The Institute for Policy Studies was the earliest leftist think tank, and it's still going strong. One of things it does is publish the weekly newsletter on inequality issues, Too Much. This week's issue featured a review of what sounds like a really interesting new book, The Trouble with Billionaires (Facebook page here.). Here's a good chunk of what "Too Much" had to say about it:
The Super Rich: A Delicious Skewering Linda McQuaig and Neil Brooks. The Trouble with Billionaires. Viking Canada, 2010. 272 pp. Linda McQuaig writes punchy prose as an op-ed columnist at the Toronto Star. Neil Brooks teaches about taxes at a top Canadian law school. They make a great pair. Together they've just penned what may be the most entertaining treatment yet of our super rich - and their devastating impact upon us.
The Trouble with Billionaires does, to be sure, cover a good bit of ground that other authors have already plowed. But these other authors have seldom plowed with anything close to the zest and wit we see in these pages.
Other analysts, for instance, have explored how political and economic power frame the "free" market and enrich a fortunate few at the expense of the great many.
McQuaig and Brooks do this exploring, too - by explaining why mega-millionaire British actor Michael Caine, who has threatened to exit Britain if its tax rate on the rich rose a single point, would never have become rich in the first place if he had plied his acting trade in our world's "only true free market," the "adult" film industry.
And what about incentives? To get top "performance" from our most talented, must we offer massive rewards as motivation? McQuaig and Brooks start discussing this core question by comparing baseball statistics. Alex Rodriguez, they note, took home $27.7 million in 2008, over 30 times the top pay, after inflation, that ever went to Hank Aaron, a performer every bit as productive.
In The Trouble with Billionaires, McQuaig and Brooks both take us back in history, to the political decisions that helped birth our billionaires, and move us forward into the cutting-edge research on the clear and present dangers concentrated wealth poses. Along the way, they take on - and blow away - the various spins we get on wealth creation from the flacks for the awesomely affluent....
This did sound more interesting and inventive than most writing about inequality, so I cranked up the old Google, and the first thing I noticed was the this excerpt from the Toronto Star:
On the campus of the University of Toronto, buildings bear the names of some notable Canadians: among them, literary giant Northrop Frye, public health pioneer John FitzGerald, inventor Sir Sandford Fleming, who introduced the concept of standard time. But the buildings named in honour of important intellectual figures typically date back more than three decades. In more recent years, campus buildings have been named almost exclusively after those whose distinguishing characteristic is the possession of lots of money.
There's a reason for this. As universities have lost government funding in recent years, they've turned more and more to private donors.
Universities are now heavily in the business of fundraising, devoting huge effort to wooing wealthy alumni. And the effort has paid off. In the past five years, U of T has collected an average of $120 million a year from benefactors.
In exchange for money, donors get their names on plaques, or auditoriums, or even whole buildings if they donate enough. The result is that affluent businessmen are honoured and commemorated throughout the university. Particularly prominent at U of T for instance are merchant banker Joseph Rotman, pharmaceutical entrepreneur Leslie Dan and businessman Peter Munk, chairman of Barrick Gold, the world's largest gold mining company.
But if the university has become a showcase for the wealthy, there's apparently no room at the university to honour someone who is the closest thing we have in this country to a genuine hero.
A group of U of T professors found this out when they approached the university in 2007 with the idea of naming the Health Studies Program after Tommy Douglas, considered the father of Canada's public health care system. In 2004, Douglas was selected the Greatest Canadian of all time, following a nationwide contest organized by CBC-TV in which more than 1.2 million votes were cast over a six-week period. (Runners-up were Terry Fox and Pierre Trudeau.)
But, other than apparently being the most respected Canadian ever, what does Tommy Douglas have to offer the University of Toronto? Apparently not enough to justify getting a program named after him.
The cultural insult here is bad enough. But it's indicative of much more, the authors note:
Paul Hamel, a biologist in the U of T Faculty of Medicine and one of the professors pushing for the Tommy Douglas program, says that the university simply wasn't interested in the idea, seeing little potential in it for fundraising.
Hamel criticizes the university for adopting this attitude, which he sees as a function of the growing power exerted by its fundraising arm. "As a result, the priorities of the university have been skewed towards areas that interest the elites," says Hamel, "rather than towards the priorities of faculty, staff and students who are engaged in critical analysis, research and teaching."
This seems certain to undermine the role of universities and colleges as places of critical thought, where the prevailing policies and dogmas - championed by those wealthy business interests - are carefully scrutinized and debated.
But where the excerpt really kicks into high gear is when it examines one particular example, Peter Munk's donation of $35 million to establish a school of global studies. There is, it turns out, far less to this than meets the eye. First off, that $35 million merits a whopping tax deduction, so it only cost Munk about $19 million, with $16 million kicked in by taxpayers. What's more, they note, "[I]f Munk made his donation in the form of shares in publicly traded companies - as most donors do - then his tax savings will be considerably larger (possibly by millions of dollars) and his personal contribution far smaller than $19 million." Then another minor detail: The Ontario and federal governments are also contributing $25 million each, making the total taxpayer contribution at least $66 million. And, of course, not only will it be housed in a century-old building, but it's ongoing costs will also be underwritten by taxpayers as well, bringing Munk's share of the total cost "well below 20 per cent," they note. As a result, they dryly observe, "It would seem more accurate, then, to call it the Canadian Taxpayers School of Global Affairs, with Some Help from Peter Munk."
Oh, and just one more thing: The money is paid out over a period of time, with mechanisms spelled out that clearly provide means for Munk to influence the content of what is taught there. And in case there were any question about what this influence might be, there's also a provision "that the school will also house the Canadian International Council - a right-leaning think-tank that has been pushing to replace Canada's earlier role as a leading UN peacekeeping nation with a more prominent role in U.S.-led war efforts."
This example is probably more pernicious than most. Probably. But some degree of distorting the public purpose of public education is virtually inevitable. And so the authors note:
This aspect of philanthropy is rarely mentioned in the public feting of wealthy benefactors. On the contrary, the role of philanthropy in funding universities - as well as hospitals, museums, art galleries, concert halls and opera houses - is typically advanced as one of the reasons we shouldn't be concerned by the rise of billionaires. After all, we're told, our public institutions need money, following the cutbacks of the 1990s.
Of course, the problem is circular. If governments hadn't cut tax levels so deeply - particularly for those at the upper end - there would be sufficient revenue to sustain our public institutions, as there was in the early postwar years.
All in all, The Trouble With Billionaires sounds well worth looking into. Much more than a litany of those troubles, it seems aimed at opening our eyes to new ways of seeing the usually hidden influences that make our world much less than it should be as a result of appropriating so much into the hands of so few.
