Trinket magnate Jeff Bezos, America’s richest man, has made a very public charity donation of a $2 billion. The number sounds big, doesn’t it? In fact, it is a disgrace. Let us demonstrate:
Jeff Bezos’ approximate net worth: $163 billion
Jeff Bezos’ largest-ever commitment to charity: $2 billion
Percentage of Jeff Bezos’ net worth charity donation represents: 1.2%
Median net worth of an American household: $97,300
Equivalent charity donation by an average household: $1,168
Jeff Bezos has given to charity the same portion of his wealth that an average household would give by donating less than $1,200. It’s certainly nice for an average household to donate $1,168 to the United Way at Christmas, but I doubt anyone will be holding a parade for them.
In fact, the donation from the average household would be considerably more admirable than Bezos’, due to the concept of diminishing marginal utility, which essentially says that once you have a ton of money, its value to you is less than the value it would have for someone will far less money. Ten bucks means a lot to a starving homeless man, but not much to a rich man. Likewise, $1,168 is a significant amount to the average household, but giving $2 billion won’t change Jeff Bezos’ lifestyle one bit.
Because he already has far too much money to ever spend, see.
Consider the behavior of Bezos’ peers. (He does not actually have peers—his wealth approaches that of Bill Gates and Warren Buffett combined—but these people are as close as it gets). Bill Gates, the next richest man in America, has started the nation’s most famous foundation, funded by his own billions. Warren Buffett, the next richest man, has given away more than $30 billion in the past decade. Mark Zuckerberg, next on the list, recently gave $45 billion.
All of them, along with dozens of other billionaires, have signed the Giving Pledge, a (modest) promise to give the majority of their wealth to charity. No one should have a billion dollars. A billion dollars in the bank account of a single human in a world where poverty exists is a profound failure of politics and morality.
Expecting the billionaires to give almost all of it away is the very lowest sort of expectation that one could even attempt to argue is ethical. More ethical would be to tax it all away immediately. More ethical than that would be to ensure that such grotesque accumulation of wealth can never occur in the first place.