ssjamind
All American
30098 Posts
user info
edit post |
Defined:
http://en.wikipedia.org/wiki/The_Gospel_of_Wealth
In use today:
http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BF8D306EB%2DE563%2D4901%2DB916%2D40916AEA66A7%7D&siteid=mktw&dist=
| Quote : | "From making money to giving it away
Buffett joins others in being more involved in philanthropy
By Kristen Gerencher, MarketWatch
Last Update: 7:38 PM ET Jun 26, 2006
SAN FRANCISCO (MarketWatch) -- At what point does a hard-driving businessman end the quest to add more zeros to his net worth and then decide to give most of his money away?
For billionaire Warren Buffett, who announced on Sunday his intention to start giving the bulk of his personal wealth to the Bill & Melinda Gates Foundation, the time is now. See full story.
He joins a club of elite philanthropists such as George Soros, Michael Bloomberg and Bill Gates, who've made similar choices in recent years.
Buffett is following a new wave in charitable giving, where the super-rich decide they want to live to see the results of their philanthropy, rather than funding large foundations at the time of their death, according to Tim Ogden, vice president of communications for Geneva Global in Wayne, Pa., which advises wealthy philanthropists. "The major thing we've seen change in the last 15 years or so is that people are stopping [wealth accumulation] while they're still alive," he said, adding that he sees that as positive. "We think it gives people more opportunity to think strategically about what they want to accomplish, making decisions and evaluating the results of their decisions so they can progressively get better at what they do."
Dr. Stephen Goldbart, co-director of the Money, Meaning and Choices Institute in Kentfield, Calif., which helps newly wealthy people handle the challenges of inheriting or making a fortune, agreed. "Giving less to the kids and more to philanthropy is absolutely a trend among the wealthy. We've seen it grow a whole lot in the last seven years. "It's kind of the 'now what?'" he said. "'What is the purpose and meaning of my life? What I can do that will be a model for my adult children so they won't become lazy?' I think those are the big motivators." With people living longer, more also are working longer. And many who've built successful businesses want to continue building an effective outlet for their charitable giving -- even if it means taking a more active and even entrepreneurial role, Goldbart pointed out.
More involvement
Buffett's move is a departure from the tradition of "checkbook philanthropy," where wealthy people sign away large portions of their estate without taking the time to research and monitor how the resources would be spent, according to Goldbart. The new form of giving requires more of donors' time, he said. "Some of them are creating second careers by being philanthropists, where they're having to spend 20 to 30 hours a week running a philanthropic entity, but they like it."
Buffett's approach to philanthropy mirrors his approach to investing, Geneva Global's Ogden commented. "He's not trying to reinvent the wheel himself," he said. "It's similar to what he does in the investment world. [Buffett] doesn't go and start companies; he goes in and finds companies and backs them. "We see more and more people getting involved in exactly that question of, 'I want to treat my giving like an investment. I want to be able to measure my returns,'" Ogden added. "What that ultimately produces is some very thoughtful giving and very effective giving."
An infusion of more demanding donors will help sloppy or underperforming charities clean up their acts, according to Eric Thurman, a consultant for major donors in Glen Mills, Pa.
"This has been a trademark of both Gates and Buffett, this 'how do I know if something is performing?'" he said. "I think that's a great mentality to bring to philanthropy."
That's because overreaching can be a danger, Ogden noted. Answering simple questions can go a long way toward discerning a program's effectiveness. "How many people receive microfinance loans?" he asked as an example. "Are those businesses still operating? Are they generating income?
"You don't try to fix everything at once," he said. "You find small problems you can do something about and measure and advance from there."
Dissatisfaction with institutions
As for what motivates donors like Buffett to start giving large amounts while they're still alive, many have a distrust of government and public institutions, as well as a concern that income disparities are growing unchecked, Goldbart said.
"There's a lot more recognition post-9/11 of what global poverty actually means to everyone," he added. "There was a time when it didn't matter that people in other countries were poor, because we never saw those people.
"The generation coming into money now, the baby boom generation, has a much stronger social conscience and much greater sense of responsibility. Maybe they didn't have it while they were accumulating it, but they seem to have it now."
Buffett's method of philanthropy differs from that of so-called robber barons such as Andrew Carnegie and W. K. Kellogg, because he's not promoting his own name, according to Rick Shreve, adjunct professor of business ethics at Dartmouth's Tuck School of Business in Hanover, N.H.
"Typically, we sometimes view philanthropy as somehow tainted because we think donors are just looking for admiration for their generosity," he said. "This is a case where someone -- a businessman, no less -- is giving to a foundation where he receives no recognition. This is pure altruism."
Earlier this month, the Carnegie Corporation of New York -- founded by Carnegie in 1911 -- received a gift of $30 million from an anonymous donor. The contribution came from New York Mayor Michael Bloomberg, who has given about $85 million to the grantmaking foundation over the years, including $20 million last year.
Bloomberg has said that philanthropy will become his full-time job when he finishes his second term in 2009. Last year, he gave $100 million to Johns Hopkins University.
Billionaire investor George Soros, 75, has been an active philanthropist for more than 30 years, supporting the Open Society Institute and the Soros Foundations.
Even some highly paid movie stars, like Angelina Jolie -- who Forbes pegs at No. 35 in its 2006 list of most powerful celebrities -- are embarking on very public charity efforts at what seems an ever-younger age.
In an interview with CNN's Anderson Cooper earlier this month, Jolie responded candidly when he remarked that she gives a third of her earnings to charitable causes.
"Yes, well, I have a stupid income for what I do for a living," she said in the interview.
High-profile donors can increase the social pressure to give, Goldbart said. "The good news about Gates and Buffett is they're making news, and they're sending a message about the value of money, that there's something more that offers satisfaction."
Regular Americans give, too
It's not just the billionaires of the world who move the needle on philanthropy.
Despite concern about donor fatigue in the face of many natural disasters, regular Americans dug deeper into their pockets to give to charity last year than in 2004. The effects of Hurricanes Katrina and Rita as well as the Asian tsunami elicited broad support.
American foundations, corporations, bequests and individuals donated $260.2 billion in 2005, a 6% jump from 2004 and nearing the record $260.5 billion reached in 2000, according to a report from the Giving USA Foundation released earlier this month.
Individuals, typically the largest source of donations, led the way again last year -- accounting for 76.5% of all giving, or $199 billion, the survey said.
With new services popping up, people increasingly have more ways to incorporate philanthropy into their activities. About 10% to 15% of all engaged couples are giving to a charity through the I Do Foundation, a nonprofit Web site that helps couples give back, according to its executive director, Bethany Robertson.
Couples raised $1.1 million last year through the I Do Foundation, she reported. The groups that received the most funds were Doctors Without Borders, the American Cancer Society and the American Red Cross.
Most couples are registered with a store that makes a donation every time a gift is purchased, Robertson said, and they have a choice of how much involvement they want with the charities. "[Couples] can give and never be contacted. Some people like that privacy aspect. But other people say, 'We want them to know and we want to be kept informed about the kind of impact the organization is having.'" " |
[Edited on June 26, 2006 at 10:12 PM. Reason : ] 6/26/2006 10:11:45 PM
|
