3) you don't want the project to lose its integrity/vision. The dollar amount matters less than finding a fitting buyer at a good enough price.
> once you have that sort of money, there are only a couple of reasons to run it up any further:
Your reply seems to indicate you didn't read what he said, but instead read your own meaning into it. Your #3 doesn't make sense as a reason to "run it up any further".
Microsoft can sell Mojang to EA the very next day if they want to.
He briefly though about investing into Psychonauts 2, but dropped out when he realized how much money was involved ($18m). [1] With a couple of hundred million dollars on his bank account he could get interesting and novel AAA games that would never get funding from traditional publishers made.
He even mentions this in [1]: "Perhaps in some distant future when I’m no longer trying to make games, I could get into angel investing."
[1] http://venturebeat.com/2013/02/04/exclusive-minecrafts-notch...
1. almost everything is capital gains (which comes to 23.6%). Note that this was 15% under GWBush, so it was even better back then.
2. You can avoid state taxes by relocating to WA/TX (If I recall correctly, this was Bezos' motivation for starting Amazon in Washington). A lot of billionaires live in 0% state capital gains tax states, except the ones that need to live in CA/NY for the tech/financial sector respectively. If you live in one of those, then think of the total taxes as more like 33% total (federal + state)
http://www.irs.gov/pub/irs-soi/09in12ms.xls
Effective tax rate plateaus at around a half mil in annual income, then starts going down again after around five million.
I couldn't find any hard data about brackets above that. Didn't Mitt Romney pay around 15%?
Then there's my all-time favorite quote, of Leona Helmsley:
>Only the little people pay taxes.
But, that's only anecdotal, heh :-)
It's also worth noting that the tax rate for the very rich is still 15%. As far as I can tell, certain very rich people "not paying taxes" is a myth.
Finally, it's worth noting that Notch is not American.
Rich people do have ways of reducing their tax burden, sometimes to surprisingly low amounts.
[1] planning is normal reduction of tax burden and is unlikely to be challenged by tax authorities.
[2] avoidance is legal, but sometimes exploits loopholes in tax laws in weird ways and you might risk the Inland Revenue changing the regulations - sometimes retroactively.
[3] evasion is just illegally not paying tax.
Exactly, there are good reasons for this. The problem is that it would be grossly unfair to tax a small business owner or small investor at say income tax levels because their risks are so much higher. On the other hand a big investor will millions or billions ends up paying the same tax rate as that small business owner or investor, but is able to spread their risk across many investments reducing the overall risk. Yes it would be unfair to tax them at a higher rate for doing fundamentally the same thing - how would we justify one tax rate for one investor in a company, but another rate for this other investor?
Taxation is a hard problem.
Because taxation has gone way beyond what it was initially meant to do. That's why it's a hard problem; we're trying to make value and fairness judgements and using that as a basis for applying tax.
To me, personally, people can't claim fairness if they're treating people differently based on their arbitrary value judgements. Until we start treating "fairness" as a universal, with no subjective component.
The big reason why the rich guys can lower their tax rates is because they can use investment losses to offset taxes. It's not a loophole, just a tax deduction you can optimize.
For example, if he has someone in charge of spending money on medical research, don't you think there is a point (a few billion) where they just don't know what else to spend money on? I mean, there are only so many medical researchers in the whole world.
Of course you can always just throw money away/at people, but it won't do any good. "Give a man a fish" vs. "teach a man to fish."
Only about 16% of proposed NIH grants alone are funded each year- we can immediately see from that data that funding all NIH grants in just one year would probably take well over $100 billion.
The life scientists of the U.S. could find a use for Bill Gate's entire fortune in a few years. Not that dropping $80 billion on across the board medical research wouldn't be incredibly, enormously beneficial, but the infrastructure and manpower in the medical sciences are there to be able to absorb it and put it to use.
I've done grant funding as well. People say they want money, but the minute you give them a deadline, they're gone, and they can't collect even the merest evidence required for due diligence.
That is about twice as much as NASA [2].
[1] http://www.nih.gov/about/budget.htm
[2] http://en.wikipedia.org/wiki/Budget_of_NASA#Annual_budget.2C...
Edit: well, of course everyone's salaries would go up since there would be so much more demand and no extra supply, but I doubt they could go up that much all at once; most of the money would still go unspent.
Yes, throwing fish at the poorest is the right thing to do. Malnourished children grow with diminished intellectual capacity. Then it is too late to teach them to fish.
Look at the recent US drought - were people wrong to have had children ten years ago? How were they to know that some areas of the US were going to be in severe multi-year drought?
Why is it different if you change "the US" to some other part of the world?
Have a read of "Too Poor To Farm" which explains some of the problems very poor people face, and explains some of the reasons why very poor people have children.
http://www.irinnews.org/report/94947/lesotho-weather-extreme...
That's hardly surprising. Managing money is investing, and wise investment requires a lot of skills, market information, and connections. There's only so many good investors out there.
Not investing as a whole is a zero sum game but specifically increased levels of investing sophistication and savvy.
1) You have "Big Plans" that need funding (eg. Elon Musk)
2) Running up the numbers as a life gamification to "beat" your peers, or just because you can't stop chasing yourself, like one of those freak beast weightlifters that looks like a space monster but is addicted to "the gainz" (eg. Larry Elison, et al)
There are only so many houses and planes and boats and experiences you can buy, practically speaking, and at a certain point all your grandkids' grandkids are easily taken care of (should you decide to reproduce, and assuming society stands and the dollar keeps its value, of course).
Interestingly I'm pretty sure Bill Gates started in bucket #2 but moved to #1 at some point later in life, but I think most people stick in one or the other.