Monday, December 13, 2010

moral wiggle room for billionaires

I forgot to write about this when it happened but it so appalled me that I still want to long after the fact.

Imagine that you are a billionaire and a fellow billionaire asks you to join forces to share your good fortune with the world, changing the trajectory of history for the better for millions of people. Choose one of the following options:
  1. Yes!
  2. I worry that we will have conflicting interests or fall victim to groupthink. Instead let's each go our separate philanthropic ways and hope that our diverse efforts will more quickly lead the way to effective solutions.
  3. I would love to use my wealth for good but I worry that I cannot do so effectively. Let's instead delegate our decision making to the masses and the experts and focus on their chosen priorities instead of barking on an individual crusade.
  4. I admire your intentions but I personally prefer to keep my fortune for myself, my investments, and my heirs.
  5. How dare you suggest such a thing! You're trying to take over the role of government! No single person should have so much power to make the world a better place and I refuse to use my wealth philanthropically at the risk of destructive hubris.
Reasonable answers? 1-4. 5? Clearly insane. But that didn't stop Peter Krämer from riling up the rich Germans with just that logic when Bill Gates asked him to join a pledge (with 40 other billionaires) to donate half of their money to philanthropic causes.

He vaguely defends his argument with the fact that charitable contributions are tax-deductible in the U.S. First of all, Bill Gates's billionaires aren't responsible for the tax deduction law. Either they join the pledge and get the deduction or they refuse and "donate" a third the amount to the government instead. Is he seriously saying that the latter is the better choice, even though "join the pledge, don't get a deduction" is not an option?? (Or at least, not a reasonable option. Obviously no one, including Mr. Peter Krämer, is going to voluntarily pay extra taxes as though the government is a charity.)

Second of all, is he really suggesting getting rid of the tax deduction? It is well-documented that tax law has a huge effect on the amount of charitable giving in the U.S., especially among the top income brackets. Without it we'd be depriving many wonderful non-profit organizations in favor of a much smaller boost to huge ineffective government bureaucracies.

Third of all, what do you think the chances are of a large philanthropic effort producing destructive results? People are philanthropic in part because they want to be seen as philanthropic; if they're doing things that the world doesn't want done or failing miserably, they will of course stop. And they are also philanthropic because they want to do good; if it turns out they are making things worse, they will of course stop. The only example I can think of where a large donation led to a bad outcome is when eminent domain was used to confiscate property in my hometown to build an athletic village for OSU with a donation from T. Boone Pickens. And guess what? That's because the government was involved. Private charities can't claim eminent domain.

And all of those points pale in comparison to the last two: Who in their right mind thinks the government knows what is best to do with our money and can use it efficiently?? Or that they even have the power to address many important issues, or have any political incentive/feasibility to address the ones that don't win voters (other countries, shockingly, have problems too...)? And where on earth did this idea that government is the only entity that is allowed to be responsible for philanthropy come from???

*melodramatic sigh*

Edit: I also forgot to mention that the very existence of the tax deduction for charitable contributions means that the government has deemed the best use of that money to be the charitable contributions...


Anonymous said...

we love our sports teams and we hate our government holding us "under my thumb". We don't seem to be able to make the connection, however, that the state university is the government - sheeesh - well I wasn't there watching the gladiator entertainment in Rome or in any of the arenae throughout the Empire, but I do know that as the Emperor entertained us he led us down the path to the end of our entertainment.

Cucipata said...

I guess the key to the argument here is choice. We should all have the choice to do with our money as we please. If Bill Gates can convince others to donate their fortunes, and no one forces them to, more power to him.