Sincere props to Michael Dell and other very wealthy individuals who are donating generously, but it raises the question of why this sort of gesture is even necessary in our society.
Making people financially whole and getting them back on their feet in the aftermath of a disaster of these proportions should be handled by insurance, and when that falls short, the government.
The problem is not that the money is private, but that it's donation relies on the compassion of individuals, not on laws.
If that's not the case and these donations are a tiny portion of the funds for the relief effort, then why do we make such a big deal about them, when there are probably a lot of other people who have donated a similar percentage of their (much smaller) net worth?
The problem caused by flooding is exacerbated or at least continued by government subsidies in the first place. Flood insurance it too cheap, especially in flood plains (Houston being one such). Moreover, the floodplain prairie is paved over diminishing the capacity of the floodplain itself to absorb water.
Congress tried reforming it back in '12, but unreformed it after they reformed it because "premiums were getting too dear" (and congress always seeking re-election, got cold feet and again undercharges). Now flood insurance is $25B under (before calculating Harvey in to the mix).
If the government were to do the right thing, they would ease up on subsidizing these homes over 50 years (so people don't suffer catastrophic asset loss) but at the same time discourage new development (in the floodplain) from enjoying the same perks.
Encourage new development to take place in non flood plains.
Wait but if we discourage further development in the flood plains, we just have existing property owners a huge gift because their property values soar.
Texas says it wants less government. The people there keep joking about independence (I'm talking sincere middle aged wasp men, not some edgy teen). Personally, I think the federal government should be involved in the immediate disaster relief and that's about it. No tax discount for buying a new car, new house, renovation, nothing. No federal money for reconstruction. Let Texas state government ask for the money it needs.
> Texas says it wants less government. The people there keep joking about independence.
As a fellow Texan, this mentality gets taken to an extreme by some people in this state – usually rural – but I don't think it's reflective of an overwhelming majority. California wants to secede too, so maybe we're onto something. ;)
Texans do tend to have a lot of personal pride and love for their state which was reflected in impressive volunteer-rescue effort that grew organically and spread like fire. My brother said every boat dealer was sold out of flat bottoms in Dallas. I do think it was unprecedented and hopefully set a positive precedence for social behavior in situations like this. For a gun-toting state, I'd say it was surprisingly civilized and non-violent for the 4th largest city in the United States (500k less people than Chicago)
The problem is this "overwhelming majority" is nowhere to be found in DC where people like Louie gohmert (CBA to spell his name properly) and Lamar Smith have their seats pretty much sealed.
I'm sorry if this came the wrong way but I only say this because I love Texas so much. I spent my shaping years there and east Texas feels like home to me but there is so much irrational hatred of socialism which doesn't make sense for people never subjected to it. I apologize for my rudeness.
>Wait but if we discourage further development in the flood plains, we just have existing property owners a huge gift because their property values soar.
But the proposed insurance would become less affordable over time (tapering off the subsidy), off-setting the increased value due to scarcity.
Sorry but can we trust ourselves to turn off that tap? Nobody will complain if we keep the tap running but plenty will complain if we turn it off. I for one don't trust these "fiscal conservatives" in the red states to put their money where their mouth is. Everyone always talks about reducing government spending but they always mean spending that I don't benefit from.
Flood insurance was purchased by fewer than 2 in 10 Houston homeowners. Lax zoning encouraged building in high-risk areas and then living without expensive insurance, hoping for the best.
I'm not sure what to think of that attitude. I understand the motivation, but I find this statement particularly odd:
> donation relies on the compassion of individuals, not on laws.
It would be odd to expect laws to be more compassionate on average than all the individuals under the laws, particularly in an ostensibly democratic society. Yet I can think of several plausible reasons to expect laws to be less compassionate on average than individuals.
It's not about compassion, it's about having systems in place for situations like these. Laws encode behavior that should always happen. Compassion is private, and having thousands rely on it is not a reliable practice.
The problem with slashing taxes and then outsourcing all of our public goods and social support systems to private patronage is that then the wealthy get to decide how they will work, with little public accountability.
So if e.g. the main charity in town is a religious group, all of the homeless shelters and soup kitchens will come with a side of proselytizing or decide to turn away supposed blasphemers. Or if some of the main supporters of academic research happen to be motivated billionaires, we’ll see results that suspiciously align with their personal interests. Etc.
> It would be odd to expect laws to be more compassionate on average than all the individuals under the laws, particularly in an ostensibly democratic society.
Not if you assume that compassion isn't complete selflessness, and at least some of the population understands on some level the adverse incentives associated with things that are game-theoretically similar to tragedy of the commons.
The problem is not that the money is private, but that it's donation relies on the compassion of individuals, not on laws.
As it should be. Generosity should not be forced on people via fear of the law (i.e the consequences for not paying your taxes). Even further, a private citizen is often far more in control of the effective distribution of their resources as compared to government.
You see it as enforced generosity. Others see it as general societal obligation to take care of its members when hit by forces not under their control. If you were hit by similar circumstances, I'm not sure you'd be as quick to denounce "forced" generosity, especially if there wasn't a sympathetic local billionaire around.
That said, I'm sympathetic to the general problem of government not utilizing resources efficiently.
Nah, it's not a matter of perspective, because that's exactly what it is. Citizens are motivated to pay their taxes through fear of the consequences of disobeying the law. Thus, generosity that is forced on a citizen via taxes is ultimately fear-based (not compassion-based) generosity.
Others see it as general societal obligation to take care of its members
Which is why we Americans have started and serve in hundreds of thousands of private organizations from churches to food banks to shelters to clothing charities and more, and many are quite effective at providing in times of need. If I was hit by similar circumstances, I would go to one of these already-existing institutions and seek aid.
It's unfortunate that you're unable to even imagine that some people see paying taxes--for this purpose specifically, even--as an obligation, however much they may grumble about waste and "lost" income.
> should be handled by insurance, and when that falls short, the government.
This is pretty much how I feel about all social issues like health care, homelessness, education, etc...
Large donations are nice, and we should all be grateful for such generosity, but I'd much rather pay an extra bundle in taxes so our government can be adequately prepared for all these scenarios.
I'm in Australia and I really don't understand the US attitude to these things, I gather neither does the rest of the world. The last federal election here the right wanted to introduce a more user pays health system, the left countered with we don't want a health system like the US. Pretty well everyone agreed and that was that.
No one likes paying taxes, but a country without people paying taxes is not one that is pleasant to live in.
> it raises the question of why this sort of gesture is even necessary in our society.
The purpose of the United States is to make corporations (and their owners) obscenely rich.
Tax breaks like those recently shown to Apple are the perfect example.
So because corporations, and therefore their owners like Mr. Dell are obscenely rich, the government is not. In fact, it does not even have enough money to provide Health Care, higher education or disaster relief to it's citizens.
I completely disagree. Keep insurance prices and taxes low, and I believe that generous people will pick up the slack in disasters and in non-disasters people will be able to help themselves. Make it a priority to praise generosity and the ones interested in receiving praise will compete to out-do each other.
I didn't get this message at all from the GP comment:
> Sincere props to Michael Dell and other very wealthy individuals who are donating generously, but it raises the question of why this sort of gesture is even necessary in our society.
Michael Dell is worth $22.9 billion; $36m is 0.157% of his wealth. For you to donate an equivalent amount, you only have to donate $157 per $100k of your net worth.
Not only does money not scale linearly like that, Michael Dell's net worth is very volatile and illiquid, making a straight comparison not all that helpful.
I get the feeling this was a glib example interest/amusement not to be take as an economic truism. And I suggest if you going to jump on any statement an claim its wrong, include information to back up your assertion. I like to think HN comments add value and we don't encourage taking easy pot shots at comments. For that reason I gave you a downvote, and also took the time to explain why I feel that was needed.
My daughter was hospitalized a few years ago and spent a couple of days in Dell Children's Hospital in Austin. Everybody we dealt with there was fantastic and the facility was wonderful. The Dells have done a lot of great things for Texas.
On a religious note, the probable reason the amount is $36M is that 18 is a special value in Judaism. In Hebrew the word chai (which means "to life")is represented as the number 18, and it is considered a good deed to give donations in that amount. He and his wife apparently combined their $18M amounts. For more: http://www.shiva.com/learning-center/commemorate/chai/
> You mean hes reallocating 36M of his taxes usually paid
It sounds like you've never made a charitable donation under the American tax code. A dollar donated isn't a dollar saved. A dollar donated is (1-marginal tax rate) dollars saved.
No, that is not how taxes work. You do not get to deduct a dollar from your tax obligation for every dollar you donate.
You only deduct the percentage dictated by your tax bracket. So assuming he's in the 39.6% tax bracket his tax obligation is reduced by 39.6 cents for every dollar he donates.
This is an oversimplification, there's a bit more to it than that, but you get the point. Maybe.
This is great news, but a nitpick, it isn't Michael Dell pledging, but his foundation.
Michael Dell, the billionaire Texan who founded Dell Technologies, has pledged $36 million of his foundation’s money to help disaster relief efforts in the wake of Hurricane Harvey.
The gift from the Michael and Susan Dell Foundation is the largest donation to date aimed at recovery efforts.
Again, distinction without a difference. Is it a "funding allocation" if I was going to spend $100 on a night out but choose to donate it instead? It's both. And still just as much a donation.
Making people financially whole and getting them back on their feet in the aftermath of a disaster of these proportions should be handled by insurance, and when that falls short, the government.
The problem is not that the money is private, but that it's donation relies on the compassion of individuals, not on laws.
If that's not the case and these donations are a tiny portion of the funds for the relief effort, then why do we make such a big deal about them, when there are probably a lot of other people who have donated a similar percentage of their (much smaller) net worth?