Beware Billionaires Bearing Gifts

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By Leo W. Gerard, the international president of the United Steelworkers Union (USW). Produced by the Independent Media Institute.

There’s a new Koch organization in town. Instead of trying to buy politicians to do the bidding of billionaires, as Charles and David Koch have historically done, this foundation will support community groups trying to cure the miseries of eons—everything from poverty to addiction.

And they’ve got some street cred, having successfully worked with renowned liberal Van Jones to secure legislation to reduce mass incarceration. Billionaire Charles Koch says the mission is this: “We must stand together to help every person rise.”

That is some good stuff, right there. It’s what labor unions have always preached—workers must stand together to gain the collective power essential to pull every one of them up. It works, too. In the middle of the last century, collective bargaining created the great American middle class.

There’s an important difference, though, between the work of labor unions and billionaire-funded organizations. Labor unions are created and controlled by workers. Billionaire-funded organizations are beholden to billionaires.

What could be so bad, though, about accepting gifts from billionaires? Just last week, billionaire Robert F. Smith promised to pay off the student loans of 396 graduates of Morehouse College. That means these young people get to launch their careers without the burden of debt. Smith granted the loan forgiveness with no stipulations other than urging every member of the class of 2019 to do what they could to pay it forward—that is, help others achieve as well.

This gift is part of Smith’s effort to fulfill his giving pledge. He signed a formal promise in 2017 to donate half of his fortune, estimated at $5 billion.The giving pledge is a project of billionaires Warren Buffett and Bill and Melinda Gates, who are bequeathing at least half of their money and urging other billionaires to do the same.

In 2016, Smith, who graduated from Cornell University and worked as a chemical engineer before he became an investor, committed to donating $50 million to Cornell’s chemical and biomolecular engineering school. A significant portion of the endowment will be dedicated to scholarships and fellowships for AfricanAmerican and female students who are traditionally underrepresented in engineering and technology. Cornell then named the department the Robert Frederick Smith School of Chemical and Biomolecular Engineering.

Not all billionaire gifts are benign, however. Just ask the students at George Mason and Florida State universities. Grants from the Kochs to the schools came with significant strings attached.

In the case of the millions the Kochs gave to Florida State for its economics department, the Kochs demanded the right to approve who was hired, to annually review their work and to withdraw funding if dissatisfied. Outrage erupted when students and the public learned of this infringement on academic freedom.

The Kochs donated approximately $150 millionto 300 colleges and universitiesbetween 2005 and 2015, gifts they frequently specified must support economics and law schools fostering unfettered free-market capitalism. Of that, at least $50 million went to George Mason, where, like at Florida State, the Kochs got control over faculty and course selections. The libertarian brothers’ money helped convert the college into a center for libertarian study.

Three years ago, George Mason renamed its law schoolafter the late, extreme right-wing Supreme Court Justice Antonin Scalia. This occurred after George Mason received a $10 million donation from the Kochs and a $20 million gift arranged by the Federalist Society, a Koch-funded institution that has for decades cultivated conservative and libertarian attorneys and promoted them as jurists, including current Justices Neil Gorsuch and Brett Kavanaugh. George Mason gave the Federalist Societyanddonors like the Kochs a say in faculty selection.

The Koch intrusion into George Mason academics was revealed by a campus group, Transparent GMU, which sued for release of the information. It is an affiliate of the group UnKoch My Campus, which seeks to preserve academic independence, freedom and integrity, as well as faculty governance rather than donor governance.

It’s one thing to name an engineering school after a guy who sponsored scholarships for women and minority students. That promotes diversity among learners and achievers and new perspectives for scientific inquiry. It’s another thing to name a law school after a reactionary Supreme Court Justice at the bidding of libertarian donors bent on converting the school into a right-wing training camp for future conservative judges. That covertly promotes a specific viewpoint, not free and wide-ranging academic instruction and research.

Billionaires don’t necessarily have students’ or workers’ best interests in mind when they hand out cash. Libertarian and right-wing judges, like the libertarian and right-wing political candidates that the Koch network has propped up with hundreds of millions in donations, push policies that are great for private-jet-owning billionaires, not workaday thousandaires.

The 2017 tax cut is a good example. By 2027, millionaires will reap 82 percent of its benefits. The law definitely lined the pockets of the Koch brothers, among the richest people in the world, worth more than $53 billion each.And the Kochs showed their appreciation with a gift. Thirteen days after the U.S. House, under the leadership of former GOP Speaker Paul Ryan, passed the tax break for millionaires, Charles and Elizabeth Koch each gave $247,000 to Ryan’s fundraising campaign, Team Ryan—a total of nearly half a million.

When the U.S. Senate approved the tax cut, which is projected to increase the federal deficit by $1 trillion over a decade, Ryan announced that he would attempt in 2018 to close that massive hole by slashing Medicare and Medicaid. Those are the health insurance programs for the elderly and poor that are beloved and depended on by working people—the very people who got precious little out of the tax cut for the rich that exacerbated the federal deficit.

Here’s the thing: Maybe it’s nice that some billionaires are willing to give. But billionaires’ “gifts” too often bear self-dealing strings. And handouts make many workers queasy anyway. They’d rather earn their own money and make their own decisions.

For Americans to achieve real freedom and self-governance, some of the billions that flow into the pockets of the already rich must go instead into the paychecks of the workers whose sweat creates profits. Political bribes, like the $500,000 the Kochs gave Ryan, must be outlawed. And the rich must be properly taxed so that the nation can afford to pave its roads, send its youngsters to affordable, properly government-supported technical schools and colleges, and restore its once-great middle class. American workers want autonomy, not charity, to help every person rise.

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  1. flora

    This is either the longest introduction ever, or there’s a ‘close italics’ tag missing. ;)

  2. upstater

    Antonin Scalia School of Law = ASSOL

    A joke to laugh at, but seriously destructive in practice.

  3. a different chris

    > Charles and Elizabeth Koch each gave $247,000 to Ryan’s fundraising campaign,

    New rule – Campaign donations are now unlimited, but:

    1) every donation has to be to a specific race
    2) and it needs to be split across everybody running

    Because if you think Candidate A is the best candidate, then hey won’t he/she win if they all get equal exposure? Well Charles?

    PS: I can’t seem to get rid of the italics, either?

  4. JEHR

    It’s a strange thing that billionaires always feel good about giving money as charity but not giving a decent wage to the many employees and others that work for them. It must be part of the need for stroking billionaires’ egos that makes this so. My only consolation is that billionaires cannot yet buy their way into infinity!

    1. Arizona Slim

      JEHR, you hit the nail on the head.

      When I was a much younger Slim, I worked for the fundraising arm of a university. And I saw what you described. Very wealthy people making BIG gifts, for which they were lauded and glorified to the nth degree.

      Meanwhile, back at the office, my coworkers and I were making very little money. To the point where one lady had to get food boxes from her church.

    2. Barbara White Stack

      This is exactly right. In the middle ages, employers paid squat, then tried to buy their way into heaven by giving tons of money to build churches. I wonder if the Koch brothers can buy themselves passes through the pearly gates.

    3. WheresOurTeddy

      Noblesse Oblige is a form of control. They much prefer this to taxes, both because they can give round numbers for PR that sound like a lot to laypeople but actually represent a much smaller % of their income than they’d otherwise pay in taxes (and get no fanfare for it).
      Taxes are them being told that everyone deserves to have their lives get better, regardless of who the ruling class thinks deserves it, and are a clear message that YOU DON’T CONTROL THIS SOCIETY, IT CONTROLS YOU.
      The rich must be governed or they will govern everyone else; history shows us that without exception, this will be to bad ends.

    4. Anon

      Many colleges/universities are non-profit/charitable institutions. So these donations are tax deductible, as well as image burnishing.

      (Seems everything on this page, including this comment, is being ITALICIZED.)

  5. jfleni

    RE: Beware Billionaires Bearing Gifts.

    Its like the game of looking for the pea in the walnut shell;
    you are #### no matter what you do; stop look and listen,
    just like a rail crossing!

    1. WheresOurTeddy

      being a billionaire is a character flaw; a society that allows them to exist while homeless veterans sleep under bridges and people die of preventable diseases is morally indefensible

  6. Barbara

    When the news came out about the gift of debt forgiveness for this year’s graduates at Morehouse College, I thought of it similar to the pharmaceutical companies’ preference of giving donations of medicines to selected patients rather than lowering the price overall so that all patients who need the drug can afford it.

    Good pr, tax deduction, keeping the status quo, calling the shots. Not bad. And we all get to be grateful.

    1. Stratos

      “Good pr, tax deduction, keeping the status quo, calling the shots.”

      Good points. The gift of debt forgiveness would have had more impact if Johnson had cleared the debts of students who graduated with worthless degrees from for-profit colleges———-many of them Black and Latinx women. Instead he chose to make a show of giving to some of the most elite (and male) Black graduates in the U.S.

      Johnson’s action only underscored the need for a debt jubilee for everyone with student loans. Student loans are a wealth transfer scam. Student debt is also designed to keep young people so occupied they don’t organize for social change against the status quo.

      Student debt peonage is an abomination.

  7. WheresOurTeddy

    Letting billionaires decide who deserves charity and who doesn’t is obviously a terrible idea as soon as you say it out loud and think about it for more than 10 seconds

  8. BenX

    What the super rich want when they have everything else is fealty and adulation. As it turns out, money can buy that too.

  9. Denis Drew

    Simple answer — couldn’t be simpler: massively reset American labor union density to a level higher than ever before — overnight — it couldn’t be easier. Mandate regularly scheduled, union certification-recertification-decertification elections at every private (non gov) workplace.

    High union density will automatically fill the coffers of progressives to match anything billionaires can give — backed by almost all the votes.

    I read this on Vox:
    “The Democrats’ new bill would also allow workers to sue employers who illegally interfere with unionizing efforts, instead of forcing them to take all their complaints to the National Labor Relations Board, an independent federal agency that enforces collective bargaining laws. The new bill would also let the board hit employers with fines if they break the law. Right now there’s currently no financial penalty for employers who illegally fire workers who are trying to unionize, for example.”
    * * *
    “Most importantly, though, the bill would allow workers to sue their bosses for violating their right to organize under the National Labor Relations Act. There are few things businesses hate more than the idea of a jury awarding millions of dollars to an aggrieved employee. That threat gives employers a strong incentive to follow the law. ”

    Very impressive sounding; but do you think that next year workers at Target and Walgreens (otherwise than dollars, great places to work) are going to be getting organized? Think we might go from 7% unionized to 15% over ten years.

    What we need to 50% to 75% to reach critical mass — the level at which the average person take the country over.

    Creating a union should be as pleasant and uneventful as acquiring any business license. No gauntlet should have to be run. No guerilla war with management need ensue.

    Why Not Hold Union Representation Elections on a Regular Schedule? Andrew Strom — November 1st, 2017

    “Republicans in Congress have already proposed a bill that would require a new election in each [private] unionized bargaining unit whenever, through turnover, expansion, or merger, a unit experiences at least 50 percent turnover. While no union would be happy about expending limited resources on regular retention elections, I think it would be hard to turn down a trade that would allow the 93% of workers who are unrepresented to have a chance to opt for unionization on a regular schedule.”

    Once we get full labor union critical mass, we can legislate sector-wide (centralized) bargaining like they have in continental Europe, French Canada, not to mention Argentina and Indonesia — and — prohibit hiring replacement workers during strikes as they prohibit such in Mexico.

    “when a union officially declares a strike, ‘a workplace cannot be opened.’”

    Only regularly scheduled cert elections can rebuild American labor union critical mass.

    1. Guest

      If you want legislation like this to have teeth and actually let employees and unions sue union-busting employers, you need to reform the Federal Arbitration Act of 1925, as it’s the current gold-standard get-out-of-court-free card (and also is a Best Practice to circumvent any action above the individual level). Until FAA is specifically and dramatically reformed (or repealed) the Roberts court will continue to dramatically expand its scope as stealthy “tort reform”-plus.

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