Sunday, August 15, 2010

Forty billionaires donate to charity instead of buying panda chairs

This weekend, while furniture shopping in SoHo for my friend, we saw a chair made out of stuffed panda toys. The price tag? $75,000. The rich really are different - and by different, I mean crazy.

But maybe not all of them. Last week, Warren Buffet announced that 40 wealthy individuals and families have signed on to the Giving Pledge, a project he started with Bill and Melinda Gates. This means those rich folks will be giving away more than 50 percent of their wealth (in some cases, much more.)

As this Daily Finance article describes, "Each person who chooses to pledge the bulk of their wealth to charitable causes will make this statement publicly, along with a letter explaining their decision. The Giving Pledge is a moral commitment to give, not a legal contract. It does not involve pooling money or supporting a particular set of causes or organizations. At an annual event, those who take the pledge will come together to share ideas and learn from each other."

The list includes Mayor Bloomberg, Pierre Omidyar, Ted Turner, Paul Allen, and Barry Diller (who is of special interest to me since I just started working for his company, IAC.)

Of course, some pundits must look at everything, even these charitable acts, through a polarized political spectrum. Evan Newmark ( suspects that Buffet is providing cover for President Obama to raise taxes (aka let the Bush tax cuts expire) by reminding us how rich the rich still are. This seems like a stretch. Steven Perlstein points out in The Washington Post that theoretically, these donations actually reinforce "trickle down" theories and make the case that private donations can be more effective than government spending. He thinks that those people donating should focus instead on just paying their full taxes, since the mega-rich often have an easier time dodging their fair share, and the money spent is also then (ideally) accountable to citizens.

But I did a lot of research into Buffet's and the Gates' charitable histories and motivations for my book, and I'm choosing to look at this a lot less cynically. Nothing is forcing these uber-rich people to donate; they could be wasting money on panda chairs. These billionaires all have their own individual reasons and made this commitment as a personal choice. Good for them, and hopefully this continues to set a great example for others.

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