Peter Krämer, a German multimillionaire who made his fortune in the heavily regulated and subsidized shipping industry, has been criticizing Bill Gates’s “giving pledge,” an initiative embraced a by a large number of U.S. billionaires and multimillionaires to encourage the wealthiest people in the world to donate half of their fortunes to charity. In an interview with Spiegel Online, Krämer shares his thoughts:

SPIEGEL: Forty super wealthy Americans have just announced that they would donate half of their assets, at the very latest after their deaths. As a person who often likes to say that rich people should be asked to contribute more to society, what were your first thoughts?
Krämer: I find the US initiative highly problematic. You can write donations off in your taxes to a large degree in the USA. So the rich make a choice: Would I rather donate or pay taxes? The donors are taking the place of the state. That’s unacceptable.

In many instances, the billionaires in question are donating amounts that far exceed their tax liability. And my sense is that even $600 billion, a high estimate of what the U.S. billionaires who’ve signed on with the pledge will ultimately donate to charity, wouldn’t be enough to create a rival government that would battle the United States federal government for control over the temperate regions of North America. Moreover, private charities have a freedom and flexibility that the state does not — to impose conditions for assistance, to pursue new institutional forms that might prove too risky for the public sector, etc.

SPIEGEL: But doesn’t the money that is donated serve the common good?
Krämer: It is all just a bad transfer of power from the state to billionaires. So it’s not the state that determines what is good for the people, but rather the rich want to decide. That’s a development that I find really bad. What legitimacy do these people have to decide where massive sums of money will flow?

Note that Krämer is using impressively sweeping language — “it is all just a bad transfer,” etc. He also seems to believe that it is the role of the state, not individuals acting separately or collaboratively, to determine what is good “for the people,” a view that is not in keeping with the liberal tradition in North America or indeed Germany. As for the legitimacy point, one wonders if Krämer believes that the state should also control all investment decisions, a view that even James Kenneth Galbraith, America’s leading advocate of central planning, doesn’t embrace, though he sometimes comes close.

SPIEGEL: Do the donations also have to do with the fact that the idea of state and society is such different one in the United States?
Krämer: Yes, one cannot forget that the US has a desolate social system and that alone is reason enough that donations are already a part of everyday life there. But it would have been a greater deed on the part of Mr. Gates or Mr. Buffet if they had given the money to small communities in the US so that they can fulfil public duties.

This reflects an impressive degree of ignorance about social provision in the U.S. It is true that the United States has a somewhat less generous social insurance system than is commonly found in northern Europe. It is also true, however, that the top 80 or 90 percent of U.S. households are far more affluent than their northern European counterparts, with the possible exception of Norway. Krämer seems to be suggesting that Mr. Gates and Mr. Buffett should have given money to cash-strapped local governments. Given that both men have invested heavily in scalable anti-poverty programs focusing on eradicating hunger and disease and illiteracy in the world’s poorest countries, and in improving the quality of educational institutions across the United States through the use of pilot projects and experiments with personalized instruction, etc., it seems peculiar to suggest that giving money to Camden, New Jersey, to name one example, would have delivered more bang for the buck.

SPIEGEL: Should wealthy Germans also give up some of their money?
Krämer: No, not in this form. It would make more sense, for example, to work with and donate to established organizations.

One assumes, however, that established organizations were founded by someone at some point — and indeed that some established organizations, like large research universities and other institutions devoted to the public good, were founded by wealthy individuals.

(Thanks to Tyler Cowen for the link.)