Are you just arguing that the institution of a foundation should not be allowed because it serves no positive purpose that could not otherwise be accomplished via a company?

If so, I'm not sure the ownership part is the issue, but the separate government treatment.

Seems like the articles of the foundation are the Constitution and the agents are then the executive branch. In that way, how is a foundation really different than the founding of a company or country? Seems like a non-profit could function identically.

If I were really wealthy, I can imagine trying to set up a foundation or a company to further the ends of individualism and achieve some modicum of immortality.

Yes, any organization formed by private individuals in a voluntary association for a specific purpose is private. Forming such an organization does not make the assets it controls not private.

The conditions on how donated assets are used are generally agreed on by those running the organization, which is why they are there -- in support of common values. If they violate the conditions then the assets should be disposed of in accordance with the original donor's directions. Some especially egregious exceptions are the major foundations originally funded by entrepreneurial capitalists and now used for far left and environmentalist political causes.

Contortions in today's laws governing different kinds of corporations, including non-profits, are either something we have to live with or are useful protection, including against taxes. Private organizations will always exist; the laws governing them can be better in a better, capitalist social system.

This is not an endorsement of every foundation, many of which today are established by and for unsavory politics or are promoting bad ideas or both (like Sorros or the classic example: the Fabian Socialists in Britain).

Both owners and agents have the ability to direct resources. Foundation officers and employees are agents. No person or group of persons is legally or morally the owner of a foundation. This makes foundations, as presently constituted, something other than private property, and not legitimate institutions in an Objectivist or capitalist society.

How is this legal entity with substantive resources not privately owned? Someone(s) has the ability to direct the resources; therefore, that person "owns" them.
The only issue here is the tax approach to this collection of donations, to which there are a variety of approaches and no doubt, opinions.

How long do you plan to have your foundation last? 50 years? 100 years? Indefinitely? Charity or not, the longer your foundation goes on, the greater the chance that it will go off the rails, as far as your original intent is concerned. If I win the lottery, any donations I make will be to people whose ideas I support and who can put the money to immediate use to advance those ideas.

That's kind of a separate but related issue, and deserves its own discussion. My thoughts on the topic refer to those who have died without making any plans to return.

Just don't cross the street to buy your lotto ticket. The chance of being killed by a car is 1 in only 20 million.

I read Dagny's resignation from the board as done to avoid any possible conflict of interest between her duties to each of the two companies had she kept her seat.

I see no reason to refrain from using either the share-based (corporate) or partnership form in setting up a business venture, though a good case can be made for abolishing the corporate veil. Certainly I'd like to see bankers and brokers, who handle other people's life savings, be made liable to lose their own life savings if they screw up and lose yours through malpractice.

This strikes a little close to home for me, as I am signed up for cryonic suspension with a foundation made up of others like myself, and I hope that none of them shares your view that they have no duties to us who funded the effort once we are legally dead. Certainly I will keep my word to the other members if it should turn out that I outlive them.

Re: “the real question is ‘who benefits from the operations of the Foundation.’” That’s not the real or fundamental question. The real question is whether such an institution should exist at all. There will always be people who benefit from a socially recognized entity, whether that entity is morally entitled to exist or not. The beneficiaries in this case are people employed by foundations and those to whom the foundations’ assets are distributed. That doesn’t equate to ownership, and does not address the issue of whether such foundations are legitimate in an Objectivist, capitalist society.

Conceptually, I don’t think foundations meet the standard of any rational definition of “ownership”. By its legally established nature, a foundation cannot be bought, sold or traded in the marketplace. The persons operating a foundation are “agents”, but agents that have no owner to report to. In a fully consistent capitalist society based on private ownership of all (non-government) property, a foundation of the type existing today would not be recognized as a legitimate legal entity.

Re: "If a foundation does not have anyone registered as a beneficiary then the trustee(s) are the owner(s)." No they're not. The trustees have no ownership interests in the foundation, either legally or morally. They are agents. Theoretically the original donor's wishes control the disposition of the foundation's assets, but we see how that has worked out in practice.

The question is whether such foundations should exist in an Objectivist society. I think the answer is “no”. Although a person has a right to designate heirs to which his property passes upon his death, a person has no moral right to exercise control of property from beyond the grave. In theory “private foundations” have no place in a capitalist society, and in practice they are easily corrupted into becoming vehicles for anti-capitalist activism.

In What is Capitalism Ayn Rand said, “Capitalism is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned.” She was right.

The owner of a trust or foundation is the person who is entitled by law to control what is done with its assets. This will usually be the beneficiary(ies), with the trustee(s) as his/their agent(s).

If a foundation does not have anyone registered as a beneficiary then the trustee(s) are the owner(s).

But in either case the owners' control is subject to the conditions under which the original donor(s) entrusted their assets to the trust/foundation. And the founding document usually spells out what happens to the assets if the trustee/s do not follow the conditions.

Foundations are not owned at all. Pick a foundation and point me to an owner, as the term is defined in Objectivism (or even in statutory law). Foundations certainly have agents to administer them, but not owners.

Trusts may be private property to a limited extent. Foundations are not private property at all. Point me to an owner.

It's valid for an owner to decide to what to do with his property while he is alive, and to designate heirs to receive it upon his death. Beyond that yesterday's owner has no rights at all. "A 'right' is a moral principle defining and sanctioning a man's freedom of action in a social context." --Ayn Rand. Once a person is dead, he no longer has any rights because he does not exist.

What do you mean? If it's not owned by a govern-
ment, it must be privately owned,or it is not owned at all. People have a right to get together and put their money together, if nobody is forcing them to. It
may not be very sensibly done; it may not be very rationally administered in a particular case; but that does not change the fact that people do have a right to deal with one another,by their own free choice. (This does not mean they have a right to commit fraud).

I would add to that "Corporations". I strongly believe that when corporations came into being it was the end of Capitalism in our country. Imop, corporations are just a corrupt way to deny ownership or responsibility for a business to a private person. Just as Dagney had to divorce herself from the "board of directors" to build the John Galt Line. She took full ownership and responsibility. I think this was Ayn Rand's statement about corporations.

Foundations and trusts are indeed private property, though there are restrictions comparable to "entail" on the ways the owner(s) can dispose of the property. The assertion that they are "not privately owned" is complete nonsense.

I see no reason these forms of organization wouldn't continue to exist in the future. Even without the tax advantages, the rich people who choose to create endowments for parks, concert halls, or chairs in certain subjects at universities might still choose to do those things with their money.

I recall one passage in AS which seemed to imply that Rand didn't believe it was valid for yesterday's owners to limit today's owners by placing restrictions. But isn't that a valid part of the right of yesterday's owner to decide what to do with his property? I'm not sure an exact line can be drawn, but I lean in favor of allowing such entail.

So the real question is "who benefits from the operations of the Foundation." You are limiting your scope of "ownership" to who derives monetary compensation from its operation. It seems like the Foundations you are referring to don't operate on a monetary basis and so the very nature of the Foundation's value structure is foreign to such a constrained notion of "ownership". If one defines ownership as "one who derives value from something and can control its function", I think we get a little closer to a working definition for use in this case. I think what you are really getting at is simply this question: Would an Objectivist society prohibit the legal recognition of what we might also call a charity.

Classified that way, I think you run into a conundrum because two competing ideals would be in play. The first is the rejection of altruism which many Objectivists associate with charities. The second would be the Objectivist rejection of government meddling in the associations of businesses and private groups at all. So as a compromise between the two, I don't think you'd have any kind of official "disapproval" of such an entity, but societally such would be frowned on.

Legally, however, what would be the point of prohibiting such an arrangement? Most corporations are formed merely for the purpose of legal recognition for taxes and control - two notions Objectivists object to!

Foundations are a method of gathering and accumulating money free of taxation. As a result, you get everything from the worst to the noblest kind of legal entities. Mostly the worse as in the Clinton Foundation.

Wonder if O the Deep State Still Great and Powerful will godfather any Catholic baptisms among his clique of good fella friends.

If I read the original poster right, why would anyone need a foundation in the present sense of the term? Would not a joint-stock corporation serve just as well, even if it were to operate, not to grow as an investment, but to serve a charitable or political cause? In fact, Section 501(c)(3) of the Internal Revenue Code would not survive the Code itself.

A private corporation has owners, those who hold shares of its stock, which can be bought and sold. There are no identifiable owners of a "private foundation". Neither the foundation officers, the board of trustees, members of the general public, nor the government can own a foundation or any fractional part of it. There is no answer to the question, "Whose foundation is it?"

For that to happen requires the approval of both Apollo’s creditors and Miller’s former employer, which provides the company with billions of dollars a year in student loans and grants. “With those decisions looming,” Politico reports, “Miller and at least one other former Obama insider have met with staff to Sens. Elizabeth Warren (D., Mass.), Richard Blumenthal (D., Conn.), and Dick Durbin (D., Ill.), looking to reassure some of the loudest critics of for-profit colleges in the president’s own party.” Alongside Miller in several of those meetings was Jonathan Swan, a former Obama administration legislative Sherpa now cashing in at Vistria. A former Obama deputy communications director has been brought on to consult as well. “The holding company set up by the investors to buy the University of Phoenix has also paid $80,000 to lobbyists,” including Republicans. The band’s all back together, leveraging the relationships and knowledge and clout acquired in the public sector to rake in the bucks in the private one.

Normally, when one is talking about "private" ownership one is making a distinction between something being run by a government entity vs not, rather than trying to distinguish between an identifiable individual vs a group. So your statement that "foundations, by their very nature, have no private owners" is confusing to me. How are you attempting to use the word private within your question? (My second question above is a consequence of the distinctive application of the word "private" being applied to mean anything with a group ownership rather than single-ownership.)

Yes and the new Obama Foundation.
The Obama Foundation was established in January 2014 to carry on the great, unfinished project of renewal and global progress. Officially established as an operating, 501(c)(3) nonprofit corporation, the Foundation is governed by a volunteer board of directors chaired by civic leader Martin Nesbitt.

“Bid to buy for-profit college by former Obama insiders raises questions,” read the headline of Michael Stratford and Kimberly Hefling’s story. Questions like, Are you kidding me? For years the Obama administration has scrutinized and tightened the regulation of for-profit colleges, the most famous of which, the University of Phoenix, has been subject to multiple investigations and court actions. The battle has taken a toll. As Preston Cooper observes, shares of the Apollo Education Group, which sold at $87 when the president was inaugurated, have sunk to less than $10 a piece. Critics of the for-profits are gleeful. “Let’s hope this Phoenix does not rise from the ashes!” Alan Singer, a social studies educator at Hofstra University, lamely punned on the Huffington Post last spring. Sorry professor, but you might not get your wish. Because some of the very same people who decided that for-profit colleges should be run into the ground, and successfully achieved that result (with not a little help from the colleges themselves), have now decided, well, hey, what do you know, maybe these diploma mills aren’t so gross and hazardous after all.

Among Marty Nesbitt’s various enterprises is the Vistria Group, a private equity firm he founded a few years back and whose chief operating officer, Tony Miller, was formerly deputy secretary of Education under President Obama. Last February Vistria and other investors agreed to buy the Apollo group and the University of Phoenix for $1 billion in cash. When the deal closes, Miller will be chairman of the board.

Read more at: http://www.nationalreview.com/article...