I don't think every person who buys a new laptop for $2500 is saying they'd rather have a faster web browser than save a life from malaria. We don't expect everyone to operate that way. Spending money is a hybrid between emotion and rationality, and I think that's ok.
> I don't think every person who buys a new laptop for $2500 is saying they'd rather have a faster web browser than save a life from malaria.
So there's this thing called "revealed preferences". I have a $2000 laptop, and I was very aware when I bought it that I was saying that this laptop was more important than an african life. I don't have a moral defense for this. I think it's not so much that people don't prefer a laptop to an african child surviving - they do prefer the laptop - but they don't want to perceive themselves to be the sort of people who prefer a laptop to an african child surviving. And so they don't think about it, and get angry at you when you make them think about it. But they still act in that way.
Personally, I sort of feel I'd be a lot more ready to donate a fraction of my income to worthy causes if everyone else was willing to help as well. Maybe we need to run charities like very long term kickstarters - say "we need X trillion dollars over a span of ten years to have an even shot at wiping out Malaria forever, commit yourself to a monthly payment, payment starts once we cross the threshold." I think something like that would be better at motivating me, at least - humans are inherently more sensitive to relative local standing than absolute global effects.
I support charities and think more people should give.
At the same time, I think it is a bad systemic solution to rely on charitable giving to solve large-scale problems.
Imagine an island with 100 residents, each with $100. Their moral compass varies randomly from Mr. Rogers all the way to a few outright sociopaths. Each day, everyone decides how much to donate. The kinder people donate more because they're kinder. The selfish assholes obviously don't.
What does tomorrow look like? Well, now all the good people are a little poorer and have a little less power. The sociopaths are richer and stronger. They use their edge to secure a little more power, maybe skim a little more off the top.
Watch that island for a few years and what do you start to see? A few avaricious monsters with all the wealth and a horde of poor decent folks doing their best to distribute fewer and fewer scraps equitably amongst themselves.
This is the real magic of taxes. Because taxes are morally neutral. They don't preferentially take more money away from the most decent folks. Ultimately there are some bad selfish people out there and if you don't have some way of forcibly reducing their power, they will take it all. Taxation backed by the force of government is one of the least violent ways of doing that.
To be honest, I'd recommend just giving as directly as you can. Right now, I ordered remote teaching equipment for teachers in my community. You can too. Identify people doing good important things, and give them money to do it.
Especially if you give resources to volunteers doing genuinely good work in your community, it has a huge multiplier effect.
This is a common viewpoint, but quite different from OP's. $5000 can save a person from Malaria or it can buy all the history teachers at a first world school document cameras. No doubt, both are worthy causes, but if you are choosing between which change to make in the world, one thought is to choose things like the former, which are seen to do more good for the same resources.
Well, to be fair, I know people and projects in the developing world, and buy things for (or give money to) people there too.
I've also seen the impact of organizations which promise to spend money to save people there, and it's not always pretty. You can't serve two causes well. Picking between Western donors and local recipients, successful NGOs must choose to serve the former and not the latter. That often just distorts markets and causes its own problems.
To be frank, with that attitude, we'd never make better decisions ever. We'd always see that things get complicated quick.
Things ARE complicated. Teams spend time navigating the questions and coming up with their best answers - the poster who started this thread posted a site that has done that exercise https://www.givingwhatwecan.org/giving-recommendations/
They have a model, and they can iterate on that model as they get new information or insights. It's hard for me to think that their model is worse than my lack of model.
Well, no. My claim is that donating to individuals doing work in the field is almost always a better path for individual donors than working through megacharities, or even through charity aggregators like this one.
For large-scale work of the type you describe, family foundations do a pretty good job. Gates, Schmidt, CZI, etc. all have exceptionally competent staffs who are able to take in grant applications, sort through those, and support quality projects in a way in which you or I can't. Program managers are top people in the field hired to rigorously evaluate projects.
They have billions of dollars to throw around too. If you want to fight malaria in Ghana, be Bill Gates. Or if it's something you're passionate about, take your next family vacation in Ghana, understand the people, context, and culture, and THEN donate to good people or organizations you know there. Combine your vacation with your giving.
What family foundations don't have are the cost structure to support individuals in the field or small organizations. If there is a good project in a school in Ghana, there is no way they are raising funding through Gates/CZI/Schmidt/etc. On the other hand, if you see a problem and spend money to fix it, you'll fix it. If you see an organization in need of resources and donate them, they'll have them. It's really not rocket science to do that.
There's something to be said for giving to one-off opportunities that you're directly aware of, and that are genuinely underserved by others; this can have some very real impact. But such cases are rare, and limited in scale. The basic benchmark of just donating to save people in very poor countries from malaria and the like is very hard to beat.
Well, it depends on your utility function, but judging by Zuckerberg's experience with the Foundation for Newark's Future vs. mosquito netting in Africa, I think that ratio is not out of the realm of possibility.
A $1,000 donation, if given well, can measure better on this metric than a $1 million donation, if given badly. Not a very meaningful thing to say, I agree.
Chuck Feeney embodies what Gandhi said about the rich having wealth in trust and using it for the good of society:
"“supposing I have come by a fair amount of wealth — either by way of legacy, or by means of trade and industry — I must know that all that wealth does not belong to me; what belongs to me is the right to an honourable livelihood, no better than that enjoyed by millions of others. The rest of my wealth belongs to the community and must be used for the welfare of the community.” [1]
Each time I bike past Cornell Tech, Feeney's generosity awes me. What a mensch. Makes me proud to be human.
The amount of negativity in this thread regarding billionaires and charity is stupefying. There are well established reasons why the distribution of wealth is lumpy - the uneven distribution of initial endowments, skills, parenting, luck, education, etc. The work of Pareto and the Ergodicity Economics gives a sound theoretical basis to this realization. There is no middle ground folks - in any incentive driven system you will have a power tailed distribution.
Can we just celebrate Chuck Feeney and his awesomeness?
“What many don't know is that [Mark Benioff] donation was to complete a match of $125M offered by Chuck Feeney (who does not have his name on a building anywhere on the campus, AFAIK).”
“I wonder if I ever will have the strength to do what he has done.”
“I’ve long argued for massive estate tax rates on large estates in order to incentivize behavior like this.”
“This is a role model I can actually appreciate.“
“I humbly encourage everyone to make giving a larger part of your life.”
Those are quotes from the current top 5 comments in this thread — plenty of celebration of Chuck Feeney’s awesomeness.
I saw those but there was the usual jaw-boning if Billionaire philanthrophy is good for our society. I understand the hand-wringing but that is akin to wishing that we were all born equal to perfect families in strife free lands with perfect health care and child care and the rest.......utopia.
He was outed a few years ago due to a IPO of DFS, otherwise he'd still be below the radar. His partner at DFS, Miller, took the opposite route: still a major shareholder, extravagant lifestyle with his kids being classic "rich kids".
Absolutely. Especially being an American. We have such a materialistic, maximalist culture. There’s definitely a psychological element here to be able to tune out all those negative messages (“Why don’t I have a nicer car/house/yacht than Alice/Bob?”). I’d be interested on where he falls on the satisficer/maximizer scale.
Myanmar is an exceptionally devout Buddhist society with many monasteries supported through traditional almsgiving. I suspect that's why Myanmar tops even the U.S. in the World Giving Index, which merely asks whether you've donated money or time (volunteered).
Not that faith-based giving is inferior, but different people have different notions about what constitutes philanthropy and charity.
>Not that faith-based giving is inferior, but different people have different notions about what constitutes philanthropy and charity.
I'm sure there are people who will find a way to invalidate this kind of charity. But it takes a level of dedication, discipline and a moral code to take 10% of earnings for benefit of your community and do it without legal compulsion. And it's the latter part that makes it different then those that pat themselves on the back for merely voting for higher taxes or disparage others for not voting for higher taxes.
> But it takes a level of dedication, discipline and a moral code to take 10% of earnings for benefit of your community and do it without legal compulsion.
Absolutely, but I think that's pretty rare among the general population. IIUC, if I drop $10 into the offertory basket at Sunday Mass I'm counted just the same as a Mormon who tithes 10% of their income.
I have never heard the complete opposite so thanks for the data.
It’s interesting because having grown up steeped in the culture for 30 years I have never once heard this or seen much real charitable action. I see small donations and token donations but very rarely anything like donating most of ones wealth or giving up excess to donate to those less well-off.
I’d love to better understand this discrepancy. I hear more about how much money people spend more than how much they donate in the media. And even anecdotally I can’t think of anyone talking about a donation they made in conversation. It seems like this should be something we talk about and champion more.
Most countries don't let you deduct your donations from your taxes. It's hard to compare levels of giving across nations because of this.
A lot of people only donate to reduce their tax bill.
Also, because we don't have a social safety net in the US, a lot of people donate to make up for that, which is certainly noble, but would be far less necessary if we had a stronger social safety net that more evenly distributed that wealth giveaway.
With very few (and even then, extremely capped) exceptions, the US absolutely does not let you deduct donations from your taxes. You’re allowed to deduct your donations from your pre-tax income, which is equivalent to being able to deduct some percentage (typically less than 30%) of your donations from your actual tax burden.
It’s not being pedantic; this changes the calculus altogether. Deducting from your taxes means you can say “oh well, I have to pay $1M in taxes, I might as well just use that money to make a donation to a charity of my choice and gain some PR instead,” whereas deducting your taxable income means “instead of parting with $1M in tax, I would need to part with $5M in charity to zero out my tax burden,” which is a very different decision and still largely a philanthropic one at some level or the other.
A lot of people don't understand how tax deductions work, and assume that they get the full value. Also, as noted below, it has a PR benefit while also giving you a 30% "discount".
I'm not sure that's the case at all. And even if they did assume that they got the full value, they would be quickly corrected of that belief when they actually filed their taxes.
Having volunteered to help people fill out their taxes, I think you vastly overestimate people's abilities to understand complex math. Most people just don't understand how deductions or graduated tax brackets work, even after having it explained to them.
Also, it's hidden. If you used TurboTax for example, you put all your numbers in and get a number out. All you've heard is "donations are deductible" but there really is no obvious connection to putting in your donations and seeing how much it saves you.
It's not about saving money. As this thread shows, charity is akin to a good PR move. Paying taxes is seen as neutral, at best. If you're "spending" either way, you might as well get something for it.
It's better than spending the money on yachts or luxury goods, which is the other way people signal status. I'm a big fan of conspicuous philanthropy over conspicuous consumption.
Debatable considering that donating art works (whose valuations can be, let's say, subjective) for tax purposes is a fairly well known way to reduce your tax burden.
If you were raised a certain way, in a certain era, it wouldn't be rational to spend it on 'frivolity'.
There are a lot of people like this. Tons of very rich folks living in normal homes, driving normal cars that they 'never buy news'.
I think in some ways more common than not, especially in more rural and suburban areas wherein projecting wealth isn't actually necessary to their professional identity.
I agree. I don't think it's a surprise that someone who grew up during the Great Depression could be so frugal, even with massive wealth. Many people who were young during this time seem traumatized by it, often including their children.
It’s true of him regardless, but as someone from Northern Ireland, Chuck Feeney is a freaking hero.
I don’t have much to add that hasn’t been said already, but his donations - right up to the last - have made genuine and lasting differences in the hearts and minds of kids growing up here and I doubt even he knows all the good that’s come of what he did in this place.
I don’t want to ramble on because it’ll end up sounding like a eulogy but he’s done an incredible thing for our people and we’re incredibly grateful for it.
This guy is my hero. I do hope he was able to enjoy spending some of his money on himself and his family though. I have no problem with billionaires who contribute a lot to society living well as long as they aren't hording resources (huge acreage estates, mega yachts, rental properties). "Contribute to society" is the sticking point for many of them though.
I hope I can live like Mr. Feeney, although I personally wouldn't be quite as ascetic as he given the circumstances (I would own a small but nice house in San Diego or Hawaii and a nice 0 emission solar/sail powered boat).
Chuck's actual works get just a little mention in this piece.
He is known for helping to bring peace to Northern Ireland and the Republic of Ireland. That is, to end the Troubles, a conflict that lasted about 30 years, from the late 60s to the late 90s. People who were not yet adults in that time may have difficult imagining the violence of the Troubles. The terrorism, riots, violence and armed actions that characterized a guerrilla war and its suppression, all on the edge of Western Europe. The southern counties that now make up the Republic of Ireland had only achieved independence a few decades before that (the dates are complicated, but let's say it was in 1921) after 800 years of British occupation, and a recent war of independence.
That was the backdrop against which Chuck Feeney tried to bring peace. He did so by working with both sides of the conflict, the Catholics and the Protestants, with diplomacy and massive investments, to make sure that they could see a path to peace despite all the anger, animosity and desire for vengeance that decades of violence and killing can instill. He helped resolve that. Not alone, but he was crucial. And we don't even think about it any more because it's all been relatively normal for a while. And that's amazing.
most people say the would do something like this if they ever became extremely rich, but only a few would actually be able to do it. I'm in awe of the strength of character this guy must have.
You don't need to "become extremely rich" for charitable giving to be quite worthwhile. Even donating trivial amounts of money to high-impact charity can easily come with a factor of 1000× in value created, compared to just spending the same amount of money on your own private consumption. (Of course this assumes that you're choosing the right causes, generally involving very poor countries and the like; not just "donating" to your local art gallery, or for that matter your local college with a billion-dollar endowment.)
I try to give away 10% of my income, after hearing about how some Christians I know did it (largely but not only to their churches). I don't give to religious institutions myself.
You don't have to be rich to do this. Although yes, some people truly can't spare 10%, that's fine, nobody needs to reply saying so. Anyone can spare what they can spare, whether that's 0 or more. For a lot of people 10% seems about right to be enough to feel it without being a hardship. (I calculate 10% of take-home, post-tax. It is still enough to feel it).
I give about half of it in automatic monthly contributions, the other half in spontaneous one-offs. I (in the USA) don't require to be tax deductible, but enough of it is that I reliably increase my tax refund every year.
It definitely makes me feel better about what I'm supporting and doing with what I'm lucky enough to have. Although of course "making me feel better" should not be the goal if I want to maximize impact, but nobody would do it if it weren't rewarding in some way. I don't give enough to get any kind of 'public recognition' (and wouldn't want any), my reward is feeling like I'm putting my money where my values are and hopefully contributing to what i want to see in the world.
Well, if you're working in paid employment it will usually be a lot more effective to put in some more time at work, and give away some of the resulting income. "Donating your time" can of course be genuinely worthwhile if you're, e.g. a scientist who might want to do useful research on globally-relevant, critical issues; just not very much otherwise.
I think some of the chronic ills of our society are rooted in the (incorrect) belief that solving any given problem is simply a matter of throwing $X at the problem.
"Donating time" is a deceptive phrase because it just sounds like you are paying out some currency other than money and that's it. "Donating time" encapsulates "building friendships, lifting up others, increasing love/unity in communities, gaining new perspectives" and more, unlike "donating money" which encapsulates none of them.
it will usually be a lot more effective to put in some more time at work, and give away some of the resulting income.
I'm paid salary. I'm of the opinion that it is usually the self-absorbed that think that after they leave the office they are still worth what their employer pays them.
Making it a requirement that your time donation be within your professional skillset is saying, "such work is beneath me". I'm not above ladling a bit of soup into a bowl or picking up the dog shit while at the animal shelter.
> I'm not above ladling a bit of soup into a bowl or picking up the dog shit while at the animal shelter.
I'm not opposed to that if you're doing it for your own benefit. But you should be thinking of this as leisure time for yourself, rather than assuming that you're "donating time" for the sake of real social impact. There's picking up dog $#!+, and then there's actually impactful stuff.
Then you don't understand the specialization of labor very well, and you're being very disingenuous to the parent post. They made no reference to certain work being beneath them, only the idea in maximizing resources. Maybe you could help the shelter with some database work while a junior high kid picks up poop.
There is far more dog shit to be picked up than database work to be done. I sometimes get the impression that folks think non-profits have an endless stream of IT projects, if only someone would volunteer time to do them. That has not been my experience, most volunteer organizations need physical work, not another web app. Most of the software needs can be taken care of by off-the-shelf products that will be supported longer than one-off volunteer projects that get abandoned.
Lots of us have highly specialized technical skills. It's nearly impossible, logistically and financially, for a small non-profit to hire a software developer or a web developer or an IT tech for two or three hours. Donating your time and talents can be very valuable for small organizations.
Now there is no way of obviously measuring this, but I'd make the case that donating time (volunteering on the ground) to organizations is way better than donating money. First, money goes through so many layers that it's hard to actually know what they go to, and how much actually ends up being useful and not just scavenged by middlemen. Secondly, donating your time by volunteering gives you more than just the feeling of feeling good. You also gain so much more perspective on life that will make you a better person, you'll appreciate what you have more and you can make sure what you actually spend time on is worthwhile.
So, please donate time by volunteering! But if you can't, money is also good of course.
The thing is, you can only donate time to organizations who are local to you, and there's a limit as to what causes these organizations can work on - highly-impactful local causes are quite few and far between. So if you're going to volunteer for some charitable purpose, be sure to choose something that has a decent chance of being genuinely worthwhile. (Advocating for criminal justice reform might be a good example.)
This is nice, but money very likely goes further than time. The work done by volunteers in organizations is typically not that high impact and usually grunt work. If you work in a high paying industry such as tech, working money and donating it will absolutely have a larger impact than volunteering. I agree volunteering can have a greater personal benefit, but from a utilitarian standpoint donating is better. Peter Singer makes this argument very well in his book the most good you can do.
I disagree. I wouldn't spend too much time thinking about what other people have done. Just what I can do. Just working in a food bank or picking up roadside trash on a weekend. It doesn't take much.
Basically if you make a high tier engineer's salary, you could do more utilitarian good by hiring several people to work at a food bank on the weekends. Roadside trash pickup is an example of a problem in need of a systemic solution, so if you can reduce litter in the first place, or build a machine that cleans everything, you might be doing more good that way, even though it doesn't look or feel as "noble".
But others have pointed out that it is useful to donate your time if you are giving your skills, and not just effort.
I would say the best place where everyone could donate time effectively would be a mentorship program like the Boys and Girls club. Having a positive role model, even just hanging around doing "boring" stuff, makes a huge difference at a young age [0]. One day I'll psyche myself up to actually being a mentor.
Yes, you are right. Because there is always someone else who is paid less than you who will run around and do the actual work whilst you take all the credit. Genius.
It's far more important to be there and take the credit in person, doing the job of someone who could be doing a better job than you for $15/hr, while not just doing the job you get paid $50/hr to do and sending the money.
Everybody knows the most important parts of charity are who gets the credit and one's own personal growth.
I am always amazed by the poor comprehension ability of people on HackerNews.
I am saying that credit isn't the point. Also, I am not entirely clear on why you would require $15/hour to volunteer at a charity...but...good for you turning charity into a second source of income.
Btw, my point (I will spell it out) is that the problem is almost never money. Money is required to the extent that is required to pay other people...but, particularly for almost all local problems, the issue is not money but time. There is no reality in which people donate enough income to solve these problems but they could donate time, and that would be effective.
I respectfully disagree. Trying to accomplish something with lasting impact with volunteer labor is really hard. Sure you can clean up litter and staff a soup kitchen on the weekends but to make a meaningful, lasting difference requires organizational structure and sustained effort by dedicated people. In other words, you can have volunteers ladle out soup, but running the actual soup kitchen as an institution requires a professional staff. That requires money to pay those people's salaries.
By all mean, volunteer at your local soup kitchen. It is a great thing to do! But the money is more helpful on an ongoing basis.
Is a person who invests that money for-profit but makes giant advancements in maths/science while doing it an equally big giver?
Take for example, Elon musk. Even though he hasn't given monet away to charities like Chuck, his for-profit enterprises like electric cars, solar farms, spacex and possibly neuralink might just have been things that end up equally great for humanity.
He started out with a lot of money from his family's South African mining operations.
Your mockery is ill-directed, and in the context of a post about someone whose corporate wealth was able to be donated to charity, in really poor taste.
Now you've added personal insults to your class mockery. Please, this sort of casual disregard of other people is not appropriate on HN.
Your initial claim was that he had no money apart from company stock, and lives entirely on debt. This is factually incorrect, as I pointed out: his family money predates all of his companies.
Attached to your factually-incorrect claim was a casual denigration of a group of people with whose beliefs you disagree. This was both misguided and unnecessary.
My factual statement in response was simply:
> He started out with a lot of money from his family's South African mining operations.
Based solely on that true statement of fact, you derided me, responding to claims I never made and labeling me and my "thinking" in inaccurate and insulting ways.
If you are so good on facts, please point to some (other than speculation) that confirm your theory that Elon somehow benefitted from family money, or is currently living off family money not Tesla and SpaceX.
Your statement was extremely loaded, suggesting Elon's family somehow is part of his success. While our past is certainly part of us always, it is very loaded and complex. As is well known Elon's father was very abusive, committed crimes, and has just married his stepdaughter. Ask any psychologist and I think that is more a hindrance than an advantage in terms of family background.
I stand by the fact that anything implying Elon is successful because of his family money is a hugely far-left opinion, if not communist, and has its roots in your resentment for Elon's success.
> I stand by the fact that anything implying Elon is successful because of his family money is a hugely far-left opinion, if not communist, and has its roots in your resentment for Elon's success.
Farmers working under communist rule in China who started private farming caused agricultural productivity to skyrocket and the number of starving people to drop [1]. Say what you will about human greed, but aligning a behavior you want with a natural economic incentive is a powerful tool.
On the flipside, some industries like healthcare don't belong in such a ruthless system, because "voting with your wallet" is sometimes equivalent to "voting with your life". Other industries like scientific research have too long a lag time for the the companies to stay afloat, or for the decision makers to benefit from the decision. These industries are the ones that frequently need help from government, nonprofit, donors, etc.
I'd say spacex is a pretty big leap forward in terms of advancements in science, maybe even maths. Same with neuralink that will help handicapped people to walk one day. Hopefully that knowledge will drive our whole human race forward
As long as the intention is to actually create wealth for the society as a whole as opposed to just making yourself rich, I don't see a problem to what Elon does.
Interesting! I wonder if he tracked outcomes so we can see what the result is of all this. He seems pretty happy with how his charitable "investments" have done.
That data could reveal which things are the most effective things to operate charitably in terms of increasing human happiness.
That's something I really like about Jack Dorsey's approach. I get to follow along and see what works.
> While many wealthy philanthropists enlist an army of publicists to trumpet their donations, Feeney went to great lengths to keep his gifts secret.
Crazy respect for this. Many times billionaire charitable foundations are just tax preferred ways of building your image or amassing influence. Bill Gates has done a lot of good, but his charitable work also served to redeem his image from that of the ruthless businessman crushing competitors that he had in the 1990’s. In addition, it has also given him a lot of soft power. I bet there are dozens of heads of state, especially in Africa and Asia, that he could personally get on the phone within 30 minutes if he really wanted to.
One of my arguments against the accumulation of vast wealth is that Bill Gates can get an in-person visit with my local representative faster than I, a constituent, can get a return phone call.
I think we need 5x the number of representatives at the House level. Separate their duties, strip power from some of them, and keep them in district most of the year so they can actually be held accountable. Would also help to further democratize the House.
> I think we need 5x the number of representatives at the House level. Separate their duties, strip power from some of them, and keep them in district most of the year so they can actually be held accountable.
That is a a great idea. One idea along those lines, is maybe make the House entirely online with the representatives being in the district 100% of the time. It would do a couple of things. It would make lobbying harder since instead of getting a bunch of people together in Washington at a fancy dinner, the lobbyists would have to travel and meet 1:1. In addition, it might decrease partisan ship by decreasing the power of the party whips. When people are all in a single location, tremendous social pressure can be brought to bear to convince a representative to vote along the party lines, even if it would be going against the wishes of their constituents. With the representatives dispersed and remote, the social pressure would be diminished, and maybe representatives would vote more in line with their constituents’ wishes.
Sure, but what benefit does that power get him except to accomplish the goals of his philanthropy? He doesn't appear to be trying to amass more wealth.
He needs to amass connections and power if he wants to accomplish his philanthropic goals.
As for fixing his image, sure, maybe that was part of it. But I doubt it. He could have just made a few really big donations and then went off to himself to enjoy his wealth.
Huge fan of Chuck. “Who wants to be the richest person in the graveyard?” Is a question I often ask myself. Chuck has lived that philosophy. I moved to the bay last year and I hoe to one day meet him!
2 million is only 0.025% of 8 billion. It's a bit of editorializing to call it "broke" but donating such a huge percentage of his net worth is commendable and he will be living a relatively much more modest lifestyle.
The article says he put away $2m for his and his wife's retirement. While I agree it's not quite 'broke' in the classic American sense, it is .025% of his former net worth of $8b.
Yeah, the word "broke" is clickbait. $2m for retirement is more than most. It's simply "not extravagant" which I guess from the eyes of the wealthy class may as well be "broke".
Certainly not broke, but it seems difficult to find a way without hyperbole to indicate that he's given away billions and now is no longer in the top 10% of people in his age bracket in the US.
There's probably lots of people reading this comment who are worth two million dollars, but I bet there are none who are worth eight billion dollars. Knocking yourself down from the 99.9999th percentile to the 90th is a real change.
I find those people who determine to earn big and then give away big very interesting minds. Their reasons to earn are most of the times very different from a typical person.
Speculating here as I am not spectacularly wealthy... I suspect there is more to relate to than first meets the eye.
Chuck is human like all of us. Most people have to spend some amount of time solving for generating enough capital to meet their (and their family’s) needs - whatever they may be. The fabulously wealthy / successful did too once upon a time but at some point crossed a threshold the vast vast majority of people - which I will refer to as “typical” - will never, and that is having enough to do and buy literally anything they could possibly desire indefinitely.
Thus the motivation to keep on going professionally (ie to earn more and more, something that drives typical people who are solving to meet needs), I suspect, changes to things money can’t buy which are nevertheless “typical”: The desire for impact.
Some want it in their life times, others want it for generations (legacy). Some want it in their church or on their job. Others seek and have the means to achieve it on a global scale.
For a long time I dreamed of being wealthy. But a few experiences being a small-time investor have convinced me that being wealthy (and trying to be wealthy) is a lot of work, and it's work I don't particularly enjoy (too much paperwork).
I'd much rather work as an individual contributor and earn an upper middle class salary for my entire career, with enough to retire comfortably. Growing up I always heard stories about how happiness is not correlated with income above a certain (commonly achievable) level, and I can now corroborate those stories!
You don't have to be rich to give. You can not make the money in the first place, and instead make the world a better place by tending to your own happiness and doing something you enjoy. And if you are lucky like Chuck you can give it away. Or if you are lucky like Jonas Salk you can dedicate your talents to good causes.
> When I visited a few years ago, inkjet-printed photos of friends and family hung from the walls over a plain, wooden table. On the table sat a small Lucite plaque that read: “Congratulations to Chuck Feeney for $8 billion of philanthropic giving.”
Chuck Feeney is not "officially broke." Per this story he has a couple million set aside for retirement and is living a perfectly happy life with all of his needs met. It seems disrespectful to Feeney's vision for his own life - he can give away so much and still be fine. Not broke.
I don't know why the author had to cross the line into falsehood with the title. It's a great story about a great person, why sacrifice your integrity with an utterly false headline, particularly when the story doesn't need it?
The author very likely did not choose the headline and the story itself never refers to Feeney being broke. It does use the idiom “go for broke” meaning to give something your full effort, which Feeney certainly did. Perhaps the headline was a lame attempt at a pun on the idiom or perhaps it’s just a clickbait headline.
Preface: yes, absolutely, all the props in the world to this guy for doing something so thoroughly incredible and selfless and rare for the benefit of humanity. Even if I had the means, I know I'd never have the guts to do something so amazingly heroic in as extreme a way as he did.
That said (i.e. time to be the irritating pedantic little asshole, but I think it's a genuine enough question about the purpose/execution of philanthropy)... does the anonymity really warrant extra props? We know that the guy gave away essentially all of his money; does the anonymity of the individual donations really make it more selfless? If anything the headlines "Feeney gives $100M to cause X" and going on TV to talk about it etc. would likely bring more attention and donations to X, which I assume is why Bill Gates and others tend to do things that way.
Edit: ok, I've just figured out from other posts that it basically wasn't known beyond a small group of people that he was giving away most of his wealth. I didn't realize that (although it's also my first time hearing of him). I agree then, he really did spend the bulk of his life being pretty much truly anonymous and that does deserve extra props.
I guess I'm more cynical than you. I see it as subtracting props to insist that your name be inscribed on the side of every structure you fund. Bill Gates and others like him are not "giving away" money, since there's practically nothing material they could buy with it in the traditional sense. Gates is trading useless wealth for social prestige. Compare to Sergey Brin, who also spends money on humanitarian efforts such as disaster relief, but takes pains to avoid headlines.
There's certainly a paradox in the ideal of being secretive with your donations and thereby not being able to make an example that others could follow, or being vain in beating your drum but setting an example for charity.
For myself, I have always wanted to appear to be doing my best in hiding my charitable donations while inadvertently getting discovered for my generosity, killing two birds with one stone. Unfortunately, I don't nearly have the wealth to pull this off.
I don't think Chuck Feeney set out to be purposely secretive as much as anonymous and focused on the money doing the work. I think stories like this one in Forbes highlight he understands the necessity of good leadership by talking about the mission after it's accomplished, rather than looking for recognition during the process. Gates & Buffet are role models for the getting started; Feeney for how you finish.
Wow, he hasn't followed this strategy: "set up a legacy fund that annually tosses pennies at a $10 problem."
One of the things almost all foundations do is this: give 100K for $100M problem. There are certain reasons for this: (a) foundations have become mini governments; (b) foundations want to support everyone that comes their way; (c) either foundations can't judge the potential of ventures or they end up supporting their crony or pet projects.
Knowing people such as Chuck Feeney exist is very motivating. I have had many near-death experiences. When I came back to this world everything saddened me. It’s supposed to be good to be alive. And it is! But ontologically suffering appears to be a fundamental nature about this world. And there are so much unnecessary suffering around us. So many miseries. So many heart-broken things and false dreams and inauthenticity that just result in more sadness. All for nothing at the face of the death.
This is why I want to believe. I want to believe in the goodness of people. Just as I’m constantly troubled by the realistic notion of death as I try to appreciate the transient presence of being here, I want to believe things will get better in the sense that there will be less suffering and people will learn and mature and become wiser and nicer to each other.
As we approach death and become one with nothing, we become one.
As we exist, we are only inducing more pains to ourselves. There are meanings though. I hope there are more meaningful things. We are sentient.
I think out of all possibilities for the attitudes and practices of billionaire philanthropists, Feeney is probably as close to the ideal as possible[0].
But it still makes me sad to see this sort of thing celebrated. A small number of ultra-rich people should not be deciding for society what causes get funded, no matter how pure their intentions are. The fact that individuals are able to amass this much money in the first place is itself a problem.
[0] Then again, we can't actually know that he's ideal, since he's worked hard to keep his activities anonymous. On one hand I applaud him for not seeking fame for all this, but on the other, we have little insight into whatever impact -- good or bad -- he's had.
>A small number of ultra-rich people should not be deciding for society what causes get funded.
Alternatively, we can elect a small number of ultra-rich people into government who would have surly spent his money better on say, funding an ever-growing military.
regardless if you're a billionaire or not, at some point money is for keeping score. We all have biases that influence our desires and actions; he was able to indulge his more fully.
What's your proposed alternative to the amalgamated actions of rich individuals? I'm not sure what else could work better, and we've certainly seen worse collective approaches throughout history.
It’s sad when all these billionaires and multi-millionaire athletes are afraid to risk a few million dollars by commenting on human rights abuses (concentration camps in China e.g.). You can’t take it with you! Use your wealth for good...
I've had an idea for a while: some body (could be the government) maintains a list of useful/important infrastructure projects--bridges, hospitals, schools, etc. If you die with more than $x million, we take all the excess (like today's estate tax), but you get to pick what gets built, and have your name on it (or not, if you're like Feeney).
That's one person I definitely admire. Not afraid to play the game and not afraid to end it on his terms. It's one thing to amass a billion or more, quite another to purposefully, part by part dismantle that empire until there is absolutely nothing left with an unknown chunk of life at the end of it.
Chuck Feeney is officially welcome at my table, anytime.
Good for him & communities. Only few people are real monks. I admire for his detachment with Money.
Not sure word “broke” is the right adjective here. If consciously someone donated their money to charity they need to be celebrated as a “winner” or overpoweing materialistic “money”? Something amazing. “Broke” means very negative. I don’t know. I could be wrong.
This article is definitely worth reading. However, I didn't follow the link for over 21 hours after it was published because, I didn't recognize Chuck Feeney's name, and I couldn't tell from the title what the article was about.
I think when an article is shared on HN some consideration needs to be given to ambiguous situations like this.
I'm a bit confused. The NYT article from 2017 says they he had finished giving away $8b and was only keeping about$2m for his retirement. This article says the same thing. Is he any more or less broke than in 2017? It sounds like the main development is that he officially dissolved his charity
Instead of giving away it all away, why not invest $8B which would generates about $800M per year in returns perpetually and give that as 0% loans for education, health and starting new businesses to people who needs it? This would be then perpetual giving that can outlast the donor.
If you want to have the most impact in your secret donations and change the lives of many people in good, then you should finance democratic and peaceful political underdogs in poor and represive countries.
I know it sounds revolting that giving money to politicians is better than fighting malaria or cancer. But at the end of the day, those who are having the most impact in alleviating poverty and disease are not international philanthropists, but the governments of the respective countries. Misery is the result of the lack of institutions or their systemic failure under corrupt, inefficient and incompetent leaders. We have known for decades how to eradicate malaria and provide all people on Earth with basic food, shelter and education, what we lack is world-wide execution of essential state-building and infrastructure that would enable it, and much more.
And money is a fundamental part of politics; politicians are just like any other people: if a decent, respectable living an be made in the field of politics, public office will attract decent and respectable people. If the only way you can get into power is by making trades with the devil, since no one will found politics, then what you get is corrupt and ineffective leaders that oppress rather the serve the public.
This is why, for all his sins, George Soros remains one of the most effective philanthropists in the world. And this is why he's vilified by a whole wagon of authoritarians, from Putin to Orban to Jinping: they know that the most pressing threat to their power is not some foreign country, or a political or military international alliance; they are most afraid of a well funded and cohesive internal political opposition that can properly articulate the public discontent.
Is it just me or is there something a little off about the phrase "$76 million for grassroots campaigns supporting the passage of Obamacare"? Grassroots and funded secretly by a billionaire seem like fundamental opposites...
This article doesn't cover any of the most interesting part. His brokeness. Is he now homeless? Is his plan to now kill himself? Does he get to experience the day to day struggle of broke elderly now? What's the deal?
Thanks for posting - with all of the horrible selfish things happening (people not wearing masks on purpose, etc. etc.) it is great to have a vision of how we could be better as a people.
Chuck Feeney sounds like a great guy (I don't know anything about how his empire treated its employees), but I'd really rather the government take and distribute those billions.
> Where did $8 billion go: health, science, education, and social action
Other than science, those are some very bloated and inefficient causes. $1 billion to Cornell? Aren't most of the prestigious universities already swimming in billions of dollars of endowments? He can do what he wants of course, but it would have been nicer if the money was targeted to long shot bets--that only a super rich person could fund--rather than normal things are already well funded through taxes.
Funding top research institutions are in fact long shot bets.
Where else does research get done? Who pays for the buildings, where each one costs hundreds of millions of dollars? Scholarships? Who pays for new tenured positions?
Yes, administrative costs could be cut (I think substantially). But there's this long-going misunderstanding about the roles of endowments at American universities. These endowments have been budged into the next century of operation -- each year they are expected to generate some income to cover operating expenses. These expenses include salaries, financial aid, etc. The larger the endowment, the more income. They can't just drain the whole thing to pay for a building, because then they auction off the future for the present.
Disagree. There are more than enough resources on effective NGO's. There is no reason to give cornell a billion dollars when that money could save hundreds of thousands of lives in the developing world.
Not only is whether or not he's maximizing the impact of his donation a call he gets to make, whether or not he even wants to maximize the impact of his donation at the cost of other considerations is a call he gets to make.
Yeah. I also think these large contributions to college endowments are of questionable social value. They clearly help the people who go there to get an education but do they really address the issues that people who can't go to an Ivy League school face.
It could have been seen as a force multiplier. If Feeney was educated at Cornell, then that $$ to Cornell could possibly contribute to more Feeneys in the future who could also follow in the footsteps of philanthropy.
On the face it's certainly selfless, but the causes and recipients of the massive sum are important. Certainly you'd think differently if the recipients were foreign militants, no?
An even faster way would have been for him to create a website , for example, www.claimmymoney.com and allow people to put in requests for donations, for any reason, that he would either honor or decline. There would probably have to be ID verification and other system in place to try to prevent people from abusing it. Given how so many Americans are living below poverty or in poverty or having expenses, he would have little trouble giving it all away
This method would limit benefactors to only those who have access to the internet and a way to receive money online. Most of the third world country population wouldn't fit into this category.
And you can't be solving big systematic problems and bring about societal change by working with individual cases. This is like fighting fire when you should have made the building fireproof in the first place.
can someone here who thinks charity is a morally noble act answer this question: why is it good to extract billions from people who work for you and then give it a way and feel good about it? why not share the profits with your workers in the first place? how is it morally justifiable to steal and exploit in order to give?
What a great man. Such a shame that he gave it all away to a bunch of scammers and then a different bunch of billionaire scammers come out and try to claim that they're affiliated with this great man to boost their own reputation when in fact they're nothing alike.
Most people are some combination of financially irresponsible and uneducated. Honestly, with the numbers you have here I have to lean towards irresponsible regardless of whatever difficulties the middle class faces. Even at a median wage just doing the absolute bare minimum of saving 5%-10%, not even factoring in 401ks, would leave you well past this given the last few decades of market returns.
I think cost of living should be factored into this though. San Francisco is one of the most expensive cities in the world. 2 million is meager to try and retire in SF. You are correct that he clearly isn't broke.
I mean, I am just some rando engineer and I intend to retire with way more than that in the bank. That's a modest retirement savings and compared to what he has given away is "broke".
To be that good at making money and that intent at giving it away is such a massive paradox not to mention paradigm shift from how we typically discuss wealth and wealth accumulators.
I don't see a paradox at all. He made a lot of money by being good at operating organizations. He seems to have given away his money by working with organizations. He just wanted to make an impact on the world and he did.
I don't pretend to know the motivations of Bezos or even Musk (even though I think he has been clear) but I see this as consistent with what Feeney did.
I can at least conceive of a thought process like "I can help humanity now and in the future by making money to fund new businesses that would not otherwise exist." Maybe the best way to contribute is to give away money to charity, maybe it is to start a rocket company. I don't think either of those are wrong, and I think they can have the same base motivation.
Maybe naively I believe I grasp some of it, but I don't know, to me it takes maybe a little bit of hubris? I certainly see how parts of the mechanics feel very contradictory. The idea that sticks to me is "people are spending money, so it may as well become my money".
It feels like a weird and maybe bad example, but it feels like sort of a chaotic good version of The Dark Knight Joker. You have the idea of "if you're good at something never do it for free", combined with a more wholesome version of "some men aren't looking for anything logical, like money."
Maybe you just have weird anomalies where you have someone who likes business, like what their work entails, but for whatever reason aren't drawn as much to some of the other trappings.
I think the assumption being the baseline is that the interest follows the money.
He didn’t get caught up in the money trap that almost everyone is, and I wondered how he did that? Is it religion? Is it innate morals? How he was raised? Very interesting.
Hope I can learn something from this. What does a non rich person do? I guess it is about trying to influence things rather than injecting money.
Time is money and if you don't have money then give your time. It's the most generous thing a person can do. More so than money in many ways since you can always make more money but you can't make more time.
You can't expect to make a major change in the world. But you can make some small changes that means the world to some people.
One could argue that everyone has the same responsibilities to society at large. Thus for every Chuck Feeny and Bill Gates, you, personally you, have an obligation to create many billion dollars of value and give it away. If you don't do that, you're worse than any evil billionaire you care to name. They at least are paying millions of dollars in taxes for any money they pull out of investments. How many millions in taxes have you paid?
This seems like a strange argument since someone who is say, running a large conglomerate, benefits much more from society's infrastructure and organization than a layperson. It then seems reasonable for their obligation to be proportionally greater.
In the US, according to the CBO[0], the people who are in the top two quintiles of income pay for all services and infrastructure. Saying that these people benefit more from this infrastructure than a middle income household is very odd. It's like I decide to be a farmer and need more water, so I dig a well to water my farm. Then my neighbor sees the well and asks if they can get drinking water from it and I say sure. Then they tell me I get more benefit from the well and I have to pay to maintain it.
Their large incomes are made possible by infrastructure. The analogy doesn't make much sense to me since even the most prolific billionaire didn't build much of this infrastructure.
As a class they did. Some of it was built by billionaires past, but is maintained by the current generation of the well to do. Regardless, the middle income household certainly did not build it.
Oh, I didn't know that "billionaires as a class" digged roads, erected buildings, manned trains, stores, telephones, farms, factories... "The low income households didn't build it", you have a very twisted definition of what that means.
You're ignoring that there is more to creating something than just paying for it. Someone had to exist and sacrifice their time and also their body (construction is dirty and taxing work) to build the infrastructure. By saying "Regardless, the middle income household certainly did not build it." you are not only disrespecting the work, you're also failing to understand what money really is about. It's one thing to be, narcissistic, ignorant and rude, it's another to be plain stupid.
I can trivially mint my own currency and become a billionaire yet I am unable to build infrastructure. When a street is about to be repaved I don't see any billionaires around, all I see is workers doing their job. Money on its own is worthless, it's just a convenient fiction that functions as a lubricant to make trade easy. Without a second party accepting your money on the other side you can't do anything with it. The power of a billionaire doesn't lie in their money, it lies in the ability to steer thousands of people to work for the billionaire. The middle class IS the wealth of the billionaire.
People are weird and think the abstraction is reality. Maybe it becomes clear when you look at a retirement scheme. Many of them are based on the idea that you contribute to a pension fund while young and that pension fund is immediately paying out to retirees. Doesn't this sound odd? Isn't this a pyramid scheme where we need more young people than old people? Why aren't people saving up their own money and then use their own money during retirement? Because that can't work. Imagine a closed community with 10 people who do not have children but are working and saving up money. Now all of them have retired and each of them has $1000000 saved up. Everyone is a millionaire but there is no food because everyone retired, nobody is working on the farms. The money only had value because there was a community of people working in exchange for money. Once the workers are gone, so is the value of that money.
Money and labor are tied together because all material goods are the product of labor (including infrastructure). Each dollar you own is just a promise that someone else will work for you. Billionaires just managed to get a lot of people to promise to work for them. That's why they don't have to work themselves.
In that argument you assume that the net effect to society of their winning billions of dollars is zero, which is obviously nonsense. For instance the net effect to society of somebody like Charles Koch is, undeniably, absurdly negative. He has (not even being hyperbolic here) the blood of thousands on his hands, with his pushing of climate change denialism. We could even argue about the net impact of Bill Gates (is Microsoft a net positive to society or negative? it's at least not obvious, and one can argue).
> One could argue that everyone has the same responsibilities to society at large.
Yes you could argue that.
> Thus for every Chuck Feeny and Bill Gates, you, personally you, have an obligation to create many billion dollars of value and give it away
Now that is a big jump. It does not follow that we all have the same responsibility that we all have a specific responsibility.
Historically some rights were tied to the ability of the upper classes to fulfill some base responsibilities that the lower the classes could never possibly meet. Such as being able to afford a full set of bronze armour and a spear. Thus achieving both moral and social superiority.
This is a good turnaround of the previous statement. It is incorrect to assume there is only so much wealth, and subsequently, billionaires need to be taxed in order to maintain our standard of living. Most billionaires have created something entirely new, not hoarded some scarce resource from the rest of us.
"To maintain our standard of living" is not even close to the reason we need to tax billionaires.
Let me put it to you this way: I couldn't give 2 shits how many mansions, yachts, and Ferraris anybody has, but, when there are people[0] who literally have the ability to spend an amount of money greater than the entire GDP of a small country[1] to influence my country's elections, then I have a problem with that. Put another way, it's not the amount of money that certain people have accumulated that bothers me. It's the amount of undue influence those people get because of it that's the problem. It's not 1 person = 1 vote. It's more like $1M = 1 vote, when you take that $1M and apply it in the right places (such as directly into the pockets of politicians by way of lobbyists).
Find a way to fix that problem, and then we can talk about allowing billionaires to exist. Until then, America isn't a republic: it's a de facto oligarchy. And that, I have a real problem with.
$1M 1vote is no problem. So even a big short billionaire cannot influence much since 50,000 votes would be $50bn. Ok, this might effect Slovenia. One time. And then its a former billionaire.
Perhaps, but only to an extent. It is not as if, if only average people were clever enough, we could all become billionaires, and the GDP could be 10,000x higher than it currently is. There are, in fact, scarce resources – including land and minerals and other natural resources, but also labor. Most billionaires become that way by being in charge of a large company, one with a lot of workers. Well, you can't be the ruler without people to rule over. And if not for you, those people would still exist and would be making some other contribution to society.
> “ Where did $8 billion go? Feeney gave $3.7 billion to education, including nearly $1 billion to his alma mater, Cornell, which he attended on the G.I. Bill. More than $870 million went to human rights and social change, like $62 million in grants to abolish the death penalty in the U.S. and $76 million for grassroots campaigns supporting the passage of Obamacare. He gave more than $700 million in gifts to health ranging from a $270 million grant to improve public healthcare in Vietnam to a $176 million gift to the Global Brain Health Institute at the University of California, San Francisco.”
What an absolute gut-punch of deeply sickening waste.
I feel extremely outraged reading. It’s a absolutely shocking waste of money. I can’t believe this is celebrated or held up as good. This is a form of basically negligent homicide.
$3.7 billion on education? $76 million to lobby for Obamacare.
How can you not instead fund known, effective charities like Against Malaria or SCI. $1 billion to a wealthy Ivy League credential mill - that’s astronomical waste.
This is the charity equivalent of seeing a lottery winner blow their money on sports cars or Vegas. This is appalling.
I mean this so sincerely. People should be sick and outraged over this degree of negligent waste.
Why? It was his money and he could have bought diamonds and shot them into the sun if he wanted. Instead it seems that the vast majority of the spending was a net positive to society and will do some good.
Yes, there was probably a more impactful way of spending it from a humanitarian perspective, but presumably there wasn't a more satisfying way to spend it for Feeney.
Nearly everything that everyone does is a negligent homicidal waste if you view it through the lens of opportunity cost. Unless you are living the life of an acetic, working every living hour, and donating it all to charity, you personally are hundreds if not thousands of people a year.
Your objection falls flat. We can definitely analyze everybody else’s behavior another time - it’s not relevant here and only serves to distract.
This one person had a huge fortune and explicit goals to spend it in efficacious charities.
From that point of view, this particular story is one of exorbitant waste and missed opportunity, the magnitude of which should stupefy people.
We’re not talking about some other joe schmoe who failed to be as ascetic as possible - that’s just rhetorical deflection. We’re talking about this particular instance of egregious waste.
Your comment is like if some heard about the Deepwater Horizon spill and replied, “everything looks like waste or hazards if you measure every cubic milliliter of spilled oil, can’t we just given them a break for trying to harvest it and do something with it?”
I guess I’m still don’t understand the fundamental shock and sense of waste you describe. Frenzy didn’t hurt anyone here and provided a net benefit to society.
Failure to optimize is equivalent to directly perpetrating harm, especially when the stakes are high ($8 billion) and optimizing is jaw-droppingly simple and easy (read recommendations from Giving What We Can, 80,000 Hours, GiveWell, etc., and spend some ultra tiny fraction of time comparing the impact on lives between e.g. donating $1 billion to fucking Cornell vs $1 billion to a cause like Against Malaria or SCI).
Tell the children who have died and will die from directly preventable malaria or waterborne parasites that Feeny’s negligence has done no harm.
By not spending the money on them, he literally facilitated their deaths. For what? Cornell has a fancier campus? Obamacare had a nicer grassroots website? It’s sickening.
And it’s no defense to distract by saying nobody can be perfectly ascetic or optimize away every wasteful purchase or discretionary spending. That’s not at all related or up for discussion. We’re talking about one guy with a stated goal of funding efficacious charities with $8 billion of available funds to do it over time. Just about as pure a thought experiment of negligence as there ever was.
Whew. Finally. I was scrolling looking for a comment like this. How is almost no one saying this?
The speakers they mentioned are the most establishment politicians you can find. What does that say about his actions that those are the people representing him?
How can you give $70M+ to something that is grassroots too?
You are deliberately ignoring the reality of it. It’s not “good” to do something when the opportunity cost you passed up is that X-hundred thousand preventable malaria deaths or waterborne parasite deaths occur.
It’s a luxury to blow $1 billion in donations to Cornell. That’s not humanitarian anything. That’s not charity. At best that’s gross negligence, at worst narcissistically relegating hundreds of thousands of people to preventable deaths.
We’re not talking about wasting a few thousand dollars on selfish consumption. This is egregiously wasting the better part of $8 billion. It’s gobsmacking, the scale of it.
For someone who is actually in the middle of doing this: Chris Hohn.
He has built one of the largest charities in the UK, and I believe it is top 10 in the world. He has given away his net worth multiple times. His general story is also totally remarkable for the UK, he came from literally nowhere.
Somewhat inevitably these days, he is regarded negatively in the media (most recently, he came up because the UK's finance minister used to work at his fund, so Hohn was the "vulture" capitalist with his beak in govt...funnily enough, their view didn't change when they found he is the main funding for Extinction Rebellion...2020 is amazing).
Like you said most people don't really have any extra income. They have a mortgage. Their retirement is heavily underfunded. Kids future school is not paid for.
Then there are people that have 100% of everything paid for and already have more than they will ever need... not to mention they can grow their money way quicker than the people who need it.. Yeah, it's pretty easy to be "generous" in that situation because it's literally extra money just sitting around doing nothing but making more money.
edit: wow, downvote me and op for this? Must be by the HN 400k engineers without a family who don't understand what the problem is
One stops and carefully donates his money to have the most impact. He ends up "officially broke."
The other doubles down on for profit enterprises, but focuses on those with the most impact, like electrifying a fossil fueled sector of the economy or making us a multi-planetary species. The profits are reinvested to accomplish these goals. He ends up richer than ever.
It isn't clear that the second billionaire is less admirable than the first.
Depends on your definition of impact. Tesla certainly is not improving education outcomes worldwide, nor funding healthcare research; nor is spaceX saving rainforests from being cut down every day, or helping sustain democracy.
I guess EVs have less environmental impact after four years of use, but do Teslas last that long? The intent there (and the impact) is still very much to monetize
Buffett & Munger agree with you. (paraphrasing here) Munger cited Costco as an incredibly important, effective, and efficient institution that couldn't be replaced by a non-profit or government. It has lowered the costs of essential goods while treating its workers well.
Musk has signed the giving pledge, so he might end up doing both. He wants to die on Mars, and it seems likely that if it would require the bulk of his fortune to make us a multi-planetary species, he would commit it.
> In February 2011, Feeney became a signatory to The Giving Pledge. In his letter to Bill Gates and Warren Buffett, the founders of The Giving Pledge, Feeney writes, "I cannot think of a more personally rewarding and appropriate use of wealth than to give while one is living—to personally devote oneself to meaningful efforts to improve the human condition. More importantly, today's needs are so great and varied that intelligent philanthropic support and positive interventions can have greater value and impact today than if they are delayed when the needs are greater."
Opinion Coronavirus treatment
Bill & Melinda Gates: Vaccine fairness will make us all safer | Free to read
Sharing Covid-19 jabs equitably would result in fewer deaths and faster control everywhere'
Please make a point rather than just pasting insinuations and links to articles. Neither of the two articles you've provided give any reason Feeney would have a negative opinion of Gates.
@hamburglar I have no idea hence my question. Feeney's style has been to very privately and anonymously find worthwhile projects and fund them. Gates owns giant swathes of the media and is vastly wealthier than Feeney. I wonder what Feeney makes of that during the current global pandemic. (the reply link is not appearing on posts, so this may be out of thread order)
Aside: the lack of reply link happens when you're in a conversation HN decides is moving too fast, which may indicate a flamewar.
I think you're being misinterpreted by me and others in this subthread, but it's your fault. :) You're literally just wondering aloud what Feeney thinks of Gates and whether that's changed in recent years, but we are reading an insinuation that it has changed for the negative. I don't think our misinterpretation of what you're saying is unreasonable -- someone above states that Feeney has publicly stated that he thinks highly of Gates and your response is to suggest that that's different now, and you link to a couple of articles, seeming to be supplying "evidence" of that, but the articles don't give any reason to think Feeney's thoughts about Gates have changed.
Your responses have convinced me that you really are just asking questions and have no preconceived notion of the answers, but the way you're asking the questions is causing people to bristle because they are presented like insinuations.
FYI.
edit: in my attempt to be helpful I see I'm being a bit repetetive. Was trying to get this out there quickly before the misunderstanding escalated into a shit-fight. :D
I don't assume Feeney has a negative opinion of Gates, everything he has said publicly has been supportive of Gates.
Given Gates central role in driving for global pandemic vaccines, I wonder what Feeney thinks of that huge global and very public project. The Ft Gates oped link above is from today, I just read it before opening HN and seeing the Forbes Feeney post.
Are you suggesting that Feeney thinks less of it because it's public giving? I just get the impression that that's Feeney's style, not that he thinks other philanthropists need to act that way.
i am not making any suggestions, I am wondering what Feeney, who has quietly donated huge sums with no fanfare or hype (example: SF UCSF children's hospital, see elsewhere in these comments, is named the Benioff children's hospital despite the fact Feeney donated more than Benioff for the hospital).
I have no idea what Feeney makes of Gates in 2020 but I'd love to know. No insinuations, me projecting what I think he thinks...
@bena do you have a point to make here? Where are my 'snide comments'???
Gates is exponentially wealthier than Feeney, and is extremely noisy in the media he funds as the second wealthiest human on the planet. I wonder what Feeney makes of Gates in 2020.
If you'd actually bothered to read the two 'spam' links as you called them you would understand the point I was making.
Link one: FT oped by Gates published today about Covid19 Vaccines
Link Two: Article about Gates rapidly growing fortune and how difficult it is for people as rich as he is to give away money.
Not that I want to in any way detract from this incredible and selfless accomplishment, but he has held on to a $2M retirement fund, so he's not quite "broke" yet.
>>> When I first met him in 2012, he estimated he had set aside about $2 million for his and his wife's retirement.
I don't know about everyone else on HN, but having 2mil in the bank is not my definition of "Broke". I want to see what trusts have been setup. What life estates has he retained? I credit him for giving most all of it away, but "broke" doesn't mean you are worth 0.0001% of some huge number. Broke means you might not cover next month's rent and are parking your car at a friend's to hide it from the repo guy.
With all due reference to Shai-Hulud, I'd say broke has a lot of different possible meanings. It could mean you declared bankruptcy, have negative net worth, or maybe just like 99% gone (while you don't think it means that by definition, and I agree, I think socially we could agree with that. Someone with a dollar in their pocket isn't broke, but is also broke.).
If anything, having enough money to take care of his needs I think is good. If he was hiding his car from the repo man, it's probably because he's not paying payments on it, and therefore all the people that rely on those payments for their jobs you're kind of "stealing" from, in that you aren't fulfilling the legal and financial obligation. And that doesn't seem very charitable either?
>> you're kind of "stealing" from, in that you aren't fulfilling the legal and financial obligation.
Stealing requires conscious choice. Not being able to pay a debt isn't a choice and therefore shouldn't be described as stealing. We don't send people to jail anymore for failure to abide contracts.
The point is that Forbes shouldn't be using terms like broke to describe millionaires when there are millions of people who are actually broke living incredibly difficult lives.
Are they former billionaires though? The point of him being "broke" isn't that he has nothing, it's that he has shared almost all of what he had, to a much greater extent than most of us could ever dream of.
Ask anyone who has shared more of their worth than this man has. Plenty of parents have done more than give up "everything" to support a kids. Talk to any bail bondsman. Plenty of people regularly go past 0 and into negative net assets to help a family members in need. Talk to any veterinarian. They see people give their last dollar, and then leverage out every credit card beyond that last dollar, to save a pet. Broke means broke, not 2mil, not even really 0. Broke means broken. Forbes should not attach that word to this situation because this man is not.
Some questions lingered in the back of my mind after I read this article:
- How much to employees at Duty Free Shoppers (DFS) make? Is their healthcare fully covered? Do they have generous paid time off and access to higher education for themselves and their children? Was any of his fortune used to give back to the employees whose labor built his wealth in the first place?
- Does this dude realize how difficult it is to get into Cornell compared to when he went there on the GI bill? Giving to Cornell seems counter-productive to me. Giving a bunch of Ivy League jocks more resources doesn’t seem like an equity promoting endeavor.
Not to diminish his other accomplishments. Still, philanthropists get to choose who to include and exclude. Ideally, it wouldn’t have been possible for this guy to amass 8 billion dollars of wealth in the first place - it would have been properly taxed and invested into our communities equitably.
Because the government has such a great track record of collecting tax revenue and then investing it where it is appropriate?
Questions can be raised about some of his specific donations, but when someone gives away $8B of his wealth, spending nearly none on himself, does it globally, influences other billionaires to do the same, picking at any one of his specific donations seems counter productive.
Yes Cornell is an Ivy League school, but it is where he went to school, he probably has very strong ties to that school, perhaps met his wife there, or his business partner, if he chooses to give back to that school that is also good.
Plus there was a tremendous amount he gifted to "education" so without knowing all of the details, hard to imagine that he didn't provide some sort investment in to under represented communities. If he helped Vietnam with their healthcare he obviously wasn't just US centric but helped where he though his donation could have an outsized return.
By the way he gifted a large amount of money to the Obamacare campaign, so by proxy, he was providing healthcare to his workers, and more likely than not.
My argument is that a system that allows $8 billion in wealth to accumulate enough to be controlled by one person has already failed.
The US government is actually really impressively good in a lot of areas, and I personally get fatigued of the oft-repeated notion that government “can’t possibly work” or that they “can’t possibly spend tax dollars responsibly.”
> a system that allows $8 billion in wealth to accumulate enough to be controlled by one person has already failed
I think you have little appreciation of how wealth is created.
Jeff Bezos became the wealthiest person in the world neither by stealing or exploiting , but rather by improving peoples lives. Amazon was able to organize systems, take advantage of technological developments and put capital to work to improve the lives of hundreds of millions of consumers.
There have been dozens of controversies involving Amazon: shopping for tax breaks it doesn’t need for HQ2, micro-managing warehouse employees’ bladder, union busting, firing a COVID whistleblower, cross-contaminating inventory, insufficient protections against counterfeit items, building a book ecosystem monopoly, probably numerous others I haven’t thought of off the top of my head.
The team at Amazon improved people's lives, not Jeff Bezos all by himself. Why couldn't there be thousands more millionaires that helped build Amazon rather than one mega billionaire?
I believe the government's role is to provide protection from foreign threats, guarantee basic human rights, reasonably regulate the business environment, and provide basic public services that are only possible on a society-level basis. When they get into areas that local communities and private charities operate, they'll at best be inefficient and more than likely be corrupt at some level.
> - How much to employees at Duty Free Shoppers (DFS) make?
I have similar thoughts when I hear about the philanthropy of the mega wealthy. Instead of a single person like Chuck Feeney or Mark Zuckerberg or Bill Gates amassing ungodly amounts of wealth and then later choosing how to distribute it, why couldn't the companies they built have made 1,000 or 10,000 or X other people relatively rich instead of one man mega rich?
The middle class hasn't died at all. In fact it is larger today than ever before. It's just a bad narrative people have bought into. [1]
In essence what has happened as the upper-middle class has grown over the last 40 years. Poor, lower-middle and regular middle class percentage has shrunk to its lowest levels. We have fewer poor people than ever before. But because the upper middle class has grown so much, middle class people feel closer to poor people.
We have more well to do people than ever before. The middle class is smaller but the lower-middle and poor classes are even smaller. So people have generally moved up.
Interesting hypothesis. Thanks for the article. I will have to stew on this. It doesn't seem to jibe with the all angst about class that people seem to be feeling.
Some hypothesis I’ve read believe that because the upper middle has grown so much and is so visible, middle class people don’t feel as middle class.
More people have moved up than down. However as the nation has become more wealthy a greater share of the wealth has gone to upper middle than below them.
I think there’s so many dynamics at play here and it isn’t 100% cut and dry. For instance, there are more single parent (or single person) homes. Divorce isn’t socially unacceptable anymore and young people are waiting longer to get married. Do people lose the efficiencies of 2 earners in a household and possibly the class bump?
I’m not an expert on this but the data does show growth in the middle class by growing the upper-middle and a shrinking poverty class.
Well, not saying this is what he did, but if you took away from American minimum wage workers and gave to rural South Asians or sub-Saharan Africans, you are improving world equity.
> Was any of his fortune used to give back to the employees whose labor built his wealth in the first place?
No idea. Maybe some of it was.
> Does this dude realize how difficult it is to get into Cornell compared to when he went there on the GI bill?
His donation to Cornell was earmarked for opening a new campus (Cornell Tech) to employ more educators and educate more students. It wasn't for replacing a stadium and putting his name on it.
It's great he donated his wealth to charity, but it's a little unfair that he took it upon himself to chose where the money went instead of letting the people choose.
One of the reasons that private charity is somewhat looked down upon in certain countries with a robust welfare state is that historically, private charities were selective in whom they helped. If the private charity felt that your "lifestyle" (i.e. you were a mother out of wedlock, you were LGBT) or ethnicity was objectionable, you were just left to suffer. Or those private charities would assist you, but you were obliged to convert to their religious denomination or sit through a long sermon before getting to eat.
Welfare states run from taxpayer money and overseen by democratically elected officials, while they have their downsides that are often commented on, at least tend to assist groups that would be marginalized otherwise, and there are no religious strings attached.
That and the fact that such charity systems are demonstrably less efficient than welfare. It seems that many of people just want to ignore that evidence though and continue to scaremonger.
This is not to dismiss the likes of Bill Gates: he has been very public with his donations, but in some cases (notably celebrity) notoriety in your donations may create a multiplier effect as it encourages others to do likewise. Even so, I think this is still on a lower-rung, philanthropy-wise, than Feeney's approach.
Nonetheless, we're sitting here praising someone who reduced himself from billions to $2M, but we must remind ourselves that this is unimpressive compared to the poor person who donates $25 to others while starving herself. The value of money is nonlinear. I'm sure that Feeney would say this as well: he no doubt sees himself as saddled with the burden of billions of dollars rather than someone doing something amazing.
I wonder if I ever will have the strength to do what he has done.