To the People

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or TO THE PEOPLE.

Thursday, September 14, 2006

An Idea Better Than Google

A bee in my libertarian bonnet is the proliferation of non-profits. "Non-profit" first of all is a misnomer, as they are free to horde tons of money and make profits, as Harvard's $30 billion endowment exemplifies. They are basically organizations that are federally subsidized in that they do not pay taxes on their income and also in that contributions to them are tax-deductible for donors.

Annual federal tax support of Harvard comes out to be about $10,000 per student, funded by you and me and not Harvard's huge endowment.

But the worst of the breed are the huge foundations, which were in most cases set up by free-market capitalists like Andrew Carnegie and end up funding socialist projects.

So I was thrilled to read in the NY Times today that the maverick Google founders Brin and Page elected to set up their Google foundation as a for-profit, tax-paying entity.
The ambitious founders of Google, the popular search engine company, have set up a philanthropy, giving it seed money of about $1 billion and a mandate to tackle poverty, disease and global warming.

But unlike most charities, this one will be for-profit, allowing it to fund start-up companies, form partnerships with venture capitalists and even lobby Congress. It will also pay taxes.
This seems to me to be very smart. Why is there a need for the 501 (c)3 tax designation at all? The Google article is here.