Tag Archives: philanthropy

Bill Clinton Gets 6 Billion In Pledges For Global Philanthropy

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(MORE LINKS TO COME)

Reuters reports that ex-President Bill Clinton has raised a record $6 billion for a global philanthropic effort called Clinton Global Initiatives:

“Former President Bill Clinton secured a record 291 pledges worth more than $6 billion to tackle global woes at his sixth annual philanthropic summit, which wound up on Thursday.

The value of Clinton Global Initiative pledges for economic empowerment, education, environment, energy and health was $3 billion less than 2009, but the organization said that in previous years one or two big commitments represented a disproportionate share of the whole.”

So what’s the Clinton Global Initiative?  Here’s the website

And here’s what its all about (my translation in italics)

“In 2005, President Clinton established CGI to turn ideas into action and to help our world move beyond the current state of globalization to a more integrated global community

[Lila: More centralization leading to world government]

of shared benefits, responsibilities, and values. [Lila: perks, taxes, and bureaucratic regulations]

By gathering world leaders from a variety of backgrounds [Lila: We’ve bullied, bribed, and blackmailed every pol  on the face of the earth to join],

CGI creates a unique opportunity to channel the capacities of individuals and organizations to realize change [Lila: You want to make any money, you’re going to need to do business through us].

To fulfill the action-oriented mission of CGI, all members devise practical solutions to global issues through the development of specific and measurable Commitments to Action.

CGI Annual Meetings have brought together more than 125 current and former heads of state [Lila: OK, we’re missing a few islands], 15 Nobel Peace Prize winners [Lila: Now you know why they’re given Nobel prizes – they can lend their credibility to the CGI], hundreds of leading global CEOs [Lila: Right-wing fat cats], major philanthropists and foundation heads [Left-wing fat cats], directors of the most effective non-governmental organizations [Lila: Professional do-gooders  and trojan horses], and prominent members of the media [Lila: The PR department].

These CGI members have made nearly 1,700 commitments valued at $57 billion, which have already improved more than 220 million lives in 170 countries

[Lila: 220 million reliable constituents and advocates of bigger government].

The CGI community also includes CGI University (CGI U), a forum to engage college students in global citizenship; CGI Asia; MyCommitment.org, an online portal where anybody can make their own Commitment to Action; and, CGI Lead, which engages a select group of young leaders from business, government, and civil society.”

Goldman Charity Prompted By PR Concerns

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RaceTotheBottom, a law blog on corporate regulatory issues, has this on the latest PR move  by Goldman Sachs, one we noted in our previous blog post on Haiti. which mentioned the donations made by the big banks.

“The latest effort by Goldman to ameliorate the criticism is apparently to require top officers and managers to donate a certain percentage of their compensation to charity. As the NYT noted:

* While the details of the latest charity initiative are still under discussion, the firm’s executives have been looking at expanding their current charitable requirements for months and trying to understand whether such gestures would damp public anger over pay, according to a person familiar with the matter who did not want to be identified because of the delicacy of the pay issue.

Apparently Bear Stearns had done something similar in the past, requiring the top 1000 employees to contribute 4% of their compensation to charity.

The specifics have apparently not yet been determined. Nonetheless, unlike the stock bonuses, the approach effectively reduces the amount of compensation paid to each employee.

Goldman could have considered reducing the amounts paid in compensation and contributed the saved amounts directly to charity. The financial institution in fact added an additional $200 million to its charitable foundation. But making direct contributions would have potentially violated state law.

Corporations are obligated to profit maximize. Some portion of the company’s profits can be donated to charity. Companies may do so, however, only if there is a business benefit. See RMBCA § 3.02(15)(permitting “donations, or do any other act, not inconsistent with law, that furthers the business and affairs of the corporation.”). For modest amounts of contributions, the business benefit can be vague, with enhanced reputation in the community enough of a justification.

For more significant amounts, however, there must be a sufficient nexus to the business of the company. Had Goldman chosen to donate 5% of the amount left aside for compensation, an amount that would probably exceed $1 billion, it would have needed to show some type of meaningful connection to its business. Any failure to do so would likely generate lawsuits from shareholders alleging that the board had failed to engage in the required profit maximization.”

My Comment:

Isn’t this exactly why the more laws you have on the books, the more complicated your problems get?

Think about it. Goldman can’t make direct charitable contributions, because companies are obligated to maximize profits. Why are they obligated to maximize profits?

Because that’s what shareholders are due, per company law.

You might ask whether maximizing profits is always in a company’s best interests, versus building long term value or market share or any number of other things that stake-holders in the company might value more than high returns, but those things don’t count, because that’s how a law works – like a blunt instrument.

And then when managers focus on these short-term horizons and start doing legal (or illegal) tricks to show quick gains on their books, then we need another set of laws to curb them, with incentives running in the opposite direction….

The end result is a muddle of misplaced directives and restrictions that distort the market.
And people criticize the free market!

Philanthropic Versus Misanthropic Libertarianism

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Mad props to Humble Libertarian for coming up with this:

“Libertarian thought often starts with “me” and says to others “you shouldn’t violate my rights,” which is certainly true, but somewhat off-putting because it’s egocentric. Aside from being off-putting, it’s the moral low-ground. It’s moral and true, but it pushes the moral imperatives of libertarian thought off on someone else. The moral high-ground is to accept and practice the moral imperative for yourself. Libertarians would always do better to say, “I shouldn’t violate your rights- I won’t violate your rights.” In practice this makes a world of difference. On the issue of welfare and property redistribution, for example, the first approach would sound like this: “Who are you to take my hard-earned money and give it away to the poor? Even if I should give it to them, you have no right to confiscate my property from me.” The second approach is a sharp contrast to the first in both tone and content: “Who am I to take your hard-earned money and give it away to the poor when I’m likely not even giving enough myself? Even if you should give it to them, I have no right to force you to, especially when I’m not giving enough myself. How hypocritical of me would that be?” See how much more humble that is and sounds?

The first example is a challange. Its tone is antagonistic and its premise is egocentric. The second example is an invitation and a catalyst for conversation. Its tone is humble and its premise is philanthropic- motivated by love and concern for other human beings and their rights. The distinction here can ultimately boil down to these alternatives, egocentric libertarianism on the one hand, and philanthropic libertarianism on the other.“