What's Tony Thinking

Tax-payer or Philanthropist?


Why be a lowly, garden-variety tax-payer when you can be something so much better, i.e. a philanthropist?

On Saturday Pro-Publica broke its story of legal tax avoidance by the wealthiest Americans. We learned that the richest people  in the world, like Jeff Bezos, Warren Buffett and Bill Gates, pay little or nothing in U.S. taxes. My guess is that their flaks will be quick to point out what generous philanthropists they are. And for many, if not all of them, it’s true. They create charitable foundations that look to be, and mostly are, doing good things all over the world.

During the last 40 years, as the rich have gotten richer, and the poor and middle-classes have lost ground or, at best, stayed even, there has also been an explosion of philanthropy and the creation of a boat-load of foundations. No more just giving in the old philanthropic style, to aggregates like Seattle Foundation or United Way, or long-standing community institutions like the symphony or hospital.

Create a foundation named after, well, yourself.

If you are a PBS Newshour viewer like we are, you’ll have noticed that the list of foundations contributing to the support of the Newshour gets longer and longer. Their names, read nightly, become familiar. I guess it is a kind of life after death.

And your point? You got a problem with this? Isn’t a good thing that people like Bill Gates and Michael Bloomberg give so much to so many causes that you think important?

What isn’t always noted about all this wonderful philanthropic giving, is that its a great way to keep your taxes down (maybe to nothing when combined with several other manuevers), make charitable donations at a one-step remove to yourself, and reap the benefits in PR and social recognition. Not only that. It can make both philanthropist and foundation a major political player, but without being accountable in the political system. It some cases it becomes a kind of shadow government.

Donald Trump put the business of not paying taxes in his usual memorable way when he said, “Only suckers pay taxes.” We thought maybe it was just him and other grifters. (Trump does have the additional distinction of not actually even paying his own Foundation what he claimed.) But it turns out, according to ProPublica, it’s all the super wealthy who are in on the deal.

Several years ago the left-leaning Danish economist and historian Rutger Bregman was surprised to find himself addressing the World Economic Forum in Davos, Switzerland. He told the wealthy attendees that their taxes needed to go up, saying, “It feels like I’m at a firefighters conference and no one’s allowed to speak about water, right? Just stop talking about philanthropy and start talking about taxes.”

That seems unlikely to happen. But it should.

Here’s Maureen Dowd in her column yesterday on the Pro-Publica revelations:

“Paying taxes is an expression of citizenship. You can’t belong to the club and not pay your dues.

‘You shouldn’t come into the world with the ambition to pay no taxes. Paying more taxes should be a sign that you made more money — and good for you. We don’t want to ding you for succeeding but we’re halfway to a plutocracy here.

“The richest of the rich want unspeakably high gains with unspeakably low costs. It may not be against the law but it certainly isn’t right. It’s tacky.

“Show some public spirit, Monopoly Men! Do not pass Go. Do not collect $200.”







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