40 billionaires pledge to donate half their wealth
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Perspective: The US national debt is increasing by over $4b per day. If the $600b was used just to keep the debt from increasing it would last less then 5 months.
On the other hand, maybe I don't understand what I'm talking about, and if so, please correct me.
Actually, it's not. Inflation is related to interest rates and the "value of the dollar", both of which affect our ability to pay off the debt, but the debt itself, the number of dollars owed right now, is independent of inflation.
> this pledge could reduce that significantly
It's less than 10% of the admitted debt, $8T, and that number is significantly less than the unfunded liabilities (SS, Medicare that folks think that they have pre-paid).
And most of those folks are giving their money to charity, not to govt, so it's not providing govt revenue that can be used to pay off govt debt.
In other words if the debt increased 0$ in a given year we would have effectively paid off ~3% of it.
PS: The actual increase in debt over the last few years has still been ridiculously fast. Defense-related expenditures outside of the Department of Defense constitute between $216 billion and $361 billion in additional spending, bringing the total for defense spending to between $880 billion and $1.03 trillion in fiscal year 2010.[7] (http://en.wikipedia.org/wiki/Military_budget_of_the_United_S...) Basicly we are putting the entire DoD budget on Credit Cards.
Wouldn't it be funny, if at the end every nation/bank has the same debt to each other?
What a $100 billion can do - http://www.visualeconomics.com/what-bp-could-have-bought-wit...
It comes down to whether the billions of dollars fund businesses or bureaucrats.
I'd MUCH rather that they pledge to donating half of their wealth to economic development. We are in desperate need of investment capital here at home. Wouldn't that $600B be better spent investing in alternative-energy and other high growth fields?
We've given these folks huge tax breaks with the idea that they'd reinvest that money in our economy. The article is somewhat light on details about where this money ultimately ends up, but I firmly believe that it's best spent helping tomorrows billionaires (all over the world) get their start.
Would that not include non-profit research into the areas you outlined?
Is money better spent feeding/clothing a bunch of Africans and preventing aids _or_ on research, bio-engineering, space/ocean exploration, education etc. here at home?
Which one is short term and which one is long term?
The continued existence of the entire human race may depend on space exploration and subsequent colonization. One comet or black-swan type disaster could wipe out humanity as a whole. This is not without precedent (dinosaurs).
Each time we leave this planet we punch a whole in our ozone layer that can't be repaired! Some things were meant to be left alone. Simple education like teaching man to fish and read (not like our socialist education system here in America) will improve life and decerease deficits on this earth! Socialism is not the answer!
Can you provide a source for the ozone whole claim? Where did I mention socialism?
http://www.nasa.gov/centers/kennedy/about/information/shuttl...
Most African economies are agricultural and it is therefore alarming that the EU uses 40% of it's budget(about 48B Euros annually) on agricultural subsidies. The US uses about $20B every year on the same.Ending these subsidies would enable Africa to export more, buy more products from the US and Europe as well as form the basis for industrialization.
We need more trade and less aid. Is that asking for too much?
More info;
http://en.wikipedia.org/wiki/Agricultural_subsidy
http://www.downsizinggovernment.org/agriculture/subsidies
http://www.time.com/time/nation/article/0,8599,1978963,00.ht...
The problem is that many Americans (I don't know as much about Europe) aren't actually that wealthy. Without food subsidies, our food quality would probably increase, but so would our costs. Poor Americans are overweight today because the distorted food costs make it cheaper to eat processed food (that is more expensive to make overall) than to eat basic fruits and veggies and grains. Without subsidies, they would be starving, or at least calorie deficient.
Nixon put in our current system of subsidies because "food should never be an issue in a presidential race". And since then, it hasn't. America may be wealthy, but the wealth is very unevenly distributed. Without social programs, many of our people would be starving as well.
Productivity and efficiency have increased much faster than when subsidies were in place.
http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspon...
http://www.nytimes.com/2007/08/02/business/worldbusiness/02f...
Although I'm not in a position to give away large sums of money, I don't believe in _just_ investing in people.
Investing in their economy, industry etc. makes more sense in the long term than investing in food/water and short term solutions.
Of course, It is very easy to talk about this sitting on my couch with a full stomach.
Nobody wants to put all their eggs in one basket, especially if it's someone else's basket. And from what I hear of high-yield food production, the good baskets all have problems down the line. Meat has disease and animal rights activists, fish has chemical pollution and overharvesting, fruit has pollination and insecticide issues, grain has crop rotation neglect and nutritional deficiencies.
Add to that the issues global trade is facing, such as rising fuel costs, treat of piracy, troublesome weather, looming threat of magnetosphere and solar interference, and politicians, and you can understand why I'd be reluctant to designate Africa as the world's breadbasket. Perhaps I've just watched too much TV, but food is one of the last things I want outsourced.
With that much money you can do both.
That's very harsh and insensitive. There are millions of people dying of hunger and all you care about is space exploration?
The Gates Foundation, for example, has a strong focus on education, which is all about "teaching boys and girls to fish" and is really a prerequisite to a strong economy.
There has been some good coverage of this angle from This American Life(PRI) and Planet Money (NPR). Example: http://www.realmedicineblog.com/2010/05/29/haiti-this-americ...
A significant portion of the scholarships should also be going to fund apprenticeships to get people certified as competent electricians, plumbers, brick layers, mechanics, etc. There's no point putting someone through university if there's going to be no one around to help build a university in their country, or their business office, etc.
One of the struggling points of our own economies is that we're vastly short handed in the skilled trades to the point that many countries (Australia) basically hands out citizenships to people with these skills. It would be asinine to play economics and screw up right off the bat. We need to educate in controlled proportions from the top and to the bottom of our own skill ladders.
I know people who are incredibly smart who can't use a hammer. Who would build their house, repair their roof, reside their property, replace their windows, etc. We're talking about regions with a high proportion of natural disasters, and they'd need a good supply of skilled workers to ensure a tragedy like Haiti doesn't happen because buildings aren't constructed to modern codes.
Many of those whose studied under the program came back to Kenya when the country needed them most.
United Way: Please send a check for $25K to Sallie Mae on my behalf, and we'll call it settled.
It also opens up the discussion of what burden 'normal' folks assume when their most basic needs are taken care of. How many HN readers donate at least 10% of their earnings?
The joke is that he is $50,000 in debt, so half his net worth is -$25,000, so he will donate that debt to the United Way.
I thought it was funny in the "clever-funny" way that usually garners upvotes.
I'm sure Gates and Buffet already understand this well, and have said so, but I wish it were making it into the coverage.
Even Larry Ellison is in the list.
> what makes me think I can efficiently or intelligently deploy that amount back into "society" or "the community" in far less time
It's simple to invest billions of dollars with the intention of increasing your wealth: you hire people at some well-respected financial institutions and pay them a good amount to do it for you. (let's overlook recent history here)
In the same way, there are many excellent charitable and non-profit institutions that have the infrastructure and knowledge in place to turn monetary investments into social good.
It might be more cost-efficient to make everything cheaper to make it easier to help Africans in poverty.
Some material things make my life more enjoyable; many, however, would not. I like having an expensive private plane, but owning a half-dozen homes would be a burden. Too often, a vast collection of possessions ends up possessing its owner. The asset I most value, aside from health, is interesting, diverse, and long-standing friends.
Nothing to say on top of that.
"The pledge is a moral commitment to give, not a legal contract. It does not involve pooling money or supporting one cause or organization. It's up to each person who signs the pledge how to divvy up their wealth."
Also, reading the pledge letters, it becomes clear that these folks won't be giving away their fortunes today or tomorrow, it's about what happens to the remainder of the funds after they die. For all we know, they could've spent it all on hookers by then.
I don't buy any of this. What charities are going to handle this kind of money without the majority of it being misappropriated? This sounds more like a set up for a giant scam and huge distraction than anything that might actually be useful to other human beings.
Philanthropy has worked in the past.
We need enabled intellectual prowess as much as outright cash.
Pulling that much money from where it is invested now means less money for startups, etc. It could easily be a net loss to society to have that funding diverted to charities unless they were some pretty awesome / above average charities.
I mean there are charities and then there are self-serving charities
(ie. the Dominos pizza billionaire literally built his own catholic city).
Shouldn't we be keeping an eye on charities? That sounds like it'd be ripe for exploitation.
Although I still think that the wealthy have a vastly disproportionate influence over government and at times to the expense of the greater public and that many of the super rich would short the public to increase their bottom line, reading the letters written on http://givingpledge.org has entirely reformulated my perception. I am now much more likely to give any rich person the benefit of the doubt and even perhaps view them slightly favourably rather than default to their status being illegitimate.
I have been inspired and it is absolutely amazing to see what the captains of industry are doing with their wealth. There were many of them committing 90%, 99% of their wealth, even to die broke. Not only so but committing their time and experience too. Some of the most experienced and I would think of intelligence individuals dedicating themselves to such great causes as Socratic methods of teaching, many scholarships, medical research, clean water, libraries, homeless, social programmes for the young... I think is very inspiring and motivating to become rich.
What is inspiring also is reading things such as Greek immigrant, orphanage, all our worth at the back of a Ford's car, an average American.
There is much that can be improved with the working of democracy, but with people like these I have faith in that country and trust much to be good.
I can now once more view them as role models. They are great people doing great things and I am inspired to become as great if not more.
Of course if these billionaires put significant amounts of money toward various respectable aid programs it may reduce the amount that the government needs to spend, allowing it to direct more money toward paying off the debt.
This only works if it somehow lowers your overall tax load, and for Mr. Billionaire, I don't think it's much of an issue.
Buffett says the rich should pay more taxes
Easy to say for a guy who built his wealth starting with an insurance company, which uses government regulation to make most of its money. Wealthy people put their money into the insurance company because life insurance payouts aren't taxable but estate taxes are. Then Buffet's insurance company gets to invest that money in low risk bonds to get basically free money before paying it out. This only exists because of insurance company lobbying - it only adds friction to the system and wastes time and resources, while insurance companies get rich extracting money from the system. This is how Buffet built much of his starting capital.
Then he keeps most of his earnings in the holdings company, and only occasionally pays capital gains. The guy's gamed huge loopholes in the U.S. tax system his whole life, and then has the audacity to say that "the rich" should pay more taxes? Physician, heal thyself.
Edit: Reply instead of downvoting? There's a bunch of not commonly known facts in this comment and it's getting some downs, a non-fact progressive viewpoint is getting some ups... that's got to be the most disappointing thing about HN lately, the trend towards up/downvoting based on politics and not content in a comment.
Stick to business and stay out of trying to be a folk hero? Or pay higher tax rates voluntarily to set an example? Campaigning for a tax increase when a lot of his money came from helping people use a tax loophole created by his industry doesn't seem particularly righteous.
As a businessman, he's required to exploit these loopholes, much like a lawyer is required to defend a client they know to be in the wrong. What makes Buffett special is that he, unlike so many other super rich, is choosing to publicly draw attention to the system they all know to be broken.
http://www.taxpolicycenter.org/publications/url.cfm?ID=90058...
On the other hand, the tax burden and the supposed services and goods provided might have a larger effect on the poor but rich-compatible ideologues.
You're not under some silly impression that if the government suddenly had less money that they would cut spending are you?