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  • The season of giving is officially here and look,

  • I know it often seems like Americans are self-obsessed, narcissistic, and vain,

  • and that's because we are.

  • We're obsessed with ourselves. Think about how pissed off you get

  • when your phone doesn't recognize your face.

  • You're like, “Excuse me, Apple. Do you even know who I am?”

  • But it's important to remember Americans are also incredibly generous.

  • Last year, Americans donated $428 billion.

  • We're home to some of the biggest charities in the world.

  • United Way, Red Cross,

  • and of course, Go Fund Me,

  • the best way to help your friend get used DJ equipment.

  • Now, American charities even gave us those star-infested music videos.

  • -♪ We are the world ♪ -♪ We are the world

  • -♪ We are the children ♪ -♪ We are the children

  • We are the ones who make a brighter day So let's start giving

  • Start giving

  • Stand tall, stand proud... ♪

  • Voices that care

  • Wait, wait, if you're trying to save the world,

  • your first thought shouldn't be, “Get me Jon Lovitz.”

  • He's like, “Kuwait. You're welcome.”

  • Now, here's what's strange, though.

  • Despite taking in record donations last year,

  • the actual number of Americans giving to charity

  • has been falling for almost fifteen straight years.

  • But the total share of donations coming from the ultra-rich is skyrocketing.

  • By one estimate, 30% of all charitable donations this year

  • are expected to come not from the top 1%,

  • but the top half of the 1%.

  • This is the penthouse on top of the penthouse.

  • These are the people who hire Elton John to babysit.

  • Which is a symptom of a much bigger problem,

  • wealth inequality.

  • Now, it's at historic levels.

  • The 400 richest Americans own more wealth

  • than the bottom 150 million adults.

  • Now the rich don't want us coming after them with pitchforks,

  • which is why you see this sort of thing.

  • I've committed to a $100 million challenge grant.

  • -$100 million? -$100 million.

  • Yo, yo, yo, yo, yo!

  • Michael Bloomberg making a huge donation,

  • $1.8 billion with a “B”

  • to John Hopkins University.

  • The philanthropist Robert Smith

  • shocking the graduates

  • with an unexpected gift.”

  • My family is making a grant

  • to eliminate their student loans.

  • Okay, wiping out that debt

  • was only the second best part of that video.

  • The best part of that video is the guy's reaction in the corner.

  • ...to eliminate their student loans.

  • Also, billionaires, come on. Stop giving out money through grants.

  • That shit's boring. I want to see cash exchanging hands.

  • Just once I want to see Warren Buffett giving out money like Drake.

  • It's a lot of bad things That they wishin' and wishin' ♪

  • And wishin' and wishin' and wishin' On me

  • Hey! ♪

  • She say, “Do you love me?” I tell her, “Only partly” ♪

  • ♪ I only love my bed and my mama I'm sorry

  • Hey, you didn't think Buffett could go hard, right?

  • That's him on the weekend.

  • Now, it feels good watching good things happen to good people.

  • That's why we love when rich people donate to scholarships,

  • low income housing, school laptops, mosquito nets, and divorce settlements.

  • Look, I know it's sad,

  • but they can both afford to buy fresh brains with new memories.

  • But look, there's still a lot that's missing from this picture.

  • We always talk about how the rich make their money.

  • Right? But we almost never scrutinize how they give it away.

  • And that matters

  • because giving money away is one of the main ways

  • they justify being so rich to begin with.

  • That's why I want to talk about big philanthropy.

  • 'Cause on paper it sounds great, right?

  • Rich people are trying to make the world a better place.

  • But are billionaires really going to save us?

  • And it is it worth everything that we give up

  • by letting them even be so rich?

  • Look, I'm not sure. 'Cause when you look at the big philanthropy-big picture

  • a little closer, there's a lot of problems.

  • For example, according to one estimate,

  • only about 9% of grant money makes it to communities of color.

  • 9%. That's not good.

  • Now, look. I'm not saying charity is bad.

  • When you Venmo 200 bucks to a homeless shelter, that's a good thing.

  • But big philanthropy goes way beyond basic charity that you and I do.

  • It's a whole system of financial tools and products that help the rich

  • give away their cash in ways that benefit them.

  • From pooled income funds to private foundations,

  • which help rich donors pay less income, estate and capital gains tax.

  • Then there's something called DAFs or Donor-Advised Funds,

  • which Silicon Valley loves.

  • Donor-Advised Funds are kind of like

  • checking accounts for charities.

  • So, you put money in,

  • you get an immediate tax write-off

  • for the full amount.

  • Then you donate the money

  • to an actual charity later,

  • often much later because the money is

  • allowed to sit in the fund indefinitely.

  • Okay, that guy's collar is so tight,

  • I swear he's trying to hide a bad neck tattoo.

  • They're like, “Hamburger Helper?

  • What were you thinking, Robert?

  • How often do you eat it?”

  • So you can donate to a DAF,

  • take the tax break, but not actually send the money to a charity for years,

  • which might be why DAF donations have almost tripled since 2007.

  • Nothing triples that fast

  • except the number of songs Kanye writes about Jesus.

  • But...

  • Philanthropy doesn't just mean donations to traditional charities.

  • It also includes gifts to so-calledcivic groups,”

  • or 501(c)(4)s, which promote social or political causes

  • while letting you keep your donations anonymous.

  • Yeah, anonymous.

  • Because nothing says the spirit of giving more than,

  • Keep my name the fuck out of this.”

  • Now it's all perfectly legal with very little oversight,

  • and it helps billionaires change the world however they want.

  • And the kicker?

  • They get to pay less taxes.

  • Take Nicholas Woodman, the CEO of GoPro.

  • The only camera endorsed by downhill skiers

  • and Uber drivers afraid of being murdered.

  • Now, when GoPro went public in 2014,

  • Woodman was suddenly worth around $3 billion

  • and faced a tax bill in the tens of millions.

  • So when GoPro stock was near its peak,

  • Woodman and his wife gave $500 million

  • worth of stock to a DAF within a foundation,

  • which saved them millions of dollars in taxes.

  • But within months, GoPro started tanking.

  • So the value of their donation also started tanking,

  • but Woodman still got his $500 million tax write-off,

  • which he totally regretted.

  • A lot was made of how much money you are making, your foundation,

  • how much you were giving to the foundation.

  • There was a lot of controversy around that.

  • -Yeah. -Do you think that was fair?

  • No, but I also understand, um...

  • how the world works.

  • Ultimately, it's not whether it's fair or not.

  • Um, it's just...

  • uh, how you manage it and I try not to get too caught up in in all of that.

  • My man's like, “Don't hate the player, hate the inequitable financial structures

  • that incentivize unmitigated tax avoidance.”

  • Fair, but my problem is this.

  • How did he find the only thing

  • that looks dumber on your head than a GoPro?

  • Just... I can't.

  • Rich, just lower it, just...

  • Just...just...

  • Ah! There we go!

  • You're 44 years old, wear your hat like a normal person.

  • Billionaires avoiding taxes.

  • Look, just 'cause it's legal doesn't mean it's right.

  • It's like hosting a costume party calledMysteries of the Orient.”

  • You can do it,

  • but don't.

  • This is why more and more people have been criticizing big philanthropy.

  • People like Anand Giridharadas, the best-selling author of Winners Take All.

  • You gotta lock yourself in a room to write a book.

  • There's a little window in my room. It just looks at the brick wall.

  • It's painful writing a book.

  • So, Anand, you write a lot about...

  • attacking the rich and yet you look like Stanley Tucci in The Hunger Games.

  • Wow. I have been told this before.

  • But you're the first person to ever take it

  • from Twitter troll responses

  • to an actual in-person interaction.

  • Why have you dedicated yourself to criticizing the ultra-rich?

  • Over the last few years, I noticed something

  • that profoundly offended me.

  • We live in this time in which rich people are everywhere.

  • Giving back, trying to change the world, make a difference, etc.

  • You came in, and you're like, “I don't trust that.”

  • Well, I also noticed a second thing, which didn't square with the first thing.

  • The same group of people who has lobbied for,

  • fought for, clung to an economy of injustice

  • have marketed themselves to us

  • as saviors, as in fact the solutions to the very problems

  • they are still busily causing.

  • They are getting public credit for solving,

  • and the causing never gets the same notoriety.

  • Now obviously, he isn't a fan

  • of the impact billionaires have on the rest of us.

  • So I asked him a question that's been making the rounds

  • with the presidential candidates.

  • Should we have billionaires?

  • I do not believe we should have billionaires.

  • What about black billionaires?

  • I like black billionaires more,

  • but the same system that allows there to be billionaires

  • is disenfranchising way more black people and all people

  • -than if we didn't have that. -So you want to check Oprah, Jay-Z

  • and Beyoncé and that one black dude who gave away all his money

  • -Yes. -and paid off everyone's college student debt?

  • You know, that's a perfect example.

  • Robert Smith was widely celebrated, and then it was revealed that Robert Smith

  • had defended this indefensible carried-interest tax loophole

  • that benefits private equity and people in his industry.

  • Okay, so this carried-interest loophole

  • pretty much only benefits hedge fund and private equity managers

  • like Robert Smith.

  • Now, here's how it works.

  • Robert Smith runs about a $50 billion fund.

  • Now when he makes his investors a profit, he gets to keep a big cut,

  • potentially, hundreds of millions of dollars.

  • It's pretty great.

  • But unlike you or me,

  • Smith doesn't have to pay income tax on those millions.

  • Instead, thanks to the loophole, he only has to pay capital gains tax,

  • which is way less.

  • Carried interest is the finance version of, “Hey, it happened on vacation,

  • so it doesn't count as cheating.”

  • Everyone know that's bullshit.

  • Cabo sex is still cheating.

  • But Smith has defended carried interest, which only makes income inequality worse.

  • Now, honestly,

  • I didn't know about any of this stuff when I spoke to Anand,

  • so I didn't take it very well.

  • What I am calling for is a world in which, yes,

  • the Robert Smiths will make and keep less money.

  • Come on. Now, you want to cancel Robert Smith?

  • We have made choices as a society

  • to be more friendly in our system to the Robert Smiths of the world

  • than to the 400 kids he helped.

  • Wait, can I just-- Why can't I just enjoy one NowThis video?

  • Like, when I saw that video on NowThis, I was like, “Robert Smith is awesome.”

  • There's better NowThis videos.

  • Next, you're going to tell me is that AOC's into dogfighting.

  • Don't fucking ruin everything for me.

  • Don't worry, AOC isn't into dog fighting,

  • but Bernie can't seem to get enough of it.

  • I know, I didn't see it coming, either.

  • Some of you guys are like, “Is that real?”

  • He's like, “Shih Tzus are the 1%.

  • They need to go. They're the 1% of dogs.”

  • Look, at the end of the day,

  • a rich philanthropist supporting a tax loophole isn't surprising,

  • but it's touches on one of big philanthropy's most insidious benefits,