A toast to philanthrocapitalism: Zuckerberg’s charity and profit
Despite searching questions being raised on Facebook founder Mark Zuckerberg’s decision to give away 99% of his $45 billion wealth to charity, there is ground to celebrate the culture of giving that it boosts.Updated: Dec 07, 2015 19:09 IST
Whoever said that you do not look a gift horse in the mouth was evidently not an American, going by the way the US intelligentsia is tooth-combing the announcement last week by Facebook’s CEO and co-founder Mark Zuckerberg to give away 99% of his stock in the social networking company, estimated to be worth $45 billion (worth nearly Rs 300,000 crore) to charity. The 31-year-old technology tycoon and his wife Priscilla Chan’s joint initiative aims to advance human potential and equality, and is a milestone in the surge of “Philanthrocapitalism”--a fancy term that might make Karl Marx turn in his grave. There is no denying the infectious generosity that is now the hallmark of a new culture nurtured by legendary investor Warren Buffett and Microsoft co-founder Bill Gates. Five years ago, Zuckerberg had signed the “Giving Pledge” by a set of billionaires including Gates to give away a majority of their wealth.
Questions have been raised on the fine print of the pledge, outlined in an emotional letter to the couple’s newborn daughter Maxima. For one, Zuckerberg will sell or gift less than $1 billion in shares per year over the next three years. That means the money is not being poured out in a hurry. Secondly, Facebook has explicitly stated that the Harvard-educated entrepreneur intends to retain his majority voting strength in the company for the foreseeable future. The charity is being diverted not to a non-profit organization as a casual observer might presume but to a limited liability company (LLC), which means Zuckerberg can invest in profit-seeking ventures and avoid capital gains taxes. His heirs will get control of the charity, without inheritance taxes coming in the way. Then there are those who say that charity may be linked to investments. For instance, Gates donating funds to a war against diseases can generate demand for initiatives in vaccines and medicines in which he has invested.
Cynical questions apart, there are also genuine concerns on how well Zuckerberg’s money can be spent. Fingers are pointed at how his $100 million gift to a school reform programme did not quite click.
All that should not make us smirk. The simple fact is that the fever of generosity has gone globally viral, to use a memorable phrase associated with the social media culture. Wipro chairman Azim Premji, ranked fourth in a global list of givers, has pledged a quarter of his wealth for charity. Telecom billionaire Sunil Bharti Mittal is offering R 5 crore a year to nurture a legal aid service for the underprivileged.
When the giveaways are counted transparently, we expect to see generous hearts triumphing over cynical minds. That might yet be the best way to prove right the fictional Hollywood character Gordon Gecko, who famously remarked in the 1987 film, “Wall Street,” that “Greed is good”