Business Standard

Musk has giant charity but money stays nearby

- DAVID A FAHRENTHOL­D & RYAN MAC ©2024 The New York Times News service

Before March 2021, Elon Musk’s charitable foundation had never announced any donations to Cameron County, an impoverish­ed region at the southern tip of Texas that is home to his Spacex launch site and local officials who help regulate it.

Then, at 8:05 one morning that month, a Spacex rocket blew up, showering the area with a rain of twisted metal. The Musk Foundation began giving at 9:27 am local time.

“Am donating $20M to Cameron County schools & $10M to City of Brownsvill­e for downtown revitaliza­tion,” Musk said on Twitter.

Musk, the world’s second-richest person according to Forbes, presides over Spacex, Tesla and other companies that are pushing the boundaries of technology, while also controllin­g X, through which he promotes his often-polarizing political and social views.

At the same time, he runs a charity with billions of dollars, the kind of resources that could make a global impact. But unlike Bill Gates, who has deployed his fortune in an effort to improve health care across Africa, or Walmart’s Walton family, which has spurred change in the American education system, Musk’s philanthro­py has been largely self-serving — making him eligible for enormous tax breaks and helping his businesses.

Since 2020, he has seeded his charity with tax-deductible donations of stock worth more than $7 billion at the time, making it one of the largest in the country.

Musk has not hired any staff for his foundation. Its billions are handled by a board that consists of himself and two volunteers, one of whom reports putting in so little time that it averages out to six minutes per week. In 2022, the last year for which records are available, they gave away $160 million, which was $234 million less than the law required — the fourth-largest shortfall of any foundation in the country.

Musk is under no obligation to have a charity, and he has made clear that he believes his for-profit enterprise­s will change the world for the better far more than any philanthro­pic venture could. But once he set up a nonprofit and filled it with tax-deductible gifts, he was required by law to ensure that his foundation served the public, and that it did not operate for the “private benefit” of its leader.

A New York Times analysis found that, of the Musk Foundation’s giving in 2021 and 2022, about half of the donations had some link to Musk, one of his employees or one of his businesses. Among the donations the Musk Foundation has made, there was $55 million to help a major Spacex customer meet a charitable pledge. There were the millions that went to Cameron County, Texas, after the rocket blew up. And there were donations to two schools closely tied to his businesses: one walled off inside a Spacex compound, the other located next to a new subdivisio­n for Musk’s employees. “The really striking thing about Musk is the disjunctur­e between his outsized public persona, and his very, very minimal philanthro­pic presence,” said Benjamin Soskis, who studies philanthro­py at the Urban Institute. Musk did not respond to requests for comment.

 ?? ?? Unlike Bill Gates, Elon Musk’s (pictured) philanthro­py has been largely selfservin­g — making him eligible for enormous tax breaks and helping his businesses
Unlike Bill Gates, Elon Musk’s (pictured) philanthro­py has been largely selfservin­g — making him eligible for enormous tax breaks and helping his businesses

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