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Archive for August 30th, 2011

There’s a very provocative article on the New York Times website that criticizes Steve Jobs for his supposed lack of charitable giving.

Surprisingly, there is one thing that Mr. Jobs is not, at least not yet: a prominent philanthropist. Despite accumulating an estimated $8.3 billion fortune through his holdings in Apple and a 7.4 percent stake in Disney (through the sale of Pixar), there is no public record of Mr. Jobs giving money to charity. He is not a member of the Giving Pledge, the organization founded by Warren E. Buffett and Bill Gates to persuade the nation’s wealthiest families to pledge to give away at least half their fortunes. (He declined to participate, according to people briefed on the matter.) Nor is there a hospital wing or an academic building with his name on it. …the lack of public philanthropy by Mr. Jobs — long whispered about, but rarely said aloud — raises some important questions about the way the public views business and business people at a time when some “millionaires and billionaires” are criticized for not giving back enough… In 2006, in a scathing column in Wired, Leander Kahney, author of “Inside Steve’s Brain,” wrote: “Yes, he has great charisma and his presentations are good theater. But his absence from public discourse makes him a cipher. People project their values onto him, and he skates away from the responsibilities that come with great wealth and power.”

But why, to address Leander Kahney’s criticism, should we assume that Mr. Jobs has done nothing for the poor? He’s built a $360 billion company. That presumably means at least $352 billion of wealth in the hands of people other than himself. And that doesn’t even begin to count how consumers have benefited from his products, the jobs he has created, and the indirect positive impact of his company on suppliers and retailers.

To give credit where credit is due, the article does present this counter-argument. It reports that Mr. Jobs told friends, “that he could do more good focusing his energy on continuing to expand Apple than on philanthropy.”

This is a critical point. Do we want highly talented entrepreneurs and investors dropping out of the private sector and giving their money away after they’ve reached a certain point, say $5 billion. Or do we want them to focus on creating more wealth and prosperity?

Interestingly, Warren Buffett used to understand this point (before he started arguing that politicians could more effectively spend his money). And Carlos Slim Helu still does.

Mr. Jobs, 56 years old, is not alone in his single-minded focus on work over philanthropy. It wasn’t until Mr. Buffett turned 75 that he turned his attention to charity, saying that he was better off spending his time allocating capital at Berkshire Hathaway — where he believed he could create even greater wealth to give away — than he would ever be at devoting his energies toward running a foundation. And last year, Carlos Slim Helú, the Mexican telecommunications billionaire, defended his lack of charity and his refusal to sign the Giving Pledge. “What we need to do as businessmen is to help to solve the problems, the social problems,” he said in an interview on CNBC. “To fight poverty, but not by charity.”

None of this is to say that charitable giving is wrong. I’m proud to say that my employer, the Cato Institute, refuses to accept money from government. This means we are completely dependent of private philanthropy.

But those of us who work at Cato understand that creating wealth – maximizing the size of the economic pie – is the most important priority. And if the pie is big, generous people then have more ability to make contributions to worthy causes such as school choice scholarship funds, the Salvation Army, or (ahem) America’s best think tank.

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I wrote last year that, “I don’t think public policy should be based on polling data, but I always am happy when the American people are on the right side of an issue since it increases the possibility of good outcomes in Washington.”

One other thing to consider is that pollsters can manipulate results by changing how they word a question.

But even with those caveats, I feel good about two three new polls. First, from the folks at Gallup,we have two charts showing that the federal government isn’t winning any popularity contests.

And here’s some more data from the Gallup poll, showing that the federal government has the lowest net positive (or in this case, highest net negative) of any segment of the U.S. economy. It even ranks below lawyers and the oil/gas industry.

We also have some numbers from Rasmussen showing that voters are particularly dismayed by the power of the federal government.

A new Rasmussen Reports national telephone survey shows that 50% of Likely Voters believe the federal government has too much influence over state governments. Just 11% think the federal government does not have enough influence while 26% believe the balance is about right. Thirteen percent (13%) are not sure.  …These results come at a time when just 17% believe the federal government has the consent of the governed and only 14% believe the country is generally heading in the right direction.

I also like that only 17 percent think the federal government “has the consent of the governed.” Sounds like people have figured out that much of what happens in Washington is a racket for the benefit of insiders.

Numbers like these warm my heart – just as happened with recent polls on spending cuts, the VAT, and Social Security reform.

P.S. There’s a new Reason-Rupe poll showing that the American people understand that reducing the burden of government spending will boost the economy, whereas tax increases will just lead to bigger government.

…over 57 percent of Americans say reducing government spending will “mostly help” the economy, according to a new national Reason-Rupe Public Opinion Survey of 1,200 adults. Just 21 percent believe cutting spending will “mostly harm” the economy. …If taxes do go up, Americans don’t trust that the new revenue will be used to reduce the national debt.  When asked what they expect Congress would do with money generated by tax increases, 62 percent of Americans say Congress would spend that money on new programs. Only 27 percent of taxpayers believe Congress would actually use the money to pay down the national debt.

All these results demonstrate the wisdom of the American people (though I reserve the right to re-classify them as ignorant yokels when they disagree with me).

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