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If I had money to donate I'd donate it to the charity I thought would be most effective at helping the cause I cared most about. If I had enough money to creat
by c22 4y ago
If I had money to donate I'd donate it to the charity I thought would be most effective at helping the cause I cared most about.
If I had enough money to create my own charity it would be focused on the cause I cared most about.
My giant ego and hubris would make it hard for me to come to the conclusion that a charity I created wasn't the most effective at its goals, even if that didn't happen to be the case.
- teekert 4y agoThis, I mean why created anything than the charity with most value in your personal view. This just signals he has faith in his own charity.
- brookst 4y agoAll true and a perfectly valid model. But also try: If I were incredibly wealthy and obsessed with running the score up, I’d see any taxes or other loss of wealth as a threat to my ego. If my tax accountants came to me and said I could have a greater net worth by founding a charity optimized for my personal benefit, I’d happily shuffle money there rather than paying taxes. I think that’s also a valid model. I don’t have enough info to have a strong opinion, but my priors on Musk make me at least question what he’s optimizing for.
- c22 4y agoI think he's probably optimizing for both. Don't hate the player, hate the game.
- SketchySeaBeast 4y agoPor que no los dos?
- s1artibartfast 4y agoIts not a feature, it is a bug. You don't have to hate either.
- heartbreak 4y agoAnyone that wealthy has substantial influence over the design of the game itself.
- c22 4y agoVery true, but I think the dubious-donation game predates Musk by quite a bit.
- brookst 4y agoI don’t see how a charity can be simultaneously optimized for benefiting its founder and also benefiting people other than its founder. Different goals, different choices. Unless you’re suggesting that Musk is such an egomaniac that he thinks the best thing a charity can do is help him personally?
- dbfx 4y agoOne could argue that he wants the charity to be good just because of the "prestige" of having a top charity, and that would be helping personally I guess. Not sure how putting money in a charity would make him more money even with tax breaks than just investing that money somewhere else, although I got no clue how charity tax breaks work in the US,
- c22 4y agoIt goes like this: I want to lower my tax liability by donating to charity > as long as I'm doing that I want to make sure I'm supporting something I agree with > I'll start my own charity to ensure that's the case. Frankly I'm much more concerned about the billion dollar roth IRAs and 529 plans which seem to have a much lower chance of helping anyone else.
- s1artibartfast 4y agoRoth IRAs aren't supposed to benefit anyone else. That's not why they exist
- c22 4y agoThey're also not meant to hold billions of dollars (the annual contribution limit is like $6000). Yet somehow this happens [0]. [0]: http://www.propublica.org/article/lord-of-the-roths-how-tech-mogul-peter-thiel-turned-a-retirement-account-for-the-middle-class-into-a-5-billion-dollar-tax-free-piggy-bank http://www.propublica.org/article/lord-of-the-roths-how-tech...
- s1artibartfast 4y ago
- mattalex 4y agoJust that in this case the players are so powerful they can use their wealth to define the rules themselves.
- nimbius 4y ago“In a rich man's house there is no place to spit but his face.” ― Diogenes of Sinope
- deleted 4y ago[deleted]
- pwinnski 4y agoOr both. One can certainly despise a particular player playing a horrible game.
- yunohn 4y agoAh of course, “the game”. Which part of the game do you play and succeed at? Do you also get to make the rules? If not, don’t simp for billionaires.
- c22 4y agoI'm playing the same game everyone else is and so far I've found moderate success. I have some small say in the rules, just like I hope you do and I agree that in a lot of cases the rules are completely whack. Rather than "simping for billionaires" the intent of my comment was to cause the reader to introspect upon the part they play in crafting the rules and allowing the game to exist as it's currently played.
- ensignavenger 4y agoAnd you would be violating the law.
- deleted 4y ago[deleted]
- brookst 4y agoNot necessarily. Plenty of rich peoples’ charities are incredibly inefficient at their stated purpose, good for their owners, and legal. Consider an imaginary tobacco tycoon’s charity that promotes cigarette use. It would be 100% legal.
- missedthecue 4y agoLegal, but it would not qualify for 501c3 tax exempt status.
- Volundr 4y agoHonest question, what would make it illegal? Charities pushing for social change is 100% a thing and I don't think it's limited to such a vague concept as "positive" social change.
- c22 4y agoIt's limited to charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals. I guess you could argue promoting cigarette use is "educational" or perhaps "religious" if a cigarette-smoking cult existed a la The Leftovers, but I suspect it would be a hard sell in today's environment, given the scientific and social consensus on the dangers of smoking, especially if your day job is selling the things. Maybe you could make it fly by using the funds to buy cigarettes and gift them to the homeless?
- ensignavenger 4y agoFirst, you can't actually "own" a 501c3, you can control it. Second, a 501c3 can be beneficial to its donors or controllers, but: "The organization must not be organized or operated for the benefit of private interests, and no part of a section 501(c)(3) organization's net earnings may inure to the benefit of any private shareholder or individual. If the organization engages in an excess benefit transaction with a person having substantial influence over the organization, an excise tax may be imposed on the person and any organization managers agreeing to the transaction." A charity that promotes peace on earth may be beneficial to the donors to the charity... but if "optimized for my personal benefit" it is likely to be non-tax-exempt... but I suppose we could debate the exact words used and what they really mean in theory. I think in the above tobacco scenario, the IRS and courts would likely find that the tobacco promotion was merely advertising, and therefore subject to taxation. https://www.irs.gov/charities-non-profits/charitable-organizations/exemption-requirements-501c3-organizations https://www.irs.gov/charities-non-profits/charitable-organiz...
- Someone1234 4y agoBillionaire's 501(c)(3)s aren't charities in the typical sense. They're tax-exempt piles of money that are controlled exclusively by billionaire and their families (in this case Musk and his brother). The Musk Foundation in particular has donated less than 1% of the "charities" assets (most donations less than $500K, most years less than $1M) and these "charities" can pay out to their owners from tax-exempt gains on the back-end. It is a super common tax avoidance scheme. It is legal. Pretending it has anything to do with good-cause charity isn't based in reality however. PS - And to confuse matters further there are billionaires who are donating a lot to charity, like the Gates Foundation.
- badrequest 4y ago> Billionaire's 501(c)(3)s aren't charities in the typical sense. They're tax-exempt piles of money that are controlled exclusively by billionaire and their families Ah, so basically the exact same as every other billionaire family's charity.
- Bilal_io 4y agoWhat's your point? Pointing out other billionaires doesn't make the billionaire we're discussing less horrible. Most billionaires are horrible in my opinion. This is due to the idea that you cannot get that rich without exploiting people, taking money from government (while simultaneously talking against people receiving help), and this charity scheme is yet another loophole that needs to be closed.
- boringg 4y agoWhile you may love/hate certain classes of people it would probably be helpful for you to refresh how economies work and, not just modern day economies, all economies. There will always be some level of exploitation in every single type of government/economy and there will always be government there to support interest of its people. You might finesse your argument to the fact that you deem the level of exploitation and gains accrued to "billionaires" is too great for your tastes and that there needs to be a better balance struck. If not it just reads as thoughtless criticism without understanding how are human systems work.
- notahacker 4y agotbh it's even more of a non-story than that, because his "own charity" is a donor advised foundation that openly dispenses money to a wide range of completely independent charities and charitable causes he and his brother pick (many of them quite well known and well regarded), not some secretive organization with some obscure purpose that might just be an arm of one of his corporations or a place to hide wealth from the IRS and invest it in private jets. That's pretty common way for rich people to give money
- el_nahual 4y agoThere's a sibling comment to this by @Someone1234 that explicitly contradicts this: > The Musk Foundation in particular has donated less than 1% of the "charities" assets (most donations less than $500K, most years less than $1M)
- culi 4y ago> completely independent charities and charitable causes he and his brother pick The money can go to any 501c3 they pick. So if there's a 501c3 that's pushing for regulation that will benefit Tesla or SpaceX or some "raising awareness" campaign that's a glorified marketing campaign or some org that influences research, etc... those are all easy pickings
- notahacker 4y agoSure, but it can't go on megayachts or personal world domination initiatives, and Elon (or anyone else) could make tax deductible donations to those registered charities without a foundation in place. Since the foundation publishes accounts, it's actually relatively transparent what he has and the eclectic selection of causes Elon donated to has been fairly widely reported on. It looks considerably more like a man chucking money at a lot of pretty standard causes than say, the obscure nonprofit "to promote interior design" that is the tax-free beneficial owner of Ikea...
- mattrighetti 4y ago"Nobody spends somebody else’s money as carefully as he spends his own. Nobody uses somebody else’s resources as carefully as he uses his own."
- aaronbrethorst 4y agoWe’re still talking about the guy who paid almost double what Twitter was worth right?
- m3kw9 4y agoCorrect, after you give billions to a charity the incentive is to extract that by the owners. It suck, but humans are assholes when you dangle large sums of money money infront of them. The route is administrative fees.
- tlogan 4y agoThis is a tax move to stash the cash so it does not got hit by big tax bill immediatelly. That money can be then invested in twitter (thru charity), buy twitter bonds, or whatever. Or give payouts in smaller amounts to friends and family which will work for the charity. My bet is that they will buy twitter bonds thru the charity. There is nothing wrong here and it is not illegal.
- jvanderbot 4y agoOK, this isn't a fair assessment, but does match appearances. Some details are important -- I'm adjacent to major donor fundraising and see this kind of thing happen all the time. He donated to his foundation, which in turn re-donates and reinvests the money based on merit and priorities set by Musk to other charities. Of course, Elon being Elon, he probably has a huge hand in where it ultimately ends up, but this money is now out of his hands and into a "clearing house" where it can be bid / won by any charitable / non-profit that cares to submit. This is extremely common with donors of huge wealth -- they pseudo-delegate the decision of what program to fund to a board of intelligent people sitting on their foundation, each member of which cultivates relationships with major programs for the wealthy person so that the money can be ultimately effectively invested without taking all the wealthy person's time. See Bill & Melinda Gates foundation, or Warren Buffet foundation, etc.
- deleted 4y ago[deleted]
- ren_engineer 4y agothis is no different from Gates and Buffet "giving away" all their money. Their kids are all in charge of their charities and it's just a way to get around taxes that is spun into positive PR because the media doesn't call them out. The whole Giving Pledge thing is a joke https://www.axios.com/2022/09/17/the-ultimate-billionaire-tax-dodge https://www.axios.com/2022/09/17/the-ultimate-billionaire-ta...
- sschueller 4y agoI have a better idea. No tax exceptions for anything over 1 billion. 100% tax. No human on this planet needs this kind of money. Even 100 million is too much already. The money was made on the backs of the working class and they as in their elected government should be the one deciding where the money goes. If your government is corrupt then that is an entirely different issue.
- synergy20 4y agoisn't Bill Gates, Zuck, Bezos are all doing similar things. If I had that money, I will certainly donate to my own charity or some charity I firmly trust. The only exception is Buffet, who donated lots of his money to Bill Gates' charity, Buffet seems has no interests to manage that on his own. It's your money, make your call.
- tootie 4y agoIt's a perfectly valid thing to do and can be done for the right reasons, but for a counterpoint you can look at the Trump Foundation. Trump and his family gave money to the foundation and the foundation bought things from Trump (ie hosting events at Trump properties). There's loads of small foundations like this that exist for self-dealing, nepotism and tax evasion. That's also not really unique to self-funded foundations. Something like the Gates Foundation is a huge operation that is doing a lot of big, expensive and highly visible projects. What Musk is doing with his foundation is less clear. Could be real charity, could be fraud.
- synergy20 4y agoAgreed, my point is there is nothing unusual, it's a common practice everywhere, so I don't get why Bloomberg needs a big report, not sure if it did for all other big guys in the past, otherwise it seems it has an interest to target Elon. As far as fraud goes, I hope the system will work out when bad things went too far there. We're all innocent with good intention until proven otherwise, Elon should be treated the same, like him or not.
- tootie 4y agoIt was $5.7B. That's an enormous gift and one that was not disclosed at the time it happened last year. The Musk Foundation now has an enormous endowment and a hazy mission.
- GoodJokes 4y ago