General Question

Crashsequence2012's avatar

Would Andrew Carnegie be allowed to amass his fortune and then keep it so he could donate it as HE saw fit in today's social and therefore political climate?

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16 Answers

josie's avatar

Doesn’t seem likely

filmfann's avatar

Have you heard of Bill Gates and the Gates Foundation?

BhacSsylan's avatar

Considering the existence of people like Bill Gates, Warren Buffet, Steve Jobs (who even explicity never gave to charities) and hell, Mitt Romney, I’m pretty sure the answer is yes.

JLeslie's avatar

Yup. Unions and OSHA might have reduced his profits a little, but he had made so much money he still would have been very rich.

I don’t know what the tax rates were back then? That would be interesting. I also don’t know if the charity tax write off was effective back then?

Judi's avatar

Carnegie, who was opposed to income taxes and property taxes, nevertheless supported near 100% inheritance taxes on large estates. Those who held on to their money, he said, instead of distributing it for the good of society, had no moral right to decide what happened to it after their deaths: “By taxing estates heavily at death, the state marks its condemnation of the selfish millionaire’s unworthy life.”

bkcunningham's avatar

David Geffens with Dream Works, Oprah of Harpo fame, Mickey Arison with Carnival Cruises, Lex Wexner CEO of Limited Brands…here is a list of more of the greedy bastards. Here is a list of a few of the female billionaires.

janbb's avatar

The income tax did not start until the 20th century which certainly makes a difference but if you are asking if billionaires can be philanthropists still, yes, they can.

JLeslie's avatar

@janbb I think there were federal taxes collected for a short time in the late 1700’s, then it was done away with and states taxed individually. Later, in the 20th century there was federal taxation again. I think one of the amendments to the constitution in the 1900’s is what made federal taxation ok again. I wish I was better at history. Anyway, it is possible he was paying state income tax of some sort.

Patton's avatar

It’s rather amusing that you picked Carnegie as your example since he was subject to several new taxes at the time which the Chicken Littles of the day all said would make it impossible for people to accumulate wealth. So really, your own choice of examples undermines your thinly veiled assumption. The answer to your question is yes because Carnegie himself existed in similar conditions.

@janbb That’s not quite true. There were various income taxes passed prior to the 20th century, which were either repealed or annulled later. There were also various corporate taxes during the Carnegie era. Like I said above, Carnegie himself disproved the argument some made against them that they would prevent people from accumulating wealth.

gailcalled's avatar

“In 1913, the 16th Amendment to the Constitution made the income tax a permanent fixture in the U.S. tax system. The amendment gave Congress legal authority to tax income and resulted in a revenue law that taxed incomes of both individuals and corporations. In fiscal year 1918, annual internal revenue collections for the first time passed the billion-dollar mark, rising to $5.4 billion by 1920.”

“With the advent of World War II, employment increased, as did tax collections—to $7.3 billion. The withholding tax on wages was introduced in 1943 and was instrumental in increasing the number of taxpayers to 60 million and tax collections to $43 billion by 1945.”

Carnegie died in 1919 so would have felt some pinch in his last years.

zenvelo's avatar

Yes, why not? Plenty of people in the last 30 years have done the same.

marinelife's avatar

Why not? Bill Gates did. Paul Allen did. Many others have.

Ron_C's avatar

Of course he would keep most of his wealth, look at Bill Gates as an example. The problem today is that every right winger that has to pay a small tax feels that he’s being robbed by the government. It is as if things like roads, utilities, schools, and the military are somehow independent of tax money and just happen.

I noticed the uproar when Obama said that nobody becomes successful by themselves. The right-winger claimed that the government had nothing to do with their wealth even though they graduated from public school and a State college, got start up money from investors regulated by the stock exchange rules, and used electric power established with state and federal incentives. Of course the customers of the successful have nothing to do with success either.

I guess you could do somethings by yourself in today’s U.S. but you are much more likely to become successful if you become part of society instead of being a hermit.

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ETpro's avatar

It would be very difficult for one self-made man to amass a fortune equal to 0.60% of the entire US GDP. Today, that would be about $96 billion, so Bill Gates at $66 billion got close, but no cigar.

As the Koch Brothers are fond of saying, “We made our money the old fashioned way, we inherited it.” If anyone is going to reach north of $100 billion today, they’d probably have to have a running start with many billions in the bank at birth. And most people in that situation, the Walton family, for instance; have no stomach for the heavy risks of the entrepreneurial arena. They invest most of their money in safe tax shelters off shore, and give a few billion here and there to right-wing causes in hopes of obtaining more welfare for the rich and keep lots more of what they didn’t earn.

The Rothschild family in Europe is worth $1 trillion, so even in that tax environment, families that stick with the family business and build wealth over many generations can accumulate enough to live comfortably for the rest of their lies, even if they should happen to live for a billion years with no income.

That said, I have to question why you are asking this. The implication seems to be that the US would be far better served if a handful of robber barons could build trusts and monopolies and accumulate nearly all the wealth of the nation. Are you suggesting that nothing short of such wealth disparity is sufficient to motivate someone to innovate? If so, I would say that society appears much better served by policies that spread entrepreneurial spirit across a far greater spectrum. Our consumer driven economy works far better with a healthy, well-heeled middle class and millions of entrepreneurs lending their innovation to it.

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