Wednesday, June 30, 2010

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A Mench Who Might Save America

Astounding...

My Philanthropic Pledge

By Warren Buffett- June 16, 2010

FORTUNE -- In 2006, I made a commitment to gradually give all of my Berkshire Hathaway stock to philanthropic foundations. I couldn't be happier with that decision.

Now, Bill and Melinda Gates and I are asking hundreds of rich Americans to pledge at least 50% of their wealth to charity. So I think it is fitting that I reiterate my intentions and explain the thinking that lies behind them.

First, my pledge: More than 99% of my wealth will go to philanthropy during my lifetime or at death. Measured by dollars, this commitment is large. In a comparative sense, though, many individuals give more to others every day.

Millions of people who regularly contribute to churches, schools, and other organizations thereby relinquish the use of funds that would otherwise benefit their own families. The dollars these people drop into a collection plate or give to United Way mean forgone movies, dinners out, or other personal pleasures. In contrast, my family and I will give up nothing we need or want by fulfilling this 99% pledge.

Moreover, this pledge does not leave me contributing the most precious asset, which is time. Many people, including -- I'm proud to say -- my three children, give extensively of their own time and talents to help others. Gifts of this kind often prove far more valuable than money. A struggling child, befriended and nurtured by a caring mentor, receives a gift whose value far exceeds what can be bestowed by a check. My sister, Doris, extends significant person-to-person help daily. I've done little of this.

What I can do, however, is to take a pile of Berkshire Hathaway stock certificates -- "claim checks" that when converted to cash can command far-ranging resources -- and commit them to benefit others who, through the luck of the draw, have received the short straws in life. To date about 20% of my shares have been distributed (including shares given by my late wife, Susan Buffett). I will continue to annually distribute about 4% of the shares I retain. At the latest, the proceeds from all of my Berkshire shares will be expended for philanthropic purposes by 10 years after my estate is settled. Nothing will go to endowments; I want the money spent on current needs.

This pledge will leave my lifestyle untouched and that of my children as well. They have already received significant sums for their personal use and will receive more in the future. They live comfortable and productive lives. And I will continue to live in a manner that gives me everything that I could possibly want in life.

Some material things make my life more enjoyable; many, however, would not. I like having an expensive private plane, but owning a half-dozen homes would be a burden. Too often, a vast collection of possessions ends up possessing its owner. The asset I most value, aside from health, is interesting, diverse, and long-standing friends.

My wealth has come from a combination of living in America, some lucky genes, and compound interest. Both my children and I won what I call the ovarian lottery. (For starters, the odds against my 1930 birth taking place in the U.S. were at least 30 to 1. My being male and white also removed huge obstacles that a majority of Americans then faced.)

My luck was accentuated by my living in a market system that sometimes produces distorted results, though overall it serves our country well. I've worked in an economy that rewards someone who saves the lives of others on a battlefield with a medal, rewards a great teacher with thank-you notes from parents, but rewards those who can detect the mispricing of securities with sums reaching into the billions. In short, fate's distribution of long straws is wildly capricious.

The reaction of my family and me to our extraordinary good fortune is not guilt, but rather gratitude. Were we to use more than 1% of my claim checks on ourselves, neither our happiness nor our well-being would be enhanced. In contrast, that remaining 99% can have a huge effect on the health and welfare of others. That reality sets an obvious course for me and my family: Keep all we can conceivably need and distribute the rest to society, for its needs. My pledge starts us down that course.

4 comments:

Anonymous said...

On the surface this sounds quite commendable but, as a person who questions everything, I came across with a few questions. When I first heard about this I wondered to whom and what charities would be involved. That makes a huge difference. If he were to give huge amounts to an organization, such as the United Way, that money wouldn't be as near beneficial, as there overhead far exceeds what it should be.

Considering the extent of umemployment, I would suggest to Mr Buffett the money would be better spent "Investing" in unique and inovative ways. There is such a thing as "micro loans", if that's the term, that could Directly help more people. Or, even starting Other businesses that would employ people instead of people having to "live" off of charity.

There are too many people who have gained great success and in order to assuage their own guilt give money that results in people forced to remain in poverty. What has the person gained in that regard. The person may not starve to death but his life has improved little. I don't prefer to pour cold water on this, but a wise decision is better than soothing years of guilt.

Anonymous said...

Anonymous, Buffett usually channels his charitable donations through the Bill & Melinda Gates Foundation. Look them up. They are doing excellent work.

Anonymous said...

The following is from the Tanya and Lessons in Tanya:

The souls of the nations of the world, however, emanate from the other, unclean kelipot which contain no good whatever,

כמו שכתוב בע׳ חיים שער מ״ט פרק ג׳: וכל טיבו דעבדין האומות לגרמייהו עבדין

as is written in Etz Chayim, Portal 49, ch. 3, that all the good that the nations do, is done out of selfish motives.

Since their nefesh emanates from kelipot which contain no good, it follows that any good done by them is for selfish motives.

וכדאיתא בגמרא על פסוק: וחסד לאומים חטאת — שכל צדקה וחסד שאומות העולם עושין אינן אלא להתייהר כו׳

So the Gemara31 comments on the verse,32 “The kindness of the nations is sin” — that all the charity and kindness done by the nations of the world is only for their self-glorification...

When a Jew acts in a benevolent manner he is motivated mainly out of concern for the welfare of his fellow. The proof of this is that were his fellow not to need his help, this would give him greater pleasure than the gratification derived from his act of kindness.

Concerning the nations of the world, however, this is not so. Their motivation is not the welfare of their fellow; rather, it stems from a self-serving motive — the desire for self-glorification, a feeling of gratification, and the like.

It should be noted that among the nations of the world there are also to be found those whose souls are derived from kelipat nogah.33 Called “the pious ones of the nations of the world,” these righteous individuals are benevolent not out of selfish motives but out of a genuine concern for their fellow.

Crazy Smade said...

LOL! You're kidding me, right? Save America? I hope you're kidding. I hope no one is buying this pile of PR. This is like the Catholic Relief Fund saving Africa. 90% goes to overhead and what little does land in needy areas is quickly gobbled up by thieves, warlords and/or politicians. Little if anything will actually go to those truly in need. Give me a break.... Only teshuvah will save America and since that ain't going to happen you might just as well write America off as a lost cause. This daughter of Imperial Rome will fall and fall hard. You don't have to be a prophet to see and read the handwriting on the wall.

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