Saturday, February 2, 2013

State, Church, School, Charity, Part 6

Succeeding the mostly-skippable Part 5, which came after Part 4.

Charitable Evolution

Why all the stuff about the evolution of evil? The Honest Tyrant State became the Tyrant Church-State, which became the Tyrant School-State, which became the Your Friend School-State. The Your Friend School-State, covered in Part 4, is the lingering dominant form, where all vestiges of formal cruelty have been replaced by Your Call Is Important To Us. More broadly, this means that conquest is humanitarian intervention, genocide is an unfortunate accident, and theft is the admittedly imperfect, but progressing, democratic allocation of resources.

The Failings of the Honest Tyrant State

The easiest target of the Honest Tyrant State was its honesty. People initially wanted honest tyrants because honest tyrants protected them from bandits. Honest tyrants were bandits--the beginning of any noble line came when a bandit-lord grew powerful enough to patent violence within any given zone. Traditional anarchy literature has most of this simple, early stuff down quite well: the bandit-lord promises to reduce the rate of home invasions, kidnappings, rapes, and murders, in exchange for a lower rate of violence delivered only by his hand-picked goons. In addition, many people may never have to experience violence if they hand over enough labor, gold, and daughters.

Once these models were up and running, Honest Tyrant States and Tyrant Church-States could then compete with one another for labor, by offering slaves/serfs better huts and gruel, reduced whipping, etc. So yeah, we're cruising pretty easily through the beginnings of western civilization to about the French Revolution and/or the Reformation. The honesty of the lords, there, proved their undoing. People became unwilling to accept being openly ruled over; they began to feel that they should have a "say" in their lives. All the revolutions you know about happened, the feudal system began to die out, and the Tyrant School-State arose.

The Tyrant School-State solved the problems of the Honest Tyrant State and the Tyrant Church-State by becoming sweeter about everything that didn't matter. Only nobles used to be able to learn; now, the School-State allowed everyone to learn. In fact, forced them to--to learn about how great their governments and leaders and histories were. But it was still learning, and some of the learning was good. Discontent with honest tyranny continued even after people became allowed to read their own bibles and schoolbooks, so the structure morphed into the Your Friend School-State, where tyranny is expressly disavowed by the Secretary. This became Part 4, the tricks most current westerners have lived through.

The Failing of the Your Friend School-State

Cracks now show in the facade of the Your Friend School-State. They are the same cracks that ultimately required each stage of the evolution, and even while they appear, the defenders of the School-State have explanations ready. The cracks, though, will spread, as in the Reformation, and eventually bring down the Your Friend School-State entirely, replacing it by the Your Friend Charity-State. The Charity-State is, and will be, a creature of circumstance, taking the form of something that will answer the objections of the citizenry to the previous form.

To serve the original elite ends that necessitated the creation of States, the Charity-State needs to be capable of laundering vast wealth and influence. To avoid the downfall of the Church-State, it must appear to be separate from the State, yet perform its laundering in plain sight, conducting a mystical dance of such epic proportions that to even fathom the positions of one of the dancer's toes is a study of years.

Guaranteed Buyers - What Do Charities Really Do?

The Fitness Center

Like churches and schools, charities are corporations that are exempt from tax because of the services they provide. They can accumulate and transfer massive wealth without paying transfer fees to government, on the condition that the wealth does not come directly out to private individuals. This is the original "trick" of the Church-State: the claim that money hidden in the church is not paid in cash form to the members of the board without those members having to pay regular income tax on it. Therefore, it's fair, goes the argument--the same with schools and charities.

Charities, though--again, just like churches and schools--have facilities. They have buildings, computer equipment, connections, and budgets. Powerful charities use their budgets to benefit their owners, as part of the carrying out of charitable business.

Example: in a bad year, Bill has $56 million of income. To avoid paying it to the IRS, he donates it to the Bill Foundation. The Bill Foundation has, as one of its charitable purposes, eliminating stubbed toes in rural China. Bill and thirty of his friends attend a conference near John Hopkins University on the problems of stubbed toes, staying at a nearby Hilton resort, where they host a charity ball for doctors and other donors. Jackson Browne and Jerry Seinfeld are paid to appear and entertain the guests as they eat $200 plates and drink $300 bottles.

Bill and company tour Hollywood, meeting actors, eating out, watching films and shopping while raising awareness about this crucial issue. They end up on a cruise ship that takes them through Laos, Cambodia, and Thailand, where they meet with a few local doctors and visit some villages where the children have been afflicted with stubbed toes. The ship moves on to mainland China, where Bill recuperates in the finest hotels, preparing for an important meeting with a local health official. In exchange for promises of donations from the Bill Foundation to local medical clinics, the official makes sure that Bill has plenty of time to get to know the city's ins and outs, make some good contacts, and come home with some really nice memories and souvenirs.

Here, we see the malevolent brilliance of the modern nonprofit. Freed from the bounds of "the faith" or "educating County children," the potential for using tax dollars to do anything in the world is present. "Charity" can be reasonably defined as anything, provided big money can put unbeatable due diligence and accounting behind the expenditures.

While Bill is touring and raising awareness, the Bill Foundation's front office staff are struggling to make it on $32K a year as they process small private donations and format pamphlets to send to medical schools, encouraging future doctors to sign up for volunteer work in China, treating peasant children with stubbed toes. Some of them, filled with the spirit of goodness, actually go out and fix a few stubbed toes, and Bill's smiling face is all over the credits. Because after all, he paid for it with his own money, in the spirit of charity.

He's a Great Kid

Can you help my nephew out? He's a great kid; just finished college a while back, SO bright. He's looking for an opening. Do you have something?

Charities are job placement. A lot of non-profit jobs exist--at low wages, low reliability, and minimal resume value--for people who do the actual charitable work. Those jobs are used to justify managerial positions--at very high salaries, with maximum resume value and marketability. Like C-level "employment," upper level charity officials do the difficult work of making tough decisions and knowing the right people. Formal patents of nobility, the right zip code, and the right degree are gradually fading in importance for elite networks; charity control is becoming the new expression.

Example: Jacob cruises through life on his parents, partying through the best prep schools and finally selecting some sort of major at college. After this arduous educational journey, he picks around for a few years, trying to discover himself while learning how contemptible and naive most people are. Around his late twenties, he decides to get his act together, spend a few years grabbing a graduate degree, and settle into a serious job.

For most people contemplating picking up a "career" in their late twenties, things would be shaky even in a strong economy. With a lot of luck, hard work, and years and years spent working in entry-level jobs, a skilled person has a low, but still noticeable, chance of getting into a good position. Luckily for Jacob, his parents know how artistic he can be. And Jacob isn't just some greedy slob--he wants to give something back to the society that has been so good to him, and help out people less fortunate. He's willing to forego the traditional business world to be the Assistant Director for Enrichment Activities at the Seattle Foundation for the Performing Arts. He'll start with a modest low six-figure salary, company car, and downtown condo, because he'll be expected to entertain donors at the yearly holiday party.

It's very important for any charity to maintain its revenue stream. That is done through soliciting donations. So, Jacob has many grueling jobs: he needs to network with wealthy people around the city, having lunch and going to plays and reminding them of the importance of the arts in our society. His parents' friends introduce him to some of the major players, and they're delighted to see that someone like him has taken an interest in keeping culture alive in such an ignorant society. Jacob works diligently, ensuring that costume budgets are filled from the general operating fund, that the Mayor and the Aldermen know how vital it is to renew the Foundation's free lease on the Cultural Plaza and the David Snow Memorial Auditorium, and that local college students are able to get course credit volunteering to do administrative and backstage work for the Foundation. They're not paid, but it's a great resume builder. (Of course, secretarial tasks don't look that good, but the right people can call Jacob directly and make sure that their son gets some "managerial" or "production" experience.)

Of course, as the Assistant director, Jacob is expected to hold bi-yearly meetings with the Foundation's managers, getting reports on whether the gardening and janitorial subcontractors for the Foundation's main executive offices (at the old Horstein Building on the east side) have been performing adequately.

Where does all that money come from, to run such an operation? Jacob's parents have been donating to the Foundation for years, of course, but just a few thousand each year; the bulk of the money comes from the great-grandparents and great-great-grandparents of Jacob and friends. The "charity" operates like an old fiefdom, or a more-modern trust fund, but with a tax-exempt twist on the latter: the charity holds a massive sum of wealth, perpetually free of transfer or income taxes of any kind, and uses the fund to parcel out jobs and connections to the friends and relatives of its trustees, generation after generation.

In Jacob's case, the charity also provides subsidized entertainment for society's upper crust--i.e., Jacob, Jacob's mommy and daddy, and their friends. The proles may buy a $60 ticket to the latest play, and some actors and singers may earn around $33K in yearly salaries building their resumes by performing: the end result is a yearly schedule of the finest young talent performing musical or dramatic entertainment, for those who have the free time to partake in it. Almost always, it takes the immense wealth and history of the old companies (or their modern reorganizations, funded from the same sources and controlled by the same interests) to advertise shows, rent space, and attract talent. The essential-monopolies of corporate media, corporate entertainment, and charitable-corporate local arts are heads of the same hydra.

Beyond his immediate salary and benefits, Jacob acquired a lot of extras from that job: he just got experience (1) making high-value sales (by being part of accepting donations); (2) managing a large budget; and, (3) managing a large group of people (any set of the Foundation's staff). He also got great experience in (4) being part of the artistic community. Like going to the right men's preparatory school in the 1800s, or to the right university in the 1900s, he's inherited far more than his "degree" or his "paycheck." Jacob is ready to transition, later in life, to the kind of private corporate job that corresponds to his non-profit job: one where you have a big salary, a lot of people under you, and know the right people. (Alternatively, his enriching cultural experience can pre-approve him for a place in the entertainment industry, which he already knows so much about.)

Media Funneling

Perhaps the largest single part of this game is the way that charities fund a significant portion of major media advertising. For a charity, advertising for more donations is a legitimate business expense. When the Salvation Army spends $20 million of ad space, elite ad brokers and account reps fill in the empty time slots, the lucky MFAs in "film production" produce cute shorts about Christmas dinners, and hundreds of low-waged underlings do the technical and programming work necessary to get those slots on the air at the right time. Chinese eight-year-olds drink water filled by the runoff from noxious machines that make ribbons, wristbands, and tote bags, while taxless income swells in the coffers of the great charities that sell them.

As to ribbons specifically, see Dr. Dawson's Pinkwashing. The NFL, in that example, uses "charity" as a marketing tool, and gleans therefrom a significant profit--but the profit side for the charity itself is no less significant.

Safeguarding Estates

Savvy elites know that the current individualized, "American"-style model of personal responsibility and personal wealth can't sustain itself forever. It threw the proles for a while, to take away formal nobility, and pretend that the free competition for currency would fairly elevate its own paladins to the top. Warren Buffett is supposed to be viewed differently from Lord Steyne because he earned his money through savvy rather than inherited his title through blood. The great nobles still have cultural reverence, but good market predictors know that it's fading. Popular discontent at the titans of industry, as once directed at the Ancien Regime, will eventually force a shift in the model, and the elites need to keep hiding their stolen wealth flows from a slightly-savvier horde of serfs.

So Buffett, Gates, and the other great lords encourage "philanthropy." Taking hundreds of billions of dollars "away" from themselves, they will continue to shelter their holdings in massive, imaginary charitable corporations, preserving for centuries the un-taxed growth of what they've taken. Immune from criticism for its "charitable" nature, their obscene holdings will ensure that their informal social and genetic connections--the same connections that have been driving this show since "kings" began ruling "kingdoms"--will take ridiculously disparate advantage of the world's wealth. Any popular attempt to reclaim billions of dollars in stolen assets will be met with the refrain, "I'm broke! This building belongs to the charity for crippled children!"

Early lords did slay bandits. Stalin built roads. Hitler grew corn. Clinton felt your pain. Obama liberated Pakistan. Gates heals the sick. And Elizabeth II maintains the rich tradition of British history and the pride of the English-speaking peoples.

A brief snippet from Buffett's own wizened white mouth would be appropriate here: "We're hoping that America, which is the most generous society on Earth, becomes even more generous over time." Buffett is intelligent, in the craftiest, most vile of ways. Seeing the writing on the wall, he has left his people the greatest legacy he can: not mere billions of dollars, but an entire restructuring of inheritance and social perceptions that will protect his spawn better than all the shares of Berkshire Hathaway.

The illusion of trickle-down philanthropy, spawned by the first elites who accepted that weighty responsibility "leadership," and passed down through the greatest of history's dark gods, has controlled the fruits of the Earth for as long as there have been elites. It is their deathblood to exempt, from the natural ebb and flow of planetary commerce, the resources of humanity and the planet. Partitioning wealth into the control of imaginary, undying, benevolent deities--palace; cathedral; ivory tower; foundation office--is the Internal Revenue cipher machine governing the three-card monte that explains why certain people are meaningful and others are not.


  1. Wow. I have never learned more from a blogger. EVER.


  2. Excellent, but I really wonder how invisible this is and for how long it would remain so? It would be nice to have a time series data about public perception of charities.

    Personally, I would say I have had nagging, though unarticulated, suspissions about foundations etc. for years - seeing their increasingly well fed, chic, and self-satisfied functionaires, the gleaming offices, their increasing power in telling people what to do and in influencig what actually gets done, and the increasing difficulty of "getting in", I've thought something is rotten for a while. While many educated dimwits gush over foundations, I wonder how long it will be for the public to say "wait a minute!!!".

    Then, a few years later, while reading Mills, it hit me how simple it is, he explains it in half a paragraph: you can give your entire wealth to a charity (untaxed), under the condition that they get to keep the principal, and you get to keep the capital gains (still untaxed). Anyone with a rudimentary understanding of interest knows that that's where the real power is - the growth of capital over time can dwarf the original principal. (Even at modest 3.5% returns, you recoup the original capital in just 20 years.) And this is just one of the multiple "charitable" schemes.

    1. It's not invisible in a certain sense. In the same way that people will, if questioned, say that they don't like "politicians," you would be able to question most people about charitable structures and get a generally negative overall response.

      But those same people would then vote for politicians, feel good about a particular politician or set of politicians, or be more likely to buy something associated with a charity.

      Bravo Mills, writing about an earlier form of the structure. Charitable lead annuity trust, charitable lead unitrust, charitable remainder annuity trust, charitable remainder unitrust, donor advised fund, private operating founda... /choke

      Those types of income games are cool and dangerous within a human lifespan, and they're also accessible to the petite bourgeoisie, but the larger elite playing field is in the realm of dynasties and inheritance. The real monsters are the estate-driven foundations that live past their creators. Think of Terry Gross thanking the MacArthur Foundation before asking the tough questions about drone assassinations.

  3. If charitable people really want to give their wealth away in a spasm of philanthropy, wouldn't it just be easier for the billionaire to hold a lottery for those making under a certain $K per anuum to receive it directly? The standard protest from most people, of course, is that you can't help a person by just giving them money; oh no, you must help them realize their social potential to become "productive members/ upstanding citizens."

    1. Heehee. In a convoluted way, that reminds this one of Tartuffe: praying loudly in front of Orgon to create the impression of virtue. Not only do these great lords bray worldwide about their charitable natures, they decide themselves what form their good wishes will take for someone else.

      The old maxim about doing nice things for others and never letting them find out it was you comes to mind. Divorcing yourself entirely from your gift ensures that it is not something done for your own financial benefit and/or image, e.g., it is "selfless."

      More on point, actually giving reliable streams of cash to poor people would create such a massive positive surge in the economy that it would improve all of the conditions the big donors pretend they're trying to improve. People with more money do things like immunize their children and read to their children more often, and no amount of square footage in Manhattan can accomplish those objectives in sub-Saharan Africa as well as five grand per household per year.

  4. It amazes me that anyone still donates to the Red Cross. No veteran with whom I've ever spoken (including my father, uncles and grandfathers) has anything good to say about that organization, for good reason.

    What I love about this post is the way you describe how the power elites use the good-will of idealistic, mostly young, people who also are hoping to bolster their resumes.

    One of the most disillusioned people I ever met was someone who graduated my college a year before I did. He joined the Peace Corps, which sent him to Somalia. This was in the early 1980's. He said, "There's going to be a war there, and the blood is going to be on our hands. If I'd known that, I never would have signed up!"

    1. Goodwill is a strong job-marketing tool. While we wouldn't feel economically sorry for Bill or Jacob in the above examples, the non-profits they run can use the "you're giving something back" line to justify paying employees some percentage less than market rate.

      Walmart, Target, and other big box stores will often pull that one on their employees, encouraging them to feel good about lower salaries or bad job conditions because the company gives X percentage of profits to community charities.

      And of course, as you said, Peace Corps, Teach for America, et cetera...