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Does Big Giving Justify Big Fortunes?

By       Message Sam Pizzigati       (Page 1 of 1 pages)     Permalink

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From flickr.com/photos/67789586@N06/8827232234/: Mark Zuckerberg in Prague
Mark Zuckerberg in Prague
(Image by Lukasz Porwol (@porwolluke))
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reprinted from toomuchonline.org/

The claim: Today's rich are giving more than ever to make the world a better place, and we should all be cheering this magnificent generosity.

Have you heard? Facebook founder Mark Zuckerberg and his wife, Dr. Priscilla Chan, are giving away 99 percent of their Facebook stock, a contribution currently worth about $45 billion.

You probably have heard. Zuckerberg and Chan announced their new philanthropy on Facebook, and the post quickly drew 1.5 million thumbs-up -- and headlines worldwide. Their gift, reporters noted, over doubles the combined wealth of the Ford, Rockefeller, and Carnegie foundations.

But Zuckerberg and Chan haven't actually given away anything yet, and that $45 billion isn't going to any foundation. Those billions will be going instead to a new "limited liability corporation" that Zuckerberg and Chan have created -- and completely control.

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Facebook founder Mark Zuckerberg is giving the world a new twist to 'giving.'

Limited liability corporations, unlike foundations, can do virtually whatever they like. They can invest in profit-making ventures. They can lobby lawmakers. They can donate to political campaigns. Unlike foundations, limited liability corporations also don't have to fully disclose what they're doing or give away at least 5 percent of their value every year.

In effect, as tax expert Michael Graetz notes, Zuckerberg and Chan are transferring their assets from one pocket to another. So why all the hoopla? The transferred assets, Zuckerberg and Chan assure us, will only go for the betterment of humanity.

"We have a moral responsibility to all children in the next generation," Zuckerberg and Chan noted in their Facebook announcement, "We believe all lives have equal value."

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But if all lives have equal value, shouldn't all the people living those lives have somewhat of an equal say in determining humanity's future?

The new Chan Zuckerberg Initiative is taking us in the opposite direction. The pair have promulgated, quips analyst James Quack, what amounts to a "keeping pledge," not a giving pledge. They pledge to keep all their wealth and use a lot of it to make the world a better place, as long as they get to define "a lot" and "better."

The wealthy have the power to impose their personal visions of the common good.

We also need to keep in mind, adds Institute for Policy Studies wealth tracker Josh Hoxie, that Zuckerberg owes much of his fortune to the public investments made possible by the tax dollars of average citizens.

These investments, Hoxie points out, funded "the public schools that educate his employees, the judicial system that protects his intellectual property, the public telecommunication networks that enable people to use his product."

Shouldn't the public, the source of those public investments, now have a say in where the Zuckerberg billions go?

In fact, observes the Guardian's Gaby Hinsliff, we already have "a centuries-old system" for ensuring the public that say, "for ensuring the very rich can do good for others." We call that system taxation, and, in a healthy democracy, the public gets to decide where tax dollars go.

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The very rich have little patience for this democratic process. The Chan Zuckerberg Initiative, sums up policy analyst Joanne Barkan, ought to refocus our attention on mega philanthropy's most fundamental contradiction: that "the wealthy have the power to impose their personal visions of the common good on everyone else while calling it charity."

"Many will view donations like Mr. Zuckerberg's," the Economist business magazine observes, "as a reason not to worry about the intense concentration of wealth."

We should still worry.

 

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Sam Pizzigati is an  Associate Fellow, Institute for Policy Studies

Editor,  Too Much ,  an online weekly on excess and inequality

Author, The Rich Don't Always (more...)
 

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