Bill Gates has long focused on philanthropy projects through the Gates Foundation. I recently announced the end date for this graduate. As Bill Gates put it in his recent announcement:
I will present virtually all my wealth through the Gates Foundation to save and improve lives around the world over the next 20 years. And on December 31, 2045, the foundation will permanently close that door.
Gates says over the past 25 years, his foundation has put $100 billion into various projects and causes, melting through his own wealth and the wealth of other billionaires like Warren Buffet. His goal is for the foundation to pick up the pace now – until it closes over the next 20 years, he hopes that his foundation will contribute another $200 billion, and Gates will effectively give his wealth as part of this process.
The Gates Foundation has brought in tremendous benefits worldwide – some rational estimate has saved millions of lives and improved millions. Billionaires like Bill Gates are often criticized for not paying enough with taxes. However, opportunity costs cannot be ignored. (Or I think it would be better to say the time frame of opportunity. There is no need for a tax change to make this an OCD – citizens are free to send additional taxes to the government at any time.
In his book following his Leader: Political Preferences and Public Policy, Randall Holcomb distinguishes between expressive and instrumental preferences. Expressive preferences, as the name suggests, are about ideas we like to express to others and ourselves. Instrumental preferences are about the outcome of directly choosing to create when given an effective choice. What we express and like is not the same as what we tool-like. Holcomb argues that voting and political activity are driven by expressive preferences rather than instrumental preferences. As he says, voters “act expressively, not instrumentally, and not select outcomes as individuals, so they express preferences. There is a reason for the mando that thinks that express preferences in the voting box are different from those that would prefer if the choice of social alternatives actually prefers to make.”
So here is the question that comes to mind. Let’s imagine finding advocates for increasing taxes on billionaires – even better yet, one of those who argue that “billionaires shouldn’t exist.” Suppose you’re sent to signal Bill Gates’ brain, etching him a desire to close his foundations right now, and instead presenting the magic button that he wants to give all his wealth to the federal government at once as a voluntary tax contribution. At the time of writing, Bill Gates’ net worth is around $116 billion, so let’s say that by pressing this button, the federal government earns an additional $116 billion in revenue. “If not, it would have been done by the Gates Foundation over the next 20 years.
If this magic button is completed by Gates Foundation, will they press the button? Did their expressive preferences to remove billionaires from existence and collect more taxes from the rich also turn out to be instrumental preferences? Or, the full weight of that decision is suddenly given to them in full, and they personally place the full moral responsibility of erasing all the work the Gates Foundation has been doing over the next 20 years.
Do you want to press the button?
