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Okay, so it's been a while since I did a supervillain school post, so I'll try to make this one good.
Let's talk about J. Paul Getty.
Looking at how the industrialist made his money, you'll understand why middle class people will never understand taxes.
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Let's talk about J. Paul Getty.
Looking at how the industrialist made his money, you'll understand why middle class people will never understand taxes.
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2/ For those that don't know, J Paul Getty was one of the wealthiest guys in history. He mostly made his money in oil, but he was truly a pioneer in what I call organizational income efficiency.
See, his company was so efficient, it barely ever payed taxes.
See, his company was so efficient, it barely ever payed taxes.
3/ The play worked like this. Most people *know* he owned oil fields, but he didn't officially. A trust did.
Besides the oil fields weren't profitable. They would spend all of their money at shipping companies.
He happened to own those too, luckily.
Besides the oil fields weren't profitable. They would spend all of their money at shipping companies.
He happened to own those too, luckily.
4/ The shipping companies weren't profitable either though, because they would pay all their money to refineries. Which he also owned.
The refineries to gas stations, the gas stations to hotels, the hotels housed his workers, and would generate money for the trust.
The refineries to gas stations, the gas stations to hotels, the hotels housed his workers, and would generate money for the trust.
5/ Want to guess what the trust did? Bought oil fields and the cycle continued.
An FX series comically explains this, with the character laughing and saying he was so poor on paper, he could collect government assistance.
He never paid taxes, because there was no profit.
An FX series comically explains this, with the character laughing and saying he was so poor on paper, he could collect government assistance.
He never paid taxes, because there was no profit.
6/ Of course, when you're one of the richest people in history you need toys. My favorite was the last home he lived in, Sutton Place.
A sprawling compound on 60 acres in England. It cost a fortune, but good luck would have it, he didn't really own the whole thing.
A sprawling compound on 60 acres in England. It cost a fortune, but good luck would have it, he didn't really own the whole thing.
7/ It was legally the HQ for Getty Oil Europe. He had some people work out of it, to make it official, and reduce the cost of his massive home.
He did generously donate a fortune to the arts though, resulting in the world class Getty Museum in Malibu.
He did generously donate a fortune to the arts though, resulting in the world class Getty Museum in Malibu.
8/ He never saw the museum, but left it a $2 billion endowment.
The museum's trust had to spend $2 million per week to make sure it spent sufficient money to maintain a ratio consistent with a non-profit.
It's now one of the greatest collections in the world.
The museum's trust had to spend $2 million per week to make sure it spent sufficient money to maintain a ratio consistent with a non-profit.
It's now one of the greatest collections in the world.
9/ The Getty museum also happens to have an endowment worth about $7 billion last I checked. Great investment if you ask me.
My favorite Getty story though, is about his grandson who was kidnapped by the Italian Mafia. They demanded a $3 million random. Getty paid immediately.
My favorite Getty story though, is about his grandson who was kidnapped by the Italian Mafia. They demanded a $3 million random. Getty paid immediately.
10/ Just kidding. He said no, because only $2.2M was deductible.
They sent kid's ear as a warning.
He paid $2.2M, and lent the rest to the kid's dad @ 4%.
Rumor is the town's mafia used it to build what's now the EU's largest drug port. It's an ear. https://twitter.com/StephenPunwasi/status/1312176341039501312?s=20
They sent kid's ear as a warning.
He paid $2.2M, and lent the rest to the kid's dad @ 4%.
Rumor is the town's mafia used it to build what's now the EU's largest drug port. It's an ear. https://twitter.com/StephenPunwasi/status/1312176341039501312?s=20
11/ What's the point? When you don't pay taxes, your empire can grow extremely fast.
What would Getty have said if you told him you hit him with an income tax rate of 80%?
"What income?"
His income made him poor enough to collect food stamps in the tax system you designed.
What would Getty have said if you told him you hit him with an income tax rate of 80%?
"What income?"
His income made him poor enough to collect food stamps in the tax system you designed.
