On Monday, Elon Musk pledged to give every child in America one share of his SpaceX stock, each worth about $147. With 73 million U.S. minors, his contribution would total approximately $11 billion.
Naturally, people were furious.
Social media lit up with accusations of vote-buying and speculation that he wouldn’t come through. One particularly passionate person said they would rather suffer “slow starvation and limb amputations than accept a share of anything from your bitch ass.”
(For the record, my bitch ass will happily accept that guy’s share.)
On the Pivot podcast, Scott Galloway minimized the gesture, saying Musk is “giving away crumbs,” while co-host Kara Swisher suggested daddy Elon should pay more taxes.
I find it fascinating how many people know exactly what someone else should do with their wealth. Whether they’re smart—like Galloway and Swisher—or not, it just rings disingenuous and naive, e.g., “I live in my mom’s basement while you build flying f’ing cars, but here’s some financial advice...”
Musk joins a long line of philanthropists criticized for sharing their fortunes incorrectly.
After the 2019 fire at Paris’ Notre-Dame Cathedral, wealthy donors pledged more than a billion euros toward reconstruction. For their generosity, the press and social media pilloried them.
A Green Party politician accused the billionaires of wanting to pass for heroes. Philosopher Ollivier Pourriol suggested they instead extend their generosity to les misérables. And Guardian columnist Aditya Chakrabortty claimed the gifts would “turn Notre Dame into a monument to hypocrisy.”
Well, I was in Paris earlier this year and witnessed a 2-hour line to enter that lovingly restored, if hypocritical, French Gothic treasure.
I understand the temptation to criticize. MacKenzie Scott, Jeff Bezos’ ex-wife, has given away about 70% of her $36 billion divorce settlement. Along with great causes like Habitat for Humanity and Boys & Girls Clubs, she funds organizations that want to abolish the police, close prisons, and fund gender transition for minors. While I find these ideas abhorrent, my opinion doesn’t matter because it’s her damn money.
This judgmental tradition predates social media. Hell, it predates television. Critics lambasted Andrew Carnegie for building extravagant libraries while underpaying workers. Carnegie offered his own unsolicited advice. In The Gospel of Wealth, the tycoon declared, “of every thousand dollars spent in so-called charity … nine hundred and fifty dollars is unwisely spent.”
Other rich people called out peers for how much they gave. In 1996, Ted Turner name-checked Warren Buffett (then worth $15 billion) and Bill Gates ($18 billion) for their lack of philanthropic leadership. Gates emphasized he was focused on running Microsoft, implying that he would get to philanthropy later.
Indeed, he did. Gates eventually gave $60 billion to his eponymous foundation, which focuses on minimizing poverty, improving K-12 education, and eradicating disease. Last year, he pledged to give away 99% of his remaining $100+ billion.
If he had succumbed to Turner’s pressure, Gates would have contributed much less to his fellow humans. Similarly, Buffett has donated tens of billions to charity since Turner’s remarks and is still worth 10x what he was 30 years ago.
Buffett’s giving story is also relevant to Kara Swisher’s remarks about Musk and taxes. For years, Buffett famously advocated higher tax rates for rich people, to the point that the concept became known as the Buffett Rule.
Yet, when it came time to distribute his fortune, he didn’t send any extra money to the Treasury Department – he gave it to private foundations.
Why would he do that? And why would Musk send money directly to American families instead of to Washington?
I think it comes down to the words of Chamath Palihapitiya, billionaire investor, All-In podcast co-star, and my former Facebook colleague, when asked about a potential wealth tax on CNBC.
“If I could give 95% of my wealth away and I knew that all these problems would be solved, I’d do it,” he began. “The (reason) nobody wants to give 10 or 15% away is because we know that it’s a joke! It doesn’t work. (Politicians) are terrible at what they do…they should not have these jobs…if (the government) was a for-profit company, you’d fire all these people. That is the problem. The policies do not make any sense.”
Gates, Buffett, and Musk are the smartest businessmen of our time. They know a bloated, graft-plagued organization when they see one. People like them don’t want to squander their legacy on Medicaid scams, California’s high-speed trains to nowhere, or Minnesota’s fraudulent “Learing” Centers.
They want to direct their hard-earned fortunes where they will do the most good for the world. You and I might not agree with how they define that, but our opinions don’t really matter.
Maybe you’d prefer to send your spare funds to Washington. Or maybe to a food bank, a cathedral, or an organization that wants to close prisons.
If that’s how you feel, that’s your business. By all means, stroke the check.
THE END
Hey - did you see my recent interview with MLB Hall of Famer Dave Winfield? You should check it out.