John M. Templeton– contrarian?

by Greg Mayer

Just what the world needs: a hagiographic film on John M. Templeton! According to Neil Genzlinger of the New York Times, there’s a new film about Templeton, Contrarian; it will be shown in the US tonight (Saturday, Dec. 28) at 9 PM eastern time on Bloomberg TV (it aired the past two nights as well). Templeton, of course, was the very wealthy investor who spent a lot of his money on a quixotic quest to answer “big questions”, which mostly devolved into an attempt to promote “discoveries” in religion, and to mix-up science with theology. The film appears to be “authorized”, with several family members participating, and his foundation’s logo accompanying the publicity materials.

The title seems rather odd. While a lot of money is lost on Wall Street, a lot of money is also made there, so Templeton does not stand out because he got rich. Is it because of how he got rich? Well, everyone who beats the average market performance did something different from most other investors, so that hardly qualifies.  Spending a lot of money supporting his religion and advocating “free enterprise” is utterly conventional for rich men. As a Presbyterian, his religion is also completely mainstream.

The most distinctive and contrarian thing about Templeton is not mentioned in any of the publicity materials (website, trailer) that I’ve seen: that he renounced his American citizenship in order to avoid paying taxes. Templeton moved to the Bahamas, and obtained UK citizenship as well, so that he could avoid paying taxes to the US. In the trailer, it is said that he was, “very conscious of not wasting a dollar”, so I suppose Templeton thought taxes were a waste (taking a rather different view of the matter than did Oliver Wendell Holmes).

Not only do the filmmakers and the promoters leave this fact out, the promotional materials are rich with bucolic scenes of the  American heartland, emphasize his rural upbringing, and they’ve even named their website “tennesseecontrarian.com”– a rather astonishing point of emphasis about a man who renounced his citizenship! (And we’re of course not talking about an immigrant who leaves his homeland seeking opportunity or liberty– he had both, but thought he could  better his rate of return.)

It’s interesting that the film is being shown on Bloomberg TV, owned (mostly) by New York’s soon to be ex-mayor, Michael Bloomberg. Bloomberg, like Templeton, bought a residence in a tax haven, but because of his political ambitions, Bloomberg could never have renounced his US citizenship as Templeton did.

35 Comments

  1. Kevin
    Posted December 28, 2013 at 7:03 am | Permalink

    There are few reasons to leave this country if born into it as a citizen…renouncing one’s citizenship for tax purposes is not one of them. It is a very selfish thing to do, and if possible, I think less of Templeton and his retinue of apologists who plead for respect yet deserve the opposite.

    • Posted December 28, 2013 at 7:41 am | Permalink

      Edmund Burke once attempted to learn Italian so that he could escape his debt responsibilities in England. The “master of self-reliance” ended up relying on two government annuities and a pension.

      • Timothy Hughbanks
        Posted December 28, 2013 at 9:25 am | Permalink

        …and Ayn “Virtue of Selfishness” Rand, a heavy smoker, relied on the socialistic Medicare program to pay for her lung cancer treatment.

  2. gravityfly
    Posted December 28, 2013 at 7:06 am | Permalink

    Does being a woo-peddling billionaire qualify as being contrarian?

  3. Posted December 28, 2013 at 7:27 am | Permalink

    The wolf of white noise.

  4. Diana MacPherson
    Posted December 28, 2013 at 7:33 am | Permalink

    Next he’ll be called a “maverick”.

  5. Posted December 28, 2013 at 8:00 am | Permalink

    At least the US makes its citizens renounce citizenship to avoid tax. The UK allows them to be “non-domiciled” and private jet in from Monaco for a 3 day working week.

  6. Posted December 28, 2013 at 8:31 am | Permalink

    “.. he renounced his American citizenship in order to avoid paying taxes.”

    ??

    If I were to renounce my American citizenship in order to avoid paying taxes, I most definitely wouldn’t exchange my citizenship for a European one (MUCH higher tax rates there!).

    And if we’re talking income tax here (and I know we probably aren’t), then citizenship ‘s got nothing to do with it. (Being in this country and making money does!)

    • Diana MacPherson
      Posted December 28, 2013 at 8:44 am | Permalink

      I suspect he moved to the Bahamas and took out citizenship and at that time he wasn’t allowed to keep his American citizenship as well.

      • Posted December 28, 2013 at 8:50 am | Permalink

        I doubt that: The US doesn’t care if you have other citizenships (I myself have dual citizenship, once of them being American).

        As for income tax: citizenship doesn’t play a role. (Whether you live in the US or not, does though).

        • Diana MacPherson
          Posted December 28, 2013 at 9:09 am | Permalink

          It’s more complicated if you live outside the US though I know plenty of Canadians with dual US citizenship living in Canada.

          This according to Wikipedia:

          The U.S. citizen may lose his dual citizenship by obtaining naturalization in a foreign state, taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or political subdivision thereof, or serving in the armed forces of a foreign state if this action was performed with the intention of renouncing U.S. citizenship.

          More at the formal site

          However, it seems more likel that Bahamas at the time didn’t recognize dual citizenship as written here where renouncing your foreign citizenship by age 21 is required.

        • Posted December 28, 2013 at 9:58 am | Permalink

          US citizens pay US income tax, regardless of where they live or made their money. (Although there are various rules, exemptions, and credits that make the taxes of a non-resident citizen different.)

          GCM

          • mattpenfold
            Posted December 28, 2013 at 10:42 am | Permalink

            Whereas UK nationals only have to declare overseas income if they are domiciled in the UK. The rules that established whether someone is domiciled in the UK for tax purposes are complex, but basically is depends on how much time you spend in the UK in any tax year.

    • Posted December 28, 2013 at 8:50 am | Permalink

      We’re talking Bahamas citizenship, not UK. Bahamas is a separate country, independent of the UK since 1973

      • mattpenfold
        Posted December 28, 2013 at 10:40 am | Permalink

        No, he took UK citizenship. He was domiciled in the Bahamas, but was not a citizen of that country.

        • Posted December 28, 2013 at 11:04 am | Permalink

          I stand corrected; but as a non-dom he’d have still had some or all (I don’t know the details) of the tax advantages.

    • mattpenfold
      Posted December 28, 2013 at 9:09 am | Permalink

      He took UK citizenship, and renounced his US citizenship. However he did not become domiciled in the UK for tax purposes, so other than any income earnt in the UK, he was not liable to pay UK taxes.

      • infiniteimprobabilit
        Posted December 28, 2013 at 1:40 pm | Permalink

        So ‘we’ get the ignominy of Templeton being a UK citizen without even getting any of his money. Oh well done, Immigration. Next time save the space for some refugee from Uganda, will ya?

  7. Timothy Hughbanks
    Posted December 28, 2013 at 8:46 am | Permalink

    Templeton, who used to be a favorite nn PBS’s Wall Street Week with Louis Rukeyser made much of being a contrarian investor (picking stocks or sectors that weren’t in vogue). As for his views on paying taxes, well, he was very much like many of his fellow members of the super-rich financial parasite class.

    • Timothy Hughbanks
      Posted December 28, 2013 at 8:47 am | Permalink

      sorry about the italics fail

  8. Alex Shuffell
    Posted December 28, 2013 at 10:02 am | Permalink

    On his obituary at bloomberg.com it says Templeton “never flew first class and lived year-round in his peaceful ocean-side home in the Bahamas.” Does that mean he always flew privately or if he lived “year-round” in the Bahamas he never travelled so would not fly anyway?

    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOGiN456OwHY&refer=us

  9. Sarah
    Posted December 28, 2013 at 10:38 am | Permalink

    If he renounced his citizenship to avoid paying taxes, he would have had to pay a very hefty exit fee to be allowed to do it. In all other countries in the world except one, tax is based on residence not citizenship. The only other country with citizenship-based tax is Eritrea!

  10. Sastra
    Posted December 28, 2013 at 10:48 am | Permalink

    Why is Templeton supposed to be considered and loved as an example of a “contrarian?” The question seems to be answered in the article and it’s what I suspected: another example of the privileged status automatically granted to religion and/or spirituality:

    The film …doesn’t go too deeply into Templeton’s business career, instead reserving the final part for his interest in spiritual matters and in exploring how science, religion and other disciplines that are often at odds might join to answer profound questions.
    He established the Templeton Prize to promote this exploration, partly, the film says, because the Nobel Prizes ignore it. These days, when finance barons are more often in the news for the most unspiritual of pursuits, it’s a legacy that seems all the more singular.

    Get it? Ooooh, Templeton was being so brave! So dangerous! He was putting money into religion! He was being spiritual!

    Because the boring, traditional, normal, common, inside-the-box everywhere assumption is that there is no God, there are no Higher Mental-type Powers, Forces, or realms, and materialistic naturalistic atheism is true.

    Now you see. Templeton is a maverick, not afraid to go against the tide and fight the Atheist Establishment! And he puts MONEY in it! Which virtually nobody else on the planet does!

    Being ‘spiritual’ is the underdog, the unpopular but wise and thoughtful alternative to the default. Thus runs the story, and thus the religious privilege. They get the status of being “daring” while firmly following the status quo, the position held by almost everyone almost everywhere throughout human history. It’s the same damn thing as Christians framing themselves as persecuted and powerless while simultaneously claiming the culture. You get a narrative where you’re an unconventional hero AND you are constantly surrounded by reassurance from the majority. What a neat trick.

    Templeton and his Foundation are not “contrarian” because they’re not putting anything on the line. People have been trying to shove science and spirituality together as long as they’ve been trying to shove reality and religion and the natural and the supernatural together — and they’ve gotten very, very good at it. The Templeton Foundation is as likely to discover that a spiritual hypothesis is wrong as NCCAM is likely to find out that alternative medicines don’t work.

    The only surprise is going to be how they manage to spin all results as irrelevant, positive, or “suggestive of intriguing possibilities.”

    • BillyJoe
      Posted December 28, 2013 at 12:18 pm | Permalink

      Actually NCCAM have found out that alternatives medicines do not work. They just don’t talk about it all that much and they just keep looking.

      • Sastra
        Posted December 28, 2013 at 2:12 pm | Permalink

        Yes, they find it out without actually finding anything out — that is, coming out and saying “X does not work.” No, it just always “needs more research.” If they won’t even throw out homeopathy and energy healing, they have no real standards. They’re only pretending to investigate.

        Bottom line, the Templeton Foundation would not, could not negate any spiritual claim. I think the most they can do is argue that while some people believe that spiritual claim X works like this, it seems to work in another way.

        Dawkins once parodied this strategy by imagining physicists insisting that our understanding of the ether has been “clarified.” Or, from the other direction, biologists discovering that DNA is not in double-helix form and suddenly insisting that they never took the idea literally: instead the double-helix metaphor truthfully “speaks to us” and this is what they meant.

        • Posted December 30, 2013 at 5:46 pm | Permalink

          Incidentally, this is why “empiricism” is not a good philosophy of science and technology; one needs the rationalist component to rule out in advance the more implausible nonsense, if only to save the money needed to investigate it.

  11. Greg Esres
    Posted December 28, 2013 at 10:51 am | Permalink

    “rural upbringing”

    There seems to be a mythology in this country that country folks are the salt of the earth. In my view, they were the ones going to Church on Sunday and lynching black folks on Sunday night, and would have continued to do that if the city folk hadn’t made them stop. Cities are where enlightened attitudes are birthed.

    • Sastra
      Posted December 28, 2013 at 2:16 pm | Permalink

      Yes — the salt of the earth. Makes me think of this.

    • Diana MacPherson
      Posted December 28, 2013 at 2:26 pm | Permalink

      I suspect this mythology permeates many Western countries and dates all the way back to Roman attitudes during the Republic where good citizens (often portrayed as bucolic ideals) would happily plough their fields, but when duty called, would take up arms, do their part in defending Rome then happily return to the fields. The only difference is in modern times, we identify this with the common man vs. ancient times who centred stories about virtue around aristocrats.

      Your city, Cincinnati is named after a famous Roman who did just this, Cincinnatus and was revered for his ability to give up power willingly and go back to his fields.

  12. nicky
    Posted December 28, 2013 at 12:09 pm | Permalink

    The most ‘contrarian’ thing about Templeton is that he rejected science, evolutionary theory in particular.
    So he was ‘contrarian’ together with 40%+ of the USA population there. Note, I think in my country, South Africa, about 90% would be ‘ccntrarian’ in that sense.
    Maybe we live in a ‘contrarian’ world?

  13. Hempenstein
    Posted December 28, 2013 at 12:16 pm | Permalink

    Most interesting. Clearly, Templeton wanted a place in history beside Alfred Nobel. Without the above, it could be noted that Nobel’s fortune was based on his 355 patents vs. Templeton’s, um, how many were there exactly?

    Now we can further add the comparison of lifelong Swedish citizen never accused of skattefusk vs. the citizenship-switching, tax-scheming Templeton. Enjoy your place in history, John.

    • Timothy Hughbanks
      Posted December 28, 2013 at 2:03 pm | Permalink

      As Warren Buffett put it, Templeton’s (and his own) Master of the Universe status derived from being a person “who can detect the mispricing of securities with sums reaching into the billions.” My heroes.

  14. juan
    Posted December 28, 2013 at 4:04 pm | Permalink

    I don’t have a problem calling John Templeton a contrarian (he was one, at least when investing). I don’t mind his having changed citizenship to pay less taxes (or anything else people do to legally pay as little tax as possible).

    What baffles me again and again is how someone who is very objective and rational in one field can be so irrational in another.

    Templeton was a very good investor because he could look dispassionately and objectively at a security to determine its value. Doing that requires an extraordinary capacity for independent thought. Yet, religious faith requires the opposite of independent thought.

    His is just another name in the long list of people who are very rational in some fields, and also religious believers. Although we all know many people in that list, including prominent scientists, it still surprises me when I find new examples.

    P.S. Check out rule #12 in John Templeton’s rules of investing: “Begin with a prayer. If you begin with a prayer, you can think more clearly and make fewer mistakes”.

    • BillyJoe
      Posted December 28, 2013 at 6:22 pm | Permalink

      Well, “begin with a prayer” is probably just metaphor for “clear your head of all distractions”.

  15. Diane G.
    Posted December 29, 2013 at 1:11 am | Permalink

    sub


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  1. […] John M. Templeton– contrarian? « Why Evolution Is True http://whyevolutionistrue.wordpress.com/The U.S. citizen may lose his dual citizenship by obtaining naturalization in a foreign state, taking an oath or making an affirmation or other formal declaration of allegiance to a foreign state or political subdivision thereof, or serving in the armed forces of a foreign state if this action was … The rules that established whether someone is domiciled in the UK for tax purposes are complex, but basically is depends on how much time you spend in the UK in any tax year. […]

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