Key Words: Philanthropy is a ‘PR scam,’ says CEO who raised his workers’ minimum pay to $70,000

Key Words: Philanthropy is a ‘PR scam,’ says CEO who raised his workers’ minimum pay to $70,000

2021-02-23 05:05:00

He's not buying what the American billionaires are selling.

The CEO, known for raising the base salary of his employees to $ 70,000, says wealthy people who donate their money and are rewarded with "glowing items, a hospital named after you, and a massive tax write-off" add up to "one. of capitalism's biggest public relations scam ”.

Dan Price, the CEO of the credit card processing company Gravity Payments, denounced the American elites on Twitter

accusing that the average billionaire donates a smaller portion of their money to charity each year than the average non-billionaire.

"One of capitalism's biggest public relations scams is the & # 39; philanthropist & # 39 ;. The average billionaire donates 1% of his fortune to charity annually – less than non-billionaires. But if you donate $ 200, you won't get glowing articles, a hospital named after you, and a massive tax write-off. & # 39;

– Dan Price, CEO of Gravity Payments

As proof, Price cited a recent ranking of the largest charities of 2020, including big wallet donors like Amazon

founder Jeff Bezos. Critics of wealth inequality have pointed out that billionaires saw their fortunes increase during the pandemic, but the contributions they made to charities represent a small fraction of their growing wealth.

Price was inspired to weigh in on philanthropy as Washington state is discussing a proposal to introduce the first state wealth tax, he told MarketWatch. The tax would apply to humans with a net worth in excess of $ 1 billion.
Price said one of the most common criticisms he has heard about the proposal is that "billionaires don't have to pay taxes because they already donate."

"In reality, the amount they donate is a fraction of what they would pay if their tax rates were in line with the working class," he said.

Billionaires nationally pay the lowest tax rate of any income bracket, price added. In Washington state, the richest pay 3% of their income in taxes, while the poor pay 18%, he said. (That's according to a report by the Institute for Taxation and Economic Policy, a left-wing think tank.)

“I think billionaires donate for a variety of reasons, but it's clear that giving away the equivalent of what's in their bank pillows helps them avoid having to deal with higher bills that would really make a difference in solving systemic problems, ”Price told MarketWatch.

The average American donates about 2% of his disposable income to charity each year, according to Giving USA, an annual report on charitable donations.

It is difficult to calculate how much of their wealth billionaires are giving away. They don't always publicly disclose their charitable donations, and many don't have to disclose how much they give away.

According to the Chronicle of Philanthropy, Bezos was the # 1 donor of 2020. He pledged $ 10 billion to establish the Bezos Earth Fund, but last year only part of that money went to charity. The fund distributed $ 791 million in grants to environmental groups in 2020. Bezos also donated $ 100 million to Feeding America, a national food bank network.

Meanwhile, Bezos' net worth soared to about $ 188 billion by November 2020, according to the left-wing Institute for Policy Studies, a frequent critic of Bezos and other billionaires. Using those numbers – which are a moving target – Bezos gave away about 0.47% of his net worth in 2020. (An Amazon spokesperson declined to comment.)

America's billionaires increased their charitable donations in 2020, with the top 50 donors shedding $ 24.7 billion together to address pressing issues, including the pandemic and its economic impact, and calling for racial justice. The 50 largest donations in 2019 totaled $ 15.8 billion.

Despite the economic turmoil caused by the coronavirus pandemic, a recent estimate is that in 2020 total charitable donation – by billionaires and non-billionaires – has increased in the US.

Price made headlines in 2015 after announcing that he would pay every employee at his company at least $ 70,000 a year. In the early months of the pandemic, Gravity, a credit card payment processor that works primarily with small businesses, saw its revenues drop by 50%. Price said he avoided layoffs by asking his employees to take pay cuts. The company later those workers paid back

Price also lowered his own salary from $ 1.1 million to $ 70,000, along with the rest of his employees. Some observers have suggested that if he had kept his own high pay he would have more money to give away to charity, he said earlierBut Price doesn't think “ the world needs another billionaire philanthropist, '' he said, “ because we've been relying on billionaire philanthropists for so long, and I don't really think that's right. works out for us. & # 39; & # 39;

He added that he would rather see a system with more "fairness and integrity" and companies that take care of their employees.

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