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"What Should a Billionaire Give - and What Should You?"

Here are some of the intriguing turns of Peter Singer's argument in his December 17 New York Times Magazine piece on philanthropy.

Reasons to Give
According to UNICEF, 30,000 children on average die each day from avpoidable, poverty-related causes worldwide.

According to the Global Forum for Health Research, less than 10% of the world's health research budget is spent combatting conditions that account for 90% of the global burden of disease.

"The Millennium Development Goals, set by the United Nations Millennium Summit in 2000, include:

Reducing by half the proportion of the world's people in extreme poverty (defined as living on less than the purchasing-power equivalent of one U.S. dollar per day).
Reducing by half the proportion of people who suffer from hunger.
Ensuring that children everywhere are able to take a full course of primary schooling.
Ending sex disparity in education.
Reducing by two-thirds the mortality rate among children under 5.
Reducing by three-quarters the rate of maternal mortality.
Halting and beginning to reverse the spread of H.I.V./AIDS and halting and beginning to reduce the incidence of malaria and other major diseases.
Reducing by half the proportion of people without sustainable access to safe drinking water.

Last year a United Nations task force, led by the Columbia University economist JeffreySachs, estimated the annual cost of meeting these goals to be $121 billion in 2006,rising to $189 billion by 2015. When we take account of existing official development aidpromises, the additional amount needed each year to meet the goals is only $48 billionfor 2006 and $74 billion for 2015."

Warren Buffett has acknowledged that society is responsible for much of his wealth. ''If you stick me down in the middle of Bangladesh or Peru,'' he said, ''you'll find out how much this talent is going to produce in the wrong kind of soil."

"The Nobel Prize-winning economist and social scientist Herbert Simon estimated that 'social capital' is responsible for at least 90 percent of what people earn in wealthy societies like those of the United States or northwestern Europe. By social capital Simon meant not only natural resources but, more important, the technology and organizational skills in the community, and the presence of good government. These are the foundation on which the rich can begin their work. 'On moral grounds,' Simon added, 'we could argue for a flat income tax of 90 percent.''"

The Moral Question
"Gates may have given away nearly $30 billion, but that still leaves him sitting at the top of the Forbes list of the richest Americans, with $53 billion. Gates compares very well with most of the other people on the Forbes 400 list, including his former colleague and Microsoft co-founder, Paul Allen. Allen, who left the company in 1983, has given, over his lifetime, more than $800 million to philanthropic causes. That is far more than nearly any of us will ever be able to give. But Forbes lists Allen as the fifth-richest American, with a net worth of $16 billion. Is there a line of moral adequacy that falls between the 5 percent that Allen has given away and the roughly 35 percent that Gates has donated?"

A Possible Answer

The 14,400 people who make up the richest .01% of taxpayers earn an average of $12,775,000 (totaling $184 billion), with a minimum income of $5,000,000. If each gave away a third of his annual income, the contributions from this group would total $61 billion.
The 129,000 taxpayers who make up the rest of the richest .1% average $2,000,000 and make at least $1,100,000. If they gave 25% of their income yearly, they'd contribute $65 billion.
The 575,900 taxpayers who make up the rest of the richest .5% average $623,000 per year and make at least $407,000. Giving one fifth of their income would total $72 billion.
The 719,900 taxpayers who make up the rest of the richest 1% average $327,000 per year and make at least $276,000. Giving away 15% of their yearly income would yield $35 billion.
The 13 million taxpayers who make up the rest of the richest 10% average $132,000 and make at least $92,000. Giving 10% of their income would yield $171 billion yearly.

If the US used this calculation, and it were applied worldwide such that even half the global giving came from outside the US, the world would still raise $808 billion annually, more than 16 times what the Sachs task force estimated was needed to fill the gap in funding the Millenium Development goals.

Labels: class, nytimes, philanthropy