Why Gareth Morgan is wrong to give his money away

Peter Cresswell's picture
Submitted by Peter Cresswell on Wed, 2006-04-05 00:59

Gareth Morgan is wrong to give his money away. Here's why.

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.

Gareth's son Sam Morgan is such a man. 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, Stephen Tindall, Fred Smith, Tom Watson, 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.

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.

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.

LINKS: NZ man to donate website windfall - BBC News
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

TAGS: Economics, Ethics, New Zealand


Rick Giles's picture

That was a harsh previous post!

That's going to get Robert Winefield's nostrils flairing at tripple time, just you wait.

As was said elsewhere:Have

Capitalist's picture

As was said elsewhere:

Have you gents not got your own money to play with? Perhaps the fact you don't is an indication that NZ doesn't disincentivise unproductive opinions enough, which has resulted in a lot of people talking, but not doing? If not you could have a crack at investing in entrepreneurial ideas (as Morgan did, successfully). Then you get to decide what to do with your own money.

The hypocrisy of the lead post sets the gold standard, considering the author has the begging bowl out on his own blog. LOL


Rick Giles's picture

Peter is not questioning Morgan's benevolence, he's questioning his application of it. His decision is wrong? Wrong for who?

Morgan already has a life, he doesn't want another one. Administering investment millions takes talent and effort, it is demanding. This is a burdan Morgan doesn't want. He says he has had enough of that now. Is that wrong of him? Those who praise this kind of burdan praise no less altruism than they who praise Mother Taresa's in her kind of burden.

His money in service of his values. Bless him, the "pillock." If that's wrong then I'd hate to know what's right.

And you know what the really sad thing is?

Duncan Bayne's picture

The man is an economist by trade ... and he has no idea what to do with millions of dollars that are rightfully his (not a 'windfall' as the BBC puts it) through prudent investment.

What a pillock.


eg's picture

The problem is not the wealth given away but the foundations that live on after the givers.



Phil Howison's picture

I think I agree with your basic argument, but I'm not prepared to say that Morgan is wrong. At least, not until he decides which specific charities to donate to.

I do think some problems in the world are being better solved by charities rather than the free market. The only charity I support (given limited means) is World Vision, because a lot of their help is in the form of microloans, particularly encouraging Third World women to start small businesses. I think that could cause incredibly positive change, not just economic but cultural, and especially in Muslim countries.

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