Think Bigger, Bill Gates

Stealing from thieves.

The Economist reports that if Microsoft ends up actually paying the fines which have been assessed by the EU Anti-Competition bureaucracy, it will make a bigger contribution to the EU budget than many member countriesThe article points out what happens to the money:

Fines in competition cases are quietly pocketed by the Union, and poured into the general budget.

Government agencies will gladly lie, cheat, and steal to get money without having to ask their friendly local politicians because the politicians have to justify the tax bill to the voters.  The more money the EU bureaucracy can raise through fines, the closer they can get to living in the style to which they'd like to become accustomed.

The article points out that the recent €899m fine is more than Sweden, one of the richer EU contributors, paid into the EU budget in 2006.  The writer suggests that Bill Gates should just buy one of the smaller countries - it wouldn't cost him any more, and that way he'd at least get a vote.

The Cost of Empire

This sounds attractive until it's subjected to analysis.  Owning a country tends to be a losing proposition - the main reason England gave up the British Empire was that running the Empire didn't pay.  There were so many conflicts with various "lesser breeds without the law," as Rudyard Kipling put it, that keeping the Empire cost more than it returned in taxes.  How much oil would we have to pump out of Iraq to get our money back?  Building an empire loses money given today's limitations on using effective methods of nation-building.

Nation Building for Dummies

The Romans had a well-tested and highly effective solution to minimizing the cost and maximizing the tax revenue of running an empire, but the British were too squeamish to follow state-of-the-art methods of empire / nation building.

Given that the British couldn't keep the natives in line, there's no reason to think that Mr. Gates could manage it either.  Owning a country won't net him any benefit and it would only give him one vote, which might not be enough.

Payment for Services Rendered

We've explained how the Taiwanese government got the benefits of many United Nations General Assembly votes without having to assume the costs of actually running the countries which voted their way - they encouraged their people to found export businesses which earned enough foreign exchange to bribe government officials.

There's a slight problem in that the US government forbids US companies to pay overseas bribes, but that's a trivial matter for a man of Mr. Gates' means and connections.  The Chinese government has shown that it has no problems with Chinese companies paying all the bribes they find to be commercially worthwhile.  Microsoft has subsidiaries in China, India, and in other countries which have a more relaxed attitude towards bribery than the United States has.

The solution to Mr. Gates' EU problem is not to buy one of the EU countries no matter how much being a wholly-owned subsidiary of Microsoft would benefit the citizens thereof.  The cost-effective solution is to use some of Microsoft's overseas millions to persuade compliant officials to see things Microsoft's way.

Best of all, the actual manufacturing cost of Microsoft's products is close to zero so he can recognize the profits in pretty much any country he likes.  If the matter is handled properly through appropriate adjustment of transfer prices and allocating development, support, and maintenance expenses, the profits and the bribe money can be realized in the country of choice.  That way, the entire sum will be tax-deductible.

Will Offensicht is a staff writer for and an internationally published author by a different name.  Read other articles by Will Offensicht or other articles on Foreign Affairs.
Reader Comments
Sheesh.... You make a great point! Never thought of it this way. He's got the money. I've seen a report showing 9 African countries with LESS than 1B per year in revenue. Question: how does one "buy a country"? I've heard this used - sometimes in jest, sometimes in earnest - but has that actually ever been done?
March 27, 2008 4:03 PM
Yes, countries used to change hands routinely for cash payment. But I don't think anything like that has taken place in modern times... I'd guess the last situation like that might be an Arab or Indian prince around the First World War, or possibly something in Africa during the late 1800s. Wish he'd give it a try, it'd be fun to watch. For sure, the current owners and operators of Nauru would LOVE to be offered a cash payment for the keys... a quick Google will give you several reasons why, but it IS a real country with a UN seat and so on.
March 27, 2008 7:10 PM
The problem is more esoteric than that. Certainly more existential. Modern operators of a country do not really "own" it anymore. In developed and developing countries, this is inherent in the governmental construct. No one - even if they had enough dough - would be able to write a check for the US, for instance. The number of trillions would make no difference. The Republic of Nauru is not owned by any set of people or homogenous group. It has roots from Japan, Australia, various Pacific cultures and even Germany. One of the biggest reasons these small countries have no "owners" is because no one cares enough about the place to DECLARE themselves owner. The only way to get a country for yourself is to conquer it. There are other reasons at play - just because you wrote a check to the head cheese doesn't mean all the regulars are going to disappear. You'd have to write everyone checks and make sure that you bought up every scrap of land on the island and held deeds to all of it. That way, should there be a conflict later, you would have signed contracts to show to the world court or the UN or whoever.
March 27, 2008 7:30 PM
Oh, I don't think you're using your imagination, lfon. Petrarch is right. Here's how you do it, in the case of Nauru.

1. Cut a deal with the honchos there. They won't object, they want out anyway (read the Wikipedia entry.) Money can easily arrange that. Once you have their support, you

2. Buy up all the available land, which with the cooperation of the honchos, would be the majority.

3. Try to buy everyone else out. Again, with Nauru, you'd get practically everyone.

4. Move in your own people - Microsoft employees, in this case. Money can easily arrange for this, Nauru can become an island paradise no problem if enough billions are dumped in. This has many advantages anyway, since it can easily offer dual citizenship and extraterritoriality for Microsoft execs - useful when avoiding pesky monopoly lawsuits. This also allows you to hold perfectly free and fair democratic elections to allow you to do whatever you want.

There you go - Bill just bought himself a country, and Microsoft now has a seat at the UN.
March 27, 2008 8:33 PM
Imaginations have nothing to do with it (unless you imagine yourself to be Rambo, carrying a wicked blade). Conquering is the only way to get a nation.

You're glancing quickly over the biggest obstacle and sweeping away my underlying point at the same point.

You said: "Buy up all the available land, which with the cooperation of the honchos, would be the majority"

Ahhh, but you can't. The honchos don't have all the land, just the majority. There are still plenty of people that have their little strip here and there. And whether it's a 10x10' chunk of space with a mule shed or a fishing dock with a few boats tied up, the VERY THOUGHT that your country is about to be handed off to rich, Western foreigner (who made his money doing computer mumbo jumbo) would never fly.

Poor people, if nothing else, have their collective anger at the rich. That is an axiom of life in ALL nations, small or large. There is no way in heavn or earth you would be able to convince the inhabitants to ALL (100%) sign the check and walk away. Most of them would take the absurd money Gates hands them and run laughing and screaming to the waiting boat, but there would a few old timers here and there who wouldn't budge no matter how many millions he handed over. And as long Gates didn't own every last inch of land legally, he couldn't re-purpose the island for an all-new-and-improved Gate-dom.

This is precisely why governments setup eminent domain. They KNOW they can't write big enough checks to cover everyone because sentimentality (and cantankerous-ism) can't be bought off. You HAVE to have the power to FORCE people to move once in awhile. Only Gate doesn't have any army or police force, and he would have no right to use one even if he brought his own army along.

Thus, we're back to my original assertion: you can only conquer nations, not buy them.
March 27, 2008 8:49 PM
Nope. If you can own the majority (51%), that's all you need. No conquering required, you can do it through the ballot-box by importing your own people, and THEN use eminent domain to move anyone that you need to. But really that's not necessary; so you leave the odd grass shack around here and there.
March 27, 2008 8:55 PM
51% is meaningless. Where is that written down? The UN and the world courts would never stand for that. If you want to actually have your own country - we're not talking about a big resort here but an actual country with laws and military and such - you have to own the whole thing from the beginning.

With your plan, here's what would happen...

1) Western media would interview the natives (who would talk about the destruction of homogeny and culture). Time and Newsweek would run story after story screaming "oh, the humanity". Charities would be raise to potential whoever...
2) The UN would cave in about 5 minuts and throw the country out of the club
3) Gates would own 51% of a horrible little chunk of rock, not fit to build his outhouses. He'd have no authority, at home or abroad. The natives would be stealing him blind and since he was "his own country" he'd have to figure out how to setup a police force.

Remember, the entire purpose was to have a legitimate vote in the UN.
March 27, 2008 9:03 PM
All the nations that *might* be able to be purchased with your idea would all be outside the EU. Wasn't that the whole idea to begin with? To get inside and bribe the EU? There are absolutely no countries that are purchaseable within the EU. And I think it really wouldn't work anywhere else.
March 27, 2008 9:11 PM
It appears that all of us are in vehement agreement that a) it might not be possible to own a country and b) it would not benefit Mr. Gates all that much to own a country since he would need more than one vote in the EU.

That is why we commend your attention to Taiwan's methodology of becoming friendly with as many of the smaller UN members they could, and influencing their votes on issues that mattered to Taiwan.

It may not be practical for a wealthy person to own a country, but we know that it's certainly practical to own a politician, or even two or three politicians depending on how many he needs.
March 31, 2008 11:59 AM
And don't forget the media. With this kind of serious money it may be possible to control not only the content but also the distribution network.
March 31, 2008 12:11 PM
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