There is an old Chinese saying about wealth which states it doesn’t always matter how much money you acquire during the course of your life because the third generation after you will be the one to lose it all. Whether that is true or not, there has been a quiet movement known as the Giving Pledge that is having a big impact on the future of philanthropy.
The Giving Pledge is an organization that is working on increasing the number of billionaires who would like to give more than 50 percent of their assets to philanthropy.
Warren Buffet: Lead-off Philanthropist:
While it was never the intention of the creators of the Giving Pledge to receive credit for promoting philanthropy, it is recognized that Warren Buffet played a large role in helping to shape the proposition that it was an important civic duty for those who are very wealthy to make plans to donate a significant amount their assets to a charity, a foundation, or an organization that promotes the arts or humanities. And although many of the discussions surrounding the growth of the idea were private, he eventually managed to recruit Bill Gates to run a charitable foundation that was jointly funded by Buffet and Gates.
The Idea Grows:
After taking care of their own money, it became apparent that both Bill Gates and Warren Buffet were happy to talk to others about what they were doing with regards to the planning of their estates. As a result of many quiet conversations, the Giving Pledge became an organization and started publishing pledge letters from billionaires that decided that making a pledge to give away a large part of their estate was an important thing to do.
Incredibly, in the space of a little over a year, the organization received over 80 pledges from billionaires stating that they would contribute at least half of their fortune to philanthropy before they died or in their will. That was in 2011. The most recent count shows that almost 140 billionaires have now made the Giving Pledge.
Where Will All The Money Go?
The Giving Pledge organization itself never gets involved in the details of a families’ commitment. Instead, the only guidelines that are put out there for the pledge is that the donation must be made to a charity or philanthropic organization. Chances are, that will mean that a lot of organizations that provide charitable services in the metropolitan area where the billionaires live will be receiving extra help down the road.
More importantly, it means that those who are in need of help, education, or funding for something that betters mankind will have more opportunity because of the commitment of a group of people that understand that accumulating wealth across the centuries is not always the best thing for society.
Underlying their commitment is that notion that free market system has created a group of people that the old Chinese adage does not apply to. In other words, were they not to give a large portion of their wealth away, it would be impossible for any one generation of heirs to actually spend all of the money that they had inherited.