Why Gareth Morgan is wrong to give his money away
There are some people who are so productive they almost can't help creating wealth. These aren't just wealth creators, they're walking machines of production, able to turn a dollar into ten, into a hundred, into a thousand, into seven hundred million... purely on the basis of a good idea, a lot of hard work, and an understanding of the way the world works.
Sam Morgan is such a man - his zero to seven-hundred million in just five years attests to that. Steve Jobs is such a person, as are TJ Rodgers, Mary Kay Ash, Doug Myers, Richard & Christopher Chandler, Stephen Tindall, Graeme Hart, Fred Smith, Tom Watson, Warren Buffett, Ted Turner, Jack Welch, Bill Gates, Sam Walton. There's clearly more to wealth creation than the few traits I describe above; if it was that easy we'd all be rolling in our own cash -- author Edwin Locke outlines some of the traits needed in his book 'Prime Movers' -- but there's clearly a great benefit to us in letting them be free to create wealth: with every new innovation, new product, and cheaper line, we're all better off for the jobs they've created, and the new choice their creation and production has made available to us.
In fact, if the great wealth creators really do wish to 'help others', then the best thing they can do is not to give their money away, but to keep right on producing more. The more of it they have, the more they have to produce with; when we're talking about some of these walking engines of productivity, that's very productive indeed.
But isn't it better to give rather than receive? "No," says philosopher David Kelley in an interview with ABC's John Stossel, "it's better to create."
Kelley: Why do we think that giving away money is better than making money? Giving away money is a lot easier than building a new business or a new industry, where you've created something that didn't exist before. I have a lot more respect for Ted Turner for building CNN, at a time when no one thought it was possible, than I have for any possible good he could do as a philanthropist.Gareth Morgan is not in the league of these other wealth creators -- although he's certainly no slouch -- and it's clearly his own money to do with what he wishes -- but if he really does want to help others the most, he'd keep it and invest it just as wisely and as well as he's done so in the past, and use it to create even more value. But that's his choice.
Stossel: It's kinder to give money away.
Kelley: Is it kinder to give money away than to create something that enriches all of us? To create new jobs? If you create a job, you are giving someone the means to support himself. If you give money away, you're not helping him to be self-supporting.
Stossel: Who did more for the world? Michael Milken or Mother Teresa?
Kelley: Michael Milken. No question. . . . Now, people look at the two and they say, "That's absurd. Mother Teresa was a moral hero and he was a criminal." Because they're looking at motives. Michael Milken didn't suffer. He didn't go into the slums. She went into the slums and she suffered. But I say: What's so good about suffering? I look at the value that people create.
CLARIFICATION: As I said, it's his money, and his choice. He doesn't owe anybody even one minute of his productive ability if he doesn't wish to make it available. My point is that is if he does wish to help others, then producing new wealth is the way to do it.
UPDATE: Link added to David Kelly's excellent article 'Is it nobler to give than to create?', discussing the merits of Ted Turner giving away his money. Kelly concludes:
If Ted Turner wants to give his money away, that's fine. It's his money. If he wants to raise money for the causes he believes in, that's fine, too. But giving away his money is easy compared with the heroic effort it took to make it. And nothing his philanthropy will accomplish will compare with the value he has created as a media entrepreneur.LINKS: NZ man to donate website windfall - BBC News
Perhaps it is nobler to give than to receive. But in my book it's nobler still to create.
Rich rotter Gareth Morgan [Profile by Michelle Hewitson] - NZ Herald
'Prime movers': Traits of the great wealth creators, by Edwin Locke - EdwinLocke.Com
Greed - ABC 20/20 Special with John Stossell - excerpts - The Objectivist Center
Greed - ABC 20/20 Special with John Stossell - full transcript
When is greed good? - John Stossel, ABC News
Good side of greed - Video - John Stossel, ABC News
The John Stossel web page - ABC
Is it nobler to give than to create? - David Kelly, Objectivist Center
TAGS: Economics, Ethics, New Zealand