Why a German billionaire says that pledges like Mark Zuckerberg’s are really bad
washingtonpost.com
washingtonpost.com
Articles like this are bad.
> Krämer: In this case, 40 superwealthy people want to decide what their money will be used for. That runs counter to the democratically legitimate state. In the end the billionaires are indulging in hobbies that might be in the common good, but are very personal.
Literally, that is all the article has in terms of direct quotes and support. The rest of the article is a discussion and re-hash of other notable charities and comparison of charitable contributions per country, which is a side-tangent.
Asking for a quote misses the point. Look into it yourself and the first link is Where Zuckerberg's $100 million gift went wrong http://www.cnbc.com/2014/05/23/where-zuckerbergs-100-million...
>Zuckerberg envisioned the teacher contract reform to be a centerpiece of the reform and contributed $50 million — half of his total donation — to go to working on that cause.
So he decided to throw $50 million at teacher contract reform around the same time that, according to the CNBC article, "the state cutting $56 million in school aid."
But if the money ever belonged to the individual, then the public cannot "subsidize" the individual keeping what he/she earned.
Put another way: if I walk up to someone on the street and forcibly take their money - and if that wasn't mine to begin with - most people would call that 'stealing' (or at least 'coercion' of some sort). If I chose to not forcibly take their money, and they then give that money to the homeless person on the corner, I'm not "subsidizing" the person whose money I didn't forcibly take.
It was theirs to begin with - not mine.
Without the infrastructure provided by society as a whole, no large business would be possible.
I believe that the state (which isn't "society", it is the governing body of a region of land), has no right to a share of anything that is not voluntarily granted or contractually agreed upon. Believing in a higher entity with more rights than any individual is verging on something akin to feudalism.
"Feudalism is bad, so anything that can be vaguely compared to it must also be bad."
The state has a right to a fixed share of its subjects' income due to the contractually agreed-upon system of taxation. This is what that whole "no taxation without representation" slogan was about.
Your connection of representative government to feudalism is puzzling. Are you a libertarian?
Yes, because organizations are just collections of individuals. So of course an organization can't do anything without the action of individuals. Is anyone arguing otherwise?
> Believing in a higher entity with more rights than any individual is verging on something akin to feudalism.
There are many examples where groups of individuals have rights that are greater than the rights of individuals without bringing up feudalism.
No individual has the right to imprison another (for long periods at least). No individual has the right to use violence to enforce a contract. Do you imagine a society where individuals have those rights, or one where the state does not?
>which isn't "society", it is the governing body of a region of land)
No the state isn't society. In a democratically controlled system, the state is the proxy designated to act on behalf of society (the extent to which states actually fulfill this duty is highly variable).
No. When money is earned, that money is taxed. Society has gotten its share. Zuckerberg is talking about donating assets that represent money in lieu of keeping it himself, which are above and beyond whatever income taxes he's already paid.
If the argument is that he isn't paying taxes on the money he never had, that seems a little odd to me, but even if we accept that he should owe those taxes to society, then we have to reconcile that notion with the idea that society has chosen those charities to be considered tax exempt, and has effectively rubber stamped charitable donations as a societal good.
In either scenario, I don't see any way in which Zuckerberg's charitable donations has avoided his obligation to the society which has chosen to prefer charitable giving to taxation.
So income tax is the only just form of taxation? What about consumption tax? Property tax?
> Zuckerberg is talking about donating assets that represent money in lieu of keeping it himself, which are above and beyond whatever income taxes he's already paid.
Are you saying he's donating after tax income? Or are you saying that it's like he never had income in the first place because he donated it before it became income?
>even if we accept that he should owe those taxes to society, then we have to reconcile that notion with the idea that society has chosen those charities to be considered tax exempt, and has effectively rubber stamped charitable donations as a societal good.
That's true and I'm OK with that. I was arguing against the OP's example of taxation as theft, not against the possibility of charitable giving tax deductions.
I didn't specify income tax, but 'earned'. This would include a variety of taxes, including capital gains, income, etc. To be fair to the situation, this type of donation would likely trigger capital gains, but if the foundation set up is a 501c3, then they would be (possibly?) exempt -- as it seems to be an LLC, there doesn't seem to be a tax dodge here at all.
FWIW, I wasn't disputing whether any taxes were just or not; rather, disputing the notion that society is being robbed as a result of non-taxed earnings being withheld. As society has determined that is kosher, then there is no theft.
Personally, I consider income tax to be one of the least just forms of taxes, but that did not bear on my argument at all.
> Are you saying he's donating after tax income? Or are you saying that it's like he never had income in the first place because he donated it before it became income?
To be honest, it's still a bit ambiguous. If he's holding shares for now, he's paying capital gains on the shares that he holds -- to my knowledge, there's no way to earmark that money for charitable tax exemption without actually donating it, and in the short term, Zuck has stated that he won't be giving it all away immediately. Either way, if we accept the premises that society has chosen tax exemption for charitable contributions is something that society wants, and that he's paying taxes on his current earnings until he gives those shares/moneys away, he isn't robbing anyone of anything.
> I was arguing against the OP's example of taxation as theft, not against the possibility of charitable giving tax deductions.
I won't go as far as to say that taxation is theft, but as I alluded to earlier, I lean that way on income tax. Regardless, I don't think that's really the point of the argument here. Regardless of whether or not tax is theft, Zuck is still paying his taxes. Any portion of income or potential income he gives away to charity is not theft from society because society has stated it hasn't via tax code.
In the counter-hypothetical that guntar made though, wherein Zuckerberg pays the full taxes owed on his earnings and incomes, and yet is still not entitled to do what he wants with his post-tax money, hence the state must be entitled to it? That would definitely be theft, in my opinion.
Is there a quick shorthand way of referring to the notion that tax is theft?
Nothing belongs to (as distinct from being immediately, physically controlled by) anyone except in the sense that social convention grants them some, usually limited, exclusive control over it.
The typical avenue through which that social convention for both the right to control and its limitations is expressed in the modern world is the institution of the State via law (most obviously, property law, but the whole body of law, including tax and other civil and criminal law, addresses either the rights to control or its limitations.)
To paraphrase the argument goes something like: "Society giveth and society taketh away"
Implied in the argument is that the state is synonymous with society. Even in a democratic society you have the issue that a) a limited percentage of the population actually vote and b) of those who vote a minority did not get what they wanted.
Regardless of what extent the government does reflect the will of society, you still have the issue that we currently do have a system of personal property rights. If you believe those rights exist only because society willed them be for whatever reason, then arguing that no one really owns anything is quite the circular argument.
We have a system of personal property rights in which personal property is subject to taxation, both ad valorem taxation of wealth (usually, in practice, certain classes of assets are targeted for this, but there is no systemic prohibition in our system of it being applied anywhere) and taxes on particular uses or exchanges of property.
So using the existence of those property rights to argue against taxation to support public priorities is quite the self-contradictory argument.
If that is the case, what would function as a better proxy through which society can collect its debt?
Roads, and other infrastructure that facilitates trade and communication.
Courts that enforce contracts.
Water rights management to that facilitates the creation of cities (note I'm talking large scale here, not municipal water companies--think the federal government prevents people in State A from draining all the water from a river before it gets to State B)
Public health infrastructure (large scale, like fighting epidemics)
That kind of thing, plus many smaller scale and more intangible benefits that come from living in a civilized society.
Regarding your earlier comment about "a debt to society", no one is in debt to society for those things, because no one contractually agreed to be in debt. Yes those services exist, and yes they provide real benefits, but the problem is they are not voluntary. Being in debt involuntarily is akin to slavery.
Now, that is the philosophical justification for one who believes in the non-agression principle. Obviously such a belief is more of a hope for a utopia which will never be realized in the foreseeable future.
The concept that involuntary debt is automatically bad is an axiom that most people who believed like I did start with. But it's not the self-evident axiom that I once thought.
There are many cultures that consider children to have certain filial obligations (and some states in the US still have such laws), you might consider that wrong, but it's not self-evident that it is.
There are also situations where the law considers continued enjoyment of some good or service to create an obligation to pay for that good or service regardless of whether the person enjoying it requested it in the first place. I don't think this is self-evidently wrong either.
To explain why I'm not longer an anarcho-capitalist: As I got older, I started to realize that almost everything I'd accomplished was primarily a result of the situation I was born into. Intelligence and success are primarily a product of upbringing and genetics, not something I accomplished on my own that I should feel proud of.
I haven't moved over to pure socialism, but I no longer feel that allocating wealth based purely on the circumstances of birth (because let's face it, an individual's ability to make money is based almost entirely on the circumstances of their birth.) is the best system.
There are times when capitalism is the best, most efficient system for everyone involved (even if it's not the most egalitarian). But I've increasingly realized there are also time when capitalism reaches a local optimum. And I don't think we should let ideology blind us to that.
>There are also situations where the law considers continued enjoyment of some good or service to create an obligation to pay for that good or service regardless of whether the person enjoying it requested it in the first place. I don't think this is self-evidently wrong either.
As I said previously, at least for me, believing that the non-aggression principle should be the governing principle of society is a utopian view. That is, to say, it is a hope of what society could be, not a pragmatic solution that could be implemented today or tomorrow. Similarly, anyone who holds any concept of a utopian society likely recognizes they will never see it come to fruition but they hope to move things in that direction.
>but I no longer feel that allocating wealth based purely on the circumstances of birth (because let's face it, an individual's ability to make money is based almost entirely on the circumstances of their birth.) is the best system.
But this is a mis-characterization of what capitalism is. Some of the most poor people of the world today face the exact lifestyle that nearly everyone faced a few hundred years ago. It was only through capitalism, existing sometimes in a very limited fashion, which fueled the industrial revolution and enabled those of us who are so rich to enjoy our lifestyles today (and let's face it even the poorest of any first world country, are vastly rich compared to living conditions a few hundred years ago).
>But I've increasingly realized there are also time when capitalism reaches a local optimum. And I don't think we should let ideology blind us to that.
I would be curious to hear what situation you would describe as capitalism reaching a "local optimum". In my experience, every situation categorized as a "market failure", when investigated, is anything but. That goes for the idea of "natural monopolies", recent market crashes, skyrocketing tuition, skyrocketing medical costs, pollution, etc. I would be happy to point you to material to research any one of these issues.
The state is simply the name given to whatever aspect of a bounded society the society itself recognizes as governing it.
Krämer: "It is all just a bad transfer of power from the state to billionaires."
It's just a philosophical difference in opinion about who should decide what to do with the money - elected officials or billionaires.
Fixed that for you.
Taxes are used as inflation control or to incentivize certain activities.
What you're suggesting is that Treasury would have a cash flow problem if people payed less taxes, which isn't the case. Although you could start to see an inflation problem.
Its ability to sell bonds is controlled by the markets perception of its ability to pay those bonds, which is tied to a number of factors including, inter alia, its perceived ability, willingness, and track record of revenue sources with which to pay them.
People paying less taxes directly effects that.
>revenue sources with which to pay them
Can you show me where Treasury says fiscal outlays are funded by tax receipts, or solely through payments from primary dealers? The government doesn't work like a business in this case.
It may be the case that it theoretically is authorized to do so (though it does not in practice), but if so it would do so in support of the goals its employment/inflation related goals, not to finance the debt. In fact, the whole reason for having an independent (of the entities setting and executing fiscal policy) central bank is to reassure users of currency and investors in government debt that fiscal concerns will not drive monetary policy.
> Can you show me where Treasury says fiscal outlays are funded by tax receipts, or solely through payments from primary dealers?
I can show you where the Fed says that they don't purchase directly from the Treasury, and that their purchases are tied directly to their mandates regarding employment and inflation targets, not supporting Treasury's fiscal needs. [0]
> The government doesn't work like a business in this case.
The government may seem not to work like most businesses because its debt is perceived as risk-free, which gives it seemingly limitless ability to borrow money at extremely low rates, which makes it possible to make spending decisions with little short-term regard for balance with revenues; but the perception of lack of risk in government debt is driven by the underlying perception that the government has, and is willing to use to the extent necessary, the power to tax assets and income subject to the jurisdiction of the United States, and the perception of the size of those current assets and expected income.
[0] http://www.federalreserve.gov/faqs/how-does-the-federal-rese...
This sentence is really amusing to me, because our democratically elected government, at least at the congressional level, is nearly all wealthy millionaires. So either way, important causes are decided by the wealthy.
Heck, I'm in Alberta where we've had a government returning taxes when we had budget surplus... just before the election.
It would slow the pace of government doing stuff down and if someone got bribed, it would be me.
And even if we did wrong, at least we'd truly be responsible. And screwing things up is kind of our birthright.
Yeah yeah yeah, being cynical about democracy is cool, blah blah blah.
I suppose you should, what, just burn the motherf*cker down and be done with it, then?
You know, in 50 years the GOP will be able to look back and point to one of their most brilliant victories of all time: actively sabotaging the activities of government, and then using the results of their very own actions to convince the electorate that government doesn't work and cannot represent them, despite the fact that they got themselves elected into the very system they claim to despise.
It's utterly brilliant. "Starve-the-beast" neocon tactics taken to a whole new level.
I'm not sure you know what a "neocon" is. Neocons derived from Trotskyism and are found in both major U.S. political parties. Neoconservatism has done more to expand government than perhaps any other ideology present in American politics.
>actively sabotaging the activities of government, and then using the results of their very own actions to convince the electorate that government doesn't work and cannot represent them, despite the fact that they got themselves elected into the very system they claim to despise.
Ironically that strategy sounds a lot like a strategy that's been deployed by progressives. If you look at some of the most heavily regulated sectors of the economy--healthcare, banking, housing, wall street, etc--those are the same areas which progressives hold up as free market failures.
Varies considerably between things which get lumped together as representative democracies, from very poorly in systems like the US's which feature a strong duopoly, to very well in many modern multiparty systems. (More detail in, among other places, Lijphart's Patterns of Democracy.)
What about Bill Gates or Charles Koch, do you think they have about $8k worth of influence?
They way you describe it is not how it works in the real world, unfortunately.
But a change coming through the electorate process should have a more lasting effect as simply boycotting Facebook would merely shift the wealth and influence to another person instead of Zuckerberg.
You also have to take into account that the average age of Congress is almost 60. I.e. they have been working and accumulating assets for decades. Adjusted for age, the net worth of the median Congressman is at the 80th percentile: http://www.census.gov/people/wealth/files/Wealth%20distribut.... Is 80th percentile "wealthy"? It's within one standard deviation of the median. I'd call that upper middle class.
Fun fact: the median doctor is worth over $1 million by age 50, and about $2 million by age 65: http://www.medicalpracticeinsider.com/news/which-doctors-sta....
Which, again, fine, but I can't be the only one who thinks we'd be better off if we had more doctors in Congress.
How is that any different from the comment you're replying to? If the government is running something, it's a government ("public") program rather than a private one.
What he says is bad is shifting the decision to the wealthy instead of the public.
Now, if the public is deciding by choosing where to put their own funding, in the form of donations, that makes more sense. But in that sense, the millionaires and billionaires creating or donating to charitable foundations are doing the same thing: deciding where to put their own funding.
It's his money, so it's his choice where it goes. Beyond that, this is just an argument for higher taxes to take that choice away. If you want to argue against allowing people to have and direct the wealth they've created, then make that argument, rather than assuming it as a premise. Once you've assumed that as a premise, then it starts to sound obvious to deemphasize charity and emphasize government programs; that step isn't the interesting part of the argument. As it turns out, we have multiple countries in the world, with different sensibilities about the relative value and efficacy of public and private work, among many things. The US model, evaluated by European sensibilities, is broken in many ways; the European model, evaluated by US sensibilities, is broken in many ways. Neither of those is as interesting or relevant for evaluating potential changes as a country's evaluation of its own models by its own sensibilities.
Personally, I'd be thrilled to have significantly less of my income directed by government to the causes they care about; I currently donate a significant fraction of my annual income to charity, and if I had the money back that currently goes to a pile of things I mostly don't care about, I'd love to donate even more to charity. I know for a fact that it'd do more good. Changing that would require changing what government is spending the money on, and I'm far more confident that I can change the course of a charitable organization (or choose a better one) than change the course of government.
As it stands right now, I think I could do more good with a pile of cash by setting it on fire than by giving it to government; additional money in government hands has negative utility, and may be used to hurt me and people I care about.
As a random thought experiment, I've often wondered how it would work if charitable donations produced a deduction directly from your tax burden, rather than from your taxable income. In other words, every dollar you donate comes straight off your taxes. That would produce some interesting results.
But you gotta spend money to give money!
Comments like this are bad.
The question arises: How would the government be able to "give" Zuckerberg's fortune rather than him giving it himself? Through extremely high taxation for the wealthy that would take away the lion's share of his billions so that the government can put it to work more effectively. So what? 90% tax rate on the megarich?
Government isn't known for it's efficiency in spending or giving. I'm left leaning, but we don't need to give the government new ways to not spend money where it's needed.
SPIEGEL: It is their money at the end of the day.
Krämer: In this case, 40 superwealthy people want to decide what their money will be used for. That runs counter to the democratically legitimate state. In the end the billionaires are indulging in hobbies that might be in the common good, but are very personal.
...
"There’s nothing necessarily wrong with the American system of tax-subsidized charity, of course."
"The critique is that this system affords too much power to the rich, whose decisions may not align with what’s best for society. This is not to say that the government is a paragon of efficacy either, but it risks a lot to depend on a handful of mega-billionaires to be prudent, effective philanthropists."
"What genre of philanthropy will Chan and Zuckerberg invest in? Possibly anything. Their letter Tuesday set two missions, both ambitiously vague: “advancing human potential” and “promoting equality." They mention curing diseases, improving clean energy, promoting entrepreneurship, fighting poverty and hunger, empowering women and minorities, and so on.
The pair do not have a sterling track record when it comes to effective charity. One of their previous efforts, a high-profile $100 million donation to fix the schools in Newark, N.J., has been widely criticized as a failure.
Chan and Zuckerberg write in their announcement that they have learned from their past experiences with philanthropy. For now, they will start with their own community in San Francisco, focusing on education, health and “connecting people.”
In the world where Obama was a dictator and could unilaterally rewrites statutes, sure.
In the real world, Obama had just under two years (because Congressional terms start earlier than Presidential terms) with Democratic majorities in Congress.
"Accountability for you, not for me" seems to be the motto of the movement.
These seem to be opposite view points. Do you have a source for that claim? Or perhaps you were saying something else?
[0]: http://www.cnbc.com/2014/05/23/where-zuckerbergs-100-million...
Or flip that around - is Krämer's implied solution not a case of the state taking the place of the individual?
Put another way, if you founded a company, created thousands of jobs for families and individuals, and made a fortune, why should the state be the one who decides what happens with your money? Why should the state have more of a right to decide which causes get your charitable donations than you do?
This thinking is so poisonous and destructive and pervasive that I'm starting to wonder if it is either due to some natural law of human nature or some grand conspiracy to destroy modern society. Businesses are not built on the charity of the "system". Everyone is compensated in the building of a business, in exactly the amounts they demand to be compensated. The government gets its taxes, the employees get their salaries and benefits, the shareholders get their equity, and the founder(s) get(s) the rest. At that point, everyone is squared. Risk is appropriately rewarded, and risk is an absolute requirement if you want great things to happen.
I didn't say they were built on the charity of the system, just that they were built using the system.
You act like the first 50 employees of your stupid app company aren't taking a risk too. But they get 0.01%, while the founders get...? Fairly early on, you literally don't have enough time in a day to do it all yourself, even if you wanted to, so you're quite literally taking credit for more risk than you were actually able to take.
Considering Paul Graham's essay about how most of the work is ahead of you even when you start adding employees, how is the risk so skewed towards initial conditions versus the long path ahead?
This toxic thinking that a twentysomething takes more risk by trying to start his own company while early in his career deserves orders of magnitude better compensation for the risk he took, over many career people that will have to be persuaded to risk their career and reputations on this new company, who have families, mortgages, and serious obligations to others?
He really took 1,000x more risk? Bullshit dude.
The system was built for us all to use.
You could argue that they owe a moral debt to the rest of us ("give back"), but they are filling that in the form charitable works. Much like how I chose to give back with volunteer works, instead of just paying more taxes.
I don't think you can claim the rest of us actually have license to their gains, just because they built their empire on top of the very same system the rest of us are also leveraging. Unless you want to claim everyone has license to all your gains too.
Besides, the reason we build roads and such is because we benefit from the thriving economy that is built on top of them. It's not just about "I want a road for me to drive on". We build them to be used, and to reap the greater social benefit of their use.
Now, if Mr. Billionaire was squandering the system for personal gain (example: horribly inefficient bitcoin mining with CPUs when the government is paying the electricity) that would be a different story.
So a college kid "uses the system", that system being the college, and by your logic they should be required to donate a certain percentage of their future earnings back to the college they went to because without that system they wouldn't have achieved their success?
That of course would be insanity. The college and the student already agreed upon a price the student should pay for their education, and when they graduate and the bills are paid, everyone is square. Companies within the larger systems in place in our country are no different. They pay money to file with the state, they pay taxes on all their profits, they pay payroll taxes which means they have to compensate their employees higher than they might otherwise, they pay regulation taxes, environmental taxes, etc. But most importantly, they pay people to work, which to me is exactly what they should be doing. By paying people for their labor, companies are paying for the system that provided for those people.
> This toxic thinking that a twentysomething takes more risk by trying to start his own company while early in his career deserves orders of magnitude better compensation for the risk he took, over many career people that will have to be persuaded to risk their career and reputations on this new company, who have families, mortgages, and serious obligations to others?
It sounds so easy from your armchair, doesn't it? When it's not your future on the line. When it's not you that has to bear the full brunt of failure if you don't succeed.
If Zuckerberg hadn't taken the risk to drop out of a highly prestigious school, from which he could have leveraged to land any number of low risk, highly lucrative jobs, to create Facebook, then 10s of thousands of high paying jobs wouldn't exist today. That kind of risk deserves a great reward, and wouldn't you know it, Zuckerberg is every bit as interested in the general welfare of his fellow humans as the rest of us are.
> You act like the first 50 employees of your stupid app company aren't taking a risk too. But they get 0.01%, while the founders get...? Fairly early on, you literally don't have enough time in a day to do it all yourself, even if you wanted to, so you're quite literally taking credit for more risk than you were actually able to take.
They are taking guaranteed salary and benefits and a little bit of equity, too. They understand exactly the amount of risk they took on and if they don't they're incredibly naive. If they were to offer their services for no compensation then they would absolutely deserve more equity. But if they only do so after it's clear the company is well on its way to being successful then how does that represent any risk whatsoever? Where were they when nobody believed in the company and the founders were pumping in their own savings and taking no salary whatsoever? Until you've gone through that, you can't understand what the risk is truly all about.
> Considering Paul Graham's essay about how most of the work is ahead of you even when you start adding employees, how is the risk so skewed towards initial conditions versus the long path ahead?
Sure, most of the work is ahead of you, but that work is done by people who get guaranteed salaries and benefits and who can simply find a new job if the company goes south (with unemployment benefits waiting to soften the blow). People flock to successful companies because they are often too risk-averse to start their own, but just because they do good work doesn't mean they are somehow entitled to the equity of a company, especially if they're receiving industry standard compensation for their efforts.
No, they are compensated in what is agreed to by both sides - which is not necessarily fair or representative of the part they played in building the business.
Yes, and if they were not made better off by it they would have never agreed to it.
>which is not necessarily fair or representative of the part they played in building the business.
No one is compensated based on what percentage they contribute to building a business or product. That is referred to the labor theory of value and it has been disproven.
As for fair, you tell me what fair is.
From where does the business get the college-educated workforce so that it can be viable in the first place?
The answer is that hundreds of years of prosperity has created a system where enough people are middle class, value education, foster happy and curious children that don't need to work, and can send them off to college for an education because they don't need to enter the labour force until they're twenty-something.
We stand on the shoulders of giants in many, many, many ways.
That's insanity. Businesses pay more for college educated employees exactly because they are worth more, and in doing so they are "paying their fair share". It's not like these college educated employees are donating the extra money they should be making to the companies they work for. They demand higher salaries and companies often pay them. Again, everybody is square in the deal.
It would be just as insane for me to suggest that no individual is entitled to the money they earn because without all the private companies out there they wouldn't have all the tools and services required to achieve that success. Therefore, businesses are entitled to their labor for discounted rates or even for free.
Only if you take the surrounding system as given.
The original question was this:
> Put another way, if you founded a company, created thousands of jobs for families and individuals, and made a fortune, why should the state be the one who decides what happens with your money?
And the answer is that the state gets to decide what happens with the money, because if not for people banding together into nations, creating a state, taxing people, and using those taxes to enrich their nation over centuries, eventually reaching a state where a large part of a continent on this planet is occupied by some 300 million people, speaking the same language, using the same currency, having computers, wanting to connect, and therefore creating a niche for a social network to grow so big that its founder could employ thousands of people and amass a fortune.
No deal is ever squared in our society. We are continuously using the amassed production of the past, and paying it forward.
> This thinking is so poisonous and destructive and pervasive that I'm starting to wonder if it is either due to some natural law of human nature or some grand conspiracy to destroy modern society.
You have it backwards. If modern society is destroyed, it would prove the point, because we wouldn't have twenty-something computer-whiz billionaires for a very long time, not until we've rebuilt all of this again.
Yes, they are; especially when they accept public benefits, for instance, in the form of liability-shielded, government-created business structures, including the corporation, LLC, LLP, LLLP, and similar forms.
>disproportionately rewards "you" over the network that actually did much of the heavy lifting
You seem to advocate the labor theory of value which is a demonstrably false theory.
It's not like the government confiscates 100% of wealthy people's money as soon as they try to do good, it just taxes it like it does for mere mortals, whenever it changes hands. Using a legal construct to avoid personal tax liability, is quite literally depriving the government of funds it would otherwise be entitled to.
I think both sides of this debate have legitimate viewpoints, but I personally have a problem with the excessive opportunities given to the wealthy to avoid contributing to the funding of our shared system of governance and infrastructure.
Historically, they've never had it this good both tax-wise and income-wise, and to cry victim is in poor taste.
https://www.irs.gov/Charities-&-Non-Profits/Other-Non-Profit...
Two major errors in only seven words:
1: 501c4s are not "aka SuperPACs". Some SuperPACs are 501c4s, and some 501c4s are SuperPACs, but the things are neither equivalent (which is what "aka" ["also known as"] means) nor is either a subset of the other; there are 501c4s that are not SuperPACs, and SuperPACs that are not 501c4s (527s are less restricted than 501c4s in operations and historically more common for SuperPACs, 501c4s are adopted by some because, while more restricted in operation, they are able to keep donor lists secret while 527s are required to disclose donor lists.)
2: 501c4s (and 527s, for that matter) are tax-exempt non-profits, but not charities (charities are 501c3s, which in addition to being tax-exempt feature tax-deductibility of donations for donors; non-charity tax-exempt nonprofits do not feature deductibility of donations.)
But this is what inevitably happens in public choice as a state expands. Once you delegate all regulatory rights to a central exogenous body, it will be exploited by elites and a symbiotic relationship will form as the state develops special interests of its own.
Hence the need for extensive decentralization, and yes, individualism.
This has two obvious failure modes: it can decay into warlordism, and the member communities can hate each other passionately enough to go to war. (So federalism is a non-starter for the US at the present day.)
Of course, if the poster here didn't mean by federalism what I guessed that it means, the above is irrelevant.
it's in the constitution, the 10th amendment: "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."
("All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.")
The individual states are still allowed to administer themselves in uninteresting and uncontroversial areas, but they have no right to legalize dueling, or ban guns, or write their own marriage laws, or set up a state religion, or reorganize themselves as anti-clerical theocracies -- matters where a federal government would presumably let them do as they pleased. (See what I mean about parts of the federation coming to hate each other enough to go to war?)
They don't. Only the state can legally pull a gun on you and force you to do things or go to jail.
Why does anyone else?
I don't understand why people confuse this so much. It's not "should I pay this $100 in taxes or donate it?". It's "Should I pay this $100 in taxes or donate the $300 I made that the tax is for?".
Why does everyone make it sound like you can choose whether to pay taxes or donate? It's "pay taxes or donate 3-4x that amount".
A culture where private people donate is really attractive. I know that I get a lot of joy when I help people out - I donate regularly to the causes I feel important (mainly Africa, as a Brit living in Netherlands I figure I owe them). As the article says, it improves social cohesion.
Wouldn't it be nice to live in a society where "everyone" enjoyed the gift of giving?
http://www.nptrust.org/philanthropic-resources/charitable-gi...
http://nccs.urban.org/nccs/statistics/Charitable-Giving-in-A...
I fully agree with this, even though I completely disagree with the concept of taxation. If you have to have taxation to somehow collectively pay for the things society supposedly "needs", then have everyone pay for it. We are, after all, in the same boat, so we should all pay for it. And when I say everyone, I really mean everyone that has any income.
Though, to be fair, I live in a society where something close to 90% (the bottom-most earners) don't pay any income-tax at all. And stuff, society and government function. Sort of.
Nobody is saying either solution is great. All it's saying is that: wouldn't it be better to have all this power be in the hands of the democratically chosen, versus billionaires who may or may not be making relevant investments?
edit: Just downvotes, no response?
I do not take it as a given that, when the government spends money, anyone thought how it was spent was a good idea (like spending 8 billion dollars to design a tank... yes, that's billions, with a "b" (also, I love that movie))
Furthermore, all you're doing is cherry picking data points to support your argument without factoring in that military and medical equipment all have huge, onerous requirements for tracking every step of the supply chain, to the mine the metal came out of, which makes cost structures very weird.
What about the Manhattan Project, or the Hoover Dam, or the Interstate System. Bad investments? See, I can cherry pick too.
This assumes the money in question belongs to the state to begin with, and we're merely deciding how it is to be allocated. That is not the case. This is not the rich deciding what to do with the public money, it's the rich deciding what to do with their own money.
I think we would all agree, regardless of level of income, we would rather our own money be allocated to the causes that we support, rather than the causes that 51% of people support.
No, I wouldn't agree on that at all. That runs entirely counterproductive to what our society is built on. This is the arrogance people talk about - you think you know what is better for people than they do.
Where do you think Federal Reserve Notes come from?
Exactly. Nobody thinks that the government can make better use of their own money; however, many people want to use the government to tell other people what to do with their money.
> wouldn't it be better to have all this power be in the hands of the democratically chosen
In a word: no.
Although the state spends some money on things that aren't abhorrent - broken clock politics as it were - it also spends money killing, torturing, and imprisoning people.
So I think it's a very defensible moral stand to give the state as little money as possible.
Where did I say that?
I'm not the cynic you seem to whom you seem to be responding; I believe that the internet age will empower nonviolence from non-state actors as well as an end to the violence of government.
Although we may have needed government to stifle private violence in the past, I don't think we do any longer.
> the people staffing the bureaucracies and agencies don't have their (non-existent) bonus tied to how hard they fucked a customer over.
For most reasonable definitions of "bonus" for a bureaucrat, I think that this statement is false. Oliver North and John Yoo is not in prison. Hillary Clinton is running for President. These people all received bonuses for wrecking havoc on a level about which no private entity can dream.
We moved from private jackbooted-thugs-for-hire to public police protection because thugs-for-hire are unaccountable. Sadly, over the past hundred years or so we've forgotten this lesson, lost our vigilance, and have permitted many of our public servants to make themselves largely unaccountable for their actions.
Power and leadership structures naturally emerge in sufficiently large groups of people. This is unavoidable, even in sufficiently large anarchist organizations.
As the Dothan, AL incident has most recently demonstrated, evil people come to power from time to time. All healthy organizations must be able to detect evil people and remove them from power.
In your future where government is no longer permitted to apply force, where is the accountability? Who detects and ejects evil? Quis custodiet ipsos custodes?
I assert that, in a social dynamic characterized by omnipresent personal recording devices, the capacity to share the gathered evidence, and the capacity to deliberate and apply social pressure in response to criminal behavior, that accountability is the natural consequence.
Did you hear about the one where Social Justice Warriors bullied an artist into a suicide attempt because they felt her fan art "erased fat people" and that her use of the interjections "dude" and "man" when speaking to women made her "transmisogynistic"? [0][1]
This all happened on-the-record, on the Internet.
How does your social theory account for this incredibly harmful behavior?
What is an adequate response to this behavior under the system that you propose?
[0] http://www.breitbart.com/tech/2015/11/02/sjws-bullied-a-youn...
[1] http://www.dailydot.com/geek/steven-universe-fanartist-bulli...
Are you serious? How about voting with your voice. Next you'll be arguing that we should vote with bullets and that'll make a democracy.
There are things that you simply can't "vote with your dollars" for. And you sure as shit can't do it if you don't have any money.
Compare the NSA to Palantir.
Compare NASA to SpaceX.
Compare the Treasury to Enron.
Compare Bell Labs with WorldCom.
Your argument isn't as strong as your Econ 101 textbook made it out to be.
Many economists would consider this to be a problem that falls under their realm of expertise.
Can you provide counterexamples? If you look, there is plenty of competency in both sectors.
Econ 101 doesn't opine on the relative efficiency merits of government vs private sectors...makes me wonder if you have ever even taken an economics course. You misrepresent both Economics as a field of study and the argument I was trying to make (which was an argument by logical reasoning, not economic reasoning). If you'll notice, I even mentioned a specific government (the german government) as one I would entrust my money to, so it should be pretty fucking obvious the argument never was about government vs private, but rather our government vs private.
> Can you provide counterexamples? If you look, there is plenty of competency in both sectors.
Yes, I can provide counterexamples, but that I'm not gonna beat up your straw man for you. There is plenty of competency in both sectors, but you can't deny that if my money goes to the US government, that a significantly large portion of it will go to extremely bad ideas, such as blowing arabs up and funding the militaries of foreign governments that will help blow up more arabs, subsidizing millionaire farmers, subsidizing automobile travel, creating laws that imprison people for victimless crimes and building the expensive prisons to house them for mandatory minimum amounts of time, etc.
Sure, we democratically elected this shit, but we could democratically elect any pile of shit and it would still be a pile of shit. I see no utilitarian value in respecting the whims of 51% of the population.
I guess you haven't been paying attention to SpaceX.
With the exception of commodity things like their microchips, they've built all of their tech from scratch. They can deliver payloads somewhere between 33% and 66% cheaper than anyone else. Their safety record is really, really good. They're doing things with their launch vehicles that noone else is.
SpaceX is the best goddamn thing to happen to spaceflight since the Cold War Space Race.
I think we can both agree that the term "democratically chosen" contains many positive connotations which simply don't apply to the current US government. If I were a billionaire, I personally would do as much as legally possible to keep my money out of the hands of the government and personally seeing that it is used for the betterment of society. Because frankly, the idea that the current US government is effectively spending this money for our betterment is ridiculous.
I trust the guy who wants to use his own money to build a legacy for himself. He has more motivation to get results than a government bureaucrat making decisions about spending someone else's money.
Sure. If you want your money to go to the causes that everybody else supports, then absolutely, you should give more money to the government.
However, if you want the money to go to underfunded fields, or areas in which the government doesn't support at all, then you're left with making contributions to non-governmental charities or organizations.
I regularly donate to the EFF, ACLU, SAF, CBLDF, and St. Jude, Habitat for Humanity, among others. Of that list, only St. Jude and Habitat could be arguably better spent through direct taxation. It's possible that the government does more for children's cancer and housing the homeless than those charities do -- it is not possible that the government does a better job of acting as a watchdog agency for the government than the EFF, ACLU, SAF or CBLDF.
Beyond that, when I donate directly, I get the satisfaction of knowing that none of the money given goes towards causes I do not support, like war-making, privacy violations, etc.
EDIT: I picked the US government, but I doubt many other countries have to look for to see ludicrously immoral and unethical expenditures of their own.
That doesn't seem like a bad trade to me, especially since rich people have fairly low marginal tax rates.
Assuming your correct, it probably has a lot of other contributing factors. The federal government gets by far the largest share of tax revenue, but a lot of transportation issues are felt more at the state and local level.
I doubt transportation problems are due to a lack of federal tax revenue. Keep in mind most governments in the world are smaller than a big US state. Incentives and priorities get distorted a lot when you have one entity responsible for trillions of dollars of annual expenditures.
No, I'm more suspicious of measures like California's Prop 13, as well as county and city level management.
For example, look what happened in the UK: http://www.theguardian.com/commentisfree/2015/nov/11/david-c...
The US federal government is far more likely blow it all on the military weapons systems or funding tax cuts that benefit the wealthy rather than funding guinea worm eradication or anti-malaria initiatives in Africa. The typical US congressman is unwilling to spend money altruistically on things that aren't perceived as directly benefiting the United States.
Sure, billionaires aren't saints either, but I think it's far more likely that they'll donate to causes that are geared toward having a positive long-term impact on humanity as a whole.
But I'm not inclined to believe that, since I can reasonably believe that the increase in charitable giving from not having the tax is more significant than the gain from having the government control 20% or so of it.
The 'shift of power away from the government' argument is just one of the arguments made in the book, and author Linsey McGoey discusses it much more thoroughly than the article does. See quote /a/
[1] http://www.versobooks.com/books/1959-no-such-thing-as-a-free...
/a/ The second concern is that philanthropy, by channelling private funds towards public services, erodes support for governmental spending on health and education. Outspoken observers such as Michael Edwards, a former executive at the Ford Foundation, point out that private philanthropy is no substitution for hard-fought battles over labour laws and social security, in part because philanthropy can be retracted on a whim, while elected officials, at least in theory, have citizens to answer to.
This kind of thinking unfortunately is common in continental Europe, particularly in Germany and France. This is not all about the common good or democratic legitimacy. It's really all about redistribution of wealth and getting back at "the rich". It's about slave-moral thinking that strives to punish the well-off and make everyone feel equally miserable.
Not sure who's right, but if it's not WaPo, then that's some terrible fact checking and kinda invalidates the whole article.
Edit - Chan Zuckerberg is a for profit, that will fund non profits, so WaPo is actually incorrect.
Starting another large foundation creates a new source of funding with an independent decision-making process. This increases diversity in sources of funding. (Though not as much as breaking it up into multiple charities.)
Whether it's a net improvement or not depends on whether their decision-making is better than average. Unfortunately, little can be done about charities with poor decision-making (there are no market forces, and corruption is possible). But at least it's independent.
Governments are good at solving broad, societal level problems. If they weren't, they would be overthrown and replaced. But they're remarkably inefficient at solving individual, specific problems: they can do it, but it will take 4x as long and cost 10x as much as it should. Also, government intervention is limited in scope - it's hard to be philanthropic outside your constituency.
That's where philanthropists can step in. There are some problems that don't provide enough benefit to any single government to throw weight behind solving, but that require massive resources. Bill Gates' anti-malaria campaign is a good example: no country with the money to fund a malaria eradication program has significant rates of malaria.
This isn't a perfect system, as sometimes contentious conversation can be better than non-discussion. But overall it's probably a good to have a temporary throttle until a moderator can make finer grained fixes.
I realized a few years ago that this is the end result in any organization, but some German beat me to it in 1911.
https://en.wikipedia.org/wiki/Iron_law_of_oligarchy
>Michels theory states that all complex organizations, regardless of how democratic they are when started, eventually develop into oligarchies.
Is it acceptable to have the privilege to choose where your fortune will be allocated when you give away a supplemental 150% of it? Maybe it's not or maybe it is; I would strongly lean towards the latter.
There's no point in arguing about whether the state is better suited to handle the money. It would actually be better off cashed out, piled up, and burnt. Literally. A tiny deflationary event vs. eternal troublemaking.
You wouldn’t have most of modern technology, nor would you have Wendelstein 7-X.
You wouldn’t have DHL or T-Mobile.
Sure, they waste lots of money (BER, S21, Elbphilharmonie), but still they manage it better than the private sector ever could.
The top politicians earn less than the managers of any company at that size — Merkel earns 216'000€ a year. The CEO of even middle-sized companies end up making far more than that.
Complaining about that is missing the forest behind the trees. With Citizens United and general ineptitude of the legislative branch to produce any significant fixes to the system, that power is long transferred.
And who owns the state? Last I checked, it was billionaires.
It's hypocritical to point out someone who is avoiding tax just because they are doing it on a larger scale than you unless you voluntarily pay more taxes to the government than you need to.
https://www.jwz.org/blog/2015/12/zuckerberg-has-not-donated-...