General Ramblings: Giving Pledge
September 1, 2010 Paul Clolery
Billionaire Warren Buffett reportedly drives his own Cadillac DTS, doesn’t have a cell phone and doesn’t have a computer on his desk. What an inspiration he is to us all, really.
The average American drives a much less expensive car, some made by a General Motors division other than Cadillac, uses a cell phone or other personal digital assistant because the work day is now 24 hours long and often has both a desktop computer and a laptop.
So it stands to reason that regular donors are going to be inspired to be more like Warren and give away half their estate to charity or some type of philanthropy of their personal choosing. In this economy, that would be half of the barrel people are wearing because they’ve lost everything else in the markets from which Buffett has made his billions.
Just think of the ask string in a direct mail package sent by Buffett. “Yes, I’ll join this new era of robber barons. Here’s my gift of $100 million, $500 million, $1 billion.”
The announcement of his “Giving Pledge” is little more than grandstanding by the so-called Oracle of Omaha who appears now to be relishing the wealth spotlight from which he used to hide. It’s wonderful that he and his pals are giving away their fortunes. In this case, though, almost all of the people who have signed on to Buffett’s pledge are already generous participants in the philanthropic sector. New York City Mayor Mike Bloomberg announcing he’s giving away more of his cash is not going to sway the average New Yorker into digging deeper. Sure Mayor Mike takes the subway just like everyone else, although most straphangers don’t have an armed escort into the core of the Big Apple.
More is expected of those with resources. Americans already give until it hurts. Trying to show them up by grabbing headlines for billion-dollar gifts will only hurt philanthropy, not help it because it might convey the idea that the big checkbooks have things covered for now. But, foundations through which Buffett and friends give accounted for only 13 percent ($38.4 billion) of philanthropy during 2009, according to GivingUSA. It’s dwarfed by the $227.4 billion (75 percent) given by individuals, not personal foundations. Most people don’t take out ads when they send money to a charity of choice.
The super rich are not regular people and shouldn’t be treated that way. Their donations are welcome and badly needed. Buffett’s call should have been two-fold: give more and pay it out now. Hundreds of billions of dollars are already locked away in foundation vaults, the same vaults to which this new cash would be ticketed.
Buffett and his pals should take the advice of one forward-thinking foundation leader who has said, “Why put away money for a rainy day when it’s pouring out?” Buffett must have someone holding a very large umbrella for him.