Greetings, Without taking anything away from the author's arument that poverty is the greatest problem facing humanity (though I would disagree with the assertion), I will suggest that this article is rife with nonsense regarding the workings of US foundations. Foundations, especially large ones, operate under considerable IRS scrutiny to ensure that there is no self-dealing on the part of the benefactors, many of whom do retain control of the programs undertaken by the foundations they set up. Further, stock donations do NOT remain under the control of the donor, but under the control of the Boards of the foundations to which they are given, which, yes, may or may not include the donors.
Further, foundations are required to disburse minimum percentages of their assets each year, minimums set by the IRS itself. E.g. the HHMI has to spend a minimum 1.5% of its endowment each year. Of course, they may be earning more than that on the rest, in which case the endowment has a net increase, and the foundation can remain in a charitable role sustainably. I would think that an IRSer like the author claims to be would know this, so must question the author's claimed credentials. The author may not like this and feel that the gifts of donors ought to be rapidly disbursed to the poor (or some other cause), leaving no on-going endowment, but this is an argument that should be based upon an analysis of the opportunities and benefits of a full-disbursement vs. endowed distribution. But it would seem the author prefers assertions to discussion. And now to poverty. I have seen its insidious effects all over the world -- including the US -- and I have worked in tandem with poverty reduction programs in a handful of countries. I do not think that today the aid agencies or NGOs yet understand how to catalyze effective anti-poverty programs, and until this is figured out we should be careful about assertions that claim to know the answer. Distributing cash to poor people may be part of it, but unless the structural realities that CREATE poverty are addressed and remedied, I would guess that cash distribution might have some short-term benefit to the poor, but not the longer-term or sustainable results that must be the measure of any poverty-reduction strategy. Cheers, Lawry -----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On Behalf Of Christoph Reuss Sent: Wednesday, August 30, 2006 5:25 PM To: futurework@fes.uwaterloo.ca Subject: [Futurework] Tax Evasion guised as Philanthropy http://www.commondreams.org/views06/0823-26.htm The Gates And Buffet Foundation Shell Game By Sheldon Drobny Co-founder of Air America Radio 26-August-2006 My background is finance and accounting. As a socially conscious venture capitalist and philanthropist, I have a very good understanding of wealth management and philanthropy. I started my career in 1967 with the IRS as a specialist in taxation covering many areas of the tax law including the so-called legal loopholes to charitable giving. I have known for years that a smart wealthy person could keep control of all his assets without estate or income taxes through cleverly structured charitable foundations. These foundations are perfectly legal and allow the donors to keep absolute control of all their money and power and accumulate enormous appreciation free of taxation. In 1967, the loopholes were outrageous and the law has tightened some of these tactics for the rich. However, the Gates Buffet foundation grant is nothing more than a shell game in which control of assets for both Gates and Buffet remain the same. THE ONLY DIFFERENCE IS THAT THE ACCUMULATION OF WEALTH BY THESE TWO WILL BE MUCH MORE MASSIVE BECAUSE THEY WILL NO LONGER HAVE TO PAY ANY TAXES. The Gates Foundation now has about $60 Billion under the control of the wealthiest people in America. They do not have to sell any of their positions in the stocks that they put under the tax-exempt umbrella. Furthermore, they can vote their stock holdings the same as if they did before and they can make the same investment decisions about their considerable corporate holdings. Both Buffet and Gates exhibited the most predatory capitalistic practices as corporate executives and investors. Microsoft and Berkshire Hathaway are not models of socially responsible capitalism. That being said, this foundation will be in the long run richer than the Catholic Church, which has accumulated wealth and power for over 1500 years. However, the results will be exactly the same. They will never liquidate enough of their assets to do any real good for the most onerous problem we have as humans; the worldwide poverty that is caused by the great disparity between the haves and the have-nots. GATES WILL BE MORE POWERFUL THAN THE POPE The Gates Foundation and the Catholic Church have the same goals. They are to keep the legacies for which they were created. For Bill Gates and Warren Buffet it is the control and legacy of family wealth as in the ancient days of the Pharos of Egypt. And by not paying any taxes, Gates will be more powerful than the Pope. I realize that this foundation has done more for disease research and education than any single government institution. But, that is just a condemnation of how little rich countries do for the less fortunate. AND THE UNITED STATES IS ONE OF THE WORST EXAMPLES OF HOW LITTLE IT DOES FOR ITS OWN PEOPLE. The great problems of the world today are a direct result of the wide disparity between the rich and poor. But, it is hard for the wealthiest to even look at this as an issue of most importance. Catholic Charities do a lot for the poor and I am sure that the Gates Foundation will do a lot for diseases of the poor. But, that is merely a band-aid for one of the symptoms of poverty. The real issue today is poverty. The governments that keep their people in abject poverty while their leaders are obscenely rich from oil revenues cause many of the problems in the Middle East. But, even the poorest of their people now have access to satellite TV and Internet information that shows these people how much they are being exploited. The simple answer that they hate us for our freedom is absurd. They hate us because they see the wealthy and powerful as the cause of their suffering. As was the case in Germany in the 1920s, even a cultured society can succumb to irrationally violent leaders if they are hungry and poor. It is a human problem that we saw occur in a 1st world country. The 1968 movie, The Shoes of the Fisherman was a fictional account of a new Pope who had the conscience to solve world poverty by giving away all the Church's assets. Below is a summary of the plot from www.imdb.com. "After twenty years in a Siberian labor camp, Kiril Lakota, the Metropolitan Archbishop of Lvov, is set free. The Catholic Archbishop is released and sent to Rome, where the ailing Pope makes him a Cardinal. The world is in a state of crisis - a famine in China is exacerbated by United States restrictions on Chinese trade and the ongoing Chinese-Soviet feud. When the Pontiff dies, Lakota finds himself elected Pope. But the new Pope Kiril I is plagued by self-doubt, by his years in prison, and by the strange world he knows so little about. This movie contains extensive information about Catholic faith & practice, as a television news reporter steps in from time-to-time to explain the procedures involved in selecting a new Pope." OUR CHANCES OF SURVIVAL ARE MARKEDLY DECREASED The movie was not great but it did emphasize the point I am making in this piece. Unless wealthy people and governments around the world recognize the threat that poverty has on humanity, our chances of survival are markedly decreased. And unless the major wealth of the world is used to help feed its people, the diseases caused by poverty will never be cured. The prevention of diseases, both physical and mental, caused by hunger and poverty are the real dangers we face. And with all the concentrated wealth, we have the capacity to give everyone enough to survive and still leave the wealthy with plenty of luxuries. IF BILL GATES GAVE $29 BILLION AWAY AND KEPT ONLY $1BILLION HE WOULD STILL HAVE A WONDERFUL LIFE. IF HE GAVE IT TO SALLY STRUTHERS, SHE COULD PROBABLY FEED THE WORLD. SHELDON DROBNY ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ SpamWall: Mail to this addy is deleted unread unless it contains the keyword "igve". _______________________________________________ Futurework mailing list Futurework@fes.uwaterloo.ca http://fes.uwaterloo.ca/mailman/listinfo/futurework _______________________________________________ Futurework mailing list Futurework@fes.uwaterloo.ca http://fes.uwaterloo.ca/mailman/listinfo/futurework
