Just trust the billionaire! A response to “5 criticisms of billionaire mega-philanthropy, debunked”

I too initially thought the criticisms of Mark Zuckerberg’s new philanthropic foundation were in bad taste. Perhaps a little bit of sour grapes. Overly cynical.

Picture of Mark Zuckerberg, Priscilla Chan and their baby daughter Max Zuckerberg

But then I took the time to read some of the criticisms and realised that they had some really good points. So I was interested to see Quartz’s ‘Debunking’ of those criticisms.

I was, unfortunately, disappointed.

Here is my paraphrased summary of their “debunking”:

Mark rightfully wants to have the biggest impact possible with his philanthropy. Therefore he is right to found his own corporation so that he can avoid paying taxes on his capital gains, and retain control of everything. Who are we to question him? And besides, you’re just jealous.

My natural inclination is actually to give the benefit of the doubt to Mark. I do believe he has good intentions. But that doesn’t make the criticisms of his move any less valid.

In a move advertised to “make the world a better place”, his first step is to avoid paying a fair amount of tax on his massive profits. That really does not inspire a lot of confidence.

Everyone not in the Billionaire class seems to be stuck paying all of their tax bill every year – but for the mega wealthy, they are special. They get to make all of their money, and keep it to!

Oh I know, he doesn’t actually get to “keep it”. It goes into the LLC.

….which he controls.

Just stop and think about this for a moment. What does a multi-billionaire do with the extra billions he has in his bank account anyway? He certainly doesn’t need it for ‘cost of living’ expenses.

Once you get past the first billion or two, everything else is just waiting to be allocated to things you think are worthwhile. Like putting it into chosen charities, or investing it into startups and companies you think will make a difference, or potentially using it for political campaigning. ie: Exactly what Mark’s LLC will be free to do.

So the reality here is perfectly clear. Mark has simply arranged things so that he can move all of his capital gains out of the company, into his control (not ownership), without paying any tax on it. It’s brilliant. He, and his family, get everything, in perpetuity, without ever paying any tax on it. Not even estate taxes!

This means his entire lineage will be in the control of many billions of dollars of wealth without ever needing to worry about earning anything. Not that they get to spend it on their own cost of living – it isn’t *their* money. Sure. But they can definitely choose to hire themselves if they need a job…

Better still, when you control vast quantities of capital (which can be invested into companies and political campaigns), it is amazing how many other wealthy people (but not nearly as wealthy as your LLC) are willing to go out of their way to wine and dine you in the most extravagant ways possible in order to secure your support.

Being in control of a lot of money has many significant benefits which go along with it.

So basically, this is a great way to lock in your profits without paying capital gains tax, and also guarantee that your dynasty remains for many generations to come, never needing to pay estate tax either.

A great big F you to the government. And a call to the population to “Praise me!”

In my opinion, the criticisms against Mark and his “Philanthropy” stand. Nothing has been debunked.

Now we have no choice but to let him carry out his business as he sees fit. Hopefully he will actually live up to the ideals he has set forth for himself. Hopefully he will actually make a difference. Hopefully he will make the world a significantly better place.

You’re in charge now Mark.

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Helping People Inc

This is an idea for a website which I came up with just after I went to bed – which is why it is now 1:45am and I am typing this up… the idea won’t let me sleep.

The website, which doesn’t yet have a name (PleaseHelpMe.com, LetMeHelpYou.org, PhilanthopyMarketplace.com are some possibles – although that last one is a terrible name of course), will be a place where people in desperate need will be able to ask for help, while people who are able to help will be able to look to provide it.

I don’t know of any website which provides this sort of service, or anything else that operates like this at all. Charities and government services do often provide a lot of the necessary support structures that most people rely on – but surely there are plenty who fall through the cracks of these bureaucratic entities. I believe there would be real scope for this sort of service – a website which enables the haves, to engage directly with the people who need the help (rather than dehumanising the philanthropic gesture, by ‘giving’ to a faceless charity all the time and trusting them to use your resources as you wished them to be used.)

How it Works

People in need create a profile, and then publish a post which explains their situation. Along with the text based explanation of their situation, they would have to indicate details about the seriousness of their situation, about what might be required from the philanthropist to help them out, and an indication as to the type of problem they are suffering from.

This post is published when the individual is ready to publish it, after which time the post will stay public for seven days on its own. After that time, it will be automatically removed from the public list. It may be made public again at any time, or have its 7 day lifespan refreshed by the creator by completing a turing test(s). This feature stops the boards from being over crowded by old ads, and allows people who really need the help to keep their story up in the public boards as long as it is important to them.

Meanwhile, philanthropists are able to register accounts and browse the public requests. (probably allow the people in need the option to make their post open to everyone, or just registered philanthropists – so there would be a number of requests which non-registered users would not be able to see). The philanthropists will be able to browse requests by geographic location, by severity, by amount needed, types of problems etc. If they find a request which they choose to try to help out, they are free to message the person in need, and arrange a time to visit, meet etc whatever is required to enable them to help (or not help if the person in need is actually a scammer – which is a real risk of course).

The role of the website though, is just to provide a ‘classifieds’ style of space to allow people to ask for help, while others are able to browse the requests, and identify help that they can, and want to give. And then provide an avenue of contact between the two parties. No payments will be handled, and no guarantee of authenticity (at least, not in my current vision of the site).

Possible Consequences

It is possible that this concept could revolutionise charity in some respects. It will probably never ‘fix the world’, because I can’t see it being particularly useful for helping global and political issues – but when it comes to local communities of one level or another (suburb, city, state, country), I think this system could really help promote a sense of community.

It is nice to donate to the red shield appeal, or red cross or whatever – but it is something else entirely to find out that someone in the very suburb you are living in, is in desperate need of something that you have, and you are easily able to give it to them.

It will also provide a source of hope to those who are truly in need. The freeloaders who will no doubt try to get money for nothing from it will probably get nothing (because they are dealing with smart people who are no doubt going to be very discerning about who they will help), while the people who have suffered greatly will inevitably be found by someone who can help – and knowing that someone might contact you, and say “I can help”, would be an incredible source of hope for when you are in a terrible position.

There is probably heaps more I can say on this area, but I should wrap this up.

Related Activities

The number one thing that comes to mind when imagining this website is The Secret Millionaire. It is a simple enough reality TV show. A millionaire pretends to be a normal person doing filming about ‘local community’, and goes around meeting people in need. At the end of a few days of doing this, they give money to the people they think most deserving. This website will sort of enable the same thing, on a larger scale, with more philanthropists and a much better coverage of the population (rather than the few lucky people who happen to cross paths with a random millionaire over a few day period).

Secondly, current affairs shows often serve this sort of a function. Their ability to mobilize the community into ‘helping person X in need’ is quite commendable. However, if someone in need can’t get on the show, then how else do they get that sort of help? Where does someone turn, when they don’t meet the requirements of standard charities, and can’t get saved by a generous media program?

Thoughts?

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