Mackenzie Scott gives away another £2B | Hacker News Reader

Mackenzie Scott gives away another £2B

bbc.com

70 pointslakis42 comments

Interestingly, it looks like she has done a more than passable job at targeting her donations to maximize long-term social benefits. Even her donations to "arts and cultural institutions" (a field where the vast majority of charitable donations are mammoth exercises in wasteful frivolity) are actually targeted towards institutions operating in highly challenging community contexts, where arts and culture funding is a very plausible mechanism to jump-start development of high-quality social capital and community ties. So, a remarkably good job overall.

I'm really down for just funding existing organizations too. A bunch of artists in my city were livid when council approved some new $xxxk arts grant, but then it turned out that half of it was going to a new full-time position for someone to "oversee" the program.

What the heck? No! There are existing groups that will happily receive the money and get it to artists, and yes, provide you accountability about where it went and what it did.

I know this is an unpopular opinion, but in some areas I believe it is much better to invest the money in a sustainable business selling a product rather than giving that product away. That preserves profit and loss indicators and allows decision makers to judge the value their end users are receiving.

Education can be an example of that. Making a really cheap, high quality school is much better than funding tuition in existing schools. A school that manages to retain costumers indicates that they value the school so much there's nowhere better to spend the money. However if the school is "free" they might as well just go for it even if they don't get much out of it.

> Making a really cheap, high quality school is much better than funding tuition in existing schools.

But there are a lot of people working on this, including many who are already employing a "disruption" mindset.

I think it's refreshing that her approach isn't dripping with that classic tech-boy hubris of looking for two seconds and deciding you need to reinvent, but is rather rooted in affirming and uplifting good work that's already going on, regardless of whether that work is bootstrapping new and better systems, or may well just be passing on the cash— which in many cases could in fact be the most effective thing to do with it:

https://epar.evans.uw.edu/blog/long-term-impacts-cash-transf...

I agree with you. She seems to recognize that helping people to help themselves is a better use of the funds than trying to swoop in and "save them."

It's tough because I think in some cases there really are new things that can be done, where the volume of money in question makes it logical to start over— thinking of the Gates foundation trying to tackle malaria, or address sanitation issues around toilets.

But education? Inequality? These aren't ones where some random person who hasn't been thinking about it for decades is going to come up with a radically new approach.

Even the Gates foundation itself wasted quite a bit of money in funding approaches to education (like "small schools") that just didn't yield good outcomes, and were sometimes harmful.

Yeah, that was one of the ones I was thinking of, I just couldn't remember the details— here it is for anyone else out of the loop:

https://marginalrevolution.com/marginalrevolution/2010/09/th...

This feeling is, I think, pointing at the comparative ability for the parties involved to efficiently spend money. There is certainly one really good reason to prefer how a billionaire distributes their money - because they were able to earn a billion dollars in the first place (assuming it's not inherited - if it's inherited then just sign a check). However, I think this belief breaks down when you have organizations pre-established and familiar with efficient ways to spend money in that market - if the nation has a public school system the runners of that system will be happy to distribute those extra funds in the places that have the most need - those next few budget items that got cut because of a shortfall.

I personally believe that getting rich is a combination of 30/70 skill vs. luck - without the skill you're never going to get anywhere, but a lot more folks have skill than get the chance to get insanely lucky. Letting established market participants spend that money is almost certainly going to be more efficient than trying to start a new market entrant and hope it does well.

How are the people who need the product going to pay for it? End users can still report on the value of the product even if they received it for free, there are many ways to evaluate effectiveness beyond P&L.

Capitalism is not the answer to everything.

One problem with this that now you need expertise in building a cheap, high quality school. And how do you know your product (education) will be better than competing products?

And by what metric do you compare the effectiveness of your school vs competition? "Retaining customers", so does that mean we judge a school's quality by year over year revenue growth, since that indicates customer retention?

I know this is an unpopular opinion, but "I know this is an unpopular opinion" adds nothing to comments but a false sense of contrarianism.

This is the prevent the flow of negativity HN is sometimes known for, similar to the comment you yourself posted.

I know this is an unpopular opinion, but I don't see constructive criticism as a "flow of negativity."

It's not the content, it's the attitude

While I am generally in favor of very heavy taxation of wealth rather than hoping for favors from the ultra-rich in their generous moods, I am happy that at least (unlike taxes) none of this money went to the military.

Interesting that Scott has asked for the focus to be on the organisations not her. https://mackenzie-scott.medium.com/seeding-by-ceding-ea6de64...

I wonder sometimes if the marital law we have rn isn't a bit bizarre in the disbursement of half of the wealth of the "family", where 99.99% of that wealth is from one of the people.

I don't imagine I'll ever be Jeff Bezos, but I would feel pretty weird if I became an independent billionaire by divorcing my wife.

It's a hot topic, but I would appreciate some discussion on it.

I would agree with you that the 50/50 split is pretty bizarre and arbitrary, however allowing that much cash to accumulate in one couple's pockets is, I think, a pretty clear signal that other much larger parts of our system are fundamentally broken.

> the wealth of the "family", where 99.99% of that wealth is from one of the people.

Scott was a cofounder instrumental in getting Amazon going in the early days, not a "trophy wife". Equity is equity.

I'll take your word for that because I'm not privy to the details of early Amazon.

The better way to handle that is for Scott to get actual equity which belongs to her, not to rely on divorce courts to split up assets in a way which is sometimes fair. If she had been a 'trophy wife', courts would tend to award her the same amount.

HN isn't really the place to solve problems with marital law, however.

> The better way to handle that is for Scott to get actual equity which belongs to her

She got exactly that. That money didn't change hands. It was always hers. People have just been lumping her wealth into Bezos' for years.

Note "our" Amazon stock: https://twitter.com/mackenziescott/status/111385126004050329...

Good to know. As I mentioned, I'm not privy to the details of early Amazon.

The misconception that Scott received her wealth in divorce court is extremely common. I don't have high expectations for our media at the moment (cough) but they could have done a better job with this for sure.

There is a very good reason for pooling finances through civil unions, joint filings, etc.

When spouses/partners are working together for mutual success, there are countless things done by one party to enable wealth accrual of the other. In many cases, without one person doing very demanding work to enable their partner to work long hours, take major career risks, etc. their partner would have been unable to get wealthy at all.

I wish she would give to governments :-/

There are thousands of governments in the US (and many more globally). Towns, cities, counties and states and of course the federal government. Many of these governments are accountable and effective in a way that charities aren't.

Have you seen how governments spend foreign aid receipts?

I’m not familiar with a single credible analysis suggesting governments are more effective per dollar than charities. Note that none of the effective altruism people ever advise “give your money to the Chicago city government” or whatever.

The conclusion I’ve reached is that, if you have a low time preference, investing in high-risk R&D is the highest social return strategy.

It is really, really easy to have a lack of faith in governments (well in the US at least) right now due to the extremely neo-liberal bent that's been ingrained into governance starting with Regan. I think that investing in non-profit organizations in the US might be optimal, while abroad I do agree - governments have much better inherent oversight and market knowledge than most other participants.

Is there any evidence that "non-neoliberal" countries do better re: governance?

Let me explain my situation, which I believe provides a significant counterpoint.

I live in a third-world country where government is constantly pushed into supporting more and more benefits, high salaries and job safety for an educated public servant class which has the connections and resources needed to pressure the government successfully.

Meanwhile the general populace - who lack the qualifications for the highest-paying government jobs and can only ever qualify for the lowest-tier ones (which are not good, but still better than going into the private sector - more on this going forward) - is constantly impoverished by the inflationary pressure created by the government's need to finance spending on the high-tier public servants.

The private sector is also extremely bad, as the government constantly passes anti-business laws in the name of fighting "neoliberalism". Of course, this does not at all hinder multinational corporations - supposedly the face of "neoliberalism" - as these can pay for the armies of lawyers needed to navigate the constantly-changing legal environment, and the ludicrous worker obligations created in the name of "protecting the working class".

Meanwhile, smaller businesses - mostly owned by the dwindling lower-middle class, as middle- and upper-middle class people either leave the country to find skilled work elsewhere, go into the high-paying government jobs or work for the multinational corps - die constantly, as they cannot deal with the legal insecurity and fees created by this environment.

Most poorer people actually do not have any legal worker's protections even though our law is EXTREMELY generous to workers on paper, because only mega-corps can afford to hire people within the law - most people work outside of legal parameters just to survive.

So you end up with an environment where most workers have immensely generous rights on paper, government is extremely powerful and constantly passes measures which are justified as protecting the country from "neoliberalism", which we are told is coming to make us enslaved to foreigners and impoverish us all from our "birthright".

Said "birthright" consists of very bloated public services which generally suck for most of the population and serve mostly to produce sinecures for rich, well-educated people. The private sector consists mostly of foreign mega-corps who are, paradoxically protected from competition by laws passed in order to prevent "neoliberalism" from ravaging the country.

The country is, as you can imagine, corrupt to its core and runs on shady deals between the people in power, the people running mega-corporations and the high-level public servants (these groups have significant overlap, as one might imagine).

Sorry for rambling on, but whenever I see people - ostensibly from the first world - talk about the evils of "neoliberalism", I wish they would look more at how trying to prevent the supposed evil of "neoliberalism" has ravaged the third world and raised oligarchies to power.

> Is there any evidence that "non-neoliberal" countries do better re: governance?

Not only is there no such evidence, but the Scandinavian countries that people like to point towards as proof that "democratic socialism" can bring good or even outstanding governance, are actually extremely neoliberal in basically everything save their highly tailored support for lower incomes. "Socialism with Scandinavian characteristics" is just good old bleeding-heart neoliberalism.

(For clarity, actual neoliberalism without the bleeding-heart part would be something like Singapore - still very good governance in many respects, but the social inequality there is quite tangible and quite a few people suffer real hardship as a result.)

Do you have any credible analysis which supports your assertion that governments are more effective than charities at their goals?

My conclusion is usually that governments are good _coercion_ mechanisms for dealing with situations where the actions of individual players cannot lead to a good outcome for all unless they are somehow forced to go against their self-interest (i.e. collective action problems), but that as _execution_ mechanisms it is a pretty clear point that they are tremendously wasteful.

I live in Seattle and the water is clean, the electricity is constant, the safety is high, the air is breathable. This is the same and different than other places I've lived like Nairobi, NY, Austin, Long Island, the UK, etc... Governments are the big differences between these places.

While there is a coercion aspect to it (people can't burn trash in their yards), there is also an execution aspect to it (roads are paved, electric lines are maintained).

Some governments are better than others and many are truly evil.

Grantors like Scott could give to the best governments and reward them for their effectiveness and accountability. This is similar to how she gives to high quality charities but not low quality ones. She could do the same with government recipients.

That was a charitable donation so the government literally got paid a negative amount in tax on $2.7B of wealth created. That's $0 from capital gains that otherwise would have been collected and it also reduces her tax burden; probably for the rest of her life, down to $0.

Instead of all these social (justice) causes, I wish these billionaires would just build out our clean energy infrastructure and lobby to destroy our fossil fuel infrastructure.

Putting that $2.7b into Tesla shares would probably achieve more for the planet.

Meanwhile, we continue to throw money at problematic regions and peoples of the planet, for little apparent result apart from establishing a multi-generational and potentially endless reliance of those groups on massive continued aid flows.

The regions of the world where people have been truly uplifted - eg. Bangladesh and China - are the results of old-fashioned foreign investment and the hard work and adoption of Western culture and technology of the local populations and Governments, with no aid or donations in sight.

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