Bill and Melinda Gates join Warren Buffett in the $600 billion challenge
The trio is asking the nation's billionaires to pledge at least half their net worth to charity.
Wed, Jun 16 2010 at 11:26 PM
GIVE 'TIL IT HURTS: Warren Buffett helps set the tone. (Photo: ZUMA Press)
Last year, word got out that the world’s richest people had secretly gathered in New York City. Warren Buffett hobnobbed with Oprah Winfrey. David Rockefeller schmoozed with Bill and Melinda Gates. George Soros was supposedly star-struck by it all. And while most media sources wondered at this “unprecedented” event, critics felt this could only bode bad things for the rest of us.
It turns out the subject of the secret meeting was simple — philanthropy. And Fortune magazine recently detailed the first complete public disclosure on what went down in this historic meeting of monies. In what could be potentially the biggest fund-raising drive in history, Buffett and Bill and Melinda Gates are hoping to inspire other billionaires to pledge at least 50 percent of their net worth to charity during their lifetimes or at death.
Who to start with? Naturally, with the Forbes list of the 400 wealthiest Americans. In 2009, Forbes estimated the net worth of the top 400 to be around $1.2 trillion. If they gave away 50 percent of their net worth during their lifetimes, they would disseminate $600 billion to philanthropy.
Gates and Buffett say the super-wealthy can and should do more. As Fortune magazine reports, in 2007, 18,394 individual taxpayers having adjusted gross income of $10 million or more reported charitable gifts equal to about $32.8 billion. This was 5.84 percent of their $562 billion income. Also in 2007, the billionaires of our country gave about 11 percent of their income to charity.
It seems that there is a large gap between what the mega-wealthy are giving and what Gates and Buffett would like them to give. Consequently, they have since hosted a series of dinners over the past year to bring others to their cause. Buffett has already famously pledged to gradually give away his Berkshire Hathaway fortune to five foundations, much of which will go to the Bill and Melinda Gates Foundation. He has also famously pledged not to leave his fortune to his children.
But Buffett’s exclusion of his children has proved controversial among the billionaires. Some worry that such action could alienate their children. Bill and Melinda Gates have pointed out that these are valid concerns of people who want to feel as smart about giving as they were about making their money. Nonetheless, they feel others should step up to the philanthropic plate. Bill Gates has reportedly said at these dinners, "No one ever said to me, 'We gave more than we should have.'"
Buffett takes a pragmatic view. Some have already committed, but others remain reticent. As he has said, "They may not have reached a decision about that, but they have for sure thought about it. The pledge that we're asking them to make will put them to thinking about the whole issue again." And if even a few more billionaires get on board, it could change the face of philanthropy forever.
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