Taxpayers Underwrite “Generosity” of the Wealthy

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Bill Gates / via

Some months ago, urged by others, I overcame my revulsion long enough to visit Crystal Bridges, Alice Walton’s monument to herself in the form of an art museum, down in the Arkansas Ozarks. It was, to use the worst word in the language, nice, although not half so impressive as I’d been led to believe by The New York Times, among others.

Alice Walton / via
Alice Walton / via

Then again, maybe I was still myopic under the weight of my prejudice. I’m prejudiced about the thing because people are grateful for it. Alice Walton, one of six principal heirs to the Wal-Mart billions, lets the great unwashed look at her fine art free of charge, helped by volunteers proud to be part of such a service.

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The woman and her family have been screwing these people blind for 60 years, and now they’re grateful to her? Let’s examine, shall we, how the philanthropy racket works, and whom it really serves.

First, of course, you put together a big pile of money. Let’s see how that’s done, using two famous examples, Sam Walton of Wal-Mart and Bill Gates of Microsoft. Walton saw a lot of poor people around him — poor because wages were low. He bought up a bunch of dying dime stores and paid people even less to run them, but let them share a bit of the profits. The plan was brilliantly evil, in that it forced the taxpayers to subsidize Walton’s operation. His employees made so little money — still do — that they qualified for food stamps and other forms of government assistance.

Walton augmented this little trick with tactics against vendors that didn’t quite amount to extortion. After Wal-Mart grew big enough, many companies found they needed to sell through Wal-Mart or go under. So vendors resorted to cutting corners on quality for goods sold to Wal-Mart, degrading brands they’d built with great effort. Many vendors moved their buying offshore, so that Wal-Mart became responsible for sweatshop conditions among manufacturers in many countries outside its own. This, of course, improved Wal-Mart’s market share in America because people who’d lost well-paying manufacturing jobs needed Wal-Mart’s low prices, regardless of how expensive those low prices were, even to themselves as taxpayers.

Bill Gates / via
Bill Gates / via

In Gates’ case, the genius got started by buying an operating system for $50,000 that he knew to be worth fortunes. Legally, of course. By the time the federal Justice Department decided, in the 1990s, that Microsoft was engaging in a whole slew of predatory business practices and filed suit, Gates’ fortune was made and Microsoft was far too big for something as puny as federal regulators to ding very much.

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The six heirs of Sam Walton now command a combined personal fortune estimated at close to $150 billion, as much as 42 per cent of America’s families, or enough to pay close to half of Greece’s national debt at a stroke. Gates’ personal empire is worth, by most accounts, close to $60 billion.

What does one do with that kind of money? After the polo ponies and the islands and the estates in the Bahamas, what’s left to buy? Well, respectability. The taxpayers make it cheap, and the consumers, who, by the way, are the same people, make it tempting. Museums (Walton’s) and disease-fighting foundations (Gates’) will do that for you. They also save you a bundle in taxes, and they let you make public policy.

Assuming you’re not a Walton or a Gates, you can give money to the nonprofit college of your choice and get two things back: a warm feeling in your heart and a tax deduction. Your $1,000 contribution might save you a couple of hundred bucks. If you are a Walton, you can endow a chair or two, erect a building or two (named in your honor, of course), get all manner of public acclaim and save hundreds of thousands in taxes, costing the rest of us commensurately. You also get to tell the public university what its policy will be. This has happened to the College of Education at the University of Arkansas, which, with Walton money, has become a right-wing bastion of support for charter schools and vouchers. They still call it a public university. As state funding diminishes, however, private money is more welcome. So, through the tax code, we encourage wealthy people to drive public policy. The great state universities, built at enormous public expense, become the tools, not just of Wal-Mart, but of Weyerhauser, Monsanto, big pharma and assorted other businesses smart enough to invest in them — I mean, give to them.

When the oligarchs of the Ozarks decide how children will be educated, and the barons of Redmond decide which diseases will be fought, and where, then the government has become one of the people, by the wealthy and for their favorites. Nobody much noticed the revolution.