Re: Open Source endowment?
- From: Neil Doane <caine@xxxxxxxxxxxxxxxx>
- To: technocracy@xxxxxxxxxxxxxxxxx
- Date: Thu, 15 Jun 2000 00:50:34 -0700
* Steve Baker (ice@xxxxxxxxxxxxxxxxx) on [06-14-00 16:05] did utter:
> At the behest of fellow technocracy member John Bell I have finally gotten
> around to spending a few minutes over at the ISU foundation office talking
> about how you can give your money to ISU instead of Uncle Sam. Basically, I
> learned we can do anything we want with donations to ISU and they're very
> happy to help us give them money. I thought I'd share with all here on what
> I learned.
>
> An endowment is a fund that is pooled with all the other endowments at ISU
> and put to work on the stock market and other places earning more money.
> >From that money that is earned 5% of the endowments value can be spent by
> the endowment every year. So if we have say, $30K in the endowment we can
> spend about $1500 every year on say, a scholarship or merely put it back
> into the endowment to earn more money next year. Endowments are forever,
> but they typically want them to be at least $25K in size before they let you
> spend the 5% earned interest (seems reasonable to me, since anything smaller
> is almost too small to use for anything). Oh, and if you like you can
> donate securities in leu of actual cash even and that has some sort of
> additional tax benefit.
Questions:
So you invest $30k in an endowment, 5% of the profits goes do whatever the
enodowers want...what happens to the rest of it? You can take $30k in a
bucket and toss it out the window of your Saturn on Highway 41 and make 5%
on it...what happens to the rest of the profits? It sounds like _someone_
at ISU is making a killing if all the endowments are pooled together and the
managers of the funds just dole out 5% of the endowment balances each year.
If you donate securities, how does the endowment make scholarship monies and
such off of it? Sell the securities outright? margin trading? (or
something else?) If an endowment sells securities (or recieves securities)
who incurs the tax liabilities of profit from sale or unrealized gains?
> Source development lab and Open Source scholarships here at ISU. While we
> would need upwards of a half million in an endowment to be practical,
Where do you get this sum? Can you define "practical" in this context a bit
more clearly?
> Sitting all alone in the Sequent lab programming my ass off on this and
> that was far better preparation for the "Real World" than sitting in say,
> "Theory of Computation" or baby sitting 50 people in the 24 hour lab.
> Certainly better than assembling burgers at Burger King. It seems to me also
> a novel way to pay for Open Source development. I would wager by and large
> that most people who do Open Source development are of college age, this
> seem to be the target group to give money to, in my opinion anyway.
>
> Giving scholarships to incoming freshmen who've distinguished themselves
> by their Open Source programming efforts also seems a mighty fine way to
> reward them their efforts and get decently intelligent people to walk the
> halls of ISU's math/CS dept.
> Anyway, I'm going to wrap this up. What I'd like to hear are suggestions
> on what to name the endowment, who all is interested in contributing (and
> perhaps how much), what it should accomplish, how it should be run, by whom
> and so on.
I might be interested in contributing at some point (especially if it's
deductable! :)
Random thoughts: I would say that you would want to reward voluntary open
source contributors rather than to encourage open source development, like
as in a 'scholarship'. For instance, set up an endowment to be a "reward"
versus an "incentive". Rewards get people to work hard, do things, submit
code that is judged by <insert relevant open source judging criteria here>
and compared against competitors to be rewarded on a case-by-case basis.
Incentive scholarships are sortof like threats, get the grades (or in this
case, write the code) or you don't get the dough, which I think is the wrong
approach. As a reward, you could also dole out small sums on a
case-by-case basis; if someone makes a nice little trinket and releases the
code, the judges could dole out book money, if someone creates from scratch
a GPLed version of StarCraft, for instance, the judges could dole out
considerably more. Just some thoughts...
Neil
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