The brilliant investor Warren Buffett has decided to leave the vast bulk of his fortune to the Bill & Melinda Gates Foundation.
The Washington Post has the story, unsurprisingly, since both Buffett and Melinda Gates serve on the Post company board of directors. Buffett has long made it clear that he intended to leave his children only a very small percentage of his wealth, more than 99 percent of which is in Berkshire Hathaway stocksome $44 billion currently. (Disclosure: I own one share of Berkshire Hathaway.) The Gates Foundation currently has about $30 billion, donated by the Gateses from their Microsoft stock.
I suppose some people may worry about such a large bloc of capital being held by a single foundation. But from what I have seen and reported on in this blog, the Gateses seem to be extremely thoughtful and creative philanthropists. They're concentrated on world health and U.S. educationboth areas in need of serious improvement. Buffett, in contrast, evidently has no great philanthropic projects in mind.
Until now, Buffett has given little to philanthropy, amassing the wealth and leaving the work of philanthropy to others so his money could compound at a higher rate, he told Fortune. He said he had always planned to have his wife oversee his charitable giving after his death. But after she died and because he saw an opportunity to invest in an existing, well-respected foundation run by two "ungodly bright" people he changed plans to start giving it away this year, he told the magazine.
His philanthropic strategy seems to mirror his investment strategy: Berkshire Hathaway buys whole businesses and big blocks of shares in public companies in which it has confidence and lets existing management continue to run them. Now he's leaving the bulk of his wealth to be given away by the Gateses.
I remember reading somewhere that Buffett intended to leave all his money to a foundation working for population control. http://www.cirtl.org/buffett.htm That would have been extremely foolish: The dangerous specter before the world now is not overpopulation but underpopulation, as documented in Ben Wattenberg's Fewer: How the New Demography of Depopulation Will Shape Our Future, and Philip Longman's The Empty Cradle: How Falling Birthrates Threaten World Prosperity and What to Do About It. Perhaps these books helped to persuade Buffett to give up on population control, in which case Ben and Phil have a done great service to the world.
I give great credit to Bill and Melinda Gates for taking personal charge of their foundation and not just turning their money over to left-wing foundation apparatchiks but rather thinking creatively about how it should be spent. And I give great credit to Warren Buffett for deciding not to turn his money over to such apparatchiks but to give it to the Gateses to superintend.