[Conflict of interest notice: I’ve volunteered for both private and public charities, but more often private. I received a small amount of money for work done for a private charity ten years ago. Some of the private charities have been partially funded by billionaires.]
From Vox: The Case Against Billionaire Philanthropy. It joins The Guardian, Truthout, Dissent Magazine, CityLab, and a host of other people and organizations arguing that rich people giving to charity is now a big problem.
I’m against this. I understand concern about the growing power of the very rich. But I worry the movement against billionaire charity is on track to damage charity a whole lot more than it damages billionaires. Eleven points:
1. Is criticizing billionaire philanthropy a good way to protest billionaires having too much power in society?
Which got more criticism? Mark Zuckerberg donating $100 million to help struggling schools in Newark? Or Mark Zuckerberg buying a $59 million dollar mansion in Lake Tahoe? Obviously it’s the schools. I’ve heard people criticizing Zuckerberg’s donation constantly for years, and I didn’t even know he had a $59 million Lake Tahoe mansion until I googled “things mark zuckerberg has spent ridiculous amounts of money on” in the process of writing this paragraph.
Which got more negative press? Jeff Bezos donating $2 billion for preschools for underprivileged children? Or Jeff Bezos spending $2 billion on whatever is going to come up when I Google “things jeff bezos has spent ridiculous amounts of money on?”.
Billionaires respond to incentives like everyone else. If donating to charity earns them negative publicity, and buying a private yacht earns them glowing articles about how cool their yacht is, they’re more likely to buy the yacht.
Journalists and intellectuals who criticize billionaires’ philanthropy but not their yachts, or who spend much more energy criticizing philanthropy than yachts, probably aren’t doing much to promote a world without billionaires. But they’re doing a lot to promote a world where billionaires just buy yachts instead of giving to charity.
2. If attacks on billionaire philanthropy decrease billionaires’ donations, is that acceptable collateral damage in the fight against inequality?
That depends on your values. But for most people’s values, the answer is no.
Nobody knows exactly how many lives the Gates Foundation has saved. The Guardian says it’s some appreciable fraction of the 122 million lives saved in general from progress fighting infectious diseases over the last few decades. This article says Gates has saved seven million people through his vaccination campaign alone, provided another seven million with antiretroviral treatment (usually life-saving), “tested and treated” twelve million people for tuberculosis (often fatal, but there’s a big difference between testing and treatment), and been responsible for a big part of the seven million lives saved from malaria. I expect these numbers are inflated, but even by conservative estimates the Gates Foundation may have saved ten million people.
Suppose Jeff Bezos is watching how people treat Bill Gates, and changes his own behavior accordingly. Maybe in the best possible world, when people attack Gates’ donations, Bezos learns that people don’t like ruthless billionaires, decides not to be ruthless like Gates was, and agrees to Bernie Sanders’ demand that he increase his employees’ pay by $4/hour. But Bezos also learns people criticize billionaires’ philanthropy especially intensely, decides not to be charitable like Gates was, and so ten million people die. You’ve just bought an extra $4/hour for warehouse workers, at the cost of ten million lives.
In my moral system, this means billionaire philanthropy is not acceptable collateral damage in the war against inequality. Even if for some reason you believe that criticizing billionaire philanthropy is a higher-impact way to fight inequality than criticizing billionaires’ yachts, you should stick to criticizing the yachts.
3. Do billionaires really get negative reactions from donating? Didn’t I hear that they get fawning praise and total absence of skepticism?
Vox quotes Rob Reich (not the same person as the former Labor Secretary), a prominent critic of bilionaire philanthropy. Reich writes that billionaires “ask everyone involved to bend over in gratitude for her benevolence and genius in sprinkling around some social benefits” and so we need to “stop being merely grateful to donors and instead direct our skepticism and scrutiny at their activities”.
How much gratitude vs. scrutiny do billionaire donors get?
The three most publicized recent billionaire donations were Zuckerberg to Newark schools, Bezos to preschools, and Gates to malaria. I looked at Twitter to examine how much fawning vs. scrutiny people were giving each. Specifically, I searched “Zuckerberg Newark”, “Bezos preschool” and “Gates malaria”. I then coded the first twenty-five tweets on the Top Tweets page for each as positive, negative, or neutral. I ignored mismatches that weren’t about the donations, and also ignored the genre of people using Zuckerberg’s donation as a way of criticizing Cory Booker (which was more than half of the Zuckerberg tweets).
Searching “Zuckerberg Newark”, I counted 2 positive tweets, 4 neutral tweets, and 19 negative tweets:
This looks similar to failed effort of the Zuckerberg (Facebook) Foundation to "reform" Newark schools. Also serves similar purposes: Private interests control the policy agenda and evade progressive taxation.
— Robert Cotto Jr (@RobertCottoJr) April 5, 2019
Zuckerberg’s costly effort to remake Newark’s public school system may have failed, but that hasn’t put a damper in his plan to transform the educational landscape with his “personalized learning” schemes.https://t.co/0LgY85NjGb
— The Baffler (@thebafflermag) January 14, 2019
Searching “Bezos preschool”, I counted 5 positive, 7 neutral, and 14 negative tweets:
I am still mad that Jeff Bezos thinks he can solve for preschool in America. Y'all. We have a model that works beautifully. It is called Head Start. Just give it to everyone. The end.
— Abby Norman MDiv (@abbynormansays) September 14, 2018
So Jeff Bezos is putting $2 billion into homelessness and preschool. Laudable. But you have to ask — is this better than just taxing the wealth of the richest man in the world, and making that money democratically accountable? https://t.co/PcGKJWcMhJ
— Lydia DePillis (@lydiadepillis) September 13, 2018
Searching “Gates malaria”, I counted 15 positive, 4 neutral, and 6 negative.
Read The Business Of Changing The World. @BillGates, phenom philanthropist gets it. Gates was worth $91b when he did the giving pledge about ten years ago, he’s given $50b. His net worth today is around$110b. He’s also on the verge of eradicating malaria. https://t.co/RuCQNRKcDX https://t.co/2AJE2lBFQQ
— María Teresa Kumar (@MariaTeresa1) May 10, 2019
The @gatesfoundation efforts to eradicate malaria are undemocratic in this rubric. If billionaires like Gates/Buffet were prevented and that money was with the government, it would likely be spent elsewhere.
Billionaires can be useful for #AWorldThatWorksForEveryone
— Eric Minick (@EricMinick) July 18, 2019
The same is true of Google search. I examined the top ten search results for each donation, with broadly similar results: mostly negative for Zuckerberg and Bezos, mostly positive for Gates.
But when people talk about “billionaire philanthropy” in general, they tend to elide this distinction and focus on the bad. A twitter search for “billionaire philanthropy” produced 2 positive, 3 neutral, and 20 negative tweets, more negative than for any individual donation. A Google search for “billionaire philanthropy”, and the top ten results contained 1 positive article, 5 neutral articles, and 4 negative articles.
"For the super-rich, giving is really taking. Taking power, that is, from the rest of society."
This is why I prefer taxation to philanthropy.https://t.co/2D2BYyL8D7
— Cameron Graham (@camerongraham) July 20, 2019
If billionaires paid their fair share of taxes we wouldn’t need #philanthropy. It is just a facade to look like social heroes while actually engaging in tax evasion and demanding #TaxHolidays. #EatTheRich #ProletariatRevolution
— Time To Change The World (@end_patriarchy) July 19, 2019
Although some donors like Bill Gates are generally liked, others, like Zuckerberg and Bezos, are met with widespread distrust. This might be because Gates has worked harder to target his donations well, or because he made his money a long time ago and nobody is too angry about his business practices anymore. But on a broader scale, the media and social media consensus is already parroting anti-billionaire-philanthropy talking points.
If everyone were unreflectively praising philanthropic billionaires, there would be a strong case for encouraging skepticism. But if most responses to billionaire philanthropy are negative, we should worry more about the consequences of the backlash.
4. Is it a problem that billionaire philanthropy is unaccountable to public democratic institutions? Should we make billionaires pay that money as taxes instead, so the public can decide how it gets spent?
From Dissent:
Big philanthropy is overdue for reform. The goal should be to reduce its leverage in civil society and public policymaking while increasing government revenue. Some possible changes seem obvious: don’t allow administrative expenses to count toward the 5 percent minimum payout, increase the excise tax on net investment income, eliminate the tax exemption for foundations with assets over a certain size, and replace the charity tax deduction with a tax credit available to everyone (for example, all donors could subtract 15 percent of the total value of their charitable contributions from their tax bills). In addition, strict IRS oversight of big philanthropy—especially all the “educating” that looks so much like lobbying and campaigning — is crucial […]
Private foundations fall into the IRS’s wide-open category of tax-exempt organizations, which includes charitable, educational, religious, scientific, literary, and other groups. When the creator of a mega-foundation says, ‘I can do what I want because it’s my money,’ he or she is wrong. A substantial portion of the wealth — 35 percent or more, depending on tax rates — has been diverted from the public treasury, where voters would have determined its use.
This makes the same argument as some of the other articles linked above. Since billionaires have complete control over their own money, they are helping society the way they want, not the way the voters and democratically-elected-officials want. This threatens democracy. We can solve this by increasing taxes on philanthropy, so that the money billionaires might have spent on charity flows back to the public purse instead.
Two of the billionaires whose philanthropy I most respect, Dustin Moskovitz and Cari Tuna, have done a lot of work on criminal justice reform. The organizations they fund determined that many innocent people are languishing in jail for months because they don’t have enough money to pay bail; others are pleading guilty to crimes they didn’t commit because they have to get out of jail in time to get to work or care for their children, even if it gives them a criminal record. They funded a short-term effort to help these people afford bail, and a long-term effort to reform the bail system. One of the charities they donate to, The Bronx Freedom Fund, found that 92% of suspects without bail assistance will plead guilty and get a criminal record. But if given enough bail assistance to make it to trial, over half would have all charges dropped. This is exactly the kind of fighting-mass-incarceration and stopping-the-cycle-of-poverty work everyone says we need, and it works really well. I have donated to this charity myself, but obviously I can only give a tiny fraction of what Moskovitz and Tuna manage.
If Moskovitz and Tuna’s money instead flowed to the government, would it accomplish the same goal in some kind of more democratic, more publically-guided way? No. It would go to locking these people up, paying for more prosecutors to trick them into pleading guilty, more prison guards to abuse and harass them. The government already spends $100 billion – seven times Tuna and Moskovitz’s combined fortunes – on maintaining the carceral state each year. This utterly dwarfs any trickle of money it spends on undoing the harms of the carceral state, even supposing such a trickle exists. Kicking Tuna and Moskovitz out of the picture isn’t going to cause bail reform to happen in some civically-responsible manner. It’s just going to ensure that all the money goes to making the problem worse – instead of the current situation where the overwhelming majority of money goes to making the problem worse but a tiny amount also going to making it better.
Or take one of M&T’s other major causes, animal welfare. Until last year, California factory farms kept animals in cages so small that they could not lie down or stretch their limbs, for their entire lives. Moskovitz and Tuna funded a ballot measure which successfully banned this kind of confinement. It reduced the suffering of hundreds of millions of farm animals and is one of the biggest victories against animal cruelty in history.
If their money had gone to the government instead, would it have led to some even better democratic stakeholder-involving animal welfare victory? No. It would have joined the $20 billion – again, more than T&M’s combined fortunes – that the government spends to subsidize factory farming each year. Or it might have gone to the enforcement of ag-gag laws – laws that jail anyone who publicly reports on the conditions in factory farms (in flagrant violation of the First Amendment) because factory farms don’t want people to realize how they treat their animals, and have good enough lobbyists that they can just make the government imprison anyone who talks about it.
George Soros donated/invested $500 million to help migrants and refugees. If he had given it to the government instead, would it have gone to some more grassroots migrant-helping effort?
No. It would have gone to building a border wall, building more camps to lock up migrants, more cages to separate refugee children from their families. Maybe some tiny trickle, a fraction of a percent, would have gone to a publicly-funded pro-refugee effort, but not nearly as much as would have gone to hurting refugees.
The idea that we should divert money from freeing the incarcerated, saving animals, and reuniting families – to instead expanding incarceration, torturing animals, and separating families – seems monstrous to me, even (especially?) when cloaked in communitarian language.
5. Those are some emotionally salient examples, but doesn’t the government also do a lot of good things?
Yes, but the US government is not a charity. Even when it’s doing good things, it’s not efficiently allocating its money according to some concept of what does the most good.
Bill Gates saved ten million lives by asking a lot of smart people what causes were most important. They said it was global health and development causes like treating malaria and tuberculosis. So Gates allocated most of his fortune to those causes. Gates and people like him are such a large fraction of philanthropic billionaires that by my calculations these causes get about 25% of billionaire philanthropic spending.
The US government also does some great work in those areas. But it spends about 0.9% of its budget on them. As a result, one dollar given to a billionaire foundation is more likely to go to a very poor person than the same dollar given to the US government, and much more likely to help that person in some transformative way like saving their life or lifting them out of poverty.
But this is still too kind to the US government. It’s understandable that they may want to focus on highways in Iowa instead of epidemics in Sudan. Yet even on issues vital for the safety of the American people, the government tends to fail in surprising ways.
How much money does the US government spend fighting climate change? This 538 article explains why this is a hard question, but it tries to give the best answer it can:
The 2018 GAO report found that, while the Office of Management and Budget has reported that the federal government spent more than $154 billion on climate-change-related activities since 1993, much of that number is likely not being used to directly address climate change or its risks. Many of the projects reported as “climate-change-related activities” are only secondarily about climate change.
For instance, the U.S. nuclear energy program predates serious concerns about climate change and would likely exist in its current form even if it did not produce fewer greenhouse-gases than some other forms of energy production, like burning coal. But the nuclear program’s budget is counted as climate spending. All told, when the GAO evaluated six agencies that report their climate spending to the OMB, it found that 94 percent of the money was going to programs that weren’t primarily focused on climate change — things like nuclear energy. The money marked as climate spending wasn’t going to new initiatives. Instead, “it’s a bunch of related things we were already doing,” Gomez told me. Numbers like that $154 billion total can be used as political props, but that kind of accounting isn’t much good for understanding what the government is actually doing about climate change.
$154 billion * 6% primarily focused on climate change / 25 years = $369 million per year. It might be higher than the 25-year average now, because of increasing awareness of climate change, but it might also be lower, because Trump. I have low confidence in the exact estimate but I think this is the right order of magnitude.
In 2017, the foundation of billionaire William Hewlett (think Hewlett-Packard) pledged $600 million to fight climate change. One gift by one guy was almost twice the entire US federal government’s yearly spending on climate issues.
This isn’t some parable on how mighty billionaires have become or how much power they have accrued. The government’s budget is still 10,000 times bigger than Mr. Hewlett’s. It’s not that he’s anywhere near government-sized, it’s just that the government doesn’t care at all about solving these kinds of problems, so a billionaire can outspend them if he cares a little.
Thanks to Hewlett and a few other people like him, I calculate that about 3% of billionaire philanthropy goes to climate change, compared to 0.01% of the federal budget.
Not every billionaire spends their money on global health or fighting climate change. There’s a lot of criticism of billionaires who “waste” their donations on already-well-endowed colleges and performing arts centers, and I agree we should push them to think harder about their choices.
But charity, like investing, is in what Nassim Taleb calls Extremistan – almost all the value lies in getting it very right once or twice. An investment fund that picks a hundred duds plus 2004 Facebook is still an amazing investment fund. A form of philanthropy that produces a hundred duds, but also produces Bill Gates (and Dustin Moskovitz, and Cari Tuna, and Warren Buffett, and Ben Delo, and…) is still an amazing benefit to the world.
I wish I could give a more detailed breakdown of how philanthropists vs. the government spend their money, but I can’t find the data. Considerations like the above make me think that philanthropists in general are better at focusing on the most important causes.
I think this also makes intuitive sense. Charities are capable of laserlike focus on the most important and desperate causes. But give their money to the government instead, and it will get spent on building fighter jets, bombing brown kids in Afghanistan, shooting brown kids in Chicago, subsidizing coal companies, jailing anyone who tries to dress hair withoug a hairdresser license, and paying farmers not to grow crops – and then, at the end of all that, maybe have a tiny bit left over to spend on the desperately important problems that affect the most vulnerable people.
Governments are a useful type of organization that should exist. I don’t want to get rid of them. But right now we’re thinking on the margin, and on the margin an extra dollar given to a charity will do more good than that same dollar given to the government.
6. The point of democracy isn’t that it’s always right, the point is that it respects the popular will. Regardless of whether the popular will is good or bad, don’t powerful private foundations violate it?
Reich again:
The modern foundation is an institutional oddity in a democracy.
In a democracy, officials responsible for public policy must stand for election. Don’t like your representatives’ policy views? Vote against them in the next election. This is the accountability logic internal to democracy — responsiveness to citizens. It does not always work this way, but the logic has some real force.
But foundations have no electoral accountability. Don’t like what the Gates Foundation did with its $3.4 billion in 2011 grants ($9.3 million each day of the year), or what it has done with $25 billion in grants since its inception in 1994? Tough, there’s no way to vote out the Gateses.
I realize there’s some very weak sense in which the US government represents me. But it’s really weak. Really, really weak. When I turn on the news and see the latest from the US government, I rarely find myself thinking “Ah, yes, I see they’re representing me very well today.”
Paradoxically, most people feel the same way. Congress has an approval rating of 19% right now. According to PolitiFact, most voters have more positive feelings towards hemorrhoids, herpes, and traffic jams than towards Congress. How does a body made entirely of people chosen by the public end up loathed by the public? I agree this is puzzling, but for now let’s just admit it’s happening.
Bill Gates has an approval rating of 76%, literally higher than God. Even Mark Zuckerberg has an approval rating of 24%, below God but still well above Congress. In a Georgetown university survey, the US public stated they had more confidence in philanthropy than in Congress, the court system, state governments, or local governments; Democrats (though not Republicans) also preferred philanthropy to the executive branch.
When I see philanthropists try to save lives and cure diseases, I feel like there’s someone powerful out there who shares my values and is doing right by them. I’ve never gotten that feeling when I watch Congress. When I watch Congress, I feel a scary unbridgeable gulf between me and anybody who matters. And the polls suggest a lot of people agree with me.
In what sense does it reflect the will of the people to transfer power and money from people and causes the public like and trust, to people and causes who the public hate and distrust? Why is it democratic to take money from someone more popular than God, and give it to a group of people more hated than hemorrhoids?
And if the people want more money to be spent by private philanthropists instead of Congress – and they use the democratic process to produce a legal regime and tax system that favors private philanthropy – their will is being represented.
7. Shouldn’t people who disagree with the government’s priorities fight to change the government, not go off and do their own thing?
Suppose I was donating money to feed starving children, and it was going well, and lots of starving children were getting fed. Then you come along and say “No, you should give that money to the Church of Scientology instead”.
I say “No, I hate Scientology.”
You: “Ah, but you can always try to reform Scientology. And maybe in a hundred years, it won’t be awful anymore, and instead it will try to help starving children.”
Me: “So you’re saying that I should work tirelessly to reform Scientology, and then in a hundred years when they’re good, I should give them my money?”
You: “Oh no, you have to give them all your money now. But while you’re giving them all your money, you can also work toward reforming them.”
Why would I do this? Why would it even cross anybody’s mind that they should do this? I am not saying that the government is evil in the same way as Scientology. But I think the fundamental dynamic – should you give your money to a cause you think is good, or to an organization you think is bad while trying to reform it? – is the same in both cases.
Also, do you realize how monumental a task “reform the government” is? There are thousands of well-funded organizations full of highly-talented people trying to reform the government at any given moment, and they’re all locked in a tug-of-war death match reminiscent of that one church in Jerusalem where nobody has been able to remove a ladder for three hundred years. This isn’t to say no reform will ever happen – it’s happened before, it will surely happen again, and it’s a valuable thing to work towards. Just don’t hold up any attempts to ease the suffering of the less fortunate by demanding they wait until every necessary reform is accomplished.
8. Is billionaire philanthropy getting too powerful? Should we be terrified by the share of resources now controlled by unaccountable charitable foundations?
From Dissent:
Right now, big philanthropy in the United States is booming. Major sources of growth have been the wealth generated by high-tech industries and the expanding global market. In September 2013 there were sixty-seven private grant-making foundations with assets over $1 billion. The Rockefeller Foundation, once the wealthiest, now ranks fifteenth; the Carnegie Corporation ranks twentieth (Foundation Center). Mega-foundations are more powerful now than in the twentieth century—not only because of their greater number, but also because of the context in which they operate: dwindling government resources for public goods and services, the drive to privatize what remains of the public sector, an increased concentration of wealth in the top 1 percent, celebration of the rich for nothing more than their accumulation of money, virtually unlimited private financing of political campaigns, and the unenforced (perhaps unenforceable) separation of legal educational activities from illegal lobbying and political campaigning. In this context, big philanthropy has too much clout.
The yearly federal budget is $4 trillion. The yearly billionaire philanthropy budget is about $10 billion, 400 times smaller.
For context, the California government recently admitted that its high-speed rail project was going to be $40 billion over budget (it may also never get built). The cost overruns alone on a single state government project equal four times all the charity spending by all the billionaires in the country.
Compared to government spending, Big Philanthropy is a rounding error. If the whole field were taxed completely out of existence, all its money wouldn’t serve to cover the cost overruns on a single train line.
If this seems surprising, I think that in itself is evidence that the money is being well-spent. Billionaire philanthropy isn’t powerful, at least not compared to anything else. It just has enough accomplishments to attract attention. Destroying it wouldn’t enrich anyone else to any useful degree, or neutralize some threatening power base. It would just destroy something really good.
9. Does billionaire philanthropy threaten pluralism?
From Reich’s Vox interview again:
I am, by contrast, a pluralist; I want to champion the decentralization of what would otherwise be a majoritarian decision-making structure for the spending of tax dollars to produce various forms of social benefits. And I think part of what makes ordinary charitable giving a good thing is the conversion of every individual’s idiosyncratic, eccentric preferences into some civil society-facing project that by extension produces a diverse, pluralistic civil society, which is good for democracy.
I am having trouble following the argument. We need pluralism and decentralization. Therefore, we should ban anyone from doing their own thing, and instead force them to go through a single giant organization?
Consider the Multidisciplinary Association for Psychedelic Studies (MAPS). They sponsor research into mental-health-related uses of psychedelic drugs. You might have heard of them in the context of their study of MDMA (Ecstasy) for PTSD being “astoundingly” successful. They’re on track to get MDMA FDA-approved and potentially inaugurate a new era in psychiatry. This is one of those 1000x opportunities that effective altruists dream of.
The government hasn’t given this a drop of funding, because its official position is that Drugs Are Bad. MAPS writes:
Every dollar has come from private donors committed to our mission. The pharmaceutical industry and federal government have not yet supported our work, so the continued expansion of psychedelic research still relies on the generosity of individual donors and foundations.
Most of the funding for their MDMA trial came from the foundation of billionaire Robert Mercer. Because there were actors other than the government with enough money to fund things they believed in, we were able to get some great work done even though it wasn’t the sort of thing the government would support.
Or: in 2001, under pressure from Christian conservatives, President Bush banned federal funding for stem cell research. Stem cell scientists began leaving the US or going into other area of work. The field survived thanks to billionaires stepping up to provide the support the government wouldn’t – especially insurance billionaire Eli Broad, who gave $25 million to the cause, and eBay billionaire Pierre Omidyar, who sponsored a California ballot initiative to redirect state funding to cover the gap. Time after time, the government has stopped supporting things for bad reasons, and we’ve been lucky that we didn’t bulldoze over the rest of civil society and prevent anyone else from having enough power to help.
Or: despite controversy over “government funding of Planned Parenthood”, political considerations have seriously limited the amount of funding the US government can give contraceptive research. It was multimillionaire heiress Katharine McCormick who funded the research into what would become the first combined oral contraceptive pill. More recently, it was Warren Buffett who funded RU-486 and the IUD. Together with similar work by the Rockefeller and Ford foundations, these have prevented millions of unwanted pregnancies.
When there are hundreds of different actors who can pursue their own projects, we get hundreds of genuinely different projects, some of which go great. If we restrict individuals from pursuing their own projects, and everything has to be funded by a single organization with a single agenda, we reduce the possibilities for progress to a monoculture, vulnerable to any minor flaw in the hegemon’s priorities.
In other cases, billionaires and government agencies are performing the same tasks in parallel. For example, both Bill Gates and the CDC are fighting infectious diseases in the developing world; both Elon Musk and NASA are working on space exploration.
Both groups bring different institutional cultures and priorities to the fight. The Gates Foundation is not run along exactly the same lines as the CDC; SpaceX has a different institutional culture from NASA. When one organization gets stuck in a dead-end, or isn’t up to a certain task, there’s a chance that the other will have the right structure to succeed. Some of this is random variation, some of it is structural differences between the public and private sector. I think it’s really healthy to have multiple diverse institutions trying to pursue the same goal. Robustness against obvious failures like “the government just banned all stem cell research” is just a special case of this principle.
I am using Reich as a foil, but in other places he seems to agree with this. At the end of this article he writes about “the case for foundations”, and says:
I believe there is a case for foundations that renders them not merely consistent with democracy but supportive of it.
First, foundations can help to diminish government orthodoxy by decentralizing the definition and distribution of public goods. Call this the pluralism argument. Second, foundations can operate on a longer time horizon than can businesses in the marketplace and elected officials in public institutions, taking risks in social policy experimentation and innovation that we should not routinely expect to see in the commercial or state sector. Call this the discovery argument.
I agree with all of this (and am now confused about to what degree Reich and I disagree at all), but I take this as meaning that private philanthropy, far from threatening pluralism, exemplifies it.
10. Aren’t the failures of government just due to Donald Trump or people like him? Won’t they hopefully get better soon?
Billionaires sometimes do a better job than the government at funding things like stem cells and the fight against climate change. But this is because of bad decisions by bad government officials. Obama overturned the stem cell ban; hopefully the next Democratic president will fix the climate funding situation. Does this make it unfair of me to compare the government vs. billionaires on this axis when there’s a hopefully-temporary reason the government is as bad as it is?
No. My whole point is that if you force everyone to centralize all money and power into one giant organization with a single point of failure, then when that single point of failure fails, you’re really screwed.
Remember that when people say decisions should be made through democratic institutions, in practice that often means the decisions get made by Donald Trump, who was democratically elected. At the risk of going Civics 101, we’re not supposed to be a pure democracy. We’re a complicated system of checks and balances that uses democracy in some of its components. But we deliberately have other, less democratic components to deal with the situations when the demos f@#ks up. The demos seems to be f@#king up pretty regularly these days and I’m glad we still have those other institutions.
11. So you’re saying these considerations about pluralism and representation and so on justify billionaire philanthropy?
I’m bringing up these considerations as counterarguments to some of the things opponents say. But I think they’re the wrong thing to focus on.
The Gates Foundation plausibly saved ten million lives. Moskovitz and Tuna saved a hundred million animals from excruciatingly painful conditions. Norman Borlaug’s agricultural research (supported by the Ford Foundation and the Rockefeller Foundation) plausibly saved one billion people.
These accomplishments – and other similar victories over famine, disease, and misery – are plausibly the best things that have happened in the past century. All the hot-button issues we usually care about pale before them. Think of how valuable one person’s life is – a friend, a family member, yourself – then try multiplying that by ten million or a billion or whatever, it doesn’t matter, our minds can’t represent those kinds of quantities anyway. Anything that makes these kinds of victories even a little less likely would be a disaster for human welfare.
The main argument against against billionaire philanthropy is that the lives and welfare of millions of the neediest people matter more than whatever point you can make by risking them. Criticize the existence of billionaires in general, criticize billionaires’ spending on yachts or mansions. But if you only criticize billionaires when they’re trying to save lives, you risk collateral damage to everything we care about.
What about a philanthropy system where the wealthy are taxed, but the revenue is returned to citizens universally as vouchers that can only be redeemed at 501(c)(3)s? We could even keep the ability to designate a proxy who can allocate your vouchers for you. Just in case we think billionaires are better than us at picking charities.
Because more bureaucracy is what is needed right now. And more chances to game the system. Just let the smart and benevolent people put their money where they see the best philanthropic outcome.
It could be a good idea, but it would be about the government allocating part of the taxes in a different way, not about billionaires philanthropy.
I mean, sure, that would be a more technically democratic way of distributing the funds, I guess.
But it would also almost certainly result in less money being given to rationalist pet projects like malaria, climate change, animal welfare, etc. and a lot more money being to more generalist and less “effective” stuff like the United Way, various Christian missionary groups, wounded warrior charities, etc.
I think the elephant in the room here, that Scott is tiptoeing around largely for CW reasons, is that the class of billionaires is overwhelmingly more representative of blue/grey tribe values than the general public is. And that so long as this remains the case, thinkpiece writers who themselves are blue/grey tribe are shooting themselves in the foot by suggesting that we direct money away from a class of people who are 90% blue/grey (billionaires) and instead give it to a class of people who are about 50/48/2 blue/red/grey (Congress).
That’s one elephant. The other elephant is that billionaires *probably are* better than most of the general public at picking charities, for experiential and cognitive reasons that are very CW-loaded and sit very uncomfortably with Blue Tribe pieties. Also, most members of the general public probably wildly overestimate their absolute level of skill at picking charities for some of the same reasons they wildly overestimate their skill at picking stocks; and a democratic framing of “The People should get to choose where these dollars go” exacerbates rather than restraining that tendency.
I can also plausibly believe as educationrealist states in his posts below that the real axis on which all of this spins is tech billionaires messing around in public schools.
I disagree with this, or at least want to see more data. The set of billionaires Scott talked about were mostly tech billionaires, which are more blue tribe, and more likely to be in the present news for philanthropy. But they’re not indicative of billionaire’s as a whole, or billionaire philanthropists. The billionaire class includes the Koch brothers and Sheldon Adelson in the top 20, as well as Trump and his secretary of education. The only study that I’m aware of finds that (on economic issues) billionaires are much more conservative than the country as a whole.
“Economic issues” is doing a lot of work there. Tribal loyalty is about far more than economics. And literally none of the people you named are red tribe on any significant social issues.
I don’t know a ton about the Koch brothers, but my impression is that they give a lot of money to things like “lower the capital gains tax” (which the average red tribe voter doesn’t really care about much at all) and very little money to things like “subsidize Christian missionary work in Africa” or “raise money for the dependents of dead soldiers” or other sorts of charitable endeavors that are popular with the red tribe base.
The line between philanthropy and political spending can be a bit fuzzy (which is one of my larger problems with Scott’s take), but keeping firmly in the philanthropy side:
De Vos has donated to a lot of religious schools.
The Trump foundation (such as it was) only consistently donated to a charity run through police officers.
Sheldon Adelson gives to a lot of israeli causes, including to Ariel University in the West Bank.
The Kochs seem to mix up their traditional philanthropy with grants to universities advocating their political preferences.
And while these might not all be red meat issues for the right, they’re definitely not the preferences of the left.
The data exists for pure political party party contributions.
https://www.opensecrets.org/overview/topindivs.php?cycle=2018&view=fc
9/15 top individual contributors in the 2018 federal election cycle were solidly Democrat. Actual feelings are likely more lopsided than that because, as you correctly point out, many billionaires are put in the conservative box for favoring lower taxes out of self-interest.
This is not surprising as billionaires tend to have a lot of correlates to blue tribe like live in cities, have more education, and have higher openness.
The billionaire giving millions of dollars to solve a particular problem is probably going to be a lot more diligent about their choice than the random person deciding where their $1.12 is going to go.
One issue with this is that the government still decides who gets to be a 501(c)(3). Under Obama, many organizations I would have supported (as an evil Republican) were slow-walked through approval, or denied outright. Who’s to say it’s not happening under Trump too?
I like the idea; I just don’t know that I like the restrictions on where I’d be allowed to put that money. Maybe I’ve got a friend whose rent is going up and they’re looking at living on the street. Maybe the best thing in that case is to skip the “charity” thing and put that money right towards a deposit on a new place for my buddy. Or maybe my kid’s high school needs new french horns. Or any of a thousand things right in my town that I could help with immediately.
Another objection is my preference for localism. Maybe this sort of program works better at a state level than through a federal tax. So many other things do, though it depends on how well-run the state is. But that angst Scott talks about with Congress? That’s much reduced at the state level. I can even get on the phone with my state rep (granted, I live in one of the states with a smaller population) and have some say in what happens. So maybe I’d be happier with this idea at a state level.
As I recall it was all 501(c)(4)s who got the delays, though your concern is still valid.
Sure would be interesting to see what the National Rifle Association does with all the extra money, though.
You recall wrong. It was both 3 and 4.
The IRS targeting started in 2004, and affected both liberal and conservative groups. It was reported as a much more partisan thing than it really was, and that’s unfortunately how people remember it.
The second report contradicted the first. Why are you so sure that the second is the correct one?
Not only did the second contradict the first, it failed to acknowledge that discrepancy. It pretended that it was just filling in details, when actually the two reports are irreconcilable. I think that is very suspicious.
The criteria for setting up a 501(c)3 are reasonably straight-forward. Unless you are attempting to do something *really, really* partisan it’s mostly mechanical. For example, a lot of volunteer-run science-fiction conventions are set up as 501(c)3 educational organizations. There’s a pile of paperwork that needs to be done, but it’s mostly rubber-stamped if you can fulfill the requirements.
I think billionaires are *so much* better than me and other members of the common public that the thinking should be reversed: instead of the common men getting to meddle with their projects, they should get power over money that is not theirs.
When a person donates to a charity that is not a party or advocacy, the government should match a percentage of their donation. Or even better: do the matching only if the donation is of a million or more.
Why are they better? Maybe they are good or bad in the same proportion to the rest of the population, but their skills to identify high cost/benefit interventions are much greater, because that is needed to become a billionaire.
I initially like this idea, but doesn’t it incentivize self-dealing where business-relevant investments get disguised as charitable contributions in order to get public matching funds put toward sources of private returns? Even if that’s rare and well-policed, the possibility would create even more suspicion against philanthropy.
This article is how I learned that there are some people who are against billionaire philanthropy. In a functioning free-market economy, the way one becomes a billionaire is by providing goods and services that people are willing to pay for. We can debate to what extent we are living in a functioning free-market economy, or what valuable service Zuckerberg provides, but Jeff Bezos is a billionaire because I can get twelve different varieties of potato peeler delivered to my door on two days notice. Apparently that is something I and many others value. That was the contribution in exchange for which he gets to be a billionaire. Now, in addition to that service, he is also transferring a decent chunk of money from people who want potato peelers to people who want to educate underprivileged kids. And there are people who are upset about this. I agree with all of Scott’s arguments but there is something surreal about reading them. It’s like reading thoughtful, polite, well-reasoned arguments why arson is bad.
One thing I often like to point out is that the greedy and selfishly capitalistic invention of the cellular phone has done more for people all over the globe than almost any charity.
I think it’s not unlikely that Bezos’ creation and running of Amazon has done and will continue to do more good by far than any philanthropy he attempts.
I think the strongest argument that Bezos doesn’t deserve his money is that yes, there should definitely be a central online marketplace, but if Bezos hadn’t founded it and occupied that niche someone else would have.
One could then argue that Bezos isn’t taking money from society, he’s taking it from the second-fastest e-commerce entrepreneur. But if there are a million identical e-commerce entrepreneurs, and which one wins out is just due to a 1% speed advantage or something, then it stops looking like the e-commerce entrepreneurs are doing that much. Obviously they “deserve” fair compensation for their time, energy, skills, and managerial labor – which sounds like maybe a six-figure salary a year – but I can see a case that they don’t “deserve” more than that.
Bezos is probably better than the second-place and tenth-place entrepreneurs in a bunch of interesting ways, but I can see an argument that this doesn’t justify the full $100 billion.
This argument assumes that a first-mover advantage is sufficient to build something on the scale of Amazon. It really, really undersells Amazon’s success. Heck, Amazon isn’t even a first mover in most of the markets they’re in, especially globally.
If it was that easy, any number of tech companies — Google, Paypal, Microsoft, Apple, Yahoo — could have done the same. Or try any other traditional retailer. Or, one of the hundreds of thousands of online retailers that had a bigger market share than Amazon before their growth. The technology needed to build Amazon has been around since 2006, probably even before that.
You needed someone with the idea and the execution to start it up and scale it to the size Amazon is. Amazon’s success requires a combination of having the right business strategy, connections, management instinct, logistics & supply chain management, technology infrastructure, global markets, or knowing or being able to find the right people who can fill in your gaps in knowledge for all of the above — circumstances like that don’t come often. Sure, a great deal of luck was involved as well, but nobody ever said that lottery winners didn’t deserve their winnings.
Also, when you take all the above factors into account, the pool of people who can plausibly pull off an Amazon shrinks from a million to perhaps a few hundred, at best. And most of these people are probably preoccupied with their current occupations and would never have the opportunity or luck to build something like Amazon.
Sure, sooner or later someone else will come along, Amazon is probably an eventuality. But if that someone comes along 5 years later, that’s 5 years of lost value and 5 years of delayed growth. Compounded over the lifetime of Amazon, that’s worth a heck lot of lost productivity and satisfaction.
I feel like by “sure, sooner or later someone else will come along”, you’re conceding my point. I agree it makes a big difference whether that’s 5 months or 5 years, and that Bezos does deserve credit/compensation for making it happen earlier.
I don’t believe that Amazon’s success has anything to do with being a huge marketplace – it’s the business processes that underlie that marketplace that make Amazon amazing.
Everything they’ve built has been an independent platform – AWS was built so that the store is a customer, which has enabled them to add additional customers. Amazon itself is a customer of the store, which allows them to sell the store to other customers. Same with the warehouses and on and on.
I get that you’re not necessarily endorsing the argument, but, with respect, your taking it even remotely seriously is a bit surprising. I’ve always found it hard to take seriously any conversation about wealth/compensation that is based on the premise that either is or should be a form of reward or just deserts.
People don’t earn what they deserve because what one deserves is a meaninglessly subjective metric. It feels odd to even have to point that out. Who knows, maybe the joke’s on me.
Anyway, maybe I’m naive, but I really do believe that people tend to earn whatever the relevant markets value their output at. Once earned, a plain vanilla property-rights treatment of wealth is probably our best bet. That may seem conveniently simple, but I think is likely true nonetheless. Markets can be inefficient, and they can produce seemingly unfair and unsatisfying outcomes, but they happen to be fairly good at getting humans to do worthwhile things. And I think it is demonstrably true that the societies that embrace this idea tend to outperform (in terms of aggregate well being) those that take a more moralistic approach to wealth via a to each accordingly philosophy.
“Deserve’s got nothin’ to do with it”
Note that:
– when they moved to those markets, they were already an industry giant from globally dominant economy.
– yet, despite the aforementioned resource advantage, they never reached anywhere near market domination in most (any?) of them.
Point for both “it’s an eventuality” and “it’s mostly speed advantage (plus basic competence)”.
Lottery is a voluntary past-time. We don’t say that martial artists don’t deserve their winnings either, the point of contention is whether we should be structuring our entire society in a way that rewards, to continue the latter example, beating other people up.
I wasn’t talking about whether Amazon was or was not a first mover into other countries markets. I’m saying that Amazon-equivalent first movers already existed in many other countries, and non of them were able to scale vertically and horizontally like Amazon did, or establish the logistics/technology/marketplace networks like Amazon did.
In hindsight, everything Amazon did was obvious. But like I said, everything needed to build Amazon has been around for years before Amazon mushroomed into the giant they are today. Any traditional retailer could have done it — but nobody did. If not for Bezos and Co., it’s likely to take a few more years at least.
Another reason why I believe Scott’s 5 months estimate to be unrealistic: the lead time required to build up a logistics network, reputation, and tech platform like Amazon’s is measured in years. If there had been someone 5 months behind Amazon, it would have been immediately obvious from the build up. And of course, such a hypothetical entrepreneur would have gone on to become a well-known Amazon competitor. If there had been someone 5 months or a year or two behind Amazon, the world we live in would look very different.
I also think you underestimate the amount of competence required to grow a company as fast and as successfully as Amazon did.
And do we not want to incentivize people for providing better, cheaper goods and services that are more accessible for everyone? To lower your cost of living so you have more disposable income to contribute to your chosen cause? Every dollar that Amazon saves you is a dollar that can now go to fighting malaria or factory farming — or not, it’s your choice.
(This cost savings also includes, for example, savings from services that would not have existed without Amazon Web Services, which holds up a significant portion of the Internet and made many startups possible. A world where Amazon was delayed would also delay many other startups).
I don’t know if $100 billion is what he deserves, but I figure it can’t be off by more than an order of magnitude.
But I already addressed that. Amazon-equivalents from lesser countries did not have the privileged position in the global marketplace that Amazon had simply by virtue of being from the US. Even after winning (or dividing) their home markets, they had no resources to enter the already saturated markets of other countries. They appear to have stood their ground in the face of Amazon’s invasion, though, which kind of makes the case for Amazon’s systemic superiority pretty weak.
At this point it seems important to note that Amazon isn’t the biggest e-commerce provider in the world. That would be Alibaba, yet another representative of a (different) globally dominant economy. You will note that it’s operating on principles different from Amazon – but do not take it to mean it’s not its competitor or in some way incomparable. Take it to mean that the claim that
is wrong. There’s nothing to suggest any of their business moves were necessary, and there’s nothing to suggest that the services they provide could not be provided with a different business model.
Or a different internal organization, user experience, etc. They really were just the first to reach a dominant position in the market that made the majority of suppliers and customers unlikely to seek competing services. That’s really all, from that (relatively early) point on it’s just a matter of being good enough. Or, to state it more strongly, not being bad enough.
Which seems fairly weak to me. There are plenty of competitors to Amazon, and yet, Amazon is the one who -for now- is the king of the hill. If Bezos wouldnt have founded Amazon, sure, one of these other marketplace would be the top dog, but it’s a marketplace which we can suspect to be a worse service, in one way or another, due to it’s failure to beat Amazon when competing with it.
You are equivocating “better” with “fitter” (in an evolutionary sense). This is dubious for two reasons. First is that it (preemptively) rejects all criticism from viewpoints other than those assuming a perfect faith in market forces. The second is that it’s hiding the possibility that the advantage may have little to do with any kind of service or organizational quality (for example, available resources or speed of entering the market).
But now thanks to Jeff Bezos, this person that would otherwise have started an amazon equivalent, started another business instead.
EDIT: If Newton hadn’t discovered gravity, someone else would have eventually. Does that mean Newton doesn’t deserve thanks? No, because now, thanks to Newton, this other genius got to stand on top of Newtons shoulders, and discover something else.
> Obviously they “deserve” fair compensation for their time, energy, skills, and managerial labor
What about their risk-taking?
> which sounds like maybe a six-figure salary a year
Then why would anyone start a startup? If you are smart and energetic enough to do that you can easily make six-figures in lots of jobs.
It’s not an argument that Jeff Bezos didn’t create value. It’s an argument that a large amount of Jeff Bezos’s value created would have been created anyway in his absence. Not 100% though.
And then we’d be sitting here saying “Cindy Smith doesn’t deserve $100 billion for starting Nile because if she hadn’t done it Jeff Bezos would have.” None of this gets us anywhere.
@Conrad: I think the argument is something like this.
In a sense, the security guard outside Amazon HQ is responsible for 100% of Amazon’s value, since without him, people would just steal all Amazon’s stuff and it wouldn’t produce anything.
When we say the security guard doesn’t deserve that much of Amazon’s profits despite his immense contribution, I think it’s going off of some kind of argument like that if they didn’t have that particular security guard, they could hire any of a million other security guards with the exact same skillset. So the guard doesn’t get paid according to his contribution to Amazon’s value, but to his replaceability.
(I don’t know what the official economic name for this argument / math behind it is, can anyone help?)
If Bezos were equally replaceable, it would suggest he doesn’t deserve that much money, even though Amazon wouldn’t exist to produce value without him.
Yes, and if Jim the guard didn’t watch the door for $14/hour we’d pay Bob the guard $14/hour to watch the door.
The going rate for “inventing Amazon” is going to be $100 billion. Whether it goes to Jeff Bezos or Cindy Smith, somebody’s getting $100 billion out of all that value created.
ETA: And if the question is “why is inventing Amazon worth $100 billion” I think the answer is “because inventing Amazon is another way of saying ‘solving an unfathomably complex coordination problem’,” which I think you would agree is hard.
Supply and demand?
The point is that the upside rewards for creating something as complex and uncertain as Amazon was worth an extremely large incentive. The opportunity existed for entrepreneurs to risk untold billions of dollars to add value to billions of people in return for billions in profit.
The security guard is necessary, but there are countless individuals who can do it and the clearing price where supply meets demand is around $15 per hour.
Being a security guard isn’t a risky job in the same sense that being an entrepreneur is.
It’s hard to think of a non-contrived security guard analogy, but let’s try. Imagine that Amazon hired 1000 security guards to guard 1000 warehouses. However, only one warehouse contains any product. After all the security guards spent their time doing their job, Amazon then pays the security guard that happens to have guarded (without knowing at the time) the full warehouse. The security guards guarding the empty warehouses are given no pay except bus fare and they’re all sent home.
If you were going into that job, and knew ahead of time how bad the odds of actually getting paid were, you’d expect that if you beat those odds and were lucky enough to get the full warehouse, you’d get more than a security guard’s normal pay. It would make no sense to have a 1/1000 chance of getting paid but the pay is still just normal pay; the fact that you were taking such a big risk means that you have to be paid extra to compensate. In fact, just from an expected value point of view, the lucky guard would need to be paid 1000 times as much in order for this to be a fair deal. (Or even more if money has diminishing marginal utility.) That’s the position that Bezos is in.
I just want to point out that my stepmother had a job for several years as a security guard for an empty factory, and they paid her the going rate.
The going rate for picking correct lottery numbers is $10’s of millions, and it is also a hard thing to do. The trouble is distinguishing between more lottery like cases and more sweat equity like cases.
Do elitists write thinkpieces in the Atlantic about how the lottery is unfair, and how we should forcibly redistribute lottery winnings to the public at large?
I think the economics concept to look at here is the net of the worker’s marginal product of labor with that of the next best alternative worker, abstracting frictional costs of replacement. I understand that isn’t exactly what you’re [@Scott Alexander] looking for, but I think the ideas are less separable than you imply. Think of it as a sort of a labor-oriented framing of economic profit. The alternative is inextricably part of the calculation.
The whole Bezos-replaceability thing isn’t being framed properly. It’s not the right comparison unless we define Bezos as “human Bezos” + “other productive assets owned by Bezos.” If we removed “productive assets owned by Bezos” from Amazon, that would completely destroy the company. Neither his labor nor the labor of his employees would have the same productive capacity without the capital owned by Bezos. He, and other investors, receive returns on those investments.
…is that a trick question? Because yes, of course they do.
Fair enough. To be clear, I know that the elites hate the lottery and ridicule it as “a tax on the poor/stupid.”
The vector of attack in that article, and all similar such criticism, is mainly against the state and mainly framed as “the lottery is a bad regressive tax and the state should eliminate it so the poor don’t foolishly waste their money on it.” Which in my view is slightly different from the sort of criticism that billionaires just get lucky. Nobody writes thinkpieces whose primary vector of attack is against lottery winners themselves. The Atlantic doesn’t attack the actual individuals who win the lotto as being “unfairly” lavished with unjust riches just due to luck, even though in that sense it is literally true.
They probably would if the lottery prize were $100 billion though.
I think essentially all knock-it-out-of-the-park success stories have a lot of luck contributing to their success–if nothing else, timing and opportunity. But I don’t think there’s anything at all inevitable about a world in which Amazon as we know it exists, dominating online commerce and electronic books and cloud services. IMO we could easily have ended up with a dominant online bookseller and other companies dominating in other areas of commerce, cloud computing, etc. I don’t know how much of that is Bezos’ doing and how much is other people he hired, but I don’t think it was inevitable that there’d be a company like that in every possible timeline, just named after different famous rivers.
Well, one of these involves guessing six or seven numbers, scratching them on a piece of paper, giving a gas station attendant $1 and waiting a few days. The other one involves spending 25 years building the world’s largest Internet company, e-commerce marketplace, AI assistant provider, and cloud computing platform, which is also the second largest private employer in the United States.
Yeah, I can’t tell the difference either.
The argument that the wealthy benefitted from luck doesn’t imply that it’s immoral to be lucky, just that we should recognize the role that luck played. No one argues that lottery winners deserve/earned their wealth, but for generic rich people there is more disagreement. Also, the tax rate on large lottery winnings (~37%) is almost twice as that on large capital gains (20%) (which probably understates the effective tax rate of Bezos, for the same reason that Buffett’s effective tax rate is ~15%).
>(I don’t know what the official economic name for this argument / math behind it is, can anyone help?)
Marginal value, I believe. The argument is that people get paid at the value of adding one more person with that job.
OK, make it eight figures. That’s still about three orders of magnitude lower than the actual value.
@Scott Alexander
[re: does Bezos matter]
Addressing:
Travel back in time, kill Bezos and check if we’ve got something like Amazon.
I’m not so certain. Or we might have it, but it would have started a bit later.
It doesn’t only matter what we have nice things right now, but also that we had them before, so we had that money for something else to spend on in the meantime.
A lot of things are “obvious” in retrospect.
If we simulate ten timelines from 1990 on and change them only minimally by making our experimenter throw a differently-themed custome party in the Bay-Area, I’d not be surprised that we’d get wildly different outcomes by today.
I have no trouble believing that a tourist from one of those altered timelines would marvel at Amazon, but be baffled that people still keep using non-crypto-currencies in conjunction with Smart-Self-Terminating-Fancy-Contraptions (what the latter ones are isn’t obvious to me either, but they’re a big deal in three of the ten and regulated out of existence, before they could take off in another two).
I can imagine a timeline where the glasshole-meme spread virally and Smart-Glasses never killed the Smartphone market and instead smartphones become into minimally-improving absurd status symbols….. wait, sorry that’s this one. Nvm, got confused.
tl;dr:
Counterargument: That’s hindsight bias, Sidesight-blindness (taking “today” for granted) and that the societal value of something important being created years/months/days earlier dwarfs anyone’s individual “first mover”-reward.
I don’t think the relevant counterfactual for Scott’s steelmanned argument is “travel back in time, Kill Bezos” anyway– it’s “travel back in time, change the tax laws so that the reward for successful tech entrepreneurship and venture capitalism only amounts to a six-figure salary”. I strongly suspect you don’t get Amazon, ever.
Right. If bumping off Past Bezos just results in Eric Schmidt or Peter Thiel or perhaps some now-unknown mere millionaire running Amazon and making multiple billion dollars, you’ve demonstrated that there is a lottery aspect to it, but you haven’t demonstrated that this is actually unfair.
@Paul Zrimsek
Eh…. I made too many arguments.
I’m most partial to: Travel back in time, kill Bezos -> this delays Amazon by a couple years.
But I’m saying that Amazon being a year behind is aquivent to an utility loss that is so much greater than any kind of “misallocation” or “unfairness” in wealth allocation. This might be a catastrophe as damaging as hurricane Katrina, but it’s all in the “unseen” economic realm.
Katrina creates clustered damage. Delaying Amazon means hundreds of millions of people pay 30 dollars more and wait for their packages two days longer for a year. Hundreds of millions of people having a little bit less money to spend, having their plans a little bit impeded. Waiting for their deliveries longer means having their own plans delayed.
Easy to underestimate if one makes a high income or doesn’t have to worry about money, but 30 dollars is something that matters to very many people.
Not to mention that all the useless labor is doing work that does not need to be done, instead of doing something better with the time.
Companies wont copy the Amazon innovations, so the whole economy wont run as well.
If the future is in space, then delaying Amazon means delaying Blue Origin, delaying our future in space.
A delay is not as flashy of a catastrophe, but it is nevertheless one.
That’s a good argument too, Don. I was just piling another one on top of it.
Also, I think a lot of startups were not obvious and wouldn’t have arisen without their actual founders until much later, if ever. And some that *should* have been successful weren’t, and we still don’t have them.
One example: In the 90s, David Chaum was pushing his (extremely cool) privacy-protecting technology under his company, Digicash. It never quite caught on, but I’ve heard from people involved with it that they came very close to being adopted for some big stuff, and that there were basically some bad negotiating decisions by the company that screwed them over. The world might look *very* different if we’d had online payment systems based on Chaumian e-cash for the last 20 or so years, privacy-protecting protocols for subway tokens and toll roads and such, etc. Among other things, one successful company doing that stuff would have encouraged more.
As another example, without Uber being founded, I think it’s quite likely we’d still be using the crappy cab service that was widespread before, and the world would be a worse place. The whole world was caught in a bad equilibrium, and there was no guarantee we’d ever escape.
As still another, blockchain technology (massively overhyped but still with some very cool aspects) wouldn’t exist without Satoshi writing that paper and a few guys getting Bitcoin started.
I don’t know what fraction of successful entrepreneurs fall into:
a. But for this person or small group of people, this would never have happened.
b. But for this person or small group of people, this wouldn’t have happened for a long time.
c. It was railroading time, and if this person or small group of people had all died of TB, someone else would have done the same basic thing.
For (c), one example is probably telephones–ISTR that Elisha Gray got his patent application in one day after Bell, so presumably someone was going to set up a phone network.
“You didn’t build this and even if you did somebody else would have done it without you eventually” I think proves too much, because it applies to literally everybody.
The median CA psychiatrist makes something like 4x the national median household income. And yet their entire career is built and managed by discoveries and regulations set down by others. How much better is the median psychiatrist than the top group of people that couldn’t get into med school and had to settle for substantially less lucrative careers? I mean sure, medicine is hard and it takes a lot of commitment and sacrifice so maybe they ought to make like 1.1 times the median household income. But not 4x! The rest should be taken a smeared around the rest of the people who really built psychiatry by existing in a society where psychiatry happens.
Okay, Jeff Bezos is replaceable – who here is less replaceable than Bezos? How many of us really do a job that someone else couldn’t immediately step into if we puffed out of existence?
At Amazon itself, the farther down the org chart you go (you probably don’t have to go very far) the less the people are uniquely responsible for Amazon’s success. I’m sure there’s some mid level manager making very good money who is very proud to work at Amazon, but the difference between them and the second best candidate for their job is a rounding error in Amazon’s bottom line. And so on down to the warehouse laborers, who are the most interchangeable of all, but of course are the ones Vox would say deserve the largest relative increase in pay.
What’s especially weird about this is that your Vox writers and politicians exist in industries just as cutthroat and lottery-like, just played for lower stakes. For every nationally famous columnist doing the interview circuit and writing popular books about income inequality, there are thousands of beat writers and freelancers and people who just wish they could write for a living barely scraping by. How much better is Reich really, compared to those people? For every Bernie Sanders there are thousands of just as passionate people handing out campaigning stickers. And so on. But I’m sure Reich and Bernie would be quick to justify their own unique success. At least the 10th or even 100th or 1000th best guy trying to invent Amazon still had a shot at a more modest fortune or well paying job elsewhere.
Reich might try to justify his own success, but he’d be wrong. However, I don’t think politicians like Sanders or Trump are replaceable in this way.
Large organizations require a lot of competent people making intelligent and sensible decisions on a day-to-day basis to continue surviving. No matter how brilliant the vision of the leader, if there aren’t competent people making sure the code gets written/tested/shipped on time, and good people are hired, and the contractors are kept from ripping the company off, etc., the company will fail.
I think you understate the degree to which Bezos and Amazon were light-years ahead of the “second-place” competitor.
I remember when Amazon first started, and a lot of people (probably the same sort of people who dislike his philanthropy) laughed at the idea that Amazon might be successful at selling anything but books. (Even books: “When B&N wakes up, or the publishers wake up, they’ll obviously beat him because they know about books!”) After all, stores within easy driving distance sold those things! There are so many books that one store can’t hold them all, so Amazon could succeed there, but selling other stuff? Silly idea. And a “marketplace”? Hasn’t Bezos heard of eBay? It has a marketplace. Etc., etc., etc.
In hindsight, we forget that the winners didn’t just become the winners by picking up a billion door bill on the sidewalk. They worked their asses off for that fortune.
This. Much ink was spilled about the outrageous amounts of investor money Bezos was raising, when other sites were collapsing left and right, and Amazon itself was reporting millions of losses, quarter after quarter. I’ve seen firsthand people trying to talk other people into risking millions of their own money in a new venture. It’s borderline witchcraft, and even harder to go back to said investors while your venture is losing money and get even more.
Bezos might not have been sweating like a ditchdigger, but he was doing something very few people are able to do.
Entering the e-commerce market is risky, precisely because only one or a few people can succeed. Value is created when lots of people try, and one manages to succeed. Each person who tries gets an expected value of (chance of success) * (gain from success). A fair gain is a gain that is large enough that even with the large risk/small chance of success, they have a reasonable expected value.
Bezos may get many times more than fair compensation for his time, energy, and skills, but he didn’t get more than fair compensation for his time, energy, skills, and the risk that he wouldn’t be the lucky 1/1000 who succeeded.
This is correct. Maybe the right way to frame this is too look at oil field discovery. The success rate for finding a large oil field say is 10%, that is for every 10 wells drilled, only one find economic amounts of oil. But people are still willing to incur the loss, because they make a good profit on the one that they do find. Now assume that after discovering the oil, the host government changes the tax rules to make the profit much lower on the successful oil field. Sure in this particular case the Government has maximized tax revenue. But who would drill any more exploration wells in the future? Any driller would take all of the risk for no upside. The billions that Bezos made was for the incentive for all the people across the world who tried multiple different ways to make ecommerce work. They had some idea that if they were successful then they could make billions, even though they probably knew (or their backers knew) the chance of success was low. And we all benefited from this competition. If you took away Bezos’s billions now, sure you would maximise short term tax take but in the long run you are going to drastically decrease the number of entrants into any new technology, which will reduce competition and make us all worse off.
I also agree with the others up thread – this isn’t about who deserves what, it is about the system of incentives that over the last 150 years has caused an unprecedented rise in human welfare never seen before in human history. We have tried other economic systems and they don’t work anyway near as well. We should be pretty careful about changing such a system I would think, and any such change ought to be made based on lots of small trials before we roll it out for the entire economy.
I think you’re miscalculating people’s incentives. If you went back in time and told Bezos that if Amazon worked out he would make $500,000,000, my guess is that he would still do it. I think this would especially be true if that would still make him the richest person in the world (assuming that whatever wealth taxes etc. get applied to everyone else as well).
@Steve – again it is not Bezos’s motivation that we are concerned about, it is the thousands of other attempts we were trying to motivate, and actually continue to motivate. Even today, after building his company, Bezos has to worry about other people taking his rent by coming up with a better system, which again benefits us the consumer, because he has to stay ahead of them. If the value of the world leading ecommerce system was “only” $500m, how many companies would be trying to compete in that space? You can be sure Amazon would not be as good as the one that exists today. Furthermore, it is not just ecommerce systems that are being motivated by this value, it is systems like this in general. You now have a good reference as to what a global IT system can return, so you can bet (as is the case) there are lots of people trying to do the same in other areas. Again all to the benefit of us. Of course some of these areas are trivial, but the point is that no-one can actually know what will benefit humanity ahead of time such that people are prepared to spend hundreds of billions of dollars a year on it. Now that is revealed preference.
This makes sense if you’re only concerned with what they’re doing and not the results of what they’re doing. Imagine a thousand prospectors all doing the same thing (digging) out in the same field. One of them strikes gold. The rest don’t. The one who strikes gold gets a lot of money and the rest get almost nothing.
They are all performing the same activity (prospecting) but are rewarded based on their ability to actually bring gold back. Likewise, entrepreneurs are rewarded on their ability to actually generate value, not to found companies. Maybe this strikes some people as unfair. They were all doing the same thing in the same place. In fact, maybe the prospector who got the gold wasn’t even the best prospector. But do you want to incentivize people prospecting or people finding gold?
I disagree With your implied framing, Scott
Prices, including salaries and profits are signals and rewards within a market system. Thus the opportunity for profit by building an efficient online distribution system is the market signaling its value to billions of people. The entrepreneurs then risk their capital and their time and effort to try to snatch the brass ring. The greater the potential rewards (the better the brass ring) the more effort and initiative and capital that is plowed into it.
Thus the opportunity for $100 billion is the way the system signals the opportunity and rewards those fulfilling it. Besos has created vast amounts of value for society, and has been rewarded in kind. But billions were also risked by various other people who did so with an eye on that same brass ring.
The idea that Besos could have done this for a handsome salary is incorrect. It would never have been worth the risk, and never would have generated the various experiments and competition which created Amazon in the first place.
In brief, the competition created a better distribution system, and the billions in profit were the incentive and the signal to do so.
The argument can’t end there then though, Bezos doesn’t ‘deserve’ his $100 billion, then who does? If you split up Amazon you will divide it between 2 to 50 billionaires or you are skipping the whole ‘deserves’ part and just saying ‘I think group X should get the money’.
What did Bezos know in 1994
that Sears didn’t know in 1993?
A year before Bezos got started, Sears threw the gates wide open by ending their catalog sales. Once upon a time you could get almost anything mail-order from Sears, even houses. Then in ’93, Sears determined they could no longer make money doing that. Bezos replies: ‘Hold my beer and watch this’
“I’ve got to beat these other entrepreneurs” is pretty daunting, but probably not so daunting as “I’ve got to make money doing something that one of the historically most-successful retail companies in American history says can no longer be profitable”.
If Sears makes a serious attempt at the e-commerce business model in 1993, with their already existing warehouses, shipping networks, and brand recognition, then aren’t we all ordering from Sears.com today, and nobody would have ever heard of Amazon.com?
Probably not, yes to the ‘no one has heard of Amazon’ but Sears would have been at a major disadvantage as its supply chain was built to handle masses of traffic and not the tiny amounts that early years Amazon shipped. Sears would have been losing money hand over fist for a long time if it tried to convert its supply chain to an e-commerce business in the early 1990s as it was the completely wrong time to operate a massive online retailer.
I think Sears could have beat Amazon Retail up to about 2007, maybe 2008, if they had actually wanted to and had tried. But nobody at Sears actually wanted to. Sears ruined itself with very little outside help.
I think B&N -of-then could have beat Amazon Books up to about 2005, if they had actually wanted to. But nobody at B&N -of-then actually wanted to. (I have high hopes for B&N now, their new owner seems to have a clue, and has a demonstrated and successful love for resurrecting retail brick-and-morter bookstores.)
AWS is a really weird case. By the time that S3 and EC2 were started as projects, lots and lots and lots of companies had built for their own internal use “xen and networking behind REST as a service” and “http object store”. I know… I built TWO of them, *by myself*, for my employer in the early zeros, after seeing a bunch of others put together at other companies.
But AWS started selling the same kind of utterly basic compute service to anyone online at wholesale prices, and it was *three years* before any other tech company tried to enter the same market. Nobody waits three years… That’s still the weirdest part of Amazon’s story.
Having lived in a few foreign countries I don’t think it’s at all a safe assumption that “if x hadn’t come along to do amazing new service y would have soon enough anyway,” because, for example, no on seems to have made online shopping in Japan, Taiwan, China, or Hong Kong anywhere near as convenient as Amazon has made it in America, or, for that matter, as Amazon has made it (plus shipping) in Japan, Taiwan, and Hong Kong.
Yes, there is plenty of online shopping in these places other than Amazon, and yes some of the reasons for Amazon’s success may be the unique business environment of the US and/or US customers’ unique set of preferences, but the fact that they can succeed in e.g. Japan and Hong Kong to some degree and probably would succeed in China if the PRC would let them, not just by being 1% better than the nearest Chinese competitor, but by being twice as good as the most similar Chinese competitor, suggests that Amazon itself has done something valuable which we can’t simply assume some other group would have quickly done in their absence.
Yeah. Even in the US, I’m suspicious of reasoning that goes “If Amazon didn’t do it, someone else would have” when, until very very recently, in terms of online shopping, Amazon wasn’t just “a little better” than the alternatives. They were far and away better in basically every possible dimension for like, nearly a decade. They didn’t just do a slightly better job and then benefit from massive network effects – they absolutely obliterated the competition and blew them out of the water. Nobody else was even close.
If the difference between Amazon IRL and alternate Amazon is greater than $165 billion in share value, then Bezos earned his keep even if the Second Best Bezos was a total altruist willing to start and found Not-Amazon for literally no compensation.
I actually think the reverse is more likely. Bezos is not a majority share-holder in Amazon, but maybe Other-Bezos-Equivalent would be – and would be several times as rich.
Arguably the internet doesn’t need a central marketplace because the internet doesn’t need a central anything. The centralisation of the internet induced by the Silicon Valley big players is a bad thing that goes against the purpose of the internet and is detrimental in a number of ways to people all around the world.
I mean, “need” is kind of a tricky word. But it’s pretty damn convenient that I can shop for basically anything I need/want at one place, rather than having to order through five different sites.
And that’s hardly something that started with, or is unique to, the Internet. Wal-Mart and other such stores enjoyed a great deal of success offering the same general value proposition in the B&M space.
“And there are people who are upset about this”
Let me try to model the opinions of people who are upset about this, so you can better understand their position.
“Jeff Bezos was one of many companies racing to develop advanced systems in logistics, shopping, warehousing, and retailing. His company did it slightly faster and slightly better than all the others.
As a result, he has accumulated a vast monopoly that continues to grow more monopolistic. As his market power strengthens the savings and convenience he helped add to the economy will diminish against the increased losses from rent seeking as Amazon jacks up prices, cuts worker salaries, stifles innovation by crushing competitors, and uses his power to redirect money from the government to his firm in the form of loopholes, tax incentives, etc.
This is not a bug or accident, this is a feature. The huge investment and pricing on the stock market assumes and explicitly plans for this fact, and the stock price would collapse if it did not do so.
Advanced systems in retailing, warehousing, and logistics are great. We should keep these, we should incentivise developing such and there are many ways to keep and incetivise these without redirecting billions of dollars of the economy to harmful, rent seeking behavior that will only continue to grow worse and more unstoppable as it does now.
To add to the insult, Bezos then demands to be seen as charitable. To take the hard work of others through rent seeking and monopolism, and then hand a fraction back to only those things you deem “worthy”, boasting of your ethical goodness, is beyond perverse.
Not only is this ethically perverse, but its arguable if its even driven by altruism. To protect its monopoly, Amazon must avoid government intervention, and the best way is to minimise public outrage about your practices. What better way to do so than to boast of your charitable nature?”
Setting aside the fact that Amazon is not close to a monopoly, do you have any basis for believing this? The whole foundation of anti-trust is to support small businesses who are driven out of business by the low prices of monopolies.
I know the theory is that after all the competitors are out of business, a monopoly will then raise its prices. But has that ever happened? In the history of the world? (ignoring here natural monopolies and government granted monopolies, which do not follow this model of undercutting on price and then raising prices)
I definitely do not agree that a monopoly is required to justify the stock price (a monopolist who raised prices would be busted in an instant). Amazon is highly profitable now and again is not remotely close to being a monopolist.
Depending on who you ask, this is the current situation in the high-end GPU market.
Historically (Starting in the late 80s/early 90s) there were several, many, GPU manufacturers, to the point where you could call the market postively crowded. For a variety of reasons, by the early 2000s the only two still remaining were Nvidia and ATI (Who would be bought out by AMD in 2006), and that’s basically continued on to this day.
Except when comparing the lineup of Nvidia and AMD’s GPUs in recent years, it’s hard not to notice that the high-end high-performance cards are all bearing Nvidia’s name, with AMD’s offerings ending up kind of limp and flacid (Or just nonexistent, depending on the class of GPU we’re comparing). AMD competes on the low end largely by being cheaper and offering “more value”, but there are definitely applications/customers for which/whom paying less to get less is just not an acceptable state of affairs, so for those it’s buy Nvidia or don’t buy anything at all. Knowing all that, it should come as no surprise that for Nvidia GPUs that don’t have a performance counterpart by AMD, prices have ballooned.
It’s not even a strong secure monopoly, the situation was different in the past and could very well change in a GPU generation or two (A couple of years, at most). It’s not even a total monopoly, since we’re just talking about the high end, and the low end is competitive capitalism working as advertised. But it turns out that’s all it takes for a company to start cranking up prices just because it can.
Sure, this is just a small part of a market segment that I happen to know about only because I’m an enthusiast in that space, but I wouldn’t at all be surprised to find similar stories in places where other people are in a position to tell them.
Yes, I agree that if a company has market power it may raise prices because companies will generally charge the profit-maximizing price. However, is it the case that NVIDIA drove all competitors out of business with very low prices (typically, unprofitable prices) and then once it had driven them out, raised prices dramatically? If so, that would be the first time I have heard of that happening.
I guess that raises the question of why wouldn’t that happen, and maybe the answer is that driving competitors out of business with low prices is really hard and expensive and resulting monopolies don’t last for long?
It seems like you have a very simplistic idea of what I mean when I speak of monopolies, that involves keeping prices at a loss making level until all the competitors leave the market, and then jacking up prices when you are the only one left. That is not what I mean.
Businesses don’t have to be monopolies to charge above market prices. They merely have to wield significant market power, which can grant them perpetual above market average (aka rent seeking) profits, so long as they can keep that market power safe, which they do, because of barriers to entry, network effects etc.
“The whole foundation of anti-trust is to support small businesses who are driven out of business by the low prices of monopolies. ”
See my point about your understanding of monopolies
“I know the theory is that after all the competitors are out of business, a monopoly will then raise its prices. But has that ever happened? ”
Lets go back to econ 101. In an ideal market, economic profit is zero. Business is like a bulk market – its like buying bags of rice.
But in the real market, any differentiation, from brand, to convenience, to negotiating power, to lack of consumer education, allows businesses to up prices. One doesn’t have to be a monopolist to do this. In limited amounts, this is fine, because other businesses can invest in the same, and keep competing – once everyone has the same advantage, economic profit returns to zero.
For a fledging monopolist, its merely enough to have enough of the market, and barriers to taking that market share, to jack up the prices. You will never ever have a perfect monopoly, but the more powerful you are, the better the prices.
There are alternatives to Photoshop, but Adobe still charges insane prices. There are alternatives to Windows, but Microsoft still charges insane prices. There are alternatives to Facebook, but it can still have lots of problems and noone will leave. There are alternatives to the US cable companies, but they still get away with shitty service and awful prices.
Even when there are large competitors, there is often implicit coordination, especially in duopolies, as price wars and removing scams on the customer would only eat into their profits – the incentive is to cooperate, because this competition tends to be a repeated prisoners dilemma . The trends in US phone plan pricing, printer ink, and GPU are examples of this.
“I definitely do not agree that a monopoly is required to justify the stock price (a monopolist who raised prices would be busted in an instant). Amazon is highly profitable now and again is not remotely close to being a monopolist.”
I’m not sure where the monopolist busting comes from. Companies like Microsoft, US cable companies, defense contractors and pharma companies act like monopolies and raise prices all the time. No monopolist busting there.
Again, I think this comes back to the misunderstanding of what being a monopolist means.
Amazon can deliver to door cheaper than anyone else, can fuck over and monitor their workers cheaper than anyone else, can offer a wider selection than anyone else, and so on. At first, this may have been because Amazon was actually better. If that were still the case, anyone could catch up by doing a good job.
Now its just because the economies of scale benefit Amazon. Its cheaper to deliver the more places you deliver to. Its cheaper to warehouse the bigger the warehouse. Its cheaper to HR the more employees you have. Its cheaper to retain market share when you have existing customers who know the brand.
Or in other words, there are now significant barriers to being able to offer a competitive alternative to Amazon. As long as Amazon doesn’t get too greedy and always keeps its prices below the size of the barrier to competition. It can deliver economic profits to its shareholders in perpetuity.
You spoke about excluding natural monopolies. If you can run a company well (difficult but possible) a lot of fields can be natural monopolies. Anything with good economies of scale or network effects can be natural monopolies.
Diseconomies of scale exist; large organisations are sclerotic and slow to respond when the ground shifts beneath them. (You mentioned Microsoft; their massive market share in PCs didn’t do them much good when smartphones came along and it turned out they couldn’t write a phone OS that didn’t suck.)
In practice (and no I can’t prove this) the only way you get ‘market power’ and ‘shitty service and awful prices’ is by buying a government regulator to build up some nice tall artificial barriers to entry for you.
Amazon’s quasi-rents come from having some actual trade secrets; anyone who independently discovered them could compete effectively (except that if they got the capital to do so from an existing company in an adjacent market, the anti-trust guys would stop them; a bitter irony).
Right. If our choice is between Bill Gates using 10 billion to build a successful charity and Bill Gates using 10 billion to continuously snort cocaine for 68100 consecutive hours, the world with the charity is the better world. But the objection is before that choice, where Bill Gates enriched himself at the expense of competition / software evolution / consumers/ whatever; he doesn’t get brownie points for deigning to give a fifth of his monopolistic profits back. (And our scope here is on the philanthropists – what about all the billionaires who don’t even do that!)
————-
A silly analogy, imagine you’re a sys admin and your company’s doing a huge migration, software hardware and physical. Your (salaried) team works their ass off 80 hours a week for seven weeks straight to get everything set up, pulls multiple all-nighters to put out the inevitable fires as they came up, hauls boxes up stairs with atrophied computer engineer arms etc. You might expect a hefty year end bonus from that! Well Christmas comes around, and your CEO gives a big speech of how proud is he is of all your hard work and how the migration increased profits… and so he’s throwing a pizza party at Old Chicago (not covering drinks) and giving everyone a 50$ coupon to Target.
Obviously your team’s pissed at management. But it’d be stupid to say that your team hates when they throw pizza parties and gives out coupons – if they did that as a surprise thank you in May you’d be thrilled! – or that you’re jealous of the rich CEO’s mansion or whatever. It’s that your company got bunch of extra hard work from your team and didn’t pay back remotely what you deserved.
And the suggestion of “You shouldn’t complain too much or they won’t even throw the parties” would not go over particularly well, even if it’s
—–
My own thoughts differ. I’m not sure how much of Bill Gates’ wealth is “ill-gotten”, and as Scott gets into it’s unclear whether it’d be used much more effectively by the government or whoever (even including the non-philanthropist’s gains). But I totally see where those people are coming from, they definitely aren’t “space aliens” or jealous or reflexively attacking things against their political narrative or whatever these comments are suggesting.
I think this is missing an important point.
We have a kind of cultural model of people who are:
a. Highly successful entrepreneurs who get very rich, often by caring more about winning than about niceness or anything else.
b. Later on, once they’ve won and gotten older and concerned with their legacy, they become great philanthropists, bringing some of that same intelligence and drive to doing good works.
As best I can tell, we need to continue pattern (a) so we can keep having the kind of massive innovation and wealth creation we’ve had for the last century+, and also this is almost certain to continue within our economic and social system.
Scott’s talking about pattern (b). It’s probably possible to destroy this pattern. If we manage that, then most people who succeed in (a) will spend their vast wealth on making sure their great-great grandchidren can still afford to snort coke off strippers’ backsides on their yachts rather than on trying to do good in the world. And the world will be made enormously worse off as a result.
AFAICT, the articles Scott quotes follow a common pattern in the world: Someone does something admirable and worthwhile, and gets attention from doing so. Then, lots of people online try to capture some of the attention going to them by coming up with some kind of criticism or ridicule or outrage against them. Occasionally, they succeed and crap all over some otherwise wonderful thing; mostly, they fail and sink into well-deserved obscurity while the admirable/worthwhile people keep doing whatever they were doing.
I think most people who object to billionaire “philanthropy” don’t agree with your assessment of (a). They would argue that entrepreneurs are driven by the desire to build something amazing and win social status/prestige and those drives are independent of the amount of money they have in the end beyond a certain threshold of wealth. If Jeff Bezos was world’s richest man with only $10 billion, would he be substantially less happy or less motivated than he is being the world’s richest man with $160 billion?
Also for those curious because I was: bulk cocaine is around 30 grand a kilogram in the States, a larger line is ~.1 grams, and you breathe in ~1200 times an hour. So if Gates snorted a line each breath in he’d use 120 grams of coke an hour for ~3600$ an hour, so 68000 hours of continuous coke snorting would only be 0.250 billion dollars. Heck it’s only 0.032 billion a year (8700 hours): Bill Gates could invest 1 billion and have perpetual coke just off a 3.5% return, then use the other 9 billion for the charity!
(My search history now constitutes probable cause for drug warrants yaaaaay)
In what sense is Amazon a monopoly? Not in the original sense of a government grant allowing a firm to operate in a particular market and prohibiting any competition. Not in the neo-classical economics sense of a firm using its market power to reduce output and increase price.
Amazon is only a monopoly in the loose, colloquial sense of having a high market share. But it’s not at all clear why monopolies in this sense are bad. If a firm offers good products at low prices to lots of people, where is the problem?
Advanced systems in retailing, warehousing, and logistics are great. We should keep these, we should incentivise developing such …
That’s exactly what happened. Do you think Amazon is the only company that gets to use the techniques they’ve developed for retailing, warehousing, and logistics? Even as we speak they are spreading to smaller and smaller warehousing (etc.) operations.
[putting on my raw-raw Libertarian-hat]
Rent-seeking behaviour is possible only because the institutions are weak and corrupt. Amazon and Bezos are rent-seeking, but you want to curtail their power in favor of those who grant them their unfair rents?
Is Amazon evil for making cities outbid each other in bribes to put down their HQ or are the decision makers who are offering the bribes evil?
I’d say both. But I do not see how empowering the latter could possibly be a good outcome.
When you say: “We should get rid off Amazon, but keep all of the nice stuff.” (paraphrasing), who exactly do you think this “we” is and how can you possibly trust them either?
he is also transferring a decent chunk of money from people who want potato peelers to people who want to educate underprivileged kids
It’s even more interesting than that. The people who want potato peelers actually get cheaper potato peelers faster, potato peeler manufacturers sell more potato peelers, and somehow there’s still billions of dollars available to give to the underprivileged kids. I want the government to pull off such trick just once – to have prices drop, service get faster and more convenient, trade increase and billions of dollars appear without being taken from the pockets people like me. Never seen that happening. I wonder also how many of the people criticizing charity on Twitter can pull a trick like that.
but there is something surreal about reading them. It’s like reading thoughtful, polite, well-reasoned arguments why arson is bad.
Exactly my thoughts when I started reading that article – wait, there are people that think giving away billions to poor kids is bad? There’s enough of them for Scott to write a long, well-argued article proving them maybe it’s not that bad? Who are those people? Are they going to offer trillions to the poor kids instead? Or what’s their claim to knowing better than that and trying to destroy a setup that gives billions to poor kids?
It’s not so ludicrous to think that billionaire’s giving is bad if you accept one of two common premises. One is that the billionaires got their billions on the backs of the poor; they’re the _cause_ of the poor kids and their charity is only a tiny positive offset against a huge negative; better to destroy the billionaires and their charity with it. Another is that the government would do better for the poor kids if it took the money. The latter idea Scott refutes pretty thoroughly here. The former… well, I’m not sure anyone can be argued out of that one.
One is that the billionaires got their billions on the backs of the poor;
That’s obviously false – there are a lot of places without Bezos that have poor kids. In fact, poor kids existed millenia before Bezos appeared. So clearly Bezos is not what causes poor kids.
that the government would do better for the poor kids if it took the money
This is also false. Government already has – and spends – way more money that Bezos does. Only it spends it on war on drugs, incarcerating parents of those kids, building bridges to nowhere, buying votes and financing boondoggles for the well-connected. If we had magic formula that would ensure directing money to poor kids, we could use it right now without dekulakization of Bezos – governments already have trillions, but somehow it never gets to those kids. There’s no reason to assume if Bezos is dekulakized, his 0.01% increment of money available to the government would change the picture in any substantial way.
Billionaires don’t need to be the sole cause of every single instance of poverty for his argument to be true. I can’t see how it would apply to Bezos, but De Beers for example has certainly caused a fair share of poverty.
I think a lot of the hatred of the rich because of history.
Until very recently there was only one type of super-wealthy person. That was the despot. The king or feudal lord, or maybe their cronies.
It’s only in the last 200 or so years that the richest people were businessmen. People could recognize that the American citizen’s relationship to Jeff Bezos is different than the Russian citizen’s relationship was to Nicholas, Tsar of all Russias. However many people instead act like they are the same.
Hurrah for the bourgeoisie!
Well, Scott did make a pretty convincing argument that George Soros’ money should be taken from him and used to build a border wall.
If you’re going to write hot takes like that, at least provide a link.
I just thought it was funny as I was reading the essay, Scott’s talking about the bail reform charity and I’m nodding along, “that’s a really good idea.” And then animal welfare initiatives and I’m thinking “oh yeah, that sounds good.” And then he gets to Soros funding border crashers and I said “wait a minute! Maybe the anti-billionaires have a point!”
That was my reaction too. One man’s modus ponens is another man’s modus tollens.
I dunno.
I’m with Soros on this one, because I don’t think we should be striving to ever-closer approximate the Black Hole of Calcutta just to discourage people from crossing our southern border asking for refuge from conditions our own president tends to describe with words like “infested” and “shithole.”
It’s like, you can’t have it both ways. Either conditions down there are “infested” and “shithole” and it’s totally understandable why good people whose skills and labor we’d profit from would want to leave…
Or conditions down there are basically okay and it’s just lazy opportunists trying to cross the border, in which case the countries themselves, and the people who live there, must be worthy of some measure of respect.
When a man says “people shouldn’t be coming to us from those countries, they should go back to those countries, which are shitholes and crime/poverty/disease-infested,” I can pretty quickly clock that man as holding this stance out of negative sentiment towards the people, not towards either the country or the act of immigration in and of itself.
I think a lot of people have a problem with people just sneaking into the U.S. in knowing and express violation of our laws. Of course it’s understandable that people would want to move to the U.S.
Nobody’s disputing that it’s totally understandable why good people would want to leave those countries and come to the US. But you’re smuggling in the assumption that the US would profit from their labor; that’s not required by their countries being “shitholes”.
@Simon Jester
I’m not endorsing this view, but at least some opponents of immigration believe that if the people from the shitholes move to the successful country, they’ll bring with them the dysfunctional culture and politics that made their own countries shitholes, and then no-one gets to live in a non-shithole country.
Which doesn’t require any animus towards “the people“.
Sure it does. At the very least it makes collectivistic assumptions about those people’s behavior based on their ethnicity/nationality. It’s extremely bigoted to suggest that Mexicans (or any other ethnic groups) are inherently predisposed toward cultural practices that turn countries into wastelands.
I think the bigger point of contention here is whether it’s moral for the US government to only take the well-being of Americans into consideration, or whether (and how much) it should weigh the well-being of prospective immigrants.
At one extreme, you might have a pure merit-based immigration system where prospective immigrants are let in only if they have a very high probability of adding more to the country than they take (in terms of wealth, culture, general well-being, whatever). At another, you might have a policy of taking in refugees from everyplace where they’re being mistreated–send ships to pick up all the Uighurs and Rohingya and bring them here so they’re not getting killed or having their culture erased anymore. I think basically every country is in the middle somewhere, and that the actual immigration debate is mostly about moving the slider bar a little more toward “good of the country” or a little more toward “good of the immigrants.” And much of the factual debate comes down to whether (say) poor immigrants from Central America and Africa are likely to be good for the country long-term.
@LadyJane
You’re bringing ethnicity into this, I didn’t.
Some countries (“the West”) have institutional and cultural capital that have demonstrably produced liberty and prosperity. Some countries (“shitholes”) have not, despite in many cases being democracies with theoretically the same rules and forms as the West.
Unless you believe that $ethnic are inherently predisposed, necessarily culture must be a multistable system, wherein citizens of the West vote for policies and engage in practices that reinforce Western culture, whereas citizens of shitholes vote for policies etc. that reinforce shithole culture, purely as a response to / result of exposure to that kind of culture.
Then it is only necessary to postulate a certain amount of hysteresis in this effect, to conclude that immigrants from shitholes will, at least initially, continue to vote for shitholery. (And it’s not just voting, it’s stuff like high vs low trust approaches to commerce, vigilante punishment of slights to one’s honour, etc. There are a lot of things in Western cultural capital that we take for granted but that many other places don’t have.)
Now of course there are countervailing considerations, like the positive selection effect for go-getting self-improving types (though arguably the legal immigration system is better at that, because it’s not also selecting for willingness to break the law). And I’m not aware of attempts to scientifically determine whether that hysteresis effect really exists. But it’s entirely possible for someone to believe in it without being any kind of racist.
(And that’s before we get into those ethnicities which actually do have genetic reasons — low average IQ, high average time preference, poor average impulse control — for their countries tending to shitholery. The non-racist way to deal with those would be to make immigration decisions based on psychometric testing, but the Left would scream ‘disparate impact’, so instead the system of necessity raises barriers for all of them, even the smart and disciplined ones, which is racist because it’s using distributional race data where individual trait data are available.)
@LadyJane
Yes, it’s called culture.
One factor that (can) result in a separate ethnicity is a distinct cultural tradition. This often aligns with nationality.
For example, one collectivistic assumption I tend to make about Americans is that when they talk about football, they refer to the game that consists mostly of holding and throwing the ball, rather than what the British and the rest of the world call football.
When a man says “we’re going to bring in untold masses of the sorts of people who create crime/poverty/disease-infested societies, move them into my poorest countrymen’s neighborhoods, displacing their culture, crowding their schools, overwhelming their social services, illegally undercutting their wages for jobs, disenfranchising them politically, with no concern to their protestations or sympathy for those murdered by the hostile foreigners we imported,” may I pretty quickly clock that man as holding this stance out of negative sentiment towards his countrymen?
Are we just taking it as a given that the poverty and disease of a society that someone is born into is of their own making? Really?
Take an Amish society. Put them in China. Do they make something that looks like an Amish society?
If you take them as a whole, obviously they do. But if you take only the ones who decide to leave after rumspringa, it’s another question.
It depends on what you mean by “looks like”. Several hallmarks of amish society definitely wouldn’t survive, like the traditionally large amish families in the face of china’s
onetwo child policy. I’d definitely expect pretty substantial changes in culture, especially superficial ones like cuisine, etc. Depending on where in China you put these amish (Spoilers: China is a large and diverse country) I can imagine a whole host of potential changes, or not.But this is kind of besides the point. If we did take some Amish and put them in China, I wouldn’t expect their presence to be any kind of a shield against another SARS outbreak, nor would I expect them to have any effect in increasing the Chinese rates of diseases common to America (A quick google search tells me that these are heart disease,
type 2 diabetes, high blood pressure, and high cholesterol).
Spread of disease is partially a result of public health and sanitation services. If you have people who cannot form governments that can create and sustain working public health and sanitation services you get diseases and sickly people.
Related:
Venezuela’s Health Crisis Is Crossing the Border
Desperate refugees spread malaria, yellow fever, diphtheria, dengue and tuberculosis to neighboring countries as health-care system implodes.
Partially, maybe. I don’t know how effective good sanitation is in preventing heart disease.
But whatever. Say I concede this point entirely, and say you’re right. People who “move into your poorest countrymen’s neighborhoods” are going to have your poorest countrymen’s pre-existing public health and sanitation services. Any disease would be the result of your country’s government, not the government of wherever these people came from.
And those people are not going to improve the situation, because they were unable to form a healthy society where they came from. Society or civilization or government is a product of the people, not the dirt. When you move people to new dirt, they bring their ideas of how to function in society with them, for good or ill.
Nor should we expect them to? They’re rationally trying to improve their situation, not the situation of the place they’re going to (Which I expect to remain largely the same). Complaining that immigration isn’t fixing sanitation and public health services is bizarre to me.
With the exception of like, Thomas Jefferson or some such, nobody ever “forms a society”. Neither you nor I nor anyone in this comment thread has ever formed a society nor could we if we tried. We were simply born into a pre-existing society with problems that we didn’t cause and are largely beyond our individual abilities to solve.
Alternatively, their ideas of society or civilization of government changes to accommodate the new society they live in. Example: My family are immigrants from Bulgaria, and believe me that after nearly 30 years my parents are thoroughly Americanized (“for good or ill”), to say nothing of myself, or my siblings which were born here, or the children of other Bulgarian immigrants we know who can’t even speak their supposedly native language.
Lastly, even if I concede this point again, and even if I say you’re right, so what? We’ve established that disease is caused by poor sanitation and public health services. Even if immigrants have “wrong” ideas about how to run sanitation and public health services, nobody is putting them in charge of sanitation and public health services. Are you worried about fresh-off-the-boat immigrants getting elected and sweeping into local office?
Alternatively, their ideas of society or civilization of government changes to accommodate the new society they live in.
A lot of that depends on the number of immigrants (more the percentage of the new country then absolute number but the later might matter a bit too if a lot less), relative isolation/segregation (either voluntary or otherwise) of the new immigrants, the specific cultural attitudes of the new immigrants, the strength/vibrancy of the culture were they move to, the attitudes in the new country about trying to assimilate people vs trying to not do so (from “melting pot” to “salad bowl” to active attempts to reject and isolate the new comers), to the situation, events and other reasons that drive them to come here (if its harder to get here that would select for people who had the ability and motivation to overcome the difficulties, if its easy then you probably get a group of immigrants that looks more like the general run of people in the country), the political situation in the home country can also be relevant, for example for years after the revolution in Cuba, people who came to the US from Cuba (esp. but not only in the immediate aftermath of the revolution) were very likely to be anti-communist).
Of course that’s a bit of a muddy mess without a lot of specific that could apply broadly. But I think the issue is itself a bit of a muddy mess. A lot of people want to just look at the facts and ideas that support their opinion. Maybe I’m like that too, I don’t think I am too much, but that could just be my positive bias about myself. But in this case I don’t have a strong opinion to be all partisan or biased about.
https://en.wikipedia.org/wiki/Ilhan_Omar
Arrived in New York in nearly 30 years ago at the age of 10, and has undergone the citizen naturalization process (Which, having gone through it myself, is not a short or pleasant experience). She’s been a US citizen longer than some people who voted for her have been alive. This isn’t a “fresh of the boat” immigrant.
But also again, let’s set that aside and imagine she was fresh of the boat. So what? Do you think that the policies that her political opponents (Which I’ll assume you are one of) come from her being Somali? Are universal healthcare and student loan forgiveness Somali ideas that she’s importing because of her Somali way of looking at government?
@420BootyWizard
Yes, I definitely think that many of her views are due to her background. Obviously, as are mine.
For example, she’s disgustingly anti-Semitic. As an American in the tradition of George Washington welcoming Jews, that offends me. I don’t want to bring more anti-Semites into this country, which will make it (on average) more anti-Semitic.
I don’t know about universal healthcare, but Islam forbids loans, so yes, her religious views almost certainly inform that one as well.
“Her background” as someone from Somalia? Or “her background” as someone who spent the majority of her life in the United States?
The only thing even remotely on this subject in the wikipedia article you linked is some specific criticisms on the government of Israel, support for the BDS movement even though she admits it probably isn’t very effective, and some tweets about hypnosis and lobbyist money that she later apologized for. I’d call this “mildly antisemetic” at worst, nothing that would upset the anti-semitism average too much in a nation that birthed the “drunk embarrassing uncle during Thanksgiving dinner” trope. Do you have anything in particular that would make her “disgustingly” anti-semetic?
Christianity is just as against Usury as Islam is, so in theory shouldn’t all of those “America is a nation founded on judeo-christian values” capital-C Conservatives also be against loans, if that’s all there was to it?
I’m an atheist whose family is nominally Eastern Orthodox but not really. I am also in favor of student loan forgiveness. Do you think that’s due to my religious views as well?
26 years fresh.
@420BootyWizard
Obviously her background as a Somali. Given that she considers herself representative of the Somali community and enjoys substantial support from it, but is at a popularity of 9% among all Americans, I think that I can solidly support that.
Drunk embarrassing uncle is usually racist, not anti-Semitic, but if you’re arguing for importing moderate anti-Semites, I guess we just have a difference of opinion in what is acceptable in America. I’ll stick with George Washington, thanks.
Catholicism is, but America is a mostly Protestant nation, and Protestants are not doctrinally hostile to usury, beginning with John Calvin, the originator of the Reformed churches that make up the majority of mainline Protestants in America.
“Judeo-Christian” isn’t a meaningful source of specific values because doctrine can vary sharply there.
Probably not solely, but the Eastern Orthodox church is against it as well, so certainly somewhat.
I’m pretty sure she considers herself (And additionally, the rest of the united states considers her) a representative of Minnesota’s 5th congressional district, which I haven’t verified but strongly suspect is mostly not-Somali. Her popularity in Minnesota’s 5th district, according to the people who voted for her, is 78%, I think that solidly supports that.
Oh, my mistake. Of course racism is totally fine as long as it’s not against jews.
This is sarcasm.
Friend, I’m just trying to figure out what it is that led you to call her “disgustingly anti-semetic”, which you still haven’t gotten around to yet. I’m not sure what George Washington has to do with any of this, and I think an immigration policy of “Only allow George Washington to immigrate” is a bad immigration policy.
Following this train of thought, you would expect majority catholic nations (Italy, Spain, countries whose catholicism is much deeper than America’s protestantism) to be against usury as well. But weirdly when I type something like “Bank of Spain” into google, it turns out such a thing exists! Also weirdly, “Bank of America” exists in the form that it does today largely because it was acquired by a “Bank of Italy” founded by an Italian in San Fransisco! A catholic Italian!
You know, I’m beginning to suspect this whole exercise in looking at the religious beliefs of nations and drawing conclusions from that might be faulty.
And yet “Judeo-Christian” is the exact phraseology that people use in reference to a supposed source of values! You mean that people who make arguments based on religious beliefs can just make up whatever nonsense they want to justify their pre-existing prejudices??? Do tell.
I previously didn’t know that the Eastern Orthodox church was against usury, so I guess my support for student loan forgiveness must be “certainly somewhat” some kind of genetic memory from my more devout great great grandparents or something.
@420BootyWizard
I can’t imagine why the district with the most Somali-Americans elected a Somali-American. What a mystery. Mysterious.
I’m not your friend.
As for the anti-Semitic words, I’ll go with Nancy Pelosi, who I think we can all agree is not a right-winger: House Speaker Nancy Pelosi and other leaders urged Omar to apologize for using “anti-Semitic tropes and prejudicial accusations about Israel’s supporters.” https://www.foxnews.com/politics/ilhan-omars-israel-comments
George Washington specifically said that he wanted a country where Jews are welcome. I like that, so I don’t want to invite anti-Semites. You have a different standard.
Then you change to generic racism because you realize you have a bad position and you’re throwing up smoke. I am fine with not allowing the immigration of racists either, by the way. For example, we shouldn’t have allowed the immigration of the racist Ilhan Omar, who said that white men are a threat.
Because there are values shared between all branches of Christianity and Judaism that are in fact not common to the rest of the world. Which doesn’t help in resolving differences between those three.
Supposedly the district is 67.39% White 16.64% Black 6.05% Asian 8.81% Hispanic 1.23% Native American. Of course I had to look all of this up; I’m not an expert in minnesota’s 5th congressional district, much less its demographics. Why would I be? What a weird and random thing to care about.
Don’t deny it. You feel the budding friendship between us just as strongly as I do.
Yeah, that was in that wikipedia article you posted. Apparently she apologized afterwards and everyone (Except for you, I guess) has moved on. Disgustingly anti-semetic, clearly.
George Washington specifically said a lot of things. One of the more famous ones that we’re taught in our 12th grade civics classes is that he thought political parties were a super bad idea. I’m guessing you also want to deport anyone who has registered with a political party, then?
I like my position just fine and I’m not throwing up smoke. I’m a little weirded out by your obsession with Ilhan Omar though. Is this kind of like how people hate-watch every move AOC makes so they can complain about it loudly and conspicuously? Conservatives are weird.
But friend, you just finished telling me how ““Judeo-Christian” isn’t a meaningful source of specific values because doctrine can vary sharply there.”, and now you’re telling me that there ARE values shared? Specific values? Of which “Judeo-Christian” is a meaningful source?
@420BootyWizard
I’ve heard of the Argument from My Opponent Believes Something, but this is even weirder: the Argument from My Opponent Knows Something.
“My opponent knows something, therefore he’s obsessed with the thing he knows about, therefore he’s not evaluating it coolly and impartially, therefore his argument can be dismissed as biased. (So pay no attention to the thing he knows being a counterexample to the general claims I was making or implying before he brought it up.)”
She would apologize whether or not she actually thought it was a mistake. An apology is evidence of nothing.
I’ve heard of the Argument from My Opponent Believes Something, but this is even weirder: the Argument from My Opponent Knows Something.
“My opponent knows something, therefore he’s obsessed with the thing he knows about, therefore he’s not evaluating it coolly and impartially, therefore his argument can be dismissed as biased. (So pay no attention to the thing he knows being a counterexample to the general claims I was making or implying before he brought it up.)”
I can only suggest you re-read the comment thread? Like imagine I just folded and agreed with this guy. “Okay! You’re right, Ilham Omar is the devil and kicks puppies (especially jewish puppies) or whatever. I guess this proves the original point that…um…immigrants cause diseases, I guess?” Like, what? This whole branch of the conversation is a huge non-sequiter. You say it’s a “counterexample to the general claims I was making or implying before he brought it up”. What general claim is this, exactly?
Furthermore, as far as I can tell, this is mostly a case of “my opponent doesn’t know something”. They seem to think that an (uncited) 9% US-wide approve rating for a local representative elected with 78% of the vote means anything at all! They’re under the impression that said 78% share of the vote must be illegitimate because the district in question (supposedly) has the most Somali Americans, nevermind that the district is 16% black at most. This isn’t a display of knowledge, this is a display of motivated reasoning.
What an incredibly bizarre claim. It’s also practically the definition of a bad faith argument, given the context.
‘I am fine with not allowing the immigration of racists either, by the way. For example, we shouldn’t have allowed the immigration of the racist Ilhan Omar, who said that white men are a threat.’
Yeah, clearly they should have used their magic knowledge of the opinions she would hold 20 years later to decide to bar her from the country as a child refugee.
Not to mention that that’s a misleading description of what she said: https://www.snopes.com/fact-check/ilhan-omar-white-men-fear/ Her point was that white men commit more terorrism in the US than Muslims, so terrorism by white men ought to receive more attention, but no one would dream of tackling white male terrorism with the sort of broad-based attacks on the civil liberties of a whole group that, she thinks, are used against Muslim terrorism. Now, that may be a sensible comment or a silly one, but what it transparently *isn’t* is a racist claim that white men are worse than other people. I too am tired of the way ‘white man’ has basically become a sneer word for a certain kind of social justice activist on twitter, but that isn’t what was going on here.
There’s a reason she chose white men as an example other than just “it’s some group other than Muslims who commits more terrorism”. She could have chosen, oh, plumbers, but she just happened to choose the one group that the left calls evil the most. That’s not a coincidence, that’s attacking white men, regardless of whether the statement is literally true (and I’m skeptical, since there are more white men and she didn’t say ‘on a per-capita basis’.)
You seem to be in possession of some of that magic mind-reading power that DM talked about. Have you considered a job at the state department?
Ah yes, the eternal question one asks himself when the victim of terrorism; “Is this statistically more likely in absolute terms or on a per-capita basis?”
Actual human beings have to figure out things out from context and derive implications all the time.
If you use the word “more”, you have committed yourself to an argument about whether or not it’s actually “more” under a reasonable definition. You don’t get to become immune from that question by not asking it.
I completely agree with the Scott’s arguments.
But I really don’t believe free-market economy (the “ideal” version) to be a perfectly fair system where rich deserve all their money because they provided something useful to society. (nor that it is the best imaginable system or stuffs like that)
In fact, I dislike what I interpret as being a “reified” version of “deserving”.
If I think about what people “deserve”, the answer is pretty simple, everybody deserve perfect happiness and to have everything they desire.
And it is why I really dislike this concept, because it is either useless, or in strong contradiction with something in my moral foundation.
So the question (in my point of view) is what distribution of suffering and happiness is better than the other, and how to build a system which is efficient to motivate and organize people in a way to improve this distribution.
Which is messy and complex.
Inside whatever system we think is better, we can build a new concept of “deserving”, like a tool to maximize some sort of utility, but it would be a much more abstract, relative and complex concept.
To be clearer, I dislike it when I feel it is some moral foundation, I have no problem with it as a conceptual tool (if it is a good one).
The steelman is that Bezos is being disproportionally rewarded compared to the rest of the workers who contribute to the success of Amazon.
The larger a company gets the less significant the contributions of a single person are. The larger a company gets the greater the amount of shares in that company should be distributed among its employees.
Capitalism says that who funds a company should reap the rewards, socialism says who works at the company should receive them instead. I don’t see why we can’t split it half way though.
Isn’t it the exact opposite?
It depends on the person. On the lower rungs, it decreases, on the top of the pyramid, it increases.
Capitalism says that who funds a company should reap the rewards, socialism says who works at the company should receive them instead.
Since, if Amazon didn’t exist, the people working there wouldn’t have those jobs, they are receiving them.
I did the math once, not for Amazon, but for McDonald’s, when someone was arguing about “how much money the CEO makes compared to the workers”. If you took 100% of the CEO’s compensation, including stock options and the like, and distributed it among every employee of McDonald’s, they get something like an extra $2 per year.
Is running the company that provides those jobs not worth even $2 per year per employee kept employed?
nitpick – The correct comparison would be between employees and shareholders/owners, not between lowest-paid employees and highest-paid employees
$2 per year per employee sounded low, so I did the math:
McDonald’s CEO Stephen Easterbrook was paid $21.8 milion in total compensation last year (https://www.restaurantbusinessonline.com/leadership/mcdonalds-ceo-steve-easterbrook-was-paid-218-million-last-year)
McDonald’s directly employs 210,000 people worldwide. If you include workers at franchises (not directly paid by MCD), this number jumps to 1.7 million. (https://en.wikipedia.org/wiki/McDonald%27s)
$21.8 million / 210,000 = $104 per corporate employee
$21.8 million / 1,700,000 = $13 per worker of any sort
This was about ten years ago, so A.) Maybe the CEO was getting less money back then, or more likely B.) I forgot the exact number.
The data came up in the context of one of the eternal arguments over “living wage” stuff, and specifically a demand for a $20 minimum wage. I’m almost entirely certain that the person I was having the conversation with was talking about franchise level burger slingers, not corporate employees. So, $2 vs: $13 isn’t much difference.
But thank you for updating my data point for the next time I have to have that argument with someone. 😀
Not entirely correct by my reading. The debate isn’t how well rewarded Bezos is relative to the rest of the workers at Amazon. It is about how much money Bezos gets from Amazon relative to how much society (whose representative is the US government) gets from Amazon in return for providing a lot of the infrastructure that it needs in order to exist. eg Rule of law, roads, postal system, population with money to spend at Amazon, educated workers, mobile workers (eg a welfare state that reduces some of the risk of moving from a depressed dustbowl to another part of the country in order to find work)
Rob S:
The US government is our representative in some very specific and limited things, not in all our interactions or transactions. When I walk into Starbucks and order a coffee, the government is not in any sense my representative in that transaction.
Sorry for the ambiguity.
When you walk into Starbucks and order a coffee, the government represents every other affected party of your transaction. They don’t represent “you” but they represent “society” via the mechanism of laws and taxes on transactions with which they attempt to cause you and Starbucks to pay for your impact on everyone else not directly involved in the transaction. (ie they try to handle the externalities)
The whole article seems to be aimed at a readership other than the commentariat here – not just in the thesis, but the specific examples used to illustrate it, and the specific language (“brown kids in Afghanistan”).
That’s more tautological than you think. If a million people collaborate on providing a service, then whichever one of the people collects a billion dollars at the end is by definition the one who did the providing. Right?
Depends how he did the collecting. If he used a gun or a crowbar, that’s theft. If he did a lot of lying about what people would get in exchange, that’s fraud. But if he collected a billion dollars by exchanging things with people willing to pay for them, then yes I’m comfortable saying he provided a billion dollars worth of value in goods and services.
Not to be overly cynical, but I think there’s a simpler explanation here than any real principle. Certain people have a class interest in empowering the state and shrinking the private square. These people will oppose billionaire philanthropy because it complicates their narrative that concentration of wealth is inherently bad. Zuckerburg buying a huge mansion doesn’t disrupt their narrative. Zuckerburg curing cancer does, especially because that concentration of wealth is a necessary precondition for curing cancer. Likewise, due to their interest in growing government power they will very, very pointedly overlook any possible downsides to increased government power.
It definitely complicates many narratives – I think you’re right about that. It complicates the narrative of how it’s inevitable that unbridled capitalism will be violently overthrown by the exploited masses: If the capitalists buy off appreciable subsets of the masses, it feels like Hey! not fair! This might be how revolution won’t happen. It also complicates the narrative of how one day our government will achieve justice. These agile capitalists who so flashily outdo the government might make people just give up on fixing it. And what good are peace and prosperity if they don’t happen according to the political script we should prefer?
But the most important narrative that gets disrupted is based on the sense that showy charity is just evil people purchasing indulgences to whitewash their previous evil deeds. If Zuckerberg’s schools in Newark were actually good, we’d sort of have to owe him some thanks, and that feels gross to true haters. Instead we just wish really hard for all the people he tries to help to shrivel up and die miserably, so we don’t have to feel Zuck-gratitude. That’s the gateway drug that leads to Zuck admiration, and then his gross indulgences buying plan would have worked. Deep down we know that you can do a lot of good with well-spent money, but we don’t like to think about the fact that awful people are actually doing so much more good than we little people ever could, and they make our little efforts look basically symbolic in comparison.
Yes, I think this is a big part of it. As someone who’s argued in favor of Universal Basic Income, I’ve found that there’s just as much opposition coming from the left as there is from the right, maybe even more. To the socialists and communists, UBI represents a permanent loss, a way to bribe the masses into keeping the capitalist system intact, a way to postpone the revolution indefinitely. It’s the same logic that makes economic far-leftists oppose “woke capitalism” and “pink capitalism” and “rainbow capitalism,” they make the intersectional narrative of racist sexist homophobic transphobic capitalist oppressors fall apart. As corporations and society as a whole become increasingly more accepting of racial minorities and women and LGBT people, those groups will feel increasingly satisfied within capitalist society, making them less likely to rebel against it. And it’s very similar logic that makes anti-capitalists oppose billionaire philanthropy, regardless of how much actual good it does in the world.
That said, I don’t agree with your last sentence: I think it’s uncharitable to claim that people’s views stem from petty jealousy or inferiority complexes, and I try not to make assumptions about what’s going on “deep down” in people’s subconscious minds. But I definitely agree with your broader point, the existence of effective billionaire philanthropists complicates the narrative of economic leftists and threatens to reduce popular support for their ideology.
“But, in general, the protective system of our day is conservative, while the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favor of free trade.” – Karl Marx, On the Question of Free Trade (1848)
If you think that pro-revolutionary communists’ negative opinions about UBI matter more than opposition from the right, I think you’re working from a pretty biased sample. And I say that as somebody who has far more pro-revolutionary communists than Republicans among my friends and family.
Curiously, I’ve never met a UBI supporter who’s a pro-revolutionary Communist. Most of them will profess to being capitalist while showing clear signs of having been influenced by or accepted some fundamental premises of socialism (most notably the Crisis of Capitalism thesis). Are they common?
There are some fiscal conservatives and right-libertarians who support UBI as a replacement for the existing welfare system; I don’t know of any revolutionary socialists/communists who support UBI. There are some self-proclaimed “socialists” who support it, but they’re all socialists in the “we should have Nordic-style social democracy in the US” sense, not in the “we should overthrow capitalism altogether and collectivize the means of production” sense.
The groups that seem most supportive of UBI are social democrats (because they believe it’ll be beneficial to the poor), Silicon Valley technophiles (because they believe it’ll be necessary when automation pushes a sizable chunk of the population out of work), and moderate right-libertarians (because they believe it’ll be less expensive and/or more fair than the existing welfare system). Revolutionary socialists and communists tend to oppose UBI, because they see it as a band-aid solution that will fix just enough of the problems with capitalism to keep the system in place. See GreatColdDistance’s post below, it does a great job of outlining the mentality that causes far-leftists to oppose both philanthropy and UBI.
@LadyJane,
Yes but the further left is powerless outside of Twitter posts and flyers on telephone poles, so?
Deep down we know that you can do a lot of good with well-spent money, but we don’t like to think about the fact that awful people are actually doing so much more good than we little people ever could, and they make our little efforts look basically symbolic in comparison.
A somewhat nastier take is that if Zuck gives away his money, I have no input into his decision. I cannot aspire to being Zuck. However, if the government gives it away, I can aspire to being a member of Five-Year Planning Board or a direct influencer thereof, and thereby acquire power. It is about power, not about doing good.
Why is it harder to become a billionaire than a member of the Five Year Planning Board? If the board has 10 members and there are 500 billionaires, becoming a billionaire seems 50x easier.
This feels intuitively compelling to me. I’m socially awkward and would hate campaigning. I can imagine extremely weird scenarios where I become a billionaire (maybe Unsong is the next Harry Potter?), but basically zero scenarios where I become a senator.
It’s not that it’s harder, it’s that it requires a different set of skills and traits. Becoming a Senator is literally a popularity contest. Becoming a powerful bureaucrat is about playing courtly games of convincing those with power to appoint you. Becoming a billionaire is based on your ability to provide value and capture a portion of that value.
You’ll notice the first two require social skills and the last one doesn’t. If you’re extremely awkward or diagnosed as autistic, that’s a serious bar to being a Senator/Bureaucrat. But if you’ve created something that people are paying for, no one cares. Zuck is not all that socially adept. Do you think a single investor in Facebook cared he wasn’t great at giving speeches?
I can imagine plenty of scenarios where you become a billionaire. Next year you could have a brilliant idea for a psychotherapy app, post on your blog asking for advice, get together a group of five interested engineers/businesspeople/salespeople/etc. The team builds and sells the psychotherapy app. People start to download it, bringing in money, which you use to raise more funds and build a larger team. Eventually, a million people download the app and pay $20 a month. The company has a margin of 50%, so EBITDA is $120 million. The company is valued at 10x EBITDA. Boom, the company is worth 1.2 billion dollars.
Notice how many people you needed at the start? Five. Less, really. After you convince those five people, you only need to be successful in getting money and then everyone else just needs to follow their incentives. The people you hire want money. The people who invest want money. The customers are getting psychotherapy which they value more than the $20 a month. Etc.
In order to become a Senator, the smallest number of people you need to convince is a few hundred thousand (if you’re from Wyoming). That’s significantly more than the entire workforce of Facebook.
If you need to go before a planning board, then you need another skill: the ability to convince planning boards. Which either means winning popularity contests or convincing the already powerful. And that pushes towards the centrist and socially acceptable (or whatever the government is pushing for).
Imagine you’re someone who’s polyamorous in a monogamous society. Are you really sure the Board, who have to answer to a society that looks down on your sexual preferences, will give you a fair hearing? Is it easier to convince them or find five people willing to take a risk with you?
This is why Peter Thiel talks so much about lowering barriers and letting people be weird in their own little corners. Because those people might be on to something.
That seems doubtful to me. Yes, there are people like Zuck who made billions purely by virtue of their ideas, despite not having particularly good social skills. But those people are the exception, not the rule.
Most billionaires make their fortunes in the financial industry, through trades and mergers and deals. All of that requires a great deal of persuasive ability and social awareness, since they have to convince other people to go along with them while making sure they don’t get screwed over. Plenty of wheeling and dealing goes on in finance, there’s just as much schmoozing involved as there is in government. There’s a reason “finance bro” is a stereotype, the industry lends itself to alpha male types who are bold, confident, assertive, and charismatic.
On top of that, CEOs and other high-ranking corporate executives also need to have exceptional administrative and managerial skills, particularly if they’re running a company large enough to pull in billions of dollars. And those who serve as the public face of their company, like Jeff Bezos, also need to have exceptional leadership abilities and an excellent handle on public relations.
None of this is an attack on billionaires. If anything, it’s the opposite. It’s a good thing that the world has people with excellent social skills who can serve as leaders, administrators, negotiators, and deal makers! Building connections between people and coordinating their activities is a form of valuable labor in its own right. It seems like you’re seriously underestimating the importance of social skills and socially-savvy individuals in maintaining society.
That’s simply not true. The biggest maker of billionaires is tech, followed by real estate, followed by manufacturing. Financial services is number 7, between food/beverage and energy. Less than 1 in 20 billionaires come from there.
So the entire premise is false. But the wheeler-dealer type (while definitely a thing) is only one type of finance job. A lot of people have made a lot of money doing quantitative trading. Finance bros are a thing but so are nerdy quants who do deep statistical dives. It’s just that we focus on the Wolf of Wall Street types over the Moneyballs.
I somewhat agree here. But here’s the thing: managerial skill is not the same as social skills. At least, not if social skills means what gets you not bullied in high school. Further, I don’t think Zuck or Bezos are really public faces in the way (say) Kylie Jenner is the face of the brand. Their fame is incidental to their business and when they get called in front of Congress they tend to perform poorly. Zuckerburg was mocked for how he testified.
This is before the fact that founders can (and do) hire people with better managerial skills to act as president.
I didn’t perceive it as such. I agree with you: society needs those hard-charging types. And I’m not saying social savvy isn’t necessary for society or that it isn’t an ingredient in running a company. But the Founder doesn’t necessarily have to be an I-Banker CEO type. CEOs are employees, after all.
I mean, they literally had to get him a booster seat.
In general though, I agree with just about everything you said. I’d just add that I think people generally way over estimate the amount of money CEOs make in terms of straight wages and salaries. The real real rich people aren’t mostly CEOs, they are mostly founders and entrepreneurs. Bezos and Zuckerberg technically are CEOs, but that’s not why they are billionaires. They are billionaires for being founders, not for being very very good managers.
And even among the very high profile and very rich CEOs, most of their compensation comes in the form of deferred stock options, which in a certain sense has them being compensated in a form that’s more consistent with that of an entrepreneur and/or investor rather than as a salaried manager.
I stand corrected. Still, I’d imagine that most billionaires had to have a good deal of social savviness to get where they are. Regardless of industry, a lot of executive-level work involves communication, coordination, and at least some amount of persuasion. And even if you’re not involved in management and you’re just an innovative entrepeneur who came up with some great new idea, you still need to sell that idea to other people if you want to make a fortune off it. Occasionally you’ll get an idea like Facebook that basically sells itself, but again, that seems like an exceptional case.
Fair point. Admittedly, my views of the financial industry might’ve been colored by the fact that my father worked in it, and his job almost entirely consisted of social labor. The vast majority of his work involved meeting people, talking to people on the phone, or writing proposals to show to people; in that regard, it didn’t seem all that different from the kind of bureaucratic “courtly games” that you were describing. (Then again, he also wasn’t a billionaire or even a millionaire, though I don’t think that most quantatative analysts are billionaires either.)
It just seemed like you were making a point along the lines of “billionaires are good because they perform intellectual labor, bureaucrats and politicians are bad because they perform social labor.” So I felt compelled to point out that many billionaires perform social labor too, and furthermore that social labor isn’t inherently bad.
And for what it’s worth, getting elected to public office seems vastly easier than becoming a billionaire, at least to me. I don’t think it’s likely that I’ll ever win an election, but I could theoretically see it happening. I can’t really see any possible chain of events that would lead to me becoming a billionaire, so I’d say that my odds of winning any elected office other than President are higher.
My experience with founders is they tend to have about as much social savviness as is normal for their industry. The tech-y types are geeky and awkward, the fashion founders are glam and love parties, etc. The common traits I’ve seen isn’t social skills but a head for monetizing their work, risk tolerance, and often a strong independent streak. If a person isn’t good at any particular thing (and no founder is good at everything), they just hire someone.
I can see how you got that but what I meant was something closer to ‘people who are bad at social labor can be good at running a business, so we shouldn’t force them to do it’. Specifically, it was reacting to the idea that combinations of small people are inherently bad or that forcing them to put their ideas before a government board would be a good idea. My counter was that small groups of people (who might not be popular) regularly produce huge amounts of value and should be allowed to try and do that without putting them before a board or social skill/political mechanism. And they should be rewarded if they succeed.
I’m only denigrating social labor if a person sees social labor as some sine qua non and gets offended that people without it succeed. It’s a good and vital skill for many things. But not everything, and in some fields it’s possible to get along without it.
I’d say getting elected to public office is easier but not an important national office. There are almost a million elected officials in the US but maybe five hundred of them are nationally important. Being one of those five hundred is extremely difficult. Being a local mayor is not. This is why I compared it not to getting elected but getting elected as a Senator.
As for you being a billionaire, I’ll tell you what one of my mentors told me. “There are three ways to get rich. You can be born rich. You weren’t. You can get lucky, but you’re not a lucky guy Erusian. So that leaves entrepreneurship. Starting something you own that makes money.”
There are 537 elected federal seats in the U.S. (435 Representatives, 100 Senators, the President and Vice President), and 607 billionaires. So all other things being equal, the odds are roughly the same. You’re right that becoming a billionaire is slightly more likely; any given U.S. citizen has a 1 in 539,044 chance of doing so, whereas their chance of getting elected to a federal office is 1 in 609,310.
That said, all other things are never equal on the individual level. For instance, a career in local campaigning and a Master’s Degree in Political Science probably increase the odds of winning a federal office more than they increase the odds of becoming a billionaire. In fact, I’m not sure those things increase the odds of becoming a billionaire at all (though I suppose there’s always the chance that a political scientist could come up with an idea for some groundbreaking new campaign app). So in my case, I’d say being elected to the U.S. Congress is is more likely than making a billion dollars, even though they’re both extremely unlikely in general. 😛
Ha, fair enough (on both the math and your career). Though I will say, I know of one billionaire who got her start working for Obama. Turns out helping pass Obamacare is a decent start to founding a healthcare company.
The difference between being a billionaire and being a high-level bureaucrat is significant. For purposes of this thread, the bureaucrat has the advantage of exercising (or failing to exercise) decision-making power without (much) accountability, and better still, there are lots of bureaucratic positions available that pay a good salary for (often) minimal work. Still better, the expected skills of a bureaucrat are the similar to the skills imparted by being a liberal arts graduate.
The typical billionaire-hater can’t imagine being in Zuck’s shoes, or Musk’s, or even Thiel’s, but they can see themselves as important members or high-level underlings on the Central Planning Board.
They aren’t planning to run for office, they are planning to be appointed to an office by someone who does. They are always in favor of more such offices.
There are some 153 million registered voters in the US. Is it any wonder that any decision by the government is some muddled mess representative of the myriad conflicting values and hence political preferences of 153 million people?
To put it another way, do you want the 153 million other people to have not just input but control over where your money goes? The price for having control over where Zuckerberg spends his money is that the 153 million other people have control over yours. And all people are not created equal… remember that many of those 153 million people are going to support what their opinion leaders (people like, well, Zuckerberg) tell them to.
Any decision by the government is subject to one of two fundamental constraints. Some decisions are made with the constraint that there is no good solution. Other decisions are generally regarded as good by enough of the population that they aren’t problematic by nature given unlimited resources, but run into issues because the government works with a source of pooled funds.
Suppose we have two potential programs, say “vaccinations” and “mosquito nets”. Everyone thinks both programs are good, but some think “vaccinations” are better and others think “mosquito nets” are better. If everyone has a separate pool of money, we can each split our donations however we want. But if we have a shared pool of money we have to agree on, we will either run it democratically (and make the losers angry) or spend time and effort (and hence money and lives) working out how to balance things (and still make the outliers angry). Further, the people implementing the solution will also be voters with their own preferences, and thus likely tasked with implementing a solution they disagree with.
I’m a rich person with a pool of money. I see a problem that can be alleviated with my money that I want to solve. I can give my money to a central authority which may or may not allocate that money to the problem I want solved and will likely waste money in the process of solving it inefficiently. Alternatively, I can direct my money to the problem directly with influence to make sure that the money is spent as wisely as possible.
Wait, why is this nasty? Billionaires have a lot of power to influence society, and I would rather the power be in the hands of a government over which I have some (very attenuated) say. I thought that was the whole argument?
Attribution of unflattering motives to the outgroup.
FWIW, I will gladly forgo my attenuated say in order to minimize the power the hoi polloi can exercise over me via their collectively non-attenuated control of the government. Democracy is an instrumental value, liberty is a terminal value.
In theory, your “share” of the American government is about 1/350million (yes I know, some people can’t vote, even more choose not to, but let’s keep it high level math here).
Based on its current market cap, you could buy 1/350millionth of Facebook for less than $2,000 – at which point you would have approximately as much power to influence its decisions as you have over the government today.
Haha, ouch, yeah, forgot about that one.
But fine, do the math for any other company and it’s probably about the same (or a lot cheaper for older, non-tech companies).
@Matt M,
Sorry for the apparent rug-pulling; I was trying to edit my previous response & clicked the wrong button. For others: I had pointed out that Zuck has a majority voting (but not economic) share, so other shareholders have zero say.
Corporate decision making is somewhat beside the point, though; even if I could buy an effective voting stake in Facebook, that still wouldn’t matter to how Zuck deploys his personal resources.
There are >600 billionaires in the US and 535 federal congresspeople, yet getting a message to a congressperson is much easier. I have received correspondence from the office of several congresspeople, and met 2, compared to 0 billionaires. This isn’t that surprising; if you’re in congress then getting input from constituents is your job! Integrating the views of a lot of people to wield political power is what the system is designed to do!
And even if my individual vote is unlikely to make a difference in a federal election, the votes of people like me very well could. Since the set of billionaires is not representative of the population as a whole, for most people the political system will better represent the views of people like them. Again, that is the whole point of a democratic system. If your priorities are closer to the priorities of billionaires than to the political system, then either you’re idiosyncratic in the same way as billionaires, or the political system is broken.
Embrace the healing power of ‘and’. #repeal17
I think the more charitable answer I’ve found from talking with my socialist friends is concerns about lost potential. Imagine if a pure capitalist society gave 0 utils, a capitalist society with billionaire philanthropy gave 10 utils, and the people will revolt in socialist glory in any society below 5 utils. The Great Socialist Society post-revolution gives 100,000 utils (the proof of this is trivial and left as an exercise for the reader).
In this hypothetical, billionare phil is bad because it keeps things just barely good enough to prevent the kind of radical change which would make things way better.
I’ve heard this argument and I definitely understand utility/productivity traps. But I’ve never been plausibly convinced the glorious, 100,000 utils socialist future is a thing though.
Revolutionary Socialists honestly remind me of millenarian Christians more than anything else. “In Union come, the workers’ will be done, on Earth as it is in my imagination.”
If my sarcasm didn’t make it clear, I don’t believe this argument. I do, however, believe that there are people who believe this argument, and understanding it is key to understanding why they opposed big corps doing things they might superficially agree with.
I’m aware you didn’t. Just giving my thoughts.
@Erusian,
The old left was very much modeled on Christianity, they had their “union hymns” and Britain’s “Independent Labour Party” even had “Socialist Sunday School” around the turn of the last century.
In many ways Dorothy Day’s “Catholic Worker” movement brought it full circle.
This is just Pascal’s wager in a new form. Except it’s an even worse argument because the “large” upside isn’t even that large.
OTOH, the odds of this upside are higher. 🙁
I think I might have to disagree with you about that DonoNerd. I’m not going to make any big effort to calculate the odds in Pascal’s Wager but I’d give the odds of having a enormous benefit from a general move to a strong version of socialism as infinitesimal.
It’s commendable that you’re familiar with this, but it is also kind of insane that you would think that this is a narrative being defended by any of the people writing any of those articles.
Also, it’s be bad if his favorite solution – the government – did not. It’s bad if some filthy capitalist is doing some good stuff, because it proves maybe capitalists are not all evil. But that can be dealt with. It’s much worse if the filthy capitalist doing some good stuff that the government could not do. That’d be really bad.
+ 1
People who feed off the ginormous filthy beast that is the government dont like it when anybody else does what the government is supposed to do, only orders of magnitude better and orders of magnitude cheaper. It exposes them for the fake, incompetent, rent-seekers that they are.
Government’s job should be to provide conditions for society to flourish, not to solve every problem we have or provide moral guidance. It is reasonably suited for the former, and does a reasonable job at it. It is terribly suited for the latter, and does a terrible job at it.
People may have rejected organized religion, but they still crave a pope. In the absence of a real pope, they conflate the leaders of governments with their moral leaders. This is partly why people are freaking out over Trump and his tweets. Billionaire philanthropists expose this charade.
The case in favor of billionaire philanthropy is so obviously correct I’m amazed that Scott had to make it. But he did, and he did a great job. This begs the question why we need people like Scott to write a long essay providing 11 reasons why he thinks water is wet. The reason is that many pillars of our society are hopelessly corrupt, the press foremost among them.
Thank you for writing this comment in a polite, suitable for this comment section way that I could not. This is not sarcasm.
Could you provide a source (or a back of the envelope calculation)? My (admittedly weak) prior would be that billionaire spending on lobbying congress/state legislature would be a far larger share of total spending. This could include lobbying on the behalf of arms manufacturers, fossil fuel extractors, pharma companies, large financial institutions and so on(insert stereotypically evil corporation).
I doubt that this would change the overall utility calculation (simply because of Gates’ work), but some of these things (fossil fuel extraction, forcing developing nations to obey US IP law on pharma patents) could produce negative utility on a similar order of magnitude.
Basically, unless we have a better idea of the breakup of billionaire spending, I don’t know how you have your level of confidence about this.
Sorry, I meant “billionaire philanthropic spending”, which I hoped was clear in context but might not have been. I’ve edited it to be clearer.
In terms of calculation, this article is my source for order-of-magnitude $10 billion total billionaire philanthropy budget. Gates gave $5 billion to his foundation in 2017 and only a few hundred million in 2018; it looks like it varies a lot but on average he gives about $2 billion/year, about 80% of which goes to global health type causes. I can find a few scattered reports of other billionaires giving smaller amounts, so I rounded that up to $2.5 billion, and $2.5 billion / $10 billion is where I got the 25% statistic from.
My guess is that companies spend money lobbying for arms sales, fossil fuels, etc, but billionaires don’t spend their own money on it. It also looks like much less money goes to this – for example, all oil industry lobbying in 2018 was just $100 million, less than Gates alone gave to charity.
That’s fair, thanks for the update.
https://twitter.com/mattyglesias/status/1156165333050417153
Obviously, Scott’s “most $” is a better measure than Matt’s “most billionaires”. Still, it wouldn’t be surprising to me if “most billionaires” added up to 25% of $. So my hypothetical score card is:
25% high-impact goods (deworming, etc.)
50% low-impact goods (Harvard buildings, etc.)
25% medium-impact evils* (Federalist society, etc.)
Probably still adds up to a net good but it doesn’t seem entirely implausible that it wouldn’t.
*(I realize that calling the Federalist society and the like “evil” is controversial. I’m comfortable with that and I don’t think a debate on that point here would be productive.)
If “most billionaires” donate one way and “most dollars” go the other, maybe we got really lucky this time and we shouldn’t expect the system to generally produce these results.
Bill Gates is doing great work, but he apparently is not representative of the standard billionaire. Can we expect that in general the richest billionaires will also be the most benevolent? That seems unlikely…
Also, whether the allocation is a net good compared to yachts, and whether it’s a net good compared to {doctors, old people, bombs, and a bit of infrastructure} are different questions.
How would we come to agreement on what approximate fraction of our federal budget is spent doing good? My sense is that most of our wars are a net loss for both us and mankind, for example. (But probably a lot of our defense spending is basically buying peace by making it clear that starting a major war with us won’t go well for you.). I expect that most of the rest of the federal budget is spent in ways that are moderately positive, but with a lot of overhead and many counterproductive things (farm subsidies).
ISTM that a major argument for private charity/philanthropy (whether by individual billionaires or lots of less-well-off individuals) is that it gives us coverage of a much wider set of issues and problems than government does. This includes causes that are unpopular and so don’t get any support from government because they would lose elections, and causes that are obscure so nobody much cares about them.
Yglesias is doing some slight of hand here. The subject was about billionaire “philanthropy” and he sites a book on billionaire “political activities”. Few people would call the Koch’s Americans For Prosperity a philanthropic origination, for example.
The line between those two is super fuzy. When the Kochs fund a libertarian think tank is that political advocacy or political activity? scientists doing climate research (if they happen to fall on one side of the issue)? And it gets even harder when trying to come up with a change in policy, e.g. tax treatment of 501(c) contributions, that would hit one and not the other.
Id say there is some gray area, but not so much that its imposible to make a distinction. Some of the school choice stuff, sure there is a political element to that, some climate change stuff sure, but Malaria? How much of the Gates Foundation stuff would even be close to political advocacy?
To be sure, i have not read the book Yglesias is highlighting, but the Amazon blurb speaks to things that few would call philanthropy:
” while political contributions offer a window onto billionaires’ influence, especially on economic policy, they do not present a full picture of policy preferences and political actions. That is because on some of the most important issues, including taxation, immigration, and Social Security, billionaires have chosen to engage in “stealth politics.” They try hard to influence public policy, making large contributions to political parties and policy-focused causes, leading policy-advocacy organizations..”
I think Yglesias is just muddying the waters here.
RE “*(I realize that calling the Federalist society and the like “evil” is controversial.”
I for one would disagree and even put in in the other direction (but with only medium confidence on that, I’m not an expert on the institution). But I’d agree that its probably not the right place to debate that issue. And its not really central to your argument. If I was trying to make the same argument, I could just substitute some other group (possibly one you consider good).
More broadly I’d find political contributions (defined extremely broadly here so as to include supporting causes, and think tanks, legal groups and other organizations that have certain strong political, legal, and/or philosophical leanings) as including a lot of zero sum money from some effectively combating money from others spending (although that could be considered a mild positive sum in getting more candidates’ messages out) and negative sum (rent seeking and cronyism) spending. I wouldn’t broadly find political spending as a a certain or unalloyed good by any means (although I’m guessing I’d consider it less of a negative then you do).
Instead of deciding whose team is the best team whose billionaires deserve to rise in status, maybe we could split the philanthropic efforts onto a spectrum from most-universally-considered-good to least-universally-considered-good. Funding a malaria vaccine is almost universally seen as good; funding the Federalist society is seen as good by half the people with an opinion, and bad by the other half. Most things that are almost-universally seen as evil that a billionaire funds won’t be considered philanthropy at all–if you want to donate a big pile of money to helping Myanamar massacre the remaining Rohinga in their midst, it’s going to be hard to get anyone to call that philanthropy.
Even when I think your ideas are bad, though, I think there is often some value in your funding some dissemination and examination of those ideas. For example:
a. Sometimes, minority ideas aren’t being given much of a hearing in the world. Having someone fund a think tank and ideological publication for those ideas probably adds something to the general market of ideas. Even when the ideas are mostly wrong, they may still raise important issues nobody else raises, or trigger useful lines of thought, or even get people on the other side to have to really think through why the billionaire-backed ideas are wrong. That’s all probably useful overall.
b. When you fund actual research based on those ideas, you may actually learn things about the world nobody else is much thinking about.
Billionaires do spend directly on political influence, often with extremely effective results. The Koch brothers’ political budgets ($900M planned in 2016) are the same size as the parties themselves.
When people say that billionaire philanthropy is anti-democratic, I always thought this sort of political influence was at least half of the concern.
Maybe you want to separate political giving from the true philanthropy you’re discussing here, but many other people in the debate aren’t making that distinction. And it might not be obvious where the boundary is. James Olin has fundamentally reshaped our courts to be tough on crime and pro-business, and he did it mostly through donations to law schools.
And yet the Kochs are adamant anti-Trumpers
Yep, the rich political donors can’t always buy the presidential election. But the Kochs have had astounding success at every other level of government (see e.g. ALEC). And the current White House is staffed with aides from the think tanks these types fund, and Olin’s groups dictate Trump’s judicial nominees, etc.
> This could include lobbying on the behalf of arms manufacturers, fossil fuel extractors, pharma companies, large financial institutions and so on(insert stereotypically evil corporation).
This is all done by corporations who may or may not be owned by billionaires. If it’s fair to include that, we should also include all the research that’s done by corporations in our calculation.
This is as beautiful a libertarian manifesto as I’ve read at least this year!
This seems to rely on the assumption that the spending from a wealth tax will be allocated proportionally to how the government spends all the money it has right now. That seems unlikely. The proponents of a wealth tax, who would almost certainly be left-wing, would likely spend the money on some form of entitlement or other left wing cause. This could be a larger EITC, a Medicare expansion, an EITC expansion, childcare subsidies/expansion, R&D in renewable energy sources, subsidies for renewable energy sources and so on (enter typical left wing cause).
Even so, none of these programmes increase utility nearly enough to compensate for less Gates funding and thus would almost certainly be a net negative. However, it seems unfair to assume that the proponents of a wealth tax would use it to incarcerate more people or subsidize coal power plants.
A couple of Open Threads ago, I asked why the Democrats don’t make a deal with the Republicans to pass a carbon tax, then give the money to causes Republicans like.
I got a lot of different responses, but a lot of them focused on this idea that bills along the lines of “institute X X tax to do Y” are fundamentally unstable, and that as soon as priorities change or the other party gets in power, usually X tax stays around but its money gets diverted to something else.
I also don’t get the impression that Reich et al are arguing for a wealth tax per se so much as for charitable donations to stop being tax-deductible. I’ve never heard of this kind of small change in the tax code getting successfully redirected to a specific cause, though I don’t know much about this field and someone else can correct me if this often happens.
There might be another case for something like “the marginal dollar of extra government funding will be better-spent than the average dollar”, but I haven’t heard anyone claim this.
That seems both true and not. For example, I’d think funding for clean energy R&D is a lot more fungible and can easily be appropriated than spending on entitlements (which politicians try really really hard not to cut- see social security, medicare, medicaid and every pension ever).
That sounds plausible. I was thinking in terms of a wealth tax. I too would be surprised if revenue from closing tax loopholes isn’t fungible.
It appears, from your examples of Zuckerberg and Gates, that the incentives being provided to philanthropists aren’t terrible. The mainstream media loves Gates because of the causes he donates to. They deeply disklike Zuckerberg because his donations (think Newark schools, I’m unfamiliar with Bezos’ preschool stuff) are more questionable. That’s not to say that the Newark charter school experiment was terrible (I’m agnostic on it as of now), but that it was percieved as a massive failure and that there are better and worse ways to do this.
Basically, the media is aligning their incentives such that the payoffs to their actions are as follows:
highest payoff: global health
0 payoff: buy yatchs
negative payoff: fix american education system
Not sure its terrible that Zuckerberg isn’t fixing the American education system
I also think there’s fewer people around to defend Zuck’s philanthropy because it doesn’t seem to have worked very well. Newark schools do not seem to be much better off, and one of the criticisms of his donation is that it was “parachuted” in. Given that he wasn’t really personally involved in the efforts and I have no reason to think Zuckerberg knows a lot about education or has a strong incentive to care about Newark schools, if someone accuses him of just trying to buy good press with ineffective donations, I don’t know that I can make a good counterargument. But it’s easy to defend Bill Gates because his health initiatives have been demonstrably effective.
Throwing enormous slabs of money at a school system without a clear idea of what’s wrong with it or why, or worse yet with clear and wrong ideas based on sheer stereotyping, can be very counterproductive.
It is not necessarily a good way to “fix” the American educational system, and should be criticized if done hamhandedly.
I mean, suppose Bill Gates decided to spend a billion dollars fighting disease worldwide, and he spent it on homeopathy, ending vaccines’ contribution to global autism, and crystal medicine quack practitioners. People would be angry, not pleased, even though clearly he’s “just trying to help” in his own mind.
The same can be said of someone who donates a large sum of money to a school system in a counterproductive way, though usually to a lesser degree.
…
I don’t feel qualified right now to comment on where money WOULD go if someone wanted to fix American education in the ‘effective altruism’ style of fixing things.
But it’s definitely going to be a lot harder to be an effective philanthropic altruist in education than in medicine, because there’s a lot more nonsense getting thrown into the mix, and it’s a lot harder to tell which people are experts worth listening to and which people are snake oil salesmen.
Simon Jester:
It seems like the right way to address that would be to define some metrics you plan to use to decide whether your intervention is a success or not, and then see whether it works.
(For bonus points, don’t tell the people you’re giving money to what metrics you’re using, so they don’t game them.) I don’t think this is commonly done in large-scale education reforms in public schools, however, and it seems like there are a lot of dumb educational fads that probably just waste money and time and sometimes do a worse job teaching kids than the previous techniques.
My impression is that really messed-up schools are messed up in ways that nobody actually knows how to fix. Neither the latest educational fad, nor charter schools, nor head start, nor free breakfasts and lunches, nor pouring money into the local schools will likely fix the Baltimore school system, for example. To a large extent, the problem is that the population of the students is coming in with a big pile of problems, mostly outside the power of the school system to fix.
My guess is that billionaires are not a lot better than anyone else at fixing those broken school systems. The best anyone knows how to do is to rescue the smart kids who want to learn and can benefit from a better education from those broken systems, and ship them to some decent school where they’ll be able to learn something.
@Simon_Jester,
This rhymes with the standard behavior of most school districts, so singling Zuck out for special condemnation looks like it’s motivated by other considerations (e.g., the fact that his primary creation plays the same role in society as metastatic cancer does in an individual body). I’m certainly no fan of his, but proxy targets dilute the message.
I could see someone arguing for abolishing taxes on income/capital and instead relying on a VAT as a consumption tax, with all the progressivity in the tax code coming on the spending side. So more like Europe. In that case charitable dollars consumed in the US (or anywhere with that VAT-reliant tax system) would effectively be taxed more.
There might be another case for something like “the marginal dollar of extra government funding will be better-spent than the average dollar”, but I haven’t heard anyone claim this.
I would consider that to be unlikely for most specific new agendas for vast increases and government spending, and massively unlikely as a general rule. If the government is even semi-rational it would have taken out much of the low hanging fruit with all of its current spending. If its not at all rational, then whey do we want to give it a bunch of money in the first place?
More generally your normally get diminishing marginal returns.
Oh? That’s interesting to me because I am also in favour of stopping charitable donations being tax-deductible, but for a completely different reason. My motivation is simply so that governments don’t have a coercive power over charitable organisations by being able to threaten them with revoking their charitable status, and therefore significantly cutting their income.
I mean sure, that’s logical enough.
But I’d guess it’s also true that a left-wing sufficiently empowered to pass a massive new “wealth tax” was probably already sufficiently powered to re-direct existing federal spending away from right-wing causes (wars, farm subsidies, whatever) and to left-wing causes (climate change, animal welfare, whatever). In theory, it should be easier to re-allocate existing tax dollars than it would be to pass a massive new tax.
The fact that we haven’t seen the re-allocation yet would strongly imply that the left doesn’t have the power to pass an entirely new wealth tax to fund their pet causes.
And I think this is part of the reason behind a lot of new tax skepticism, among both tribes. Something like “You people have spent the current money I give you in such ridiculous ways, many of which I find completely morally objectionable, why on Earth should I trust you enough to give you even more? Show me you’re capable of spending in a way I approve of first, and then we’ll talk!”
Also, money is fungible. When states start lotteries to “fund education” the schools tend to not get any more money. Instead tax revenue that was going to schools is diverted to other projects.
Increasing *federal* spending on X is simply a matter of increasing the deficit, and deficits are a commons issue with no true constituency.
In truth, for now at least there’s no need to actually confiscate more tax money to fund extra projects, but i do think political capital is gained for some people by advocating for these taxes.
The reverse is true for the conservatives, tax cuts with no reductions in spending are politically easier.
Shifting money from one nest egg to another means pitting your interest group against another interest group.
I think we need a control here. Would you get a similar ratio of positive-to-neutral-to-negative tweets for any income inequality-related question? If income inequality pisses people off, the power of Toxoplasma would seem to ensure an even more negative response from Twitter.
I think Scott is arguing that billionaire philanthropy is good, not just less bad than other billionaire activities. So, no such control would be needed.
Human nature and all, but there’s a place for arguing against it.
The point I’m trying to make is that Scott seems to be making the assumption that Twitter gives an accurate gauge of public perception of something.
I have suffered through the stupid video provided by Bing when I search for [things jeff bezos has spent ridiculous amounts of money on], and here is the list:
10: The largest mansion in Washington, D.C., $23 million
9: A bunch of space stuff, no price given.
8: A Gulfstream G650ER jet, $65 million
7: “So many investments”. No single number given. Includes the Washington Post at $250 million.
6: Real Estate. No total given, again this list is really poor.
5: Charitable donations. No total.
4: An early $1 million investment in Google. Current value unknown.
3: A 10,000 year clock. $42 million.
2: Incredible security. $1.6 million in personal security.
1: A chunk of Seattle. One purchase of $1.5 billion, another of $200 million, plus a few more. But this was Amazon, not Bezos personally.
Now I’ve watched it so you don’t have to. I’m pretty sure all of these were better investments than $100 million into Newark schools.
I’m not sure, have you seen the newer studies saying the $100 million + reforms actually did some good?
Also, Bing?
Just checked, found one I hadn’t seen which said it might have improved English scores. Most stories claimed it failed, though the one that was mostly the Mayor complaining he didn’t get to control the money was probably a wee bit biased.
Microsoft: It’s evil I can live with.
I think some sources say more than just English scores, though I haven’t looked into it too closely. See eg https://www.nj.com/opinion/2019/06/newarks-schools-have-clearly-improved-researcher-says-but-why.html
Assuming for the moment that the $100 million didn’t do any good at all, is there any credible evidence that it did any actual harm? If not, it’s still a very valuable experiment, one which falsified the hypothesis. It showed that whatever strategy was being promoted isn’t effective. Instead of having risk-adverse government officials sitting around and wondering, we have an answer. It might not be $100M-worth of answer, but it’s not $0-worth of answer, either.
Keep in mind that the media are for the most part dead set against charter schools.
I’d classify that last one as “political lobbying” rather than “investment”, but YMMV I guess…
Fun, God’s approval is something I did as an intern for a polling company 8 years ago. Not how I expected my work to first be featured on SSC, but I’ll take it.
I should have known whoever did that poll would end up here somehow.
Any idea whether it’s been going up or down recently?
I’d guess more people approving and disapproving now (so probably higher total # approving, but also lower approve/(approve+disapprove) ). Young people were just much more likely to answer the question instead of say don’t know. I think that’s likely mostly a cohort effect.
PS. I now work at a firm that does weekly national polling. I know you’ve done a lot psychological survey research. If you’re ever interested in asking some stuff to a national audience, feel free to reach out and we can probably throw it on for you .
Michael, please email me at firstname dot lastname at gmail. I’m about to defend my stats PhD in September, and am an expert on voting methods/political mechanism design — there’s plenty to talk about.
Do you know who picked the short straw of herpes?
Moreover, what kind of person approves of it in a survey?
Scott once again pens a kind, insightful, well-researched, and persuasive article that can be accurately summarized down to “How about y’all shut the fuck up”.
Great points, great post.
I’m baffled by those people who support the “bring down the billionaires at all costs” type of views. To me they are as foreign as people who try to limit life-extension.
Why is climate change funding good when the UN’s own numbers and Nobel prizewinner William Nordhaus’ numbers both say limiting warming will do more harm than doing nothing?
Source for UN analysis: https://www.instituteforenergyresearch.org/climate-change/using-ipcc-defeat-un-climate-agenda/
Source for Nordhaus analysis: https://www.econlib.org/library/Columns/y2018/MurphyNordhaus.html
These texts refer to a carbon tax, and they don’t say that any carbon tax would be bad, just that the carbon tax the UN proposes would be too high. They don’t say anything at all about funding research, technology, etc.
Well, they say that a carbon tax, usually considered the most effective tool in reducing emissions, set at an amount sufficient to prevent warming above 2 degrees C, would cost more than doing nothing and allowing temperature to rise as much as 5 degrees C.
That’s not exactly a straw man. I suppose there could be some intermediate path between 2 degrees C and 5 degrees where the carbon tax could be a net benefit.
Yes, if I recall correctly Nordhaus’ optimal carbon tax allows for something like 3.4 degrees of warming (as opposed to a do-nothing expectation of something like 3.5 or 3.6)
So, I lack the technical expertise to go into this issue properly, but the following jumped out at me when I googled about Nordhaus’ work on this:
https://www.carbontax.org/blog/2008/10/18/a-question-of-balance-finding-the-optimal-carbon-tax-rate/
‘. Nordhaus also assumes a far higher “discount rate” than Stern, which leads to greater emphasis on present costs than distant benefits.’
Obviously, if you assume a high enough preference for costs later over costs now, then you won’t undertake a particularly aggressive policy to prevent costs in the distance future, even if those costs are really quite large. But to anyone who is not an academic economist, the actual “cost/badness of something is not in itself a feature of when it occurs, and so the only thing that actually compares the “cost” of 2 policies is one with a time discount of *zero*, and time-discounting is more accurately described as ‘care less about costs/badness the further in the future they are’ not ‘assume that the cost of the same event is smaller the further in the future it is’. That’s a separate issue from whether time-discounting is a good idea. I don’t see much intuitive case for it, but I understand it’s normal in the economics literature, which suggests there must be *some* case for it. But even if there is, it could still be that Nordhaus is setting the discount rate far too high and that’s driving the shock result.
@DM Re: “That’s a separate issue from whether time-discounting is a good idea. I don’t see much intuitive case for it,”
Money now can be used to have much more money later. Investments on the whole average out to positive net return. So take $X now and invest and on the average you will have $X+Y with Y being positive and over a long enough time often significant.
Also later might not happen. In terms of climate change the pushing off the cost to later (if you don’t increase it too much in doing so, which if of course a bit if, but having any willingness to accept higher costs in the future gives you a discount rate, even if yours is low), could amount to paying the additional costs never, if either climate change is not nearly as bad as you had thought, or if much cheaper ways of dealing with it arise in the future then anything we can do now, or if no way of dealing it with is really going to be effective and your going to get the bad anyway later on but can at least have some benefit now from temporarily avoiding the costs, or if there is going to be some other disaster that pretty much or flat out does destroy civilization or humanity generally before global warming gets too bad (say super volcanoes or a big asteroid or comet hit, or a nuclear war, or a neaby gamma ray burst pointed at us, or an alien attack whatever). You might put the chances of any thing in the whole paragraph (from “climate change isn’t so bad” to “we can fix it cheaply later” to “we all die anyway”) as being very low, but would you say the chances of each one are all infinitesimal?
Also there is the point that the world will likely be richer in the future. So even adjusted for inflation and risk as cost of $2X in the future might be easier to cover than the cost of $1X now.
Some philanthropy is good, some is bad, it should be okay to criticize the bad parts.
It’s not hard to believe that most philanthropy is self-interested and a way to achieve political power and receive social status and dispensation, and the way charity is implemented often supports that view. [Deceptive large headline numbers (donor gets credit for money that a charity will have to pay taxes on, money is only a promise over a decade, etc), donor’s children get to manage the money (and so get bestowed enormous social and political influence), lack of interest in actual outcomes or how money is spent, etc.]
You might argue that it’s worth it to let rich people trade their money for social and political benefits but it’s a discussion that society should be able to have, and I think it’s right to distinguish it from pure benevolence.
(You would also have to critically examine the actual marginal contribution of the donations. Bill Gates didn’t cure malaria by himself.)
I am not sure Twitter is a good measure of public opinion.
Twitter is a cesspool, whereOK, deep breath, ommmmm…Twitter may not be representative of the public, because only tiny part of the public with an ax to grind goes on twitter to complain, but large number of people admiring Bezos for his charitable work probably won’t go on Twitter to praise him,
because Twitter is a cesspoolbecause they do not feel the need to express this as much as outraged people need to vent their outrage and virtue signalers feel the need to virtue signal. So the Twitter sample is probably seriously skewed.It’s totally not a good measure of public opinion. It’s an even crappier method of gauging public opinion of actions taken a decade or more ago.
Even if it’s not a good measure of the “true” public opinion, might it be representative of the fragment of public opinion that the billionaires perceive? I presume Gates and Bezos etc. aren’t running nationwide opinion polls re: their donations, but very well may be checking twitter.
It took me rather short time to realize Twitter is
a cess…not a place where I would seek a honest evaluation of my actions and beliefs, done by friendly people with mine and society’s best interest in mind. I don’t think Gates and Bezos are less astute than me in figuring that out (probably orders of magnitude more) so I would have hard time believing they’d take twitter criticism very seriously. Unless it comes from someone they otherwise value, who by some incomprehensible reason decided to choose Twitter as a venue to communicate their critique.Twitter is not representative of the public, but it’s pretty representative of the journalistic class which publishes the thinkpieces Scott is responding to.
A great reason to not be on Twitter
That is pretty damning judgement on the journalistic class and a reason to pay as little attention to their opinions as possible, moreover – to evangelize such approach as the norm.
What’s the evidence for it being representative of journalists?
Also: consider the set of people who criticize Zuckerberg for his charter school experiment vs the set of people who criticize Obama for funding Solyndra. There’s distressingly little overlap. The Zuckerberg-criticizers will mostly respond indignantly to the Obama-criticizers by pointing out that Solyndra was one of many bets in the greentech space, some of them paid off, and you have to be willing to take big risks to find solutions to big problems. Which is exactly right– and which equally applies in defense of Zuckerberg’s experiment. But funding Solyndra funds people the Red Tribe hates, whereas funding Newark charter schools funds people the Blue Tribe hates, so each tribe has its motivation to declare that the experiment they don’t like was obviously a corrupt and corrupting boondoggle produced by a cabal with bad intentions.
” whereas funding Newark charter schools funds people the Blue Tribe hates”
I stand second to no one in my disdain for charters, but if Newark is your idea of a place Blue Tribe hates, you need to read up.
I think he means the Blue Tribe hates taking kids who “should” be in public schools and arranging for them to be in non-public schools.
Yes, that’s what I meant and I should have clarified: the people the Blue Tribe hates are the sort of people who run charter schools.
But if the Blue Tribe hates charter schools why do so many exist in Blue states and cities? Why did Obama appoint an education secretary who is a big charter school proponent? Why is Zuckerberg’s partner in the Newark charter school experiment running for president in the Democratic primary? Maybe the blue tribe/red tribe model isn’t actually a very good fit to the real world?
Blue Tribe hatred targets change, and can change fast. The legacy of charter school support on the center-left is very last decade. Now Booker has to equivocate about his previous partnership with Zuckerberg and the states and cities that once welcomed new charters are imposing caps.
But “the Blue Tribe hatred target changed” doesn’t at all describe what happened. The strongest opponents of charter schools today (in particular, teachers unions and their allies) were already strongly opposed during the Obama admin. Some proponents may be somewhat less enthusiastic due to some failed experiments (while others remain quite enthusiastic) but I can’t think of any prominent supporter who now “hates” charter schools (Obama has not renounced his support, for example). The basic factional lines haven’t changed.
Blue tribe/red tribe is just a really bad way of thinking about this. It’s not even a case of center-left vs. further-left, really; Booker and Obama are both on the left of the Democratic party by objective measures. The two-party structure of US politics forces together groups that have very different interests and perspectives.
Blue politicians and blue constituencies are very different. In the inner city, active participants in the school system (moms who can’t afford private school) have always been much more pro-charter than than politicians, who are more influenced by teachers, and other interests (who include moms, but mostly moms who can afford private school).
Yeah, all this is nonsense. Ed reform policy wonks are overwhelmingly liberal, and they want lots of charters.
is it fair to say that there might be tension between public school teachers who (justifiably) see charters as basically sucking out all but the most disruptive and hard to instruct students from their own institutions vs blue tribe parents who see charters as a cheaper alternative to private schools. The parents either want schools that have teaching models more in tune with their sensibilities or are trying to filter their own kids from disruptive students but are too proud to admit that’s what they want?
There’s a bit of a difference though. The Red Tribe thinks that Obama took their money, in form of taxes (no matter how much true it is, that’s what they feel), and instead of spending it on something that would benefit them at least partially, spent it on a project that has Blue Tribe written on it in enormous glowing letters, all while preaching about how Red Tribe members are too stupid and retrograde to appreciate the wisdom of that. And then it failed. “So who’s stupid now?!” the Red Tribers would yell triumphantly.
The Blue Tribe thinks that that Zuckerberg took his own money, thus denying them the opportunity to take it from them (somehow they always imagine they’d succeed in that), and put them to a project that looks like one of the Blue Tribe causes (education of poor kids) but almost isn’t (filthy capitalist charters!) in a very Blue Tribe place (Newark). The corrupt system (created in many years of Blue Tribe rule) swallowed the money with very limited positive change happening. Blue Tribe declared “you were doing it wrong, you should have asked local tribal elders and shamans on how to do it”. Red Tribe probably newer knew about this whole thing.
These situations don’t seem very symmetrical except for the common pattern of trying to do something and not achieving the desired result.
My memory of the hatred for Solyndra was (I don’t know how true any of this is) that the leadership of that particular company were connected in some way to the O-campaign and so the business support was an obvious quid pro quo that ended up not producing anything successful.
With Zuckerberg I can imagine people that don’t like charter schools would be down his throat, but again on the other end of the spectrum i recall narratives floating around that the money was almost completely soaked up by non-teaching staff costs; which is what an education skeptic would have predicted.
that the leadership of that particular company were connected in some way to the O-campaign
That was adding the insult to the injury – the government-financed solar is as Blue Tribe as it gets anyway, but if on top of that there’s a clear pay-for-play connection to O. campaign… That couldn’t but infuriate the other tribe. Absent that, Reds would probably still against that, but this of course was a blatant in-your-face case.
the money was almost completely soaked up by non-teaching staff costs
Vox says that about 50M went to union contracts, 58M on charter schools (not sure how much of that is “teaching stuff”), 21M on consultants, and the rest on various smaller projects. So I think at least 25% of it can be said to have been spent on teaching stuff, moreover – on very Blue Tribe unionized teaching stuff. Likely more since charter schools must have some teaching done too…
Funding Solyndra is not the government’s role. Like you said, it’s one of “many bets in the greentech space”, and making bets in the greentech space is not what government should do, nor is it what it is structurally equipped to do.
Solyndra is a private enterprise and if the bet was to pay off, Solyndra owners and investors could become very wealthy. Ideally, investors should use their savvy to determine whether Solyndra is a good investment and act accordingly. Instead, (I’m guessing here, if I’m wrong please correct me) we got Democratic donors receive special treatment from the government, which is corruption, not a proper investment.
When Zuckerberg gave money to Newark schools, he did not expect a return on investment (except maybe good PR, which apparently he got little of). But we as a society all benefited, if only in that Zuckerberg demonstrated that this approach did not work (maybe the jury is still out on that I dont know).
I suspect the majority of Americans would disagree with you.
I suspect you are wrong.
Wow, it looks as though if we argue based on our “suspicions” we get nowhere fast.
But please tell me more about how Americans believe the government’s job is to invest in companies with ties to the political party in power.
Re: “Also: consider the set of people who criticize Zuckerberg for his charter school experiment vs the set of people who criticize Obama for funding Solyndra. There’s distressingly little overlap.”
Part of it is government vs private spending. If the spending doesn’t go right and its my tax dollars that are wasted I’m likely to be more critical then if its some billionaire spending his own money. I wound’t have made Zuckerberg’s contribution even if I was as rich as he is, but I don’t think he caused any significant net negative beyond wasting the money, and its his money to waste.
Edit – And I’m not totally sure it was even wasted. There may have been some modest benefit from it.
This is an extremely goofy post, made even more so by your apparent belief that a Twitter search is a relevant indicator of popularity.
Mark Zuckerberg announced his gift on Oprah to wild applause. That was fifteen years after Bill Gates announced his philanthropy initiative. I guess you were barely in grade school, but in the years leading up to that announcement, Bill Gates was under *tremendous* pressure to start giving his money away. People think he finally decided to because his mother got cancer. The point is, at the time he started his giving, he was late to the game and all the other billionaires were giving money. Warren Buffet, Sam Walton, and so on.
In short, this disdain for billionaire philanthropy is very recent and very focused on a few problematic cases. No one’s bitching about Paul Allen and SETI. In years past, philanthropy wasn’t so directed by obnoxious technocrats who were convinced they knew what was what.
And apparently left unspoken is the cause that they all poured their money into: education. Bill Gates isn’t unpopular because of malaria. He’s unpopular because he spent billions trying to kill public schools as they exist, convinced he knew better than anyone else. Zuckerberg was unhappy because no teachers were fired, but in fact the bulk of his money was spent on consultants. Their funds distorted the ideas that got tried in education for years. Now everyone hates billionaire tech philanthropists who, by the way, are still dumping money into education, convinced they know better.
Reich is using this temporary discontent that will effectively shut down this philanthropic interference in public ed (whoohoo!) to make a much broader argument. I happen to agree with it in many ways. But you can’t engage with the argument based solely on the three or four tech philanthropists who justifiably got their ears pinned back for doing a lot of damage in education.
Well, by all means, EducationRealist, please explain how their ideas about education were wrong and what should be done instead.
That’s not the point. So read it a couple more times.
There’s no need to be rude, I understood your point fine. But since you’re arguing that billionaire-funded education programs have made the education system even worse, I was hoping you’d elaborate on what was specifically wrong with those programs, and perhaps describe what some better alternatives would look like.
They all thought education was bad because standards were low, teachers were stupid, and kids felt disconnected.
Yes, and the truth was?
I mean, I have my opinion: Its fine, its just expensive. We get the results we would expect, just at greatly inflated costs. But if you have another perspective, that is an important central part to your critique.
Also, re:Zuck, I’m fairly sure he got applause on Oprah because the plan was vague. Once people looked at what he and Booker wanted to do, he got a ton of high level, and local, heat and their actual plan was never implemented.
With teachers, schools play a zero-sum game against each other. Let me put it this way: almost everyone who studies to become a teacher will find a job. That means, schools are competing for a fixed pool of teachers. One school getting better teachers means that some other school gets the worse teachers.
A school can get better by hiring better teachers. The educational system, as a whole, cannot. Unless we make it much easier to enter / leave the teaching profession. But the general trend seems to go in the opposite direction.
Okay, and what’s your counter-argument?
You’re acting as though everyone is already familiar with your stance, as if the problems with the Zuckerberg view were glaringly obvious. The result is that your whole argument feels incomplete, because there are some critical parts missing. If you’re going to assert that the Zuckerberg view is wrong, you need to explain why it’s wrong. And if you’re going to assert that some other approach would work better, you need to explain what that approach is.
I actually think this might be the easiest way to improve the educational system as a whole.
“Yes, and the truth was?”
That we do quite well, which you seem to agree. But it’s expensive because we can’t do it cheaper without taking away a lot of laws that a lot of the public likes. They’re wrong, but whatever.
“You’re acting as though everyone is already familiar with your stance, as if the problems with the Zuckerberg view were glaringly obvious. ”
If it’s not, then read up. I have a blog, you can start there. Or you can google. But if you don’t have an informed opinion about billionaires interfering in public education, then by all means read on, but don’t expect people to catch you up.
“I actually think this might be the easiest way to improve the educational system as a whole.”
Well, you’re wrong. First, the education system isn’t broken, but the expectations are ludicrous. Lowering expectations for low IQ students would be a great place to start, and you don’t need higher quality teachers if you start teaching kids achievable outcomes.
@educationrealist
My expectations aren’t at all unrealistic, it’s the disgusting dehumanizing and cruel schools that are.
You could be teaching real marketable useful skills like welding and carpentry instead of warehousing kids and feeding them a “college for everyone” lie, while knowing that most will attempt “some college” but most won’t get a college diploma.
The system is foul.
Give the kids a library and unshuttered shop classes with breathing instructors.
This “system” cruelly wastes years of peoples lives for no good reason that I see, and I remember it all too well.
I did learn trigonometry eventually from a union brother not from the damn college graduates that were in charge of a warehouse called a school where you teach those you deign “worthy” of being on the “Advanced” track and warehouse the rest despite us still having eyes, hands, and yes damit minds! I haven’t forgotten and I haven’t forgiven, and to Hell with your IQ caste system!
Maybe your school district is different, but having been told by my son what it’s still like at the district we moved to I doubt it, and my wife and I weren’t going to have him suffer as well and we did the hoops to have him “homeschooled” which means he takes community college classes instead of going to a damn warehouse for far too many hours!
High school should not exist as it is it’s a cruelty that wastes precious years!
There is more than one problem with education.
Schools are insanely inefficient. Laws like “No Child Left Behind” make the situation even worse by demanding the impossible. These two facts are not in contradiction.
Schools are sometimes badly run, but my guess is that given the constraints we impose on them for political/social/avoiding outrage reasons, public schools in most places do about as well as they can.
To that plumber dude: lord, you’re a parody.
LOL, okay? I never said the education system was broken, but let’s be honest, education majors are not the cream of the crop. If teachers were paid significantly more (I am agnostic on whether that would be cost-effective), like $20k/yr more, we would get much better qualified educ majors (actually it’s dubious that education as a major provides any value, but either way you would get better people going into the field). And evidence seems to indicate that teacher quality matters for educational outcome.
I don’t see any argument from you why the above is not true. It would also be very simple. “Lowering expectations for low IQ students” would not be simple.
I’m not really sure what you’re arguing here. If the anti-billionaire philanthropy crowd gets its way, all billionaire charity will be taxed, not just education-related charity.
If billionaires are bad at education (but not at other things), that seems relevant to know so that we don’t accidentally sabotage all charity in an attempt to deal with a deficit in one field.
I haven’t looked into this much, but the most recent thing I read was that Newark seems to be doing a lot better now in a way that can’t provably be traced back to Zuckerberg’s help, but which makes it much harder to argue he did harm.
I’m observing that your entire argument is largely ignorant of philanthropic history, and I mean maybe 20-30 years. The current strong feeling against billionaire philanthropy is a)very recent and b) based entirely on attempts to re-engineer education. So not mentioning that kind of misses the ball game. And your attempt to see if they were praised or scorned was honestly so bad as to be deceptive. Again, Zuck was lionized in media (by everyone except teachers) for his spending.
Billionaire philanthropy almost singlehandedly created the charter movement, long before Gates, even. Republicans, mostly, who were hoping to kill public ed, as opposed to tech billionaires, who were just trying to reinvent it with better people.
The notable failures have allowed those who hated *all* interference in public schools to lump all these billionaires together and sell it to the public. It’s been quite clever. But it shouldn’t be confused or conflated with philanthropy generally.
Your actual argument against Reich, shorn of the recent stuff, is that marginal dollars are better with billionaires than with the government. I disagree in this sense. Billionaires are welcome to spend their money on pet notions. But they shouldn’t be able to reduce their taxes a penny for it.
As for Newark, the people literally rose up and demanded that the reforms stop. They threatened the woman charged with implementing the plan. She was fired. The man who most directly opposed the reforms was made mayor. Zuckerberg himself considers it a failure; he started listening to his wife and spends his money much less boldly now, and in a variety of small ways. If you want “but test scores” against that as some sort of indicator of popularity, I don’t know what to tell you. (and that’s assuming the gains are real, which is often not the case after the fact.)
The public is getting ever more clear on the notion that test scores ain’t all that.
I don’t think this is an honest framing.
The hope of people who set up schools outside the standard public-ed model is that their systems will work better than, and thus ultimately outcompete, said model. Now, sure, if that succeeds, it “kills public ed”, but only in the sense of replacing it with something better, which should not be obnoxious to anyone.
If, as you seem to believe, charter schools are worse than “public ed”, then they will not outcompete the latter, and won’t “kill” it.
Thus, the only logically consistent reasons I can see for opposing charter schools are:
1) If one is a rent-seeker attached to the existing system, one selfishly wants to keep one’s racket going.
2) If the Right is correct in its suspicion that the public education system is at least in part a system for left-wing indoctrination of children, then the Left will want to keep it even if it’s objectively worse at its declared purpose (education).
3) If one believes that any attempt, ever, to innovate in the field of education is ‘gambling with children’s futures’ or some such. (I don’t think I’ve ever come across anyone who holds this belief consistently, rather than just using it as an argument against that subset of innovations they already dislike, but I suppose it’s possible.)
Oh, it’s absolutely true that the major philanthropy behind the charter movement wanted to kill public ed and the teacher unions. Not the consultants and policy folks, many of whom were liberals. But the funders. This is back in the 90s. The belief was that charters would be so much and so obviously superior to public schools that everyone would demand it. That didn’t work out, for the most part–there are places where the rich opt out of public to get into exclusive charters, but it’s pretty fringe. Instead, they became focused entirely on black and Hispanics in urban areas, which gave them moral bragging rights but did nothing to convince the suburbs that charters were better. In fact, despite best efforts, suburban areas rejected and protested charters again and again.
@educationrealist
Citation needed.
Yes, isn’t that exactly what I just said? Framing this as “kill public ed” is just as dishonest as it was the first time you said it.
See my remarks above about rent-seeking.
Yeah, people who think it’s teachers that stop public schools from changing are too foolish to waste time with.
I’m stating this categorically. Understand I voted for Trump and I’m not a big fan of unions. In the early 90s, after Terry Moe’s book came out, many people really thought it would be possible to kill public schools in their current iteration. They thought that teachers were the reasons schools were “terrible”, and that everyone who sent their kids to schools would agree, and that it would be a simple matter to create competition and kill public schools. That’s just simply a fact.
They were wrong.
There’s a fourth option: charter schools are themselves rent seekers.
@educationrealist
(a) that’s not what I said, and (b) stating something, be it categorically or otherwise, is not evidence of its truth, let alone a knock-down argument.
Citation needed. Again.
@eyeballfrog
Certainly that’s possible, yes. It requires there to be some sort of board or body that has to sign off on a charter school to allow it to be founded, in which case that board can (if corrupt enough) restrict the supply of approvals, á la occupational licensure, to provide an economic profit to those of their friends who do get approvals. (You can’t rent-seek in a competitive free market.)
But then, I’d say that if your approval criteria are other than objective and outcomes-focused (not necessarily test scores!), then you’re not really doing “charter schools”, you’re doing “state schools with a façade of privatisation”; the whole point of charter schools is to take power away from the school boards and give it to the parents.
educationrealist:
Just to be clear, I think the people behind charter schools and vouchers did include a lot of people who wanted to get rid of public schools, while still providing universal education.
That is, they thought the public school system was wrongheaded, and that something better that incorporated parental choice and competition and more freedom to experiment would do a better job educating kids. That may be right or wrong, but it’s not some kind of evil plot or anything. If we replaced public schools with charters and voucher-paid private/religious schools, and kids ended up with better educations at lower cost as a result, wouldn’t we call that a win?
Now, my not-that-informed impression is that there hasn’t been a huge amount of progress or successful new ideas in education coming out of voucher/charter schools.
My guess is that this is because there are several things you can do as a charter/voucher school that lead to better outcomes[1]:
a. Finding ways to select your students to exclude the troublemakers and the dumb kids.
b. Allowing the charter/private/religious schools to opt out of some of the dumb rules imposed on public schools by political pressure (not tracking by ability, not kicking out disruptive kids) probably does lead to those kids getting a better education.
c. Opting out of various social experiments done on your kids via political pressure on the school system (busing, various kinds of indoctrination) is probably a win in terms of parental and child happiness.
d. Doing an end-run around some really corrupt city school systems that mainly exist as a way to extract taxpayer money and provide patronage jobs is probably a win overall.
e. Innovating in how you teach kids might eventually give you a big win, but the effect is so much smaller than the other things that it’s hard for it to get much traction.
My guess is that charters and private/religious schools mostly get their benefits from (a)-(d). In order to get to where (e) could start creating a benefit to a school (so competition could work well), you’d probably have to get past the point where anyone could benefit from stuff like selecting students to be smart and obedient, or selecting parents who are involved and concerned with their kids’ education.
[1] In terms of test scores, getting into good colleges, and having parents want to send their kids there.
albatross, that’s a pretty good summary.
I also agree with albatross11’s summary.
It doesn’t seem like (a) could be responsible for that much of it, because that is well understood and usually policymakers try very hard to avoid that, and also the most consistent finding in charter school research is that existing public schools improve after charter schools are opened.
I think I recall reading a study that what was successful was shutting down poorly performing schools and allowing their students to go to newly opened schools. It’s very difficult to improve a poorly performing school, much easier to open a whole new school with all new personnel and shut down the old one.
Scott’s arguments for the most part apply just as well to non-billionaires. Wouldn’t you allocate the money you currently send to the government in more beneficial ways than the government does? Almost certainly, if you have a lick of sense. So why don’t you?
Many American war tax resisters refuse to pay their taxes to the federal government as a matter of civil disobedience / conscientious objection, and then redirect that money to more beneficial causes.
I’ve been refusing to pay federal taxes since the Iraq invasion in 2003. I recommend it.
I’ve been refusing to pay federal taxes since the Iraq invasion in 2003. I recommend it.
What exactly do you mean by “refusing to pay federal taxes”? Are you just not submitting the tax forms, submitting false ones or use tax optimization strategy (like mass charity donation) to avoid taxes?
Resisters use a variety of strategies. In my case I use two: I try to keep my income below the threshold at which I would owe income tax, and, in the case of the self-employment tax that doesn’t have such a threshold (or one that anyone could live on anyway), I just don’t send the government the money they say I owe them. I file accurate returns. You can find more about my technique here and here.
Really? You file a return that says you owe money, don’t pay it, and nothing happens? You don’t get tax liens?
The IRS sends me lots of letters. And they have filed a lien against me. But that hasn’t bothered me much. If I needed to have a clear credit report for some reason I might feel differently, but as it is I don’t have any ambitions that require borrowing a lot of money. The only practical effect of the lien on my life so far is that I get a ton of junkmail from shady outfits promising me they can settle my tax debt for pennies on the dollar (the lien was publicly filed, so this clued in the junkmailers).
But aren’t there big penalties and interest that just continue to snowball indefinitely? Don’t you think there’s a good chance that some day this could screw you badly? I don’t think you can even renounce citizenship with outstanding tax liens.
This is definitely illegal and you could go to prison for doing this. Maybe that’s obvious, but I don’t want anyone here to confuse a person getting away with tax evasion for a while with tax evasion being a safe or legal course of action.
Edit: to be clear, the first thing this person mentioned, making very little money, is legal. Not paying the taxes you owe is not.
It’s extremely rare to be jailed or imprisoned just for refusing to pay your federal taxes in the U.S.
Since the modern U.S. war tax resistance movement started in 1948, tens of thousands of Americans have refused to pay taxes from motives of conscientious objection to war, and only two have done any time behind bars for it (however several other war tax resisters have been imprisoned on related charges like contempt of court, failure to file returns, or deliberately filing returns with false information — but you have to do more than just refuse to pay to be guilty of charges like those).
Do you have a citation for the claim that tens of thousands of Americans have refused to pay taxes and not been imprisoned? And how many of those only escaped imprisonment by paying crushing fines?
If I felt this strongly about war, I would pay taxes and donate to anti-war charities/candidates.
I imagine if one keeps his head down and doesn’t tie up the court system with lots of filings and such, which I think really pisses off judges, then I think it will take a while to go to jail. As a tax accountant who reads lots of tax reviews, I constantly see cases of tax protesters being convicted for filing bogus returns or none at all. Admittedly these tax reviews don’t talk about whether these protesters go to jail. OF course the IRS has ways of taking your money even if you don’t go to jail. For example, it is easy enough for them to take it out of your bank account or garnish your wages. I suppose you could stop doing using banks and avoid formal employment. It sounds to me like a lot more work than it is worth. You need to REALLY believe in the immorality of taxes to live your whole life around avoiding them.
I can understand doing this for ethical reasons – but if your goal is freedom to allocate your money better, any plan that involves making much less money, or only being able to put your money into specific non-taxable assets, doesn’t seem very helpful.
Does anybody know of legal ways to not give money to the government while not making much less money and not cutting my own quality of living?
(It’s funny that just about any way I can go about cutting my earned income would result in me having to do substantially less pleasant work. Nobody seems to want to hire a software engineer at 1/4 time).
I think the trick is to funnel it through the Cayman Islands or somewhere.
If you look at the big picture, its more about freedom to allocate my time/energy better, with my money being just one part of that.
You can convert your time/energy into money through gainful employment, which can be an efficient use of your time/energy. But in judging that efficiency you have to take into account that the government wants to siphon off a double-digit percentage of your earnings after a certain point, which reduces the efficiency of that approach.
Now I work fewer hours for money than I used to before I began resisting. This enables me to take home 100% of the income for those hours I do work (as I stay under the income-tax line). The remaining hours I can spend on unpaid volunteer activity or other unpaid creative work, in which again 100% of my time/energy is devoted to my own values rather than some percentage of it being redirected to the values of politicians.
And “only being able to put your money into specific non-taxable assets” is just another way of saying “saving for retirement or for health emergencies” as the specific non-taxable assets (in my case anyway) are tax-deferred retirement accounts and a health savings account. That’s just sensible squirreling money away for a rainy day stuff. And even that money can be put to use on the side of my values in the mean time, by being invested well.
@Moorlock,
The “values of politicians” are those directed by your fellow citizens that voted for them, but if you’re response to taxation is to do less paid work thus giving others an opportunity to get that paid work instead, I thank you and encourage you to keep doing so.
Interesting. FWIW, I strongly approve of your position, and will have to spend some time contemplating my own existence to see if I can emulate it. Not specifically as a “War Tax” resistance thing, but just because taxation is theft.
I’m a touch concerned for you, though, (although you seem to be the sort to think things through and do research before acting, so maybe my concern is misplaced) in that it seems like the “non-taxable assets” you speak of are things that the IRS could still impose a lien on, should they be so motivated. Yes, it might actually be illegal for them to do so, but at this point, it’s not like you could afford a lawyer to take them to court over it… :-/
Still, you’ve definitely given me some solid food for thought. Thanks!
You definitely want to go into something like this with your eyes open. There are better and worse ways of going about it but there’s also no one-best-way that works for everyone. Your particular circumstances, and the values you want to support, will shape which techniques are best for you.
I recommend that you look into the literature from the war tax resistance movement (like this on possible consequences, or this on living below the tax line), even if war isn’t your motivation for resisting. They have a lot of institutional memory about how best to conduct a variety of resistance techniques, about government reprisals and how to avoid them or respond to them, etc.
So this makes me wonder: Is there any connection between the huge drop in the top tax rates and the rise of middle-class-and-up women working outside the house? Staying home with the kids is an obvious instance of someone choosing to use their time in ways that don’t create taxable income but make them happy.
It seems to me this anti-Billionaire charity has a few axes to it in mainstream criticism. None of which I find very appealing (kinda like Scott appears to).
1. It seems to be just a subset of anti-Billionaire-ism.
2. A small amount of billionaires use their fund in “wrongthink” ways.
3. Even those who do use their funds, “the right way” should be using it the “righter way” which is generally giving it to government. Which is part of the same Acela “power” structure as the media writing the critique.
Like I said, I think all those axes of anti-Charity are pretty wrong. I think the biggest problem with billionaire charities is there aren’t enough of them that serve “wrongthink” interests. They are usually a bunch of cutsie ideas like mosquito nets where the fund can dubiously claim to have “saved XXX lives.” These funds are almost universally destructive to the fabric of whatever community they are attempting to help. Its all giving fishes, no teaching to fish. Indeed, what they really seem to do is just take credit for the spillover effects of international trade while also empowering warlords who are very adept at controlling roads that charitable people have to use.
I’ve never heard anyone mention 2 in this context, and I disagree with bringing up 3 for the reasons I talked about in Caution On Bias Arguments.
Try searching for “Koch philanthropy”, or just search this post’s comments for “Koch”; I think it’s been mentioned at least once. It’s not just that the Koch’s are bad because they use some of their money in “wrongthink” ways, but all their philanthropy is bad because some of it is used in “wrongthink” ways, and otherwise good causes that receive money from the Kochs are tainted because the Kochs also donate to “wrongthink” causes.
I think a more realistic critique is that there is no way legally to differentiate the wrongthink causes and the philanthropy. Say I’m using to same foundation to fund mosquito nets in Africa, research into biological immortality using bespoke gene therapy, and the Bring-Back-Prima-Nocta Chair in Rich Dude studies. The first is clearly philanthropy, the last is clearly (to most people) advocacy, in the middle is something that’s somewhat self-serving but not really political. Currently they all have the same tax status, so the only way to incentivize the earlier over the later is through social pressure. In this regime every new cause must be examined for its motives, and even worthy causes might experience spillover disapproval if we can expect that it will cause the funder to put less money into the disfavored causes, similar to some of the Kim Jong Un/KFC arguments.
Before Zuckerberg’s Newark experiment failed and basically ended up as a black hole, there were a lot of people accusing him of wrongthink. Booker was very into school choice at the time, and although that didn’t happen because people backed down, that has always been a very unpopular idea among certain people.
Regarding 3. I thought I was summarizing the article in the 1st sentence, and in the 2nd sentence giving my most likely explanation. If you disagree with the 1st sentence as a summary, please explain. If you disagree with the 2nd, I’d like a better reason that also appeals to selfishness as a motivating factor, or an extremely persuasive special pleading why we shouldn’t assume that in this very tiny case.
Educationrealist’s comment above is all about #2.
> Its all giving fishes, no teaching to fish.
I think giving fishes to starving people is a pretty good thing. We can think about teaching them to fish later, it’s probably easier to learn how to fish when you aren’t starving.
I think the fear around Gates isn’t that an *individual life* is saved so much as gate’s reduction of mortality wasn’t paired with a corresponding equivalent reduction in fertility. And the result is very rapid population growth.
Because dealing with disease isn’t something a single individual manages, you need a certain medical/sanitary infrastructure that’s under normal circumstances the product of a whole society. You can imagine that under normal circumstances things like housing, agriculture, infrastructure, and medicine would tend to be capable of handling the same population size. If your medicine can keep large numbers of people from dying, can the rest of your economy manage a standard of living for them as well?
So goes the argument anyway.However I imagine the idea that the consequences of gate’s actions were ultimately bad or harmful is less mainstream then thinking he did a good thing.
I’m pretty sure the Gates Foundation has been very much into building infrastructure, e.g. this. I don’t know how successful they’ve been at it, but they’re certainly aware of the issue.
I might darkly suspect that doing all this help just gets you more populous poor countries which will require more charity/foreign aid in the future, but I can’t see Vox entertaining that argument.
Not sure about Gates, but GiveWell have checked, and a lot of the reduction in mortality they cause is offset by a reduction in fertility.
One of the best predictors of fertility is child mortality, the hand wavey explanation being that parents will keep having kids until they can be reasonably sure that one will survive, and that this requires more kids when the chance that any one kid will die is higher. Obviously it depends no where a country is in the demographic transition, but given that Africa is already growing very fast I would predict that a decrease in mortality would lead to lower long term population growth.
I feel like you missed the point of the saying/parable. Its that charity that feels right is often a zero, or even a negative. In this case, you are generating consistent need for more free fish, and often ever more free fish because your first fish created more people that can’t fend for themselves (this is sometimes referred to the NGO “business model”).
Africa is an importer of food already, and has a rapidly increasing population. And, unlike the free fish where we at least know its edible, its impossible to disentangle Gates et al’s contributions to increases in QOL because so much is happening as a result of spillover effects.
Give a man a fish, and he’ll know where to get a fish.
While I understand your point, I can’t think of what the “teach a man to fish” is for mosquito nets. The only solution to mosquitos carrying malaria is some sort of bug repellent or driving the mosquitos extinct. While that second one has a certain appeal to it, it’s not easy to do.
It would be teaching them how to create mosquito nets in the abstract sense. But more real world sense it is getting them developing the human capital to do all this. And one of my points would be, Gates et al don’t really do that, instead they are acting in an area that is getting a lot of development because of international trade, and then kind of try to claim that they built that.
Yeah, to the extent that we can apply this analogy, it’s less “teach them to build mosquito nets” and more “teach them to construct a wealthy, capitalist, society.”
There might have been western people who once went to Africa with the intent to do something like that, but it’s not generally looked upon very favorably today…
It does seem like not having tons of people with malaria would be a helpful stepping stone to that, though.
Possibly. Its also possible that having small groups of people who develop anti-malaria on their own prosper the most and emerge as a dominant political force is an important selection mechanism culturally, genetically, etc in order for the emergent society to be good at self governance.
Provide them jobs so that they can buy malaria nets/repellent themselves? Bonus points if the job is to manufacture malaria nets/repellent that they get an employee discount on?
“Provide Jobs” is probably also incorrect, unless that is a euphemism for, “buy things or labor from them that you actually think is valuable”.
Yeah, it’s the Puerto Rico dilemma.
We spent centuries climbing out of the shit and disease in our societies, partly by learning better, partly by having more resources to spend on proper sewers, public health, police to arrest people for littering, etc. That created a virtuous cycle, wherein as our societies got wealthier, we could do things that made our people healthier (and especially stopped stunting the development of our kids), which made it easier to generate more wealth later on.
Charities providing malaria nets and vaccinations and clean water supplies and such are an attempt to jump-start that process in very poor countries, that might otherwise need a couple centuries to climb that ladder from poverty/filth/ill-health into something better. The hope is that as this process takes hold, many or most of these societies will get on that same health-education-IQ-wealth treadmill and climb out of poverty, the way a bunch of Asian countries have done in living memory.
One prededent for this is the eradication of hookworm in the American South. I believe that was largely done by the Rockefeller Foundation, another charity based on a meddling billionaire. This had a huge impact on the health and well-being of people in the South, and probably drove improvements in IQ and education and general health and wealth creation there.
I come more across criticism of billionaires claiming to be charitable and then not following through: a theguardian link or the famous Trump “charities”.
Yeah, you can play that game all day. But that’s not really the point of the article. Rich people are going to strike poses (see the Clinton Foundation.) But a lot of them are going to spend actual money on things they care about.
Since you were making arguments targeted at liberals, it occurred to me many of your points could serve to support a populist/social conservative case against billionaire philanthropy. I suppose Education Realist would be the closest thing to that perspective in this thread.
Your analogy using the KKK reminded me of years ago when Stefan Molyneux used them as a metaphor for the government or the families of his listeners who don’t accept philosophical anarchism and are thus implicitly hostile toward them.
Billionaires are nothing but thieves whose thievery is deemed “legal” in representative regimes. There is no way in hell some human can produce a billion times more than another. There are only 24 hours in a day, and there are physical limits to how much work one human can do. Billionaires rob those who work for them. Workers produce wealth and billionaires take that all away and only give back to the workers a small fraction called “salary”. Then there is also rent and speculation which allows to make more money without actually working for it.
The state in a representative regime is a tool in the hands of the richest (billionaires) and that was it’s purpose from the very beginning. They control who gets elected because they own the mass media and only the candidates who are at least not threatening to their interests or more often advance their agenda will get air time. Those who threaten their interests are “extremists”. They don’t even need direct control of journalists to do that, they only need to hire journalists they know agree with them in the first place to achieve this.
Charity is merely a condescending way to display superiority. The money should be in the pockets of the workers in the first place.
Their billions should be stripped away from them and representative regimes overthrown for real democracies where citizens vote the laws and not for so-called “representatives” who only represent themselves and in the end do the bidding of those they owe to, which is the bilionaires who fund their campaigns and who pimp them in their mass media.
Uh. So I guess the point wasn’t obvious 🙂
I’m not going to dispute some (most? many? few?) billionaires are thieves. But your assertion that a human can’t produce a billion times more than another is demonstrably false. For one thing, to take an extreme example, there are people with negative lifetime societal value. Social cases, criminals, unlucky, or just plain incompetent/low IQ. If so, there is a certain positive social value such as even you or I are a billion times more productive than that.
For another, you’re taking work in a very narrow sense. To exaggerate it for effect, you’d say a programmer’s work is basically a typist or data entry operator. The higher order effects of your work are usually those that matter most. Learning how to code makes you 100 times more valuable than a typist. Being a very good programmer makes you even better. Going into management and making sure a team of 50 programmers is productive is even better. Going into top management and making sure a division is going well is even better. Being C-level executive in a big company gives you even more reach (btw, at each of those levels you can suck as well). Building a large company from scratch even more. Being in a position to make a single decision nobody else made can sometimes dwarf everything else you’ve ever done.
Each of the steps above is not adding incremental value – it’s a multiplier. Add them up, and trying to quantify things like “time spent working in a day” when you’re making C-level decisions in a fortune 500 is very much like saying programmers are doing data entry.
I’m pretty sure some people produce litteraly zero wealth, which means that not only can some humans actually billions times more than other, but they can produce infinitely more than others.
> Billionaires rob those who work for them. Workers produce wealth and billionaires take that all away and only give back to the workers a small fraction called “salary”.
Right. The people who work at amazon, for example, would be producing all this wealth without jeff bezos, but somehow he got in a position to “rob” them of “their” wealth. It’s tragic that most people aren’t able to see this.
Amazon is a notoriously bad employer. A lot of this is because Bezos tries to squeeze every possible penny out of everything – and give workers (and probably suppliers, certainly customers) as little as he can get away with, except that with customers he had the sense to start with loss leaders etc. until their alternatives went away.
There are ethical objections to this – the relevant Biblical quote (in KJV, sorry), would be “thou shalt not bind the mouths of the kine that tread the grain”.
But many pro-business, pro-capitalist people don’t share those ethical objections. At the most extreme, it’s every business leader’s “duty to the shareholders” to squeeze as much as possible, in a supposedly virtuous race to what I see as a moral and ethical bottom.
There are practical objections too. But Bezos et al have judged (correctly, I think), that he loses less from forgoing the opportunity to employ, or sell to, people who try to avoid dealing with him, then he gains from squeezing those who are either naive or desperate, and thus enter into exchanges with his company.
To a first approximation, every business tries to do this. Bezos just did it better than most.
Like, 10 years ago, if you asked people to name a company that’s horrible for employees because they try to squeeze every last drop of productivity from low-skilled labor, everyone would have said Wal-Mart.
What happened in the meantime? Did Wal-Mart get taken over by a bunch of socialists or Christians or other groups of people who said “You know what, we don’t need to make so much money, let’s give up some of our profits in order to increase employee welfare and well-being.”
No. I imagine Wal-Mart still, today, is trying its damndest to squeeze every last drop of productivity out of every employee. But Amazon has found ways to do that better than they can. That’s the only difference.
Yes. Some do badly because they aren’t smart enough to find the best ways to squeeze. Some do badly because they don’t have enough power – potential customers, potential employees, and the legal system restrain them. And some have empathy, or a conscience, or otherwise can’t or won’t behave like completely amoral profit maximizing robots.
Bezos is clearly low on empathy, conscience etc. (or he wouldn’t be squeezing so much), making his philanthropy suspect. I can’t see “benefits to strangers” ever actually mattering to him.
That’s a pity, because he started out looking like his goal was to provide a great product – something that ought to result in people happily paying him for it, and paying him well. NOT to provide a mediocre product that’s just barely good enough that people will actually buy it unless/until they find alternatives available. Which is, of course, what he started doing as soon as he was no longer working to undercut his competition.
It’s worth remembering that squeezing every penny out of your employees and suppliers usually corresponds to lowering your prices enough that your customers benefit quite a bit.
I can order stuff from Amazon on Saturday night and sometimes get it Sunday morning. I can get HBO and Starz and Showtime from Amazon Prime a la carte for a single month without any dicking around with a cable company that makes it hard for me. When I’ve needed to return things (sometimes through no fault of Amazon’s), they’ve been easy to deal with. They may eventually squeeze down to mediocrity; I suspect at that point someone else starts eating their lunch. For now what they’re actually doing is raising prices; Prime has gone up and things you order with Prime can often be found more cheaply elsewhere with slower shipping.
My brother-in-law is an Amazon distribution center worker and would vigorously dispute your claim they are a bad employer. He makes enough to support his stay-at-home wife and two children and has a considerable benefits package. Granted they don’t exactly live like kings, but they are financially stable.
So why don’t all those badly employed people get other jobs?
Is there, maybe, perhaps, the tiniest chance that they looked at the job Amazon offered and decided it was better than anything else they could find?
@Doctor Mist,
Increase taxes, create more better jobs (a public library on every city block!) and the problem is solved!
Yes, “Eventually you run out of other people’s money“, but we’re nowhere near that point.
and give workers (and probably suppliers, certainly customers) as little as he can get away with, except that with customers he had the sense to start with loss leaders etc. until their alternatives went away.
Man, what are you shopping for on Amazon?
I am honestly baffled by this critique.
Amazon gives me the opportunity to buy things I simply cannot find anywhere else, which makes it mostly worthwhile at any price, but also lots of things that are simply less expensive, or better made, or sometimes both. The AmazonBasics line of stuff is all pretty well made, from the examples I’ve purchased, and also very inexpensive.
And there generally are alternatives. I’ve been working on an order of car parts on and off for the last few days, bouncing between RockAuto, SummitRacing, and Amazon, figuring out who has what and for what price. I bought a bunch of stuff from RockAuto yesterday, because for the things I ended up ordering, they had the clearly superior prices, even with the paid shipping. Looking at the relative totals in my various shopping carts, it looks like Summit is going to get the rest of my order.
But I also ordered a gigantic bunch of stuff from Amazon last week, when they were the ones who had things I couldn’t find in town, and had the best prices of the various online retailers.
So, I really fail to see how I am either naieve or desperate for doing business with Bezos.
@perlhaqr
Yes that and reading about the working conditions in their warehouses is what I hate about Amazon, all the bookstores closed, and the items no longer on the shelves at the remaining physical location stores because “We don’t stock it anymore because we can’t compete with Amazon”, I like physically seeing what I’m going to buy by walking into a store, I hate having that choice less and less, and I gladly pay double the on-line price when that option still exists.
@Plumber
I’m not talking about “things local stores don’t carry anymore because they can’t compete with Amazon”, I’m talking “things no local store ever carried or would carry”. Sometimes it’s even “things no local store even has the ability to order”.
There just isn’t anywhere in Albuquerque that sells fine pitch, metric, stainless, button head socket cap screws. Period.
There isn’t anywhere in Albuquerque that will even try to order trizact flap disks for an angle grinder.
Thus, physically seeing what I’m buying by walking into a store already wasn’t an option for me. So, I guess it’s a bummer that your aesthetic preferences for how you acquire goods aren’t being met, but on the other hand, I’m now able to accomplish some functional tasks at all. I mean, OK, yes. I’m a machinist. I suppose in a worst case scenario I could turn out my own stainless hardware, and use an EDM machine to punch out the hex sockets. But that’s kind of a ridiculous length to have to go to.
@perlhaqr
I’m not an expert, my knowledge here is next to nonexistent, but I was always under the impression that machinists pre-date amazon, and always kind of carried an assumption that machinists were able to get their trizact flap disks (whatever those are) from somewhere, even in Albuquerque.
Whether or not this is the case now is an entirely different matter. I wouldn’t be surprised to learn that trizact flap disks stores in Albuquerque have gone the way of bookstores in most places. Even if like you said, they had to turn out their own stainless steel hardware, what would stop a machinist from selling their work to other machinists who can’t be bothered?
But if all of that were true, it seems weird to give thanks to amazon for enabling machinist work, much like it would be weird to credit them with making reading books possible (Even though they undisputedly do that nowadays). They don’t get brownie points for solving a problem they helped create (“There are no book/trizact flap disks stores”).
Book stores, at least, were not primarily killed by Amazon. There was consolidation in the market going on for years before; the independents were almost dead before Amazon got on the scene, leaving Borders and Barnes&Noble.
As for the rest… if you wanted something slightly unusual, perhaps you could go to the store which carried similar things, they’d tell you they didn’t have it but “could order it”, then you’d wait some time between several weeks and forever and pay a huge markup on it if it did come. For things useful for the trades, you’d go to a distributor which, often as not, would only deal with people in the business (no hobbyists or DIYers, and perhaps you’d need to open an account and order a certain amount of stuff regularly), and then if a manufacturer they dealt with (a firm “on their line card”) carried what you wanted, you’d go through the whole “order and wait a long time” rigamarole.
Weird. If someone put a gun to my head and asked me to point them to a physical bookstore (without using google, etc), I could give directions a few independent bookstores (maybe like 5?) but just one Barnes&Noble and literally 0 Borderses (Obviously).
For transparency, this is in the SF Bay area, maybe the independent book store business plan of “sell a pile of interesting looking sci fi paperbacks to people who wander in” wouldn’t hold up as well in other places. And any book store trip would take be at least an hour’s drive round trip, independent or otherwise.
Sounds suboptimal, but it also sounds like a thing that possible and that people probably navigated successfully, which doesn’t exactly jive with perlhaqr’s “Thus, physically seeing what I’m buying by walking into a store already wasn’t an option for me” and “but on the other hand, I’m now able to accomplish some functional tasks at all.”
If none of the Albequerque distributors dealt with a manufacturer of trizact flap disks, or of all of those which did required a minimum order or ongoing relationship of greater value than could be provided by the customer, then they were essentially unavailable.
@420BootyWizard
I’m not an expert, my knowledge here is next to nonexistent, but I was always under the impression that machinists pre-date amazon, and always kind of carried an assumption that machinists were able to get their trizact flap disks (whatever those are) from somewhere, even in Albuquerque.
So, you don’t know anything about the subject, don’t know what the object I’m talking about is, and didn’t bother to do a web search for it, but you assume that Amazon is the bad guy here. I see.
Trizact is an engineered abrasive from 3M. I suppose in my earlier post I should have said that “among other things, I am a machinist” so as not to limit the scope of my skillset. A flap disk is a consumable that one attaches to an angle grinder, in the manner that one might attach a grinding disk, cutting wheel, or wire wheel, composed of layers of sandpaper laid at an angle around the circumference. When the sandpaper wears out, it comes off in little bits, exposing fresh paper from the flap below. Typically, angle grinder disks only come in sandpaper grits of up to 120, which is useful for initial surfacing, but not so much for a final polish. Trizact is available in grits all the way down to 1 micron, and the way it’s designed, it remains a functional abrasive long after “normal” sandpaper would be useless.
So first, trizact flap disks have nothing to do with machining, and second, I’m not at all certain they predate Amazon at all. Because I’m not sure trizact does.
And while there are many welding supply stores in Albuquerque, and even a large number of jewelry supply stores as well, trizact flap disks are such a fantastically specialized product that it is not impossible that I m the only person in the entire city using them. Because frankly, there just aren’t that many people here who want to polish the bare metal roof of a car, or a 12 foot long stainless steel dining room table.
So I’m not giving Amazon brownie points for solving a problem they created, I’m giving them brownie points for supplying a product for which the demand is so low that it doesn’t make any sense at all for any local store to fill it.
AFAIK, there were plenty of independent bookstores, some of them in malls. B&N and Borders took over the whole mall/airport bookstore business.
With the demise of malls, and other issues, B&N also declined.
In Spain, it was almost impossible to order English books, so I remember how on the way back from a trip to London I would pay Ryanair their outrageous fee to carry a suitcase of books. Later, I could order books from the US, and they usually came from Germany.
Having ebooks and a Spanish Amazon was a huge relief for my book addiction. I don’t have to buy a years’ worth of books at once, and I can buy a book when I want to read it, not before, and have it the next day/that same instant for ebooks.
Indie bookstores are having a revival now. There is a deluge of content now that publishers are not gatekeepers anymore, so you can use a bookstore with a select and specialized selection so you can get the books somebody has selected, if you like that kind of thing.
@420BootyWizard
Sounds suboptimal, but it also sounds like a thing that possible and that people probably navigated successfully, which doesn’t exactly jive with perlhaqr’s “Thus, physically seeing what I’m buying by walking into a store already wasn’t an option for me” and “but on the other hand, I’m now able to accomplish some functional tasks at all.”
I think you may have missed the part of Nybbler’s reply where he said if you wanted something slightly unusual, perhaps you could go to the store which carried similar things, they’d tell you they didn’t have it but “could order it”, then you’d wait some time between several weeks and forever and pay a huge markup on it if it did come. So, how does that not jibe with my statement that I was unable to walk into a store and physically see what I’m buying already?
Also, as he mentioned, dealing directly with a distributor is expensive. Like, “You can order stuff through us if you commit to buying $500 worth of hardware every month” expensive. And still only gets you access to the manufacturers the distributor deals with. Since, at the time I was using them, the only company that manufactured flap disks out of a Trizact paper was a small company out of England, well, I’m going to go out on a limb and say that none of the local distributors carried their gear.
Of course, these days I just use a cerium oxide slurry for my micropolishing anyway.
@420BootyWizard
For an idea of the zeitgeist, the Tom Hanks/Meg Ryan movie You’ve Got Mail summarizes it well. It was big box, not online that was the killer of small bookstores in the 90s and early 2000s.
I’m not assuming Amazon is the bad guy. I use Amazon, myself. Too much, probably. Amazon boxes accumulate in my house almost faster than I can recycle them. Even coming at this from the perspective of a socialist / communist / leftist / whatever, I know enough to “not hate the player but hate the game”, as they say.
And in my defense, I put my ignorance on the subject right up front as a disclaimer. Guilty on not doing a search though. Honestly I just didn’t actually care about this enough to bother.
Cool! That was genuinely informative, thank you for sharing your expertise with me. This is not sarcasm.
Fair. But in that case, it seems like Amazon is providing much less value in this case (Overall. Obviously to you the value is there, but aggregated over the whole city of Albuquerque, praise on providing trizact flap discs to one guy ventures from “brownie points” into “who cares” territory)
@420BootyWizard,
I also live in the San Francisco bay area and the death of The Other Change of Hobbit really grinds my gears as does the end of Cody’s Books, but so does the closing of Borders and so many Barnes & Noble locations.
My decade of working construction jobs in Silicon Valley was awful (Hates it FOREVER!) but it was alleviated somewhat by when the godawful commute got too much to bear I could get off numerous freeway off ramps and find a strip mall with a Borders or B&N and rest, and while they weren’t as good as the best independents they were pretty damn good, but most didn’t stay in business after the 2008 financial collapse.
The Other Change of Hobbit owner told me that it was mostly the City of Berkeley putting parking meters on his store’s block (which they didn’t enforce for long as too many merchants raised a fuss or just closed shop, but too many customers stopped going) that killed his decades long business, Cody’s and Borders blamed Amazon.
Borderlands Books and Dark Carnival almost went under, but thankfully they’re still on-going, so it’s more the lack of replacement parts at shaver shops and the end of Radio Shack that bugs me about Amazon.
@420BootyWizard:
I’m not assuming Amazon is the bad guy. I use Amazon, myself.
OK. Maybe I interpreted your line: “They don’t get brownie points for solving a problem they helped create” too forcefully.
Cool! That was genuinely informative, thank you for sharing your expertise with me. This is not sarcasm.
You’re welcome. I figured the conversation might be more productive if we both had some idea of what was under discussion. 😀
Fair. But in that case, it seems like Amazon is providing much less value in this case (Overall. Obviously to you the value is there, but aggregated over the whole city of Albuquerque, praise on providing trizact flap discs to one guy ventures from “brownie points” into “who cares” territory)
Sure, I’m literally one in a million (maybe 1.3 million or so, if you include the nearly continuous region of “Belen to Bernalillo” and “Rio Rancho”) but it’s also just one example. What else is Amazon providing to the other people in the area that only they want, but which there isn’t enough demand for to justify a local store carrying, but which they really want?
And all of that is leaving out entirely the fact that I specifically don’t want to have to physically walk into a store to buy all my supplies. I’ve had rheumatoid arthritis since I was a kid, and I have a blown L5-S1 disk in my spine, and a number of other issues. So, walking is painful (hell, just sleeping is painful most of the time) and sometimes I just don’t have the spoons to put on real clothes, let alone drive to 15 different stores (or even call them on the phone and sit on hold for 10 minutes apiece) looking for some supply or tool or whatnot that I need. But thanks to the Magic of Internet Shopping, I can still make progress on things even when I’m in screaming agony or catatonically depressed.
There’s some question as to how much notoriety as an employer Amazon deserves. I’ve seen long-time warehouse workers claim that Amazon was no worse than any other warehouse work (which is a rather low bar), and that the main reason for their bad reputation is they hire people used to less physically-demanding jobs.
On the white-collar side, they’re known for demanding everyone be able to justify their job and being quick to fire those who can’t; while I certainly wouldn’t want to work in such a place, it seems people must find it acceptable as there’s no shortage of similar jobs.
That’s hard to believe. Some humans are net negative productive. Most are not. There’s no reason to believe there’s a discontinuity around 0. So massive relative difference in productivity are no reason to disbelieve in non-thieving billionaires.
The labor theory of value is obviously false, but that theory of value seems to be assumed in your argument that now one can produce a billion times more value than someone else (particularly given your invocation of hours in the day). Can you rework your argument using a reasonable theory of value?
In addition to the points about negative value and non-linearity, the proper comparison isn’t between productivity between individual actors but rather something like the productivity between the capital they own. Billionaires aren’t typically paid billions of dollars. They have a net worth of billions, because their accrued assets are valuable and productive. A once-individually-productive billionaire could decide to sit on his butt, be an absentee CEO, etc., but capital on under his ownership could continue to be productive and could very easily produce billions of times the value of other humans even without resorting to negative or near-zero values for comparison.
My guess is that SchwarzeKatze would object to that based on an atypical view of the nature of property, but the fact remains that it doesn’t appear to have been considered in the original post. In fact, even with certain property-based objections, the point would still hold by crediting the skill in allocating the assets toward productive activities (to which we cannot assign a precise value, but which a market system estimates and whose existence is proved by economic profits).
Even the skill in capital allocation isn’t necessary. If you invest in index funds and get average market return… you’ve still earned that return, by creating capital. Which doesn’t mean “doing the work that earned you the money”; you turned that wealth into capital by not spending it immediately on consumption. So what you’re being paid for is producing some value in year X but not consuming it until year X+10, meaning that for those intervening 10 years the value you were paid for creating in year X is ‘out there’ in the economy doing productive stuff — probably at someone else’s direction/allocation. This remains the case even if you don’t invest at all but just stuff dollar bills into your mattress: you’re now not capturing any of the returns on that capital, but you’ve still created it; there may be fewer dollars circulating but there’s just as many goods and services.
‘Capital’ is deferral of consumption.
Quite right.
Clearly, capital, in the sense you indicate, has some value. But how much, relative to labor? I’m not sure I’d trust supply&demand to answer that question even in a transparent, efficient market; and I certainly don’t in the real world.
Markets are a great way to allocate at the margin, but that works just as well if you start from a systematic intervention as it does if you start from the status quo.
A market generates that information. A “systematic intervention” destroys it.
It works just as well provided the market trusts you not to do another systematic intervention. If it doesn’t, its allocation decisions will be aimed at gaming the intervention.
We’re tried your way before. It’s killed more people than most philanthropy has saved.
This article reminds me a lot of Ayn Rand. Not in the content (though I guess it rhymes) but in the sense of taking a reasonably obvious point and stamping it again and again in the brain of the reader, long after it agreed with the point per se, long after it shed any doubt on the matter and well into consensual indoctrination territory. “I’ll finish reading this article to make sure never ever in my life I will feel tempted to doubt it”. It’s kinda how/why you get through John Galt’s speech. Also, for the record, reading random paragraphs from it is a freaking awesome drinking game.
I guess when people disagree with things I consider obviously good, I don’t know how to convince them except by repeating the obvious points in favor of the obvious things.
@Scott Alexander,
Sorry I still disagree, as I think:
1) Having more than a billion dollars is too much power to place in unaccountable unelected hands.
2) Having worked for both (local) government and private industry I trust government far more.
3) I want my vote to count.
4) Politicians are far more accessible than billionaires (I’ve met many elected officials, but never a billionaire, the closest I’ve come is some co-workers saying they had unpleasant encounters with Larry Ellison’s wife).
5) Better public hospitals and roads, more public libraries, repaired bridges, increased sewage treatment (since
shillsYIMBY’s are Hellbent to cram more people in an area that lacks the needed infrastructure to accommodate them), and a social safety net for the indigent Californians sound much better to me than all the projects you list that philanthropists funded (100 years ago Dale Carnegie had libraries built, and more recently Mark Zuckerman donated to San Francisco’s General Hospital, I approve of those, but your list? Not so much, I’d prefer if Gates was more patriot and less humanitarian).@Plumber
But that’s no longer the reasonably obvious point. That’s discussing if billionaires can replace government. I don’t think anybody was arguing that (and I don’t think they can, btw, nor that it would be a remotely good idea, including for your reasons).
Also an annoyingly common failure mode when discussing libertarianism of any kind – X is saying “less regulation would be better” and Y is replying “private police will never work”. Cue hair pulling.
Arguing against that proposition was the main point of a few of the articles linked, to my eye. So the SSC post is arguing against arguing against it.
Do I think Scott is actually in favor of plutocratic oligarchy? No, not really. But the marginal benefit and the system overhaul point in somewhat different directions.
@Radu Floricica,
I think we have a fundamental difference in points of view in that (while I’ve heard tales of deregulation doing good in China and India) in my area in my lifetime I can’t think of any deregulation that I support, with the Lanterman–Petris–Short Act, and the subsequent Riese v. St. Mary’s Hospital and Medical Center rulling possibly being the most harmful reduction in government power.
So yes, I think being ever vigilant in opposing more “liberty” is the right, proper, and good thing to do in order to prevent further deterioration.
@Plumber
Updated on that (probably a good example on how the mind really works, if you can update so easily not on direct evidence but on prestige). I’m in the process of rechecking my libertarian intuitions anyways.
I think the root of the difference lies in how you get to deregulation, as opposed to the general idea of less regulation. You get to it by the usual process of rule-making – i.e. either for electoral capital or lobby. So you get the same kinds of results.
My intuitions are more general: first that in 99% of cases higher order effects of rules are not even considered (not that they’re easy to predict anyways), and second the corpus of rules never shrinks, which leads to Baumol on one hand, and to a strong brake on developing alternate processes on the other hand.
@Dan L
Don’t we pride here on being able to discuss finer points without going (too much) tribal? I definitely don’t mind moving the subject, that’s what makes for interesting conversation, but let’s be aware that the topic has moved.
@ Radu:
You’re going to have to be more specific, but answering what I think you meant: the problem is that “the reasonably obvious point” is a small slice of a larger issue, which in turn has a reasonably consensus set of preferences. But these simultaneously reasonable positions have markedly different policy recommendations on the margin.
Choosing to focus on one level or the other strongly influences the logic. Failing to understand that the other level exists is a deeper problem. That problem is addressable, but requires bridging an inferential gap.
“I’m not sure if we even disagree, but I’m going to hammer this obvious point even harder until it sticks” is a sign the bridge is failing, so brace yourself for some high-grade Conflict Theory.
This is interesting to me, because years ago my sister snarked at me for doing the same thing, of offering so many examples for the same point, as if it was a bad thing to do, rhetorically. Maybe she was more making fun of doing it in a more casual setting (akin to info-dumping), but still. She was like “I GET IT, move on already.”
Sometimes I really don’t get normies.
The other thing Radu Floricica’s description reminded me of was a section from Diana Wynne Jones’ “Year of the Griffin,” wherein a professor goes through his bright students’ various approaches to argumentative writing.
Absolutely every writing rule can be broken creatively and with success 🙂 48 Laws of Power puts it very well: last one is something like “assume formlessness” and go beyond just following rules. Btw, if you’re curious don’t read summaries, the value of the book is not in the dry list of rules but in the description and examples.
Interesting analogy. I read “Atlas Shrugged” at all because I first started reading The Speech online, and was so astonished at how great that it was that I immediately ran out, about halfway through it, bought a copy of the book, and then sat down and read the entire novel in one go.
I realize there’s some very weak sense in which the US government represents me. But it’s really weak. Really, really weak. When I turn on the news and see the latest from the US government, I rarely find myself thinking “Ah, yes, I see they’re representing me very well today.”
That’s because they’re not. They’re representing another/the same collection of billionaire donators.
Ah well, in that case there’s no point in taxing billionaires anyway, right?
There’d also be no point in talking about taxing billionaires, even if control of how the hypothetical tax money gets spent could somehow be wrested from them: they’ll use their nefarious power to ensure that the taxes stay hypothetical.
“Here’s a Big Problem, which exists because Premise. And here’s my solution to Big Problem, which can only ever be implemented if Premise turns out to be false.”
1. Is criticizing billionaire philanthropy a good way to protest billionaires having too much power in society?
Oh god yes. For many reasons. Firstly: Do you remember superweapons? The strategy of loading people up with negative affects and connotations? It works. If one nation was waging war against another and wanted to rally its citizens, do you think it would be helpful for the cause to put up posters saying things like “THE ENEMY NATION ACTUALLY TAKES CARE OF THEIR ELDERLY AND DISABLED QUITE WELL, JUST STATING THE FACTS HERE”. That would be terribly counterproductive.
2. If attacks on billionaire philanthropy decrease billionaires’ donations, is that acceptable collateral damage in the fight against inequality?
As a fellow utilitarian, we both know the answer depends on whether the well-being gained in the fight against inequality is greater than the suffering caused by decreased billionaire philanthropy. So to answer this question requires an object-level investigation…
… but you are jumping ahead and assuming that the answer to this question will be “no”. Did you calculate how higher incomes lead to longer life expectancies into your equation? Or consider that the capital used to treat Malaria continues to exist whether Bill Gates is a billionaire or not?
3. Do billionaires really get negative reactions from donating? Didn’t I hear that they get fawning praise and total absence of skepticism?
If the purpose of this section was to imply that criticism of billionaire donations is unnecessary because its already common knowledge, may I remind you that the Twitter user base leans quite to left compared to most other media platforms in the US.
4. Is it a problem that billionaire philanthropy is unaccountable to public democratic institutions? Should we make billionaires pay that money as taxes instead, so the public can decide how it gets spent?
No one is claiming that putting money in the hands of the government would accomplish the “same goals” as the goals of billionaires. That’s a strange straw-man-ish premise to begin with.
But beside that, of course putting more money into the hands of the democratic state transfers power to the public. Your “no” here doesn’t even attempt to refute this point! You are just opposed to the outcomes that you think democratic accountability leads to (prison abuse), compared to what you think autocratic systems lead to (no prison abuse, I guess? Is that what non-democracies typically have?).
And lastly, on an empirical level, the correlation between poverty and incarceration is extremely clear. Assuming the money the money is used for welfare programs (the Left’s position!) it’s going to take some heavy lifting to explain why a starve-the-beast pipe-dream fantasy would be more effective at keeping people out of jail than a poverty reduction program.
The problem, assuming you are aiming for democracy, of “ballot measures are too expensive” is not solved by further concentrating the power of who gets to decide what is-or-isn’t a ballot measure. Kind of defeats the purpose, no?
Ah, but your contention is actually that you simply disagree on the object level of how this particular case would have shook out, if up to the masses. Is this evidence of a structural superiority of autocracy over democracy? Of course not. It’s just a cherry-picked case of an example when things wouldn’t have happened to go your way.
If you assume the government does only bad things, and that private billionaires do only good things, then only a monster would support taxing billionaires to find the government. Wow! Amazing logic! Your righteous indignation is well deserved!
5. Those are some emotionally salient examples, but doesn’t the government also do a lot of good things?
That’s because Bill Gates doesn’t have to spend money on things like roads, medicaid, social security, or national defense. But sure, throw those in the bucket of “thing that don”t help people or save lives”.
Come on. The reason why billionaires can donate to less-imminently-pressing issues such a climate change and tropical diseases is because there’s aren’t millions of people dying in the streets from poverty and warfare. Again, did you calculate how many lives has Medicare has saved? How about social security? National defense?
“Governments only do bad things. Billionaires only do good. Please take my analysis seriously!”
Wait, then why should they exist, again? You’ve just listed all the ways in which the government having money (i.e. power) is terrible, and all the ways billionaires having money and power is great. You even go so far as to claim that the government, as an organization, literally does not exist to do good. What else, knowing you are a utilitarian, am I supposed to conclude here? If you are going to raise the black and gold flag don’t be a coward about it.
> Did you calculate how higher incomes lead to longer life expectancies into your equation?
Are you seriously claiming that that this would make as much of a difference as malaria nets?
> Or consider that the capital used to treat Malaria continues to exist whether Bill Gates is a billionaire or not?
It would never have been created in the first place, if it hadn’t been possible to become a billionaire.
> are just opposed to the outcomes that you think democratic accountability leads to (prison abuse), compared to what you think autocratic systems lead to (no prison abuse, I guess? Is that what non-democracies typically have?).
Do you also consider it autocratic that people are able to spend their time the way they want to, rather then letting the democratic government decide that?
Uh, giving the democratic state money does not give it to the public. It means The State has more money to spend on whatever The State wants. You also assume that public help programs make people less likely to be poor, which doesn’t match my experience at all.
You also claim indirectly that Medicare and welfare help out the poor, but if we’re considering all things, we ought to consider the economic engine of capitalism. Welfare can distribute the pork, but capitalism slaughters the pigs and cooks them up.
Most importantly: Scott isn’t arguing for autocracy or an end to government. The argument is that we shouldn’t yell at billionaires for charitable contributions. There’s no need to bend over backwards and praise them either. Criticize yacht spending, criticize the capitalist system, sure, just don’t discourage the good things they do and the public good they create.
On your first point, sorry I didn’t quite get – whom exactly are you rallying to a war against whom? And do I read it correctly that we should never allow even a possibility that The Enemy can actually have a point? If so, how’s that we know that Our Cause is indeed that right one and will bring more utilitons?
@Guy in TN,
+1,000,000,000
You have a lot more objections than I do, but I do tend to agree with the broad thrust of points 4 and 5. I agree with Scott’s overall point that arguing against billionaire philanthropy is ill-targeted and counterproductive, but I think the arguments he laid out in 4 and 5 feel quite cherry picked and weak.
6. The point of democracy isn’t that it’s always right, the point is that it respects the popular will. Regardless of whether the popular will is good or bad, don’t powerful private foundations violate it?
Section is baffling. We, the public, like Bill Gates for making computers and running a business We don’t like him for making laws. These aren’t interchangeable jobs. Ask the same people “okay, now do you think Bill Gates should be in control of the country?” and you’re going to get a different response.
Paul McCartney may be the most popular musician, but you’re asking “okay, so why isn’t he king?”
If the public votes for someone who promises to “take on the billionaires”, I would take that as pretty good evidence that the public doesn’t want billionaires to be in power. The best way to gauge who the public wants in power, is through voting.
However, this is obvious and leads to outcomes you don’t like. So you claim that the real public sentiment can be found in unrelated polls that are in regards to different topics. No.
Like, what is your actual position here? That we should replace voting with polling? Polling based not on questions such as “who should be in power”, but rather “does Bezos give you fuzzy vibes”?
And if people don’t want more money to be spent by privately, then they will use the democratic process to empower someone who will “take on the billionaires”. See how this works? Or would you then revert back to debasing the legitimacy of democracy like you were in the previous three paragraphs?
8. Is billionaire philanthropy getting too powerful? Should we be terrified by the share of resources now controlled by unaccountable charitable foundations?
I think the typical argument here is that billionaires are getting too powerful, and we should be terrified of the share of resources control by private organizations. It’s not the philanthropy we care about. It’s the concentration of power. You are trying to parse out the section of billionaire wealth dedicated to philanthropy and being like “look, it’s hardly nothing!”. Not what it’s about.
10. Aren’t the failures of government just due to Donald Trump or people like him? Won’t they hopefully get better soon?
This is just a weird argument. The power wielded by billionaires doesn’t exist despite the will of congress. Billionaire’s power is wielded at the consent of the will of congress. “Checks and balances” refers to the internal structure of government, not to private actors! Like, at any time Trump+congress could overturn the entire economic system, if they wanted to. And billionaires would have the legal authority to do absolutely nothing about it!
This isn’t what socialists or social democrats who advocate for taxing billionaires aspire towards. But yeah, 100% Full Communism where the self is sublimated into the collective hivemind is probably a bad idea I guess.
And all of this wonderful progress took place not under anarcho-captialism, or even a “free market”, but under the actually existing social and economic institutions we have, which includes democracy, taxation of billionaires, and government spending. “How this came to be” is answered by pointing at the institutions we have, which enabled people like Bill Gates to play the role that he did.
You ought to know better than to think so atomistically. And to be so sloppy with generalizations of “billionaires do x good, a government does x bad”.
I’ve been reading your blog for around five years now, and consider myself a fan. This is your worst post.
I started out by fisking this, but I think all our disagreements reduce to one thing.
Yes, governments can do good things. My claim is that the marginal dollar given to billionaire foundations right now does more good than the marginal dollar given to the government right now. Given that a dollar given to the government will make roads, defense, etc X% better, and a dollar given to the Gates Foundation will make their anti-malaria programs Y% better, I think the Gates Foundation will do more good with it.
This is why I’m saying governments should continue to exist – using non-marginal thinking, taking away all the government’s money would lead to no roads, no rule of law, etc, and be bad.
I don’t know how much smaller we’d have to make the government before the marginal dollar did more good in its hands than in the Gates Foundation’s. But I hadn’t really intended this to be an exploration of the idea of liquidating the government and selling its assets off to billionaires.
The point I was trying to make in part 8 is that the only proposal I’ve seen in this area is to weaken billionaire philanthropy and give its money to the government (not, as you seem to think I’m saying, liquidating the government and giving it to billionaires). So the possibilities we’re looking at here are something like:
1. Government has X power, billionaire philanthropy has 0.003X power
2. Government has 1.001X power, billionaire philanthropy has 0.002X power
I think option 1 is better. If you disagree, I still don’t think you’ve explained why.
But as far as I can see, that main criticism of billionaire philanthropy isn’t “billionaires shouldn’t give money to philantropy”, it is “billionaires should not have that much money, even if some give some to charity”.
So the correct question should be:
Does the marginal dollar given to the government do more good then the marginal dollar given billionaires through lowered taxes etc.?
Re: “Does the marginal dollar given to the government do more good then the marginal dollar given billionaires through lowered taxes etc.?”
Its not giving to them, its taking less.
Ignoring that point I’d probably still say yes. But the question is a bit off topic. The issue of the post wasn’t “should we have higher or lower marginal top tax rates”, and it wasn’t “should anyone be allowed to have a billion or more dollars” it was more along the lines of “should we complain about billionaires giving out money to charitable causes” or “is it a problem that billionaires give a lot of money to charity”
@tfowler11,
Billionaires philanthropy reminds us that they exist and that they control so much, the problem isn’t the billionaires philanthropy it’s how much wealth they have unaccountable control of.
What’s the matter with unaccountable control of wealth? I have unaccountable (to more or less the same degree Bezos is unaccountable) control of the money I earned. I hardly think the world would be a better place if I need approval from the local board of supervisors before I could spend my own money, or even if I didn’t need approval but had to explain it to them afterwards.
Plumber – Replying to my own post you replied to because there is no reply button directly on your comment. I don’t know if that will effect you seeing it or not.
1 – The issue of the initial post was the philanthropy not them simply being billionaires.
2 – Shifting from philanthropy to the idea of being able to generate billions of dollars of wealth without having to answer politically for it. That’s not a bug its a feature, and a quite good one at that.
@Plumber >
@The Nybbler > “What’s the matter with unaccountable control of wealth?…”
In respending to my post you left out the words “how much” which I think are significant.
@tfowler11,
It helps me to find that you responded to a post of mine if you put “@Plumber” rather than “Plumber” in your post.
Thanks.
Anyway I’m guessing that you want extreme private wealth in the hands of individuals as a counterbalance to governmental power, my preference would be to reduce billionaires wealth and Federal and State (until California is made many multiple States) power, until then I want even the Federal government strong to counterbalance the power of private employers and management.
@Plumber – re” until then I want even the Federalngovernment strong to counterbalance the power of private employers and management”
Once you get beyond things like reasonable anti-pollution controls, and applying laws against general crimes to the rich and powerful as well as those less so, I don’t think that stronger/bigger/more active government helps balance out power of private wealth concentrations, esp. not the ability or likelihood to use that power in negative ways. It rather enables more power and more abuse by wealthy and corrupt private sector actors who can use their wealth to recruit government to subsidize and protect their interests. If the government isn’t involved beyond protecting your from attack or fraud, then private companies have to get you to agree to become their customer or employee, and have to offer something better than the competition. If the government does get involved in can stomp out the competition and/or require your to buy the goods or services the company is selling.
If you want to ask the narrow question of whether x amount of money used for billionaire philanthropy should be transferred into generic government revenue, I’m not sure I would even find disagreement with you. The billionaire’s philanthropy is almost entirely used to increase human well-being, while only a portion of generic government spending is. (Now, if you were to extend the argument towards total billionaire wealth, that’s where you’d lose me).
This narrow question is even compatible with advocating for increased taxation of billionaires. Since, if billionaires wanted to, the could choose to keep philanthropy levels steady even with increased taxation. (I for one I simultaneously want Bill Gates to spend more of his wealth on philanthropy, and I want to raise his taxes).
But come now, your post touched on a lot more than that. This doesn’t begin to address questions you raised regarding the merits of democracy vs. autocracy.
I have to agree that there is some shoddy reasoning in this post. A content analysis of Twitter is good enough to show disapproval for billionaire philanthropy? How does that square with the approval ratings?
It doesn’t seem like you thought this post through. You may still have a good case, but there seemed to lots of arguments that just didn’t follow here or where you compared inconsistent numbers (e.g. harzerkatze’s reply).
Moreover, there are a lot of countries in the world that have varying policies related to wealth taxes, tax-exempt giving, and related things. How do they compare?
Although the tone of this critique was maybe unnecessarily hostile, it should be taken more seriously than you did, so maybe fisk it? Or do the suggested debate/adversarial collaboration: https://twitter.com/davidmanheim/status/1156075195171594241
Just wanted to say I generally agreed with all these points. I thought it was an absurd post overall, but then unlike many here I’m not a fan of this type of his post, and so I restricted my thoughts to ed.
@Guy in TN,
Just posting to say I agree with you, and to thank you.
I agree with the thing you say you agree with. I think you’re reading my post as saying something stronger (maybe “autocracy is good”?) which I am not actually saying.
My thesis on this post is “don’t raise taxes on billionaires’ philanthropic activities in particular”.
Let’s drill down to policy for a second: progressive taxation plus exemptions means that charitable giving is more effective the higher one’s income, even on a purely per-dollar basis. Is that a good thing or a bad thing? Would you oppose a revenue-neutral method of eliminating that discrepancy?
Pretty sure Scott thinks that it’s a good thing.
The post has a narrow proposition: stop attacking billionaires through the shaky proxy of attacking their philanthropic contributions, especially if the proposed solution is not to reduce their billionaire-ness, but to merely re-direct their philanthropic money elsewhere. Attack the other parts of their billionaire-ness, like wasteful non-philanthropic consumption.
The ideal would be that billionaires increase the percentage of their expenditures on philanthropy, whether because non-philanthopy money becomes philantropy, or it becomes taxes.
Insofar as it re-frames the purported efficiency gap as being between Zuckerberg’s us of pre-tax dollars and Scott’s use of pre-tax dollars, I don’t think it’s obvious.
It’s a reasonable proposition, but I think it’s a very poor response to the arguments the articles linked are actually advancing. “Not to reduce their billionaire-ness” isn’t quite capturing the sentiment in Want to Be a Principled Billionaire? Stop Being a Billionaire.
Sorry, but this feels a bit motte-and-bailey to me. Clearly “don’t raise taxes on billionaires’ philanthropic activities in particular” is the motte (elsewhere you say “don’t raise taxes on philantropic spending in particular”, which I hadn’t seen before as a serious main policy proposal), but you mainly made the call “don’t criticise their philanthropic activities, because it will decrease their philanthropic spending/the overall good being done with that money”.
People may want to criticise that though because they feel that pointing out perceived hypocrisy (evading taxes, or causing harm, and then giving charitably) or that gifts act as PR is a more powerful message to bring up the bigger issue of inequality and tax evasion (in the sense, that they can get a platform pointing this out) than simply pointing out that billionaires buy expensive things or evade taxes. I think they’re probably right about that for complicated reasons of newsworthiness and selling controversy.
You may yet be right about collateral damage,
you may disagree that this is hypocrisy, or you may think yelling at billionaires (for making expensive private purchases or charitable donations) will affect their behaviour and you may think that there is more criticism than fawning praise. Now you’re making an empirical case and that case is pretty badly made. Your Twitter content analysis is inconsistent with the approval ratings. I think probably your content analysis is more wrong and biased than the approval ratings.
Regarding backlash, you might have a case for the Sackler family, but then you don’t talk about the Sackler family (I guess your rationale is focusing on the biggest and most effective givers, but they are a prominent name in this discussion, so it could also be seen as leaving out inconvenient examples). I don’t know whether it’s better to forgive and take the money or to build a society where misdeeds aren’t easily forgiven when a fraction of ill-gotten gains is spent (and where perpetrators expect that). You could tackle that question.
PS.: I don’t think seasoned readers of your blog will think that “autocracy is good” is the bailey and I didn’t get the impression from that critique. More like “you seem to have an unexamined undemocratic attitude that Silicon valley elite preferences should indeed count more” (not sure I agree with that).
> taking away all the government’s money would lead to no roads, no rule of law, etc, and be bad.
I’m assuming you’re being hyperbolic? You don’t need to be an ancap to know that roads, law, etc. can and do exist without the state. There would be fewer roads, law enforcement, etc. certainly but not none.
> If the public votes for someone who promises to “take on the billionaires”, I would take that as pretty good evidence that the public doesn’t want billionaires to be in power. The best way to gauge who the public wants in power, is through voting.
And if they don’t, that’s evidence that they do want billionaires “in power” over their own money.
>. But yeah, 100% Full Communism where the self is sublimated into the collective hivemind is probably a bad idea I guess.
I have no idea what “full communism” is but as an actual communist I can attest you don’t understand communism. Communism is a classless stateless society and says nothing about hiveminds.
But since no such thing can be implemented on a substrate of primate brains, some extrapolation is necessary.
Tell that to pre-feudal society. The human race has lived under communism far longer then under capitalism or feudalism. Non-communism is a recent development.
Well, for what it’s worth I would rather be a hunter-gatherer than live in one of the disgusting hell-holes created by communism, so I understand why you would use that as a talking point. Please let me know if anybody falls for it one day.
I’d hesitate to call that communism.
‘There is no material wealth’ is not a non-trivial solution to the problem of distributing material wealth.
And as soon as we get surpluses of grain and bronze, we get kings and wooden horses and codes of Hammurabi and the like.
Note: An Firinne’s link is to what Communists imagined prehistoric society was like, not actual evidence of what prehistoric societies were like (which we mostly don’t have).
You didn’t read the link thoroughly. The idea was put forth by Lewis Henry Morgan, who was not even a communist. This is an accepted historical fact.
Also I feel the need to point out what a terribly vapid post that was. You basically just said “no, its wrong” and nothing else in a roundabout way.
“Primitive communism is a concept originating from Karl Marx and Friedrich Engels who argued that hunter-gatherer societies were traditionally based on egalitarian social relations and common ownership.”
Once again, we don’t know what prehistoric societies looked like; they didn’t leave histories. This just guess-work by “literally Marx and Engels” Communists. That’s true even if they sometimes cited a non-Communist.
“Prehistoric” is not really the proper term to use here. Hunter-gatherers are not prehistoric, for example. The word refers to societies who left no written records (broadly defined).
What we see about existing societies with no written records (such as societies in the Amazon or New Guinea) is that they are anything but communist in any sense of the word. They are typically ruled by “big men” who have shown themselves capable of leadership in war, resource gathering and resource distribution.
The “primitive communism” of most hunter-gathers, by contrast, is due to small groups in an environment with few resources (Namibia and Botswana). As was suggested, there is the equality of total poverty.
When humans spread out from Africa (possibly as the ice retreated, possibly because their technology had become more advanced) more resources become available, such as pigs and tuberous roots, and inequality appeared.
We lived under “communism” (so-called) for a long time, because for a long time we were dirt poor and barely had enough of anything to survive. In a situation like that, small kin-groups either shared what they had or they died. I suggest that this is not what we want for a political/economic blueprint.
There are existing hunter-gatherer societies and anthropoligists who do field work with them. It’s not clear how close they are to the norm for a world where all humans were hunter-gatherers, since they’ve been affected by farmers and industrial society in many ways. Probably the most important effect is that they’ve been pushed to marginal lands–anyplace that makes acceptable farmland or grazing land has long since had its hunter-gatherers pushed aside or assimilated into the farming society.
@Jaskologist
Yes we do. We have first hand-knowledge of what prehistoric societies are and were like. Many still exist today in the amazon and papa new guinea.
@FormerRanger
>t they are anything but communist in any sense of the word. They are typically ruled by “big men” who have shown themselves capable of leadership in war, resource gathering and resource distribution.
That doesn’t logically follow. You can have a stateless classless society (communism) that is ruled by “big men”. Communism is not the abolishment of hierarchy.
Isn’t the bigger problem that a hunter-gatherer tribe is like 100 people? Should we really expect that model to scale up to 100 million people?
<150 people, engaged in lowkey endemic warfare with the next <150 people over.
I basically agree 100% with your argument… But I’m sad that making it required dumping on government as literally analogous to the KKK? Without knowing what kind of government programs you’d approve of, I’d venture to say that sewage treatment, food subsidies for the poor, fire protection, most transit, almost all last-resort health care seem like pretty good things government provides. Notably, a lot of it is at the local, not federal level, where approval ratings of elected officials are MUCH higher. (I’d encourage anyone frustrated with government to engage more there).
Also, in some ways you’re attacking a straw man. The “don’t criticize billionaire philanthropy” argument makes a ton of sense. But the steelman is actually worrying about billionaire NON philanthropy. That is where the argument that the government would be better off with the money lies – because if even 5% of taxes get redirected sonewhere good, it’s more than the zero from the (just guessing) quite a few rich folks who make very few, if any, charitable donations. Probably you only mean to argue narrowly as the title suggests that there’s no point in criticizing billionaire philanthropy, specifically. But as someone who supports high wealth taxes, I wanted to put in a plug for why that’s actually worth arguing for, even if Vox isn’t doing it effectively (shocking).
Re: the KKK – see the geyser comic.
Re: wealth taxes – all the articles I’ve linked propose specifically increasing taxes on billionaire philanthropy, not on billionaires in general. I agree raising taxes on billionaires in general has a much better cost-benefit ratio.
(though I’m concerned that billionaires often don’t even pay the taxes they have now because of various loopholes, so I’m not sure raising taxes would be very helpful, as opposed to finding some better way of taxing them)
Yeah… As someone literally working in government because I think reforming it from within is a) possible, b) effective, I reject the comparison to the KKK on the specific axis you use. “Run basic societal processes” is a broad goal that can be moved. “Keep down the black people” is going to be much more difficult to redirect to anything else. My bias here is clear but… C’mon.
People arguing for philanthropy taxes sound real dumb, but based solely on the short and technical snippet you quoted, I think those people might actually be functionally advocating for closing tax loopholes that rich people use to avoid paying taxes by “donating” to “causes” that provide no real value (which definitely happens).
I think the axis I wanted is something like “Does it fit our intuitions to say you should continue to support an organization you don’t like, because one day you might reform it?” I think it’s fair to test this intuition against a very bad organization, see this post for my argument.
An analogous case might be something like – I criticize the president, someone else says “You have to respect the president, you’re an American”, and I test that intuition with “Would you have to respect Hitler if he was the president?” I’m not saying the president is as bad as Hitler, or even on the same axis of badness as Hitler, I’m just trying to test the general principle with an extreme case.
But in order to make it less offensive, I’ll change the example from KKK to Scientology.
But since the analogy is about reform, you can’t stop at “generic bad organization.” You picked an organization in which “reform” in the sense of “eliminate the objectionable features of” is literally impossible because it would invalidate the entire functioning of the organization. So the implication of the analogy is that (I guess?) paying taxes is pointless because there is no chance the government would ever do anything good with them, because the only way it could possibly do something good is by abandoning it’s sole reason for existence, just like the only way the KKK would ever reform would be to decide all races should be equal and they’re for that now? That is a strong argument, and if it’s not what you mean, I think the analogy is misleading. And if you still think it’s analogous, let me know cause I’m almost certain that government’s marginal room for improvement is higher than you think.
None of this makes me disagree with the main point of the article – hell, Bill Gates paid for my college, I love billionaire philanthropy. But I think the strong responses you’re getting might be because this reads to have a broader, almost unqualified anti-government message. Which I think is distracting a bit from the specific critique.
@erinexa
I actually really liked Scott’s comparison in this regard and I’d like to offer a handful of points that might ameliorate your objections.
1. While you might think the government can be effectively changed from within, not everyone does; while you might think the government provides net “good” things, not everyone does. Even while crediting “good” by the government, the “bad” by the government might be so bad as to dwarf the “pure bad” organization in the analogy. So “no positive aspects,” just “pure bad” isn’t really the key in the comparison. “Bad” and “resistant to change” is enough.
2. The point of using the KKK is that it is an extreme example and an obvious reductio ad absurdum – the idea is that *everyone* will find that group objectionable, so and be willing to mentally follow the example and understand why relying on reform while contributing to an objectionable (indeed, very objectionable) cause is problematic (i.e. not just wasteful, but perhaps actively destructive). Scott’s subsequent selection of Scientology diminishes the strength of that connection.
3. The KKK should still qualify, because even with nothing positive about their goals, methods, etc., they are still a group composed of people. So as long as you value human life and flourishing (admittedly not everyone seems to do so), you would still at least have some hope that the people comprising the group would reform from being a-holes – if not for their own benefit, then for the benefit of everyone with whom they interact. Dissolution can be effected as a gradual reform. Keep in mind also that racist organizations like that usually frame their goals as positive messages about their own tribe, which they view as under threat from the other. That sort of framework is probably substantially more amenable to change than the way you characterized it.
@erinexa
I wrote up a defense of Scott’s original example, but the software seems to have eaten it. I’ll re-post it in short form:
1. It’s a reductio ad absurdum. The idea is to make the bad choice clear so that readers are inclined to mentally follow the example. That’s the point of reductio ad absurdum.
2. KKK still qualifies because dissolution can be effected as a gradual reform. Positive aspects inherent to the organization aren’t really required. Beyond that, peaceful, tolerant interaction between former a-holes and everyone else can qualify as a positive.
I’m afraid you confused the analogy when you changed KKK to Scientology, and potentially made it more offensive instead of less, because now you’re calling Scientologists racists.
“And maybe in a hundred years, it won’t be racist anymore”
(unless they have this reputation and I’m out-of-date)
There’s also the more subtle point that you’re saying Scientologists don’t much like feeding starving children. No idea if they do any charity.
I suggest changing it back, the KKK is a much safer dead horse to kick. If you don’t want to change it back, then I suggest changing “racist” to something else.
It occurs to me that the KKK is an interesting example for this, because there have been some very different incarnations of it. The original was an insurgent terrorist group fighting Reconstruction governments in former Confederate states. The second had virtually nothing in common but the costumes, which is related to it being the most popular incarnation which had appeal beyond the old Confederacy. This didn’t occur because some insider “reformed” it, but because the first iteration was suppressed and then decades later some enterprising huckster realized he could make a lot of money via cos-playing its brand.
> But the steelman is actually worrying about billionaire NON philanthropy.
A steelman means the best version of an argument for a position, not at an entirely different position.
Screw Vox and the like sideways with a splintery broomstick, I’m not defending their points anyway but they’re attacking the wrong thing and you’re defending the wrong thing I guess.
If they pay all their taxes honestly (without resorting to crazy schemes involving 10 countries with different tax reforms and tax havens and making one company spend all the money and the other earn all the money etc) they’re of course free to do as much philantrophy as they can and should be applauded for it.
But when they’re avoiding 100 units of money from paid as taxes and then using 1 unit of that for philantrophy this is nothing to applaud, this is just being so selfish that they’re still wanting to be applauded while they’re basically robbing the public.
So among those billionaires, the ones with “clean” billions as in no monopoly/duopoly/price fixing/bribery/other noncompetitive stuff/tax avoidance etc, they’re great philantrophists. The rest are just robber barons who are worse than ordinary robber barons since they also want to be canonized as saints.
A marginal dollar given to billionaire foundations right now might do more good than the marginal dollar given to the government, but they’re avoiding like a bunch of dollars from the government and spend only 1 on their billionaire foundations.
> But when they’re avoiding 100 units of money from paid as taxes and then using 1 unit of that for philantrophy this is nothing to applaud, this is just being so selfish that they’re still wanting to be applauded while they’re basically robbing the public.
Not paying taxes is not the same as robbing the public. At worst, it’s selfishly preventing the public from robbing you. However even if it were robbing the public, it would be justified in this case from an utilitarian perspective.
When the majority (people with salary jobs) have no way of avoiding their taxes even when they’re struggling to make ends meet, but the billionaires with their army of accountants and whatever are able to avoid it, it’s robbery by the billionaires’ part.
Not paying taxes IS EXACTLY robbing the public. It’s the definition of the free rider problem. It’s the tragedy of the commons.
And how is it justified avoiding 100 units of tax, buying fancy shit with 99 units and spending 1 on charity? Are the billionaires 100 times more efficient than the public about how to spend it? This is not utilitarianizm, this is just hatred for the public and awe for the robber barons.
> Not paying taxes IS EXACTLY robbing the public. It’s the definition of the free rider problem.
Free riding is not robbing. If you’re enjoying SAs writing but not supporting him on patreon are you robbing him and his supporters?
> Are the billionaires 100 times more efficient than the public [that is, the government] about how to spend it?
Yes, in fact a lot of government spending is negative, like war, drug war, border enforcement, etc.
I think we do not share enough common ideas to have a productive discussion
These are three separate things, and you are wrong about all of them.
You are wrong even if you believe that taxes are legitimate and people are properly obligated to pay them. In that case, not paying taxes would constitute a fraud or theft depending on the context, but not robbery. Robbery has a specific meaning, as do the other terms you’ve misused.
Being a free rider in the sense of the free rider problem, doesn’t imply robbing anyone.
From the perspective of eastern EU culture your entire rebuttal sounds like “yeah, obviously, who are you even arguing against?”. I continue to be amazed at things that sound either like The Onion or someone’s exercise in devil advocacy, and then it turns out it’s a popular opinion.
What’s particularily troubling is people preferring taxation to voluntary giving. There is really no way to charitably interpret / steelman this, is there? This is just wanting your outgroup to suffer. I’m not really subscribing to the libertarian view of taxation as theft, but certainly it is at least a lesser evil – it is after all about taking away the fruit of your work through violent means. It is far preferable – in deontological, utilitarian and especially virtue ethic frameworks – for the person to give away their money of their own free will.
Honestly the narration about billionaires is uncomfortably close to pre-WW2 narration about a certain other social group (with a lot of overlap). Interesting times indeed.
It’s the rhetoric that is used against the “outgroup + advantage” combination. Advantage can take a lot of forms – [*perceived* prefixing all of these] affluence, ability, connection/cohesion, etc. It’s used to place them in the “bad actor” category, which then allows for dehumanization (because good vs. evil) and easy rationalization of actions at their expense.
Billionaires are surprisingly receptive to effective altruist arguments, if you read the bill and melinda gates foundation missions you’ll find that their CEO is very much an effective altruist. I’m kind of sad that she wasn’t (seemingly) a member of EA global.
Also the gates foundation has an appetite for risk that no other charity on planet earth has. They seem to be willing to try out crazy strategies and just see if they work. I often wonder if charity done by people like me even has 1/10th of the value per dollar of someone like bill gates, just due to how well run the gates foundation is.
Are there any examples of billionaire philanthropy going to horrible causes? (Especially ones that seemed reasonable at the time?)
Koch brothers foundation ? they oppose global warming and support all kind of alt right think tank.
From the other side I’m strongly opposed to the things George Soros does with his money.
Meanwhile, we have cats and dogs living together.
alt right think tank?
Can you name one?
Yeah I believe the only “alt right think tank” would be Spencer’s National Policy Institute and I don’t think the Kochs give them any money.
Surprised no one brought this up earlier, but efforts at population control by the Ford and Rockefeller foundations led to the forcible sterilization of millions of men in India. The Rockefeller foundation supported the Kaiser Wilhelm Institute of Anthropology, Human Heredity, and Eugenics, and Carnegie Institute and various other charities got onto the eugenics bandwagon when that was more accepted. The Carnegie Corporation supported poor whites in pre-apartheid south africa at the expense of the black majority in order to maintain a racial caste system.
More expansively, most groups that people agree are bad (KKK, nazis, Al Qaeda) had very rich founders or early supporters.
It seems inevitable that whatever mechanisms exist to push forward ideas, sometimes they will be used to push forward bad ideas. Rich donors, support from your own or another government, support from religious groups, support from a profession, a groundswell of well-off or middle-class or working-class or underclass people joining a movement–probably every one of those has backed terrible ideas as well as good ones.
I suspect there’s still a lot of benefit overall in having those mechanisms available, so that new ideas can be pushed forward and backed by someone other than the current sitting government.
> we’re not supposed to be a pure democracy
This shouldn’t be overlooked. Not only are we “not supposed to be a pure democracy” but we very explicitly are not a democracy. Instead being a negative rights based (critically important) constitutional republic with democratic elections. Perhaps that is seen as a meta argument but the talk of voting away people’s wealth, controlling billionaires behavior or ability to act, etc. is contrary to the underlying foundations of the USA. That’s fine… but that’s a far grander topic and probably should be explicitly debated.
You speak like opposition to Billionaire Philanthropy is opposition to all kind of Philanthropy, non-Billionaire philanthropy exist you know.
a world where Billionaires horribly taxed, would spread out wealth, create more millionaire and other rich which could give to more diffuse philanthropy, with charity decided by more representative public.
when someone opposes wealthy sports owner, you shouldn’t assume they oppose all kind of sports or want full government run sports team, Green Bay Packers could exist, so does most charity that currently depend on Billionaire money.
Which, on net, would give more to charity? 1000 millionaires or 1 billionaire (assuming equal total net wealth for the two groups)? I would guess the latter. It’s true that 1000 millionaires might give to a wider range of charities, but that’s not obviously a good thing, nor is it significantly more representative given that those millionaires are still a tiny percentage of the total population.
While 1 billionaire would probably give more to charity, if you compare the billionaire to 1000 millionaires there are also 999 people with no money at all to be accounted for. So the difference in positive impact is probably negligible.
I think the analysis of Trump is off. I think Trump happened precisely because people thought “things would be better if someone rich and powerful just took control and fixed things!” That is why billionaire philanthropy should be discouraged, and people should mood signal against it; even if in the short run, the malarial killing trains run on time. Getting people to appreciate a democratic republic is no small feat, yet appreciation for demagogues happens quickly.
The fact that people think so poorly of our government says more about the lack of good civics, and insufficient knowledge of all the other forms, “that have been tried from time to time.”
But if Larry Ellison buys another yacht, I have very little fear of second order consequences.
I have a bad feeling that you sort of disregard how bad malaria is. And so how worth it was to reduce it.
It could feel “short term” but it is not. At least no more than ending up in a authoritarian dictatorship system is a short term bad consequence.
But you don’t make people appreciate a democratic republic by discouraging billionaires philanthropy.
Quite the opposite, it make it feel like what is associated with the anti-billionaire-philanthropy was finally just about maintaining some sort of anti-rich anti-outgroup narrative, and not really caring about the helped people.
I mean, if what is bad about having billionaire philanthropy is to fortify some narrative you think could end-up being so bad it make the philanthropy not worth it…
Then it seems to me all the a speech about why this philanthropy is bad is a order of magnitude worse in a narrative point of view than the actual philanthropy.
By example, it makes it very easy to have a narrative sort of like : “this system would work perfectly if people would not try to break the good stuffs for no reason or just to make this system look bad”.
It also create what I think a dangerous “meta-precedent” about it being ok to actually fight things we think is good about the “outgroup” for the very reason that it could makes the “outgroup” look better.
It could make it sound ok or even cool to waste lot of valuables resources for little reason just because you can.
It could make a lot of people respond to lot of criticisms by “but look at this guy, what he is doing a lot worse”, particularly if for some reason nobody seems to care about his behavior, and focus on the philanthropic behavior instead.
And I am sure we can invent a lot of pretty bad second order possible consequences of this kind if we are very motivated to do it.
Voting Trump doesn’t equal disregard for democracy. It means that for any reason, you prefer President Trump to President (Hilary) Clinton. If people wanted a rich and powerful person as president, they could vote randomly, all candidates are rich and powerful.
People have a poor opinion of our government because of their lived experiences. Civics has nothing to do with noticing that your schools suck, for instance.
This is one of those cases where I think Scott is missing the basic premise. The premise is that billionaires are making things less equal. And that’s what counts.
All these arguments are completely beside the point. So billionaires get to save tens, hundreds of millions of lives, and some people can only write posts for Vox and Salon. How unequal is that?
Okay, if the billionaires go away all these people will die. But it’ll be more equal then.
There’s a point that I think is missed, which is that basic premises have nasty habit of ending up at their logical consequences. If the primary aim of this lot is equality, then other concerns – such as human happiness and health and survival – will go by the wayside. You always end up giving up secondary aims for primary ones.
This seems like a confusingly narrow definition of “equality” to me.
In the scenario where billionaires didn’t donate that money to live-saving charities, yes, perhaps fewer journalists would feel unimportant, but also millions more of the world’s poorest and most vulnerable people would die from preventable diseases. That feels a lot less equal to me than the scenario where billionaires use their wealth to help the global poor and some educated first-world journalists feel overshadowed.
Normally, for these kinds of posts, you summarize the argument you are arguing against, steelman it a little and then try to pick it apart. You have not done that here, and I think you are doing yourself a disservice. The first linked article contains a nice summation of Reich’s argument:
Note that Reich is writing as a “political philosopher”. He is arguing about systems and principles. We can see an example of this later:
You aren’t grappling with his actual criticism much at all, instead arguing with the more hyperbolic or emotional language he is using about people being grateful for donations. What struck about the critical quotes you pulled up was that they mostly weren’t critical of donations, per se. Note that the big examples were donations to schools. Zuckerberg was criticized for having an ill considered reform effort, Bezos wasn’t criticized but rather government policy was (the absence of head start as general policy), Gates wasn’t criticized, again, the absence of policy was.
Now, your examples of the size of donations compared to the federal government are salient in general, but the appropriate comparison isn’t size of Zuck’s donation to the fed budget. It’s size of Zuck’s donation to the Newark schools budget. As a comparison, you might also look at how Lebron James recent donation to Cleveland public schools was covered.
Also, if you originally had Nazis in the post and then changed it to the KKK, it didn’t help. Still fundamentally a Godwin.
+1, and annoyingly, Scott even seems to recognize the issue:
I haven’t gone through enough of the linked articles yet to conclude the post is attacking a strawman, but there are definitely some (IMO valid) arguments advanced that are conspicuously absent from this rebuttal.
I’m going to snarl a bit about this excerpt from the above, so anyone who doesn’t want to wade into the murky waters of “Those dern Bible-bashers, always retarding progress and keeping the good folks down!” can skip this with no qualms.
Oh, noes! No stem cell research at all! No funding at all! Terror-stricken scientists fleeing in the clothes they stood up in over the friendly Canadian borders to escape the torch-wielding mobs of Fundamentalists seeking to burn them at the stake just like that eminent astronomer and physicist, Giordano Bruno! All progress towards making the halt and the lame walk, the blind see, and the dumb speak torn down and trampled upon, just because of a bunch of irrational superstititous bigots!
GOOD JOB THAT NEVER HAPPENED, SO!
First, here’s something I didn’t know – from that well-known haven of conservative Christian agenda-pushing, NPR, back in 2007 when there was an attempt to overturn the 2001 ban (bolding mine):
But – but – but I thought back in 2001 Bush cowardly capitulated to the crawthumping Holy Joes and banned all science! No? No federal funding before his announcement, you don’t say?
Second, what was banned? Embryonic stem-cell research, and not all – no new lines could be created, but exisiting lines could be used:
See, us ignorant anti-science knuckle-dragging progress-hater Bible-bashers had this funny thing going on in what passes for our brains: we have this weird unreasonable objection to creating and destroying embryos, but we said that adult stem cell research, placental cord and blood research, and other non-destructive methods would be okay with us. Just no using aborted foetuses, spare waste ‘only gonna be thrown in the garbage’* embryos from fertility clinics, or whipping up a batch in the lab to be dissassembled for the stem cells. Yeah, I know – how crazy and stupid and dumb can we be, right?
So anyways all us mouth-breathers (no, I’m not American but since I am a Catholic and under some definitions that passes as Christian, and I’m a conservative/traditional one, I’m including myself in with the backwards bigots) got Bush to ban embryonic stem cells (except if you already used an existing line and could now apply for federal funding) and that was a dreadful set-back for Science, Medicine, and Progress. All those miracle cures that were only
fivetensome years down the line would now never happen at all:What do you mean, other avenues of research?
Well, okay, but those don’t really count! They’re not real stem-cell research on embryonic cells!
(to be continued)
*One reason I don’t believe the “slippery slope fallacy” is a fallacy is that I’ve seen it work out too often in real life. Catholicism does not allow IVF for reasons, and the early fertility researchers and their stooges in the media were all “How can you be so cruel? So cruel and heartless and mean! This is the Miracle of Life! Childless couples are longing for children and we can help them, but you want to forbid it!” Then, when people raised objections as to “But what about spare embryos created, what happens then?” “Oh no no no, no embryos will be wasted! The parents want children so they’ll use them all! No Precious Miracle of Life will be stored long-term unused, much less be dumped as trash!”
Didn’t take too long for the “Precious Wanted Miracle of Life” to go to “we got all these spare embryos cluttering up storage, they’re only going to be dumped as rubbish, might as well get some use from the trash so use them for stem-cell research”. But hey, no such thing as a slippery slope!
(cont.)
Luckily, Reason and Progress were rescued by Hope and Change, and with the advent of the Light-worker the new dawn shone on stem-cell research:
Well, except for some remnants of backwardness still lingering (as an aside, I really admire the names on American laws, and by “admire” I mean “gaze in stupefaction”):
Boo hiss, Dickey and/or Wicker! But anyway, at least now all the outraged and saddened scientists who were troubled by the inability to get federal, as opposed to private, funding for embryonic stem-cell research and who warned that China would get there first (and then they’d never have a shot at the Nobel and a fortune by patenting their research and selling it to a big pharma company) could now provide us with the promised Miracle Cures they assured us were there for the taking, right?
Wellllll…. not so much:
Still, we can be grateful that bold and forward-thinking professionals are not out to make a fast buck when breaking the over-cautious rules of timid-minded legislatures:
Oops. Well, never mind, can’t make an omelette and so on, and besides, the embryonic stem-cell research is really promising for research purposes and better understanding of the underlying mechanisms involved. Promised Miracle Cures? We never promised you any miracle cures within five years, and if we did, it was only the necessary appeal to public emotion to get the vital legislation passed, since lay people can’t appreciate or understand the science involved, so we had to promise them lollipops. Everyone knows that’s how it works!
In conclusion:
Embryonic stem-cell research is still mainly research-based tool, and to date is not providing many treatments or cures. The licenced forms of stem-cell treatment are ones not involving embryonic stem cells:
The miracle cures five years away still aren’t there yet, but there are lots of hucksters and scammers out there riding the crest of the publicity:
But yeah, the religious conservatives are the ones who are the biggest danger to Progress and Health.
Now, the ethical and moral questions involved are where the cleaving occurs: if you think embryos are not of moral worth and are not human/persons/possessing personhood, the ‘clump of cells’ abortion argument, then for you this is a distinction not worth making as it is meaningless: stem-cell reseach is stem-cell research, be it on embryo-derived, adult, cord blood, mouse, whatever.
But I would please like to at least be whipped with the cat o’ nine tails for the crimes I have committed, not those I have not. Nutcase religious bigots object to embryonic stem-cell research, not blanket all stem-cell research. I would like Scott to correct that much in his post, but I’m not going to demand it or expect it.
In fairness to Scott, some sloppiness there is probably more rhetorically effective for reaching the target audience of this post. On the other hand, it reinforces an unfair, inaccurate perception. I’m glad you pointed it out.
Is it too soon to say how boneheaded that plan sounds?
Ah, once again we’re separated by a common language. Here in America, they’re bible-THUMPERS. Bible-bashers isn’t a common term but if it were it would imply the people involved were against the Bible.
Just so I’m clear for later, is all of this post you joking and being humorous? None of this actually matters to you and you aren’t mad about it all?
Or will it only become humor when I later decide to quote it?
In light of the first sentence,
and the rest of the tone and content, I took it as an attempt at informing on a subject that is often described inaccurately, with sufficient sarcasm to express that even an oblique but misleading reference – perhaps especially by a careful writer such as Scott – is exasperating to those who know better (and even more so to those who feel it is their position being mischaracterized).
You seem to be implying an intention to resort to a motte-and-bailey rhetorical tactic. I didn’t observe that.
I enjoy lists and spirited debate, if that doesn’t sound like your cup of tea, please have a nice day and instead watch
“Dog and crow play fetch together” on Youtube, it’s delightful 🙂
1.”Mark Zuckerberg giving $100 million to help low-income students”
Zero change to academic outcomes, funded political corruption.
2.”by conservative estimates the Gates Foundation may have saved ten million people.”
In countries that can not currently support their populations, is increasing the population while leaving the economy unchanged a positive outcome for the world?
3.”we should worry more about the consequences of the backlash.”
the unfounded belief that altruism and empathy drives the behavior of the mega wealthy, rather than tax avoidance and lust for power from beyond the grave. Which are the motives traditionally espoused by this class
4.”found that 92% of suspects without bail assistance will plead guilty and get a criminal record. But if given enough bail assistance to make it to trial, over half would have all charges dropped.”
The desire for the charged to go free requires an alternative reading the FBI crime stats to the one that I feel is most statistically robust, or being sanguine about the effects of crime.
5.”In 2017, the foundation of billionaire William Hewlett (think Hewlett-Packard) pledged $600 million to fight climate change. One gift by one guy was almost twice the entire US federal government’s yearly spending on climate issues.”
If anyone on this thread believes in the climate movie, I’ve got houses in New England to sell you. Cheaper than a Tesla and will be delightful even with a increase of 10 degrees F
6.”I realize there’s some very weak sense in which the US government represents me. But it’s really weak. Really, really weak.”
Delightful! Slate Star finally going full Moldbug
7.”Also, do you realize how monumental a task “reform the government” is? There are thousands of well-funded organizations full of highly-talented people trying to reform the government at any given moment, and they’re all locked in a tug-of-war death match reminiscent of that one church in Jerusalem where nobody has been able to remove a ladder for three hundred years. ”
Wow, full dark enlightenment. All this post needs is a beagle picture
8.” The yearly billionaire philanthropy budget is about $10 billion, 400 times smaller.”
This is a misleading statistic, we’re better than this
9.”It was multimillionaire heiress Katharine McCormick who funded the research into what would become the first combined oral contraceptive pill. More recently, it was Warren Buffett who funded RU-486 and the IUD. Together with similar work by the Rockefeller and Ford foundations, these have prevented millions of unwanted pregnancies”
NGOs are tax write offs for people who want money to wage ware on Christian ethics, which I think perfectly illustrates the Cathedral metaphor. Tax them all! Church Charity and College all need to pay for assets and income.
10.”Aren’t the failures of government just due to Donald Trump”
Mandatory Current Year Trump bashing, again I feel we’re better than this when discussing ideas
11.”Moskovitz and Tuna saved a hundred million animals from excruciatingly painful conditions.”
This assumes two things the animals weren’t simply shifted to a more distant location, and the pricing effects of the change are zero.
Which underlies my main critique of the left,
First the belief that people don’t adjust to regulation in unexpected and often opposite ways.
and Second the belief that the residual costs are zero.
8
How is it misleading?
It sems to imply that billionaire ought to be considered as a very unimportant phenomenon. I agree.
The deficit is 40 times bigger, but it doesn’t have sexy, controversial people with yachts and visionary/grandstanding ideas for society associated with it.
People who are of course outliers and thus naturally polarizing.
Money is money and in this case it’s public money, thus even more of a public concern.
Ok, maybe one can still argue against or for Billionaire spending. Only because it is not the most important thing, doesn’t mean that discussing it, is not fruitful.
I think the argument is that, if ideas about billionaires and whether they are taxed enough or too powerful or whether this is fair or unfair, are of grave importance of someone’s political outlook, then that someone misunderstands the true scope of tax revenue and actually exercised power (and it’s effects on plurality, democracy and [insert nice thing]).
With it implied that government spending is just some force of nature, that hardly matters, cause it doesn’t involve celebrities.
“Zero change to academic outcomes, funded political corruption.”
Large positive change to academic outcomes, and the fact that “everyone knows” there was no change to outcomes is part of what scares me.
“In countries that can not currently support their populations, is increasing the population while leaving the economy unchanged a positive outcome for the world?”
These countries aren’t having famines or anything, and there’s good reason to think eliminating tropical diseases will help the economy.
“the unfounded belief that altruism and empathy drives the behavior of the mega wealthy, rather than tax avoidance and lust for power from beyond the grave. Which are the motives traditionally espoused by this class”
A lot of the billionaires mentioned in this article are giving away 90+% of their wealth, that’s a pretty drastic tax avoidance scheme.
“Delightful! Slate Star finally going full Moldbug”
Saying I don’t agree with Trump about everything is reactionary now? I guess this was the logical conclusion of everything, really.
Large changes to academic outcomes?
Scott, what are the chances you update on this piece of information you are currently quoting approvingly? Or will you later go back to claiming that education has no outcomes outside of signaling?
See https://slatestarcodex.com/2016/05/19/teachers-much-more-than-you-wanted-to-know/
My position is that good education can temporarily raise test scores, though with low effect compared to other factors. For exactly how temporary and how little effect, please read the post.
I’m well aware of your position, Scott.
Employing a study touting positive effects you don’t believe in when it’s convenient for your argument is poor form.
ETA:
I was also note that you seem to be prevaricating about what your study shows:
Reducing disease load almost certainly improves economic conditions.
Maybe just tax billionaires adequately in the first place?
I mean people see news of Bezos being worth one trillion dollars, and student debt in america being a trillion and something, it’s hard not to see that making Bezos a mere billionaire could go a long way to pay off said debt.
Merely-billionaire-Bezos could still donate to whatever fund he wants.
It’s not like they would be against it. IIRC Gates and Buffet have supported being taxed half of their worth on their deaths, so I doubt taxing them more would erase the Gates foundation.
Supporting taxation on death and supporting taxation while you’re alive are two very different things. I’m pretty sure Gates would squeal quite a bit if you proposed taking half his wealth _now_. Besides, I’m pretty sure he means only what remains of his personal fortune, not the assets of the foundation.
Most people would give their life to save their children, if need be.
You’re only really dead, if noone remembers you. And the older you get, the more you value your legacy.
So I don’t think there’s that much of a difference really.
If you are taking half of the things from someone rich now, you’d take half of their family wealth (with the ultrarich, we can probably round up to half).
If you do it when someone rich dies, you’d still take half of their family wealth.
Imagine you’ve build something big and want your son or daughter to lead it, after you’re gone. With a sufficiently high inheritance tax in force, you can’t really do that well.
[not even talking about the case, where family members die in short succession and this just destroying a company]
So with an inehritance tax, you have strongly curtailed ownership rights, because you’re attacking one of the most important forms of collective ownership. Intergenerational ownership. A man is an island……. but of his connected archipelago.
Gates is already fine with his family not having his fortune. If you take it all now, I don’t think he’d be that broken up about it either, because I don’t think he’s keeping it now for selfish reasons.
And he thinks his family will be fine anyway and doesn’t envision Microsoft as the Gates’ family business.
Gates’ personal preference don’t matter much for the discussion.
[epistemic status: a bit in over my head, and someone who understands the stock market please chime in, cause I think I’m butchering it and…. wrong; someone save me please]
Not entirely sure with the specific case of Bezos, but when they say:
“Mr X is worth Y billions.”, this does not refer to them having that much cash, but this being whatever stock in the companies they own is valued at current price.
So you can’t just tax the “trillion” of Bezos. Cause that trillion is (a large part of) the company of Amazon itself.
But that’s worth more than just the sum of it’s assets, because its also the institution and culture itself.
Which is already generating a lot of tax revenue. If you’d want to nationalize it to get at the wealth, then you’d have the government owning a tech company, which would turn it into a bureaucracy and thus….. worth a lot less.
I suppose the US could seize it and auction Bezos part off, but who would buy from someone that got robbed the good he’s selling to you and might as well rob you in turn and sell it again? The worth of a company is also a reflection of the conditions of the marketplace in which it exists.
If that marketplace becomes hostile to ownership, you’d not value the stuff, that you can find there.
If Bezos dies tomorrow, you would see that the Amazon-stock itself likely looses a lot of value immediately.
So the “value” of Amazon might be measured in dollars, but it’s mostly just how much Amazon is trusted when people risking their money/(some part of) their livelihood and bid to own a part of it.
And even if Bezos himself were to decide to sell all his stock right now, to hand a check to the US government to pay off all student debt….. he could not, cause then people would see that Bezos no longer owns (and/or trusts the future of) Amazon.
Not to mention, the willingness to sell stock reduces it’s price, even if it weren’t Bezos selling it.
So rich people’s net-worth calculation (if it comes from stocks) is more about: “How important is their endeavour, relative to all others.”
Not so much: “How many students can he bail out, if he wants nothing else or if we take all his stuff.”
It’s illiquid in many ways.
A corrolary: A bond villain’s spacestation might be estimated as being worth a hundred billion, yet no single one person can realistically build one, cause a secret lair for developing a death ray just isn’t a societally worthwhile endeavor.
Noone is actually rich enough to have that much money and the our bland and hopeless lives thus lack the color of a Bond movie and we have to get our kicks from their equivalents painting their puny yachts to match the color of their perfectly commodofied cars.
I think the usual answer is to accept payment in, for example, company stock. This way the government does have claim to the future income produced by that company, as well as the ability to liquidise it by selling that stock if it prefers to have it in a lump sum. Debt instruments on either side of the equation can act to smooth that transition as well. I don’t think there’s a problem here?
This is a great potential motte and Bailey depending on what adequately means. Is it “adequate to fund the essential services of the government without accruing debt”? Or is it “adequate to ensure there are no more billionaires”?
My personal preferred solution is, rather than tax billionaires until they aren’t, judiciously wield the anti-trust stick until there aren’t billionaires (because the fierce competition won’t let them have that much margin).
That, or a mandated ratio of highest pay in the company to its lowest pay (including sub-contractors). The populace seems to think that 30 is the right level. I’ll be generous and say 1000, so that if any company has a $15/hour worker, their CEO salary maxes out at…$31.2 million a year.
@AG,
Sounds better than the existing status quo, so sure.
it’s hard not to see that making Bezos a mere billionaire could go a long way to pay off said debt
The fallacy here is that it assumes different levels of taxation and different arrangements for education would change nothing except Bezos being slightly less rich and student debt disappearing. If you had a magic wand that allowed you to just touch specific points in economy – maybe. But in reality change of taxation would lead to massive change of behavior not only for Bezos but for every major business enterprise, and no payment for enrolling in college would also change the demand for college significantly. So just juggling these numbers as if that means something is plain economic misunderstanding.
The charity argument strikes me as a sideshow.
If you don’t have moral objections to taxes at that level, and you’re satisfied that taxing wealthy people doesn’t reduce innovation and productivity, than go ahead and tax.
I’m pretty well satisfied that it does reduce productivity, and therefore I’m against confiscatory taxes, but whichever side you come out on, *that’s* the debate to have.
Isn’t that kind of why Scott wrote this post, though? That all these outlets with these oddly specifically targeted articles are promoting a sideshow?
Like, it’s not even “murder, arson, and jaywalking,” it’s “murder, arson, and giving money to charity,” and that these articles think that the charity is the thing to be offended about.
I think 4. is exactly the point of contention, except it isn’t about democracy-as-a-process. If billionaires tend to have different worldviews/values than society as a whole, they will spend on charity in a way that society as a whole would not only not do, but not even endorse. The more effective the philanthropist, the more severe the mismatch, since the donors would spend less on “fruit that is already being gathered” due to the cause’s social support, and more on goals that nearly nobody is working towards. If this were the case, it would be perfectly reasonable to say “billionaires should spend their money in a way that society judges to be the lesser evil: they should buy yachts”. Alternatively, “if only they were philanderers, not philanthropists”.
2/3 of the specific examples given:
“Or take one of M&T’s other major causes, animal welfare. […] Moskovitz and Tuna funded a ballot measure which successfully banned this kind of confinement. […] It would have joined the $20 billion – again, more than T&M’s combined fortunes – that the government spends to subsidize factory farming each year.”
I think this is the most clear-cut case. Cheap meat has enough popular support that the state actively subsidized factory farming. (Cynical, PCT-informed phrasing: cheap meat has enough popular support that the state could get away with subsidizing factory farms.) Now some billionaires come around, get factory farming banned, and make meat more expensive for everyone.
“George Soros donated/invested $500 million to help migrants and refugees. […] It would have gone to building a border wall, building more camps to lock up migrants, more cages to separate refugee children from their families.”
Purely empirically, there is enormous popular support for keeping migration levels low, which is why these policies were proposed/implemented in the first place.
I think “democracy” enters the discussion incidentally. Trying to simplify the argument: assuming something akin to Rawls’ veil of ignorance, where we don’t know our moral opinions, we would want for society to be such that it implemented the moral opinions of the majority. (Here ignoring strengths of the opinions, proximity of effect, etc. for simplicity’s sake.) Democracy does approximate this ideal, however loosely. When billionaire philanthropists donate according to their moral opinions that are very different from society’s “average”, and violate this veil-of-ignorance view, probably the easiest description that comes to most people uses “democracy” as a proxy for “average of the moral opinions”.
_____________________________________________________________
“The idea that we should divert money from freeing the incarcerated, saving animals, and reuniting families – to instead expanding incarceration, torturing animals, and separating families – seems monstrous to me, even (especially?) when cloaked in communitarian language.”
Murderism! These are sometimes necessary, sometimes irrelevant, sometimes regrettable things that happen as instruments or side effects of various other goals.
Yes, the US criminal system is inefficient in terms of crime prevention per punishment. Yes, the US border system is inefficient in terms of demographic-goal-achievement per punishment. (Proposals for more efficient alternatives, and discussion of whether these goals are even desirable are outside the scope of this thread.) But it is these goals, run through perhaps disastrously wrong models (and public choice theory, and “the mitten-handedness of bureaucracies”, i.e. they are only able to execute consistently a small fraction of possible-policy-space) that lead to the current policies throwing around punishment.
_____________________________________________________________
6. (Some duplication)
“When I see philanthropists try to save lives and cure diseases, I feel like there’s someone powerful out there who shares my values and represents me. […] When I watch Congress, I feel a scary unbridgeable gulf between me and anybody who matters.”
These sentences were deliberately written as a pair. Surely it isn’t necessary to point out that, to someone who has different values, it is terrifying to see not only an ineffectual Congress aloof from them mostly ignore them, but also powerful individuals acting efficiently toward goals that appear to range from the pointless to the monstrous.
To repeat: in my interpretation, “democracy” in the popular debate is used as a proxy for “what we would do under a moral veil of ignorance”, or perhaps coherent extrapolated volition, because neither journalists nor the public possess these concepts.
______________________________________________________________
9-10. Using John Nerst (of Everything Studies) ‘s tilted political compass; I’ll call “coupling” corporatism/collectivism.
Devil’s advocacy: to a corporatist, pluralism has no (terminal) value. Indeed, it might have negative instrumental value, as it enables all sorts of harmess-but-antisocial behavior. (My understanding is that completely pointless social norms are useful to many, as people who follow them despite the pointlessness can be trusted to also follow norms that do matter, while people who routinely violate them with “but it’s harmless!” can be distrusted and their group membership/loyalty questioned. Uncharitably, this is especially sensible from a position of bounded rationality; you can better trust your ability to remember if your partner has followed/broken norms, than your ability to figure out if he’s trying to trick you.)
Billionaire philanthropy itself then, as it supports pluralism as an idea, helps in demolishing the walls of various tribes, thereby threatening their existence. (Sometimes this isn’t a mere side effect, but an explicit goal.) On the level of society, this is often described as “the social fabric unraveling”.
I think that, according to the corporatist view, having only a “narrow system”, a single organization to do things is unobjectionable or even desirable. Given that “we’re all in the same boat”, we make it or we drown as a group, thus our wants necessarily overlap to a very high degree, a single organization is sufficient for the purpose.
On the veil-of-ignorance view, “the demos f@#ks up” is almost nonsense.
You’ve just bought an extra $4/hour for warehouse workers, at the cost of ten million lives.
That is not true. Consider: Bezos has so much spare cash, he’s setting up his own private space jaunt project. That is from the profits made by things like screwing over the workers. Whether Bezos decides to blow the dosh on yachts, space ships or photogenic African moppets, is purely up to his whims. He’s already made money off misery.
What is really going on is: by squeezing blood from a stone, Bezos is generating obscene levels of personal wealth. That he then throws relative crumbs from his table to ‘good causes’ is not an either/or scenario, much less praiseworthy; let him treat his workers well first, that will increase their standards of living and have the beneficial knock-on effect economically for their families, the businesses they patronise, the towns where they live, the national economy which in turn can devote extra money from tax revenue to taking care of social ills and overseas aid. Then, from the excess he will still have remaining, let him engage in charity. When it bites, that is when he is doing something praiseworthy. Not when it’s “I have so much left over even after building my own private spaceship, I can afford to throw something to the beggars”.
Okay, done. So, moving on?
On the other hand, even the poorest American worker is by far richer than an African kids whom Bezos helps. So you might say that he takes money from (relatively) rich Americans and redistributes them to poor Africans, not at all unlike the government, only on the global scale. Sure some big chunk of money stays in his pockets, again just like in the case of government. Arguably government does it in a more coercive manner – taxes are mandatory but employment at Amazon at least nominally isn’t. So this makes it just a quantitative question of who’s doing more efficient job at redistribution and throws away smaller fraction on private/fighter jets. Unless of course you believe that a life of an American is inherently more valuable than that of African, in which case Bezos indeed will look as pure evil.
Unsurprisingly, given that I think billionaires shouldn’t exist in the first place (i.e. they should be taxed into merely being very rich rather than having more money than the vast majority of people even in Western country can hope to make if they lived ten thousand years.), I disagree with you. But I’m not going to convince you of that.
I think your post makes a mistake by not sufficiently distinguishing between two modes of billionaire charities. Bill Gates is the kind where they do it right : set up a foundation, give them resources, and ask them to figure out what needs to be done and do it. He does get publicity out of it, but it seems that the main goal is actually solving a problem that he thinks needs solving. It’s sort of the same thing for George Soros : he’s clearly not doing what he does to be popular, although in his case detractors could argue he’s doing it to convert his dollars into political power (incidentally, calling the Koch brothers philanthropists as you seem to do implicitly by comparing them to Soros is laughable : they are billionaires spending a lot of money in causes that don’t directly bring an RIO, but those causes are designed to hurt humanity, not help it).
The other way billionaires love to spend their money is to identify a trending problem and “solve” it by extremely publicly throwing money at it. Or, more likely, claiming that they will throw money at it and then not doing that because their feelings got hurt (Elon Musk) or because the cameras aren’t rolling anymore and they got the advertising they wanted (billionaires who offered to pay to rebuild Notre-Dame de Paris, see for example https://www.theguardian.com/commentisfree/2019/jul/18/ruins-notre-dame-billionaires-french-philanthropy)
I think you misspelled “but I disagree with their politics, so them doing it is evil whereas Soros doing it is good”. From someone with different politics, Soros’s causes might be seen as ‘hurting humanity’. Claiming that they’re designed to hurt humanity is ridiculous: adherents of every political philosophy (yes, even the Godwin-level ones) believe that their means serve good ends; caricaturing your opponents as cackling villains may be emotionally satisfying but it’s epistemically irrational.
Could you please substantiate this accusation? I’m not aware of him ever doing anything like that, in spite of the huge amounts of vitriol that are the media’s standard response when he tries to help.
The Kochs donate a ton of money to traditional charity as well. Opening a charitable hospital at a cost of $100M was designed to make things worse and deserved to be picketed?
They’re designed to hurt fractions of humanity these people don’t regard as having moral relevance. Since you bring up Godwin’s point : Hitler didn’t want to destroy all of humanity, just all of humanity that wasn’t identified as aryan (or at the very least reduce them to slavery). Nevertheless I think characterizing Hitler’s policies as “aiming to hurt humanity, not help it” would not be hugely controversial.
The Koch brothers are not quite on Hitler’s level, but they are definitely funding policies designed to hurt members of the outgroup which includes most of humanity. They’ll fund things that are likely to cause people to be hurt (from pollution, for example), rather than things actually likely to save people. I am ready to believe some of their donations fall under the traditional definition of charity/philanthropy, but those probably aren’t the ones people are mad about, or the ones which fall under the umbrella of reforming the government.
Actually I went back and checked, I misremembered and mischaracterized what happened. My apologies. Musk did call a “pedo” the person who mocked his uncalled-for submarine in the Thai cave rescue, but he did eventually make good on his (related) promise to help Flint, MI.
I still think Musk is the *wrong* kind of billionaire charity (mostly doing it for the publicity), but he’s not the *worst* kind of billionaire charity.
The understatement of the year right here.
Yeah, I hope you are ready because it’s true and can be verified with a Google. By the way, yes protesters protested their donation of $100M to open a hospital.
Let’s see your links, bro
Or fractions of humanity these people think are, in turn, hurting humanity.
Hitler believed (well, probably; psychoanalysing historical figures is a mug’s game) that Jews were an x-risk to civilisation (I’m paraphrasing, obviously). Now sure, he made an error of morals (separate to his error of fact) in concluding that that gave him the right to exterminate them, but it’s an error of morals he shares with a lot of heads of state throughout history, many of whom have fairly good reputations. (To be specific, the moral error is treating your (necessarily unreliable) beliefs about omelettes as justification for breaking eggs.)
And leaving Godwin’s realm, the Koch brothers (presumably) believe that social liberalism, leftist economics, environmental regulations etcetera do net harm to humanity, and thus that opposing such things politically will help humanity. Since you mentioned pollution: economic growth can ‘pay for’ a lot of pollution in utilitarian terms, not least by providing the capital needed to fund the development of greener technologies.
Claiming that the Kochs are just “trying to hurt their outgroup” is conflict-theory thinking.
I don’t think Musk typically does things ‘for the publicity’; I think it’s motivated by his sense of aesthetics (‘wouldn’t it be awesome if XYZ happened? wait a minute, I could make it happen’). This can often look like publicity stunts, because things that appeal to Musk’s aesthetics also appeal to quite a lot of other people’s aesthetics, whether that’s cave submarines or space Roadsters.
I don’t think the Koch brothers are quite so opposed to “social liberalism”. For example, social liberals tend to think there’s too much incarceration, and the Kochs are with Soros on that. They’re also pro-immigration.
@teageegeepea
Huh. I’d somehow gotten the idea (doubtless from endless Leftist propaganda about how eeevul they are) that the Kochs were social conservatives (particularly on ‘bedroom issues’). But apparently (even Wiki says so) they’re classical-liberal/libertarian. Awesome.
I don’t know about the specific thing you are talking about. But it seems like one of the reason we should not discourage billionaires from giving, and rather praise it.
This doesn’t prevent us to be allowed to say something about rich pretending to give but not actually giving.
Or about causes we think are negatives.
Or about increasing taxes, or even having a very different economical system where it is impossible to become billionaire.
It sounds like you’re complaining about lack of billionaire philanthropy, which I agree is bad.
First I want to note I mischaracterized the thing with Elon Musk (see cousin comment replying to ec429). I really hate the near-cult worship he’s got going on and I guess that got me to not checking that my memories of the incident were accurate. Apologies for using a falsehood as an argument.
Second, yes, I agree with you that all other things being equal, if a billionaire donates money to a worthy cause it’s better than if that billionaire uses the same money to build a giant yacht, at least in the short term (there may be adverse second-order effects).
But I think our agreement stops here : you seem to advocate a policy of encouraging billionaire charity, which means probably supporting some spending in order to have more of it (unless I completely misunderstood your position). I think that while philanthropy should not be outright discouraged, we shouldn’t rely on it. I don’t care if the state is 100 times less efficient than billionaire charities : billionaires spend less than 1% of their wealth on charities on average, so if we tax it all we can achieve at least the same results with less inequality.
I’m not concerned about your argument that worthy causes that are currently being funded by billionaires would be ignored. If progressives manage to get enough power to tax billionaires into oblivion, it’s extremely likely the government will have someone who remembers it’s a good idea to not torture people because they smokes marijuana once.
Based on what? The assumption that the tenuous alliance between economic leftists and social liberals will hold forever?
I’ve never met an economic leftist who was not also socially liberal (insofar as those categories have any meaning), so I wouldn’t call that a tenuous alliance.
@Subb4k > “I’ve never met an economic leftist who was not also socially liberal (insofar as those categories have any meaning), so I wouldn’t call that a tenuous alliance”
I’m far more “economic left” than I am “social liberal” (I’d let the “social conservatives” win almost all they want for bringing back “Welfare as we know it”, the WPA, and 1935 to 1946 labor law.
If your near Berkeley/Oakland/San Francisco, California and want to meet me e-mail: HOJ [dot] plumber [at] gmail [dot] com (no spaces)
@Subb4k: The fact that you’ve never met people like that doesn’t mean that they don’t exist. It just means that your social circle is mostly limited to people who mostly share your views.
Statistically, though, there are plenty of people who are socially liberal but fiscally conservative – they’re called libertarians, you see them on the internet all the time. Likewise, there are plenty of people who are left-leaning on economic issues but right-leaning on social issues; there’s no generally accepted term for them in political science, but I’ve seen them referred to as “hardhats,” “communitarians,” or “populists.”
According to FiveThirtyEight, 22% of Americans have broadly libertarian (socially left, economically right) views, while 20% of Americans have broadly “hardhat” (socially right, economically left) views. So these aren’t small fringe minorities by any means. As Nate Silver points out in the article, “the rigidly partisan views of political elites should not be mistaken for the relatively malleable and diverse ones that American voters hold.”
But even leaving aside statistics, you can already see the cracks forming between the economic and social left, and likewise between the economic and social right. For instance, the ongoing tension between leftist proponents of identity politics (who largely focus on the problems facing racial minorities, women, and LGBT people) and the traditional labor leftists and socialists and Marxists (who believe that the class divide is the only form of social division that matters). During Pride month, I saw constant back and forth arguments between social progressives celebrating the fact that queer people were finally being recognized and accepted by corporate society, and economic leftists denouncing “rainbow capitalism” as a form of cheap pandering and criticizing LGBT advocates who “sold out” to corporations. You can find plenty of thinkpieces and social media posts debating the issue. And that’s without even getting into the myriad conflicts between social justice advocates and “Bernie bros” back in 2016, and to a lesser extent now.
Or on the other side of the fence, just look at the fact that far-right social conservative Tucker Carlson recently denounced capitalism, having (correctly, in my view) deduced that it’s responsible for the very multiculturalism and libertinism that cultural conservatives are so vehemently opposed to. Trump himself is obviously right-wing on both economic and cultural issues, but many of his supporters are “hardhats.” In fact, a large part of the reason he won the 2016 election was because he successfully appealed to hardhats in the Rust Belt who traditionally voted Democratic. (It’s not a coincidence that many Trump voters preferred Sanders to Hillary, a phenomenon that makes no sense if you’re looking at a purely one-dimensional political spectrum.)
It should be pretty clear to anyone who’s paying attention that political alliances are shifting, so I wouldn’t take it for granted that the victories of economic leftists will bring about social liberalism, or vice-versa. Especially since a lot of socially progressive leftists are millennials or zoomers whose political views may change as they get older.
So, we elected a Democrat president and also had Democratic majorities in both houses of congress in 2008-2010. But somehow, I’m not remembering the part wher we got rid of the marijuana laws and reformed our prisons.
@albatross11
Sure we did, while still nominally against federal law, anti-marijuana laws were ordered a “low priority”, California’s medical exemption made it depends facto legal with every dime-store quack selling “medical cards” (both my father and my brother got them) and the number of inmates in the building I repair jails dropped to half its capacity despite “re-alignment” and the State changing felonies to misdemeanors so they could move inmates from the State prisons to the County jails, and smoking weed in front of court houses and police stations became regular and the stench harder to avoid.
You must have misread my comment. I know libertarians exist (I’m not going top debate their sincerity now), as well as liberals who are not leftists. I am not saying social liberal implies economic leftitst. I am saying that in my experience so far economic leftist implies social liberal.
Not American, but I think I also missed the part where Obama taxed billionaires into oblivion. To argue against “A implies B” you need to show that A happened but B didn’t.
What do you mean by “in my experience”? If you’re simply talking about the people that you personally know, then your statement could very well be true, but it’s irrelevant; all it means is that the people you personally know aren’t a good representation of the populace as a whole.
But if you’re trying to make any kind of broader claim about people’s political views, then you’re just flat-out wrong. Again, statistics consistently show that roughly 20% of Americans are “fiscally conservative but socially liberal,” and another 20% are “socially conservative but fiscally liberal,” compared to roughly 30% of Americans who are conservative on both fiscal and social issues, and 30% of Americans who are liberal on both fiscal and social issues. 20% is far from irrelevant in politics, and ignoring the existence of those groups is a glaring flaw in any political analysis. And it’s short-sighted to think the current political status quo (i.e. economically right-wing and socially conservative Republicans, economically left-wing and socially liberal Democrats) is some kind of unchanging absolute, especially since these alignments have changed before and are showing signs of changing again.
What, like, per year?
Billionaires probably spend a very small percentage of their wealth per year in the first place given that wealth is not income, not always liquid, tied up in stocks, investments, etc.
Uh, yeah, brainfart.
Accounting for how billionaires get return on investments the state would need to be way more efficient than 1% the efficiency of billionaire charities, but can still probably afford to be several times less efficient.
“But I think our agreement stops here : you seem to advocate a policy of encouraging billionaire charity, which means probably supporting some spending in order to have more of it (unless I completely misunderstood your position). I think that while philanthropy should not be outright discouraged, we shouldn’t rely on it. I don’t care if the state is 100 times less efficient than billionaire charities : billionaires spend less than 1% of their wealth on charities on average, so if we tax it all we can achieve at least the same results with less inequality.”
Again, I’m not arguing against wealth taxes, I’m arguing against (Reich and Dissent’s idea of) specific philanthropy taxes. If the government just taxes the philanthropy money, and it’s 100x less effective at spending it, then that’s just outright 100x worse for the causes.
“I’m not concerned about your argument that worthy causes that are currently being funded by billionaires would be ignored. If progressives manage to get enough power to tax billionaires into oblivion, it’s extremely likely the government will have someone who remembers it’s a good idea to not torture people because they smokes marijuana once.”
I think this basically reduces to the idea that we’re one Democratic victory away from utopia. I don’t buy it. I think it’s way more likely that the government builds a coalition around taxing billionaire philanthropy than that it builds a coalition around solving all the problems billionaire philanthropy currently helps with.
Also, at some point the Republicans will get back in power, and what then?
Wow – people are really arguing for taxing money that is donated, while not taxing money that is kept?
Or are they just arguing for putting a cap on the deductability of donations? Or a floor for that matter – must be at least x% of AGI or some such, like the medical deduction?
Trump and other elected American politicians have chosen to tax me on money that went straight from my income into someone other jurisdiction’s taxes, beyond a certain level. In that context, limiting the charitable deduction to e.g. the same amount as the now-limited deduction for state and local taxes makes a kind of sense.
Note that I’m not arguing that either decision is good public policy. Just that if you suspect folks making huge donations of not supporting your causes (as with folks in high tax states not tending to support Republicans, the logical reason for the state-and-local-tax change), then who cares about encouraging them to donate to causes you won’t in fact agree with. (An alternate approach is to insist that the charitable donation only applies to worthy causes, and work hard to gerrymander the definition of “worthy”.)
I don’t think the US is one democratic victory away from utopia, because “taxing billionaires into oblivion” is not a mainstream idea among Democrats. Even Warren doesn’t suggest more than 1% marginal wealth tax, which is not enough to erode accumulated capital (although it does significantly slow its growth).
“dwindling government resources for public goods and services”
Under what definition of ‘dwindling’ are government resources dwindling?
Total tangent, but SpaceX’s Falcon program is profitable and made Elon Musk a billionaire, along with Tesla. He was “merely” a hundred millionaire after PayPal. His is the first space company to accomplish this without major government subsidy (and at a much lower cost than any public or private competitor, and with better technology).
Arguably, becoming a billionaire doing good works is an even higher plane of existence than becoming a billionaire doing evil and then ploughing some fraction of it into charitable causes.
We can quibble over what counts as a subsidy, but SpaceX would not be profitable without their government contracts – both the NASA commercial crew contract, and in general being able to carry government (especially military payloads).
In fairness, the non-government space launch market is comparatively small.
The government contracting to buy goods and services in the market is not in itself a subsidy. And that is not a “quibble”, that is a definitional fact.
It is possible to use a services contract to deliver a subsidy, but that is a specific allegation that requires specific evidence.
But SpaceX doesn’t just contract for an off the shelf service they only used their own money to create.
The COTS program gave SpaceX a big chunk of NASA money to develop Falcon 9 itself, not just Dragon.
Raptor engine development has been largely funded by an Air Force contract.
SpaceX is currently suing the Air Force for not awarding them several hundred million dollars to develop Starship.
Incidentally (other than Starship) I think these are excellent investments. But they are the same sort of contracts other government contractors are getting.
The idea that SpaceX never took a dime of government money to develop Falcon, unlike all those other rockets that were government boondoggles, is a self aggrandizing myth started by Elon and spread by his loyal army of fanboys.
Orbital Sciences developed Pegasus in the early 1990s and was at just as “privately developed” as Falcon.
Is it even possible to tax billionaires out of existence, while staying a democratic country with human rights, freedom of movement, private property rights? Would it even be constitutional in the US, with the Fourth Amendment?
While I personally am not too happy about the existence of billionaires, I think a world where billionaires are taxed out of existence is worse than the one we live in.
And if billionaires are going to exist anyway, like they do in Russia or China, isn’t it better to have socially conscious billionaires than the Russian type? While China does produce some socially conscious billionaires, they are conspicuously absent in Russia. And if being more like Russia is your goal, go ahead.
You could tax billionaires out of existence without doing anything different in kind than what’s done now. So either current countries lack freedom of movement and private property rights, or you could tax billionaires out of existence without eliminating them, or quantity has a quality all of its own.
It would not be constitutional if the Federal government did it (because of the prohibition on unapportioned direct taxes other than income). However, states can institute wealth taxes, and (alas) confiscatory taxation doesn’t implicate the Fourth Amendment.
There is another theory which states that this has already happened.
A tax on income implies that I do not hold allodial title to my own labour (and thus, perhaps, to my own body) but only fee simple (thus making me property in allodium of the sovereign government).
A tax on wealth similarly implies that not only my real but also my personal property is in truth only a fee simple estate held in items to which the sovereign has allodial title.
The existence of taxes, and also of a thousand-and-one other reserved powers (e.g. eminent domain), which are not created by any contract but merely asserted, is, as far as “difference-in-kind” is concerned, an abrogation of private property rights.
Thomas Hobbes could have told you that. You hold allodial title only in that which you can hold against all comers.
Hmm. Hypothetical: if the equilibrium of “we all respect each other’s title” is sufficiently obviously beneficial that any potential ‘comers’ with strength against which I cannot hold are sensible enough not to come, is my title allodial or not? Does that change if we institutionalise that equilibrium through freely-contracting up some private protection agencies?
I think in both cases that is still allodial title, and that the only reason sovereigns today have the strength is because everyone else treats a sovereign coming for me as something other than a defection on the equilibrium. If people (and other nations) responded to Croatia’s treatment of Liberland the way they respond to an invasion of a neutral state (which is what, legally speaking, it is), then it wouldn’t be in Croatia’s interest to do it.
But that’s beside my point, which is that there isn’t a difference in kind between today’s social-democratic states and totalitarian hellholes that treat the citizen explicitly as property of the State, let alone mere social-democratic states that tax away billionaires. In all three cases, your title to any realty, personalty, or even your own body is always admixed with “if the sovereign doesn’t like what you do, they can force majeure your ass”.
And yet, to bring this around to OP’s question, taxing away billionaires is still a bad idea; you don’t need a difference in kind for “lots of evil” to be worse than “some evil”.
My point is, unless all countries act in concert in introducing a wealth tax, any individual US billionaire could move to NZ, or any other country of their choosing. The only way to stop it would be to remove their freedom of movement and their right to move their property.
My definition of “tax billionaires out of existence” is to tax billionaire’s economic activities so heavily that they stop being billionaires, and the money goes to the government. Chasing all the billionaires to the Bahamas is not it. But if “tax billionaires out of existence” means making sure there are no more billionaires in the US, then sure, that is trivially easy.
I think it should be a or, not a and
You can let the billionaires move where they want, and even take a lot of their properties with them.
As long as they don’t relocate their factories, you can continue to taxes it.
And it seems to me that the actual means of production is what really matter.
Ironically enough, current policy is basically the exact opposite of this. It’s easy enough to move business assets around to take advantage of favorable tax structures.
Much harder and more punishing to renounce one’s citizenship in order to escape personal income taxes.
But the factories are not what brings money, it’s the IP. The IP mostly has already been moved to the Caymans or whatever.
And no, they don’t continue to tax them, at least not at the same rate.
As a US citizen/resident, you will be taxed for your factories in China, mines in Chile, and other businesses abroad. As soon as you move away and renounce your citizenship, you don’t have to pay those taxes anymore. So yes, stopping physical movement is a requirement to tax the billions away.
Citizenship is linked to taxes in exactly one country : the United States. There are minor exceptions with some bilateral agreement (i.e. country Y with a very lax fiscality agrees to tax more heavily its residents which are citizens of country X to discourage them moving here), but mostly people only pay taxes in places where they are residents or have assets.
And while assets are easy to move around now, it&