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The $600 Billion Challenge

Buffett & Gates2010-06-16interview1:00:00Open original ↗

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SpeakersOther47Questioner26Warren17Charlie8Charlie Rose4Bill Gates3
Charlie RoseFrom our studios in New York City, this is Charlie Rose.
Charlie RoseBill and Melinda Gates and Warren Buffet changed philanthropy in 2006, and now they are doingit again. In a dramatic announcement that could have huge implications for the world of giving,the three of them said today they're asking America's wealthiest people to pledge at leasthalf of their net worth to charity. They're calling it the Giving Pledge. It encourages donors to give to their favorite cause, but not to any particular foundation. Today's announcement does not ask for specific grants. It simply asks for a moral commitment. There have been four pledges already acknowledged. They are Eli and Edith Broad, John Doar, Gary Lenfest, and John and Tashia Morgridge. If successful, the pledges could generate $600 billion for a wide variety of specificneeds. The historic partnership between the Gates and Buffet began in 2006, when Buffet pledged99% of his $40-plus billion fortune to the Bill and Melinda Gates Foundation. Bill and Melinda Gates and Warren Buffet came to our table to talk about that extraordinaryjoining of forces at the time.
WarrenIt's something I've always planned. My wife Susie and I had planned that whatever I made would go back to society, and originallyI thought she would outlive me and that she'd make the big decision on it, the manner. But since her death, I had to rethink the best way to get the money into society andhave it used in the most effective way, and I had a solution staring me in the face. I'd seen Bill and Melinda do what they have done with their foundation. They've done it with their own money. They've poured themselves into it. The decisions are great. Their goals are similar to mine. So the time is now.
Charlie RoseBill has already given you a book to start reading about all these issues. He gave that to me last night. There'll probably be a quiz after the show. We'll get to some of those questions. How much do you know about malaria?
WarrenYeah, right. I think he wants me to contract all these diseases just so I can work on them.
Charlie RoseHow do you two see the significance of this for you, for the causes you serve?
OtherWell, for us, it's just fantastic, because we look at it as doubling the impact. The diseases we've already been working on and the education and the inequities we'vebeen looking at for so long just basically double by Warren's gift, and it's incrediblethe depth that we'll be able to go to on some of these global health issues.
OtherBill?
Bill GatesWell, it's a huge responsibility. In some ways, if you make mistakes with your own money, you don't feel as bad about it as if it's someone else's, so now we're even more intent on doing it right. It's a very exciting time. The advances in medicine and other things we can do to relieve poverty, we've been making good progress, and with the doubling of resources, we think our impact can even more than double, and so it's thrilling, but it's a huge responsibility.
OtherThe idea for the Giving Pledge originated with Warren Buffett and led to a series of dinners organized by the Gates. The first was held in 2009, hosted by David Rockefeller at Rockefeller University. Other dinners across the country brought together men and women of huge wealth to talk about the experience of giving. The Giving Pledge is targeted at the richest billionaires in America. Hopefully it will spread around the world. I flew to Redmond, Washington last month to record a conversation about today's announcement with Warren and Bill and Melinda. It is their only television appearance regarding this extraordinary pledge. In addition to this program, Carol Loomis also has a story in an article called The $600 Billion Challenge, appearing today in Fortune Magazine. At the time of the conversation with Bill and Melinda Gates and Warren Buffett on the Microsoft campus in Redmond, I agreed to delay telecast of this conversation until the joint announcement could be made in Fortune Magazine and on this program. We began first asking Bill Gates what is the pledge, what they hope it achieves, and how it came about.
Bill GatesWell, it's quite simple. The idea is that people who are engaged in philanthropy will write a letter talking about what they're doing, and they make a commitment to give the majority of their wealth, either during their life or through their will. And we want to get the people who do this together. We think they can share ideas, learn from each other, encourage others, and so we're kicking this idea off and going to invite lots to join in.
OtherSo you can give at any time?
Bill GatesYou can give any time. The idea is to make the commitment, to get over the hurdle of saying, don't wait until I think about this later in my life, but think about it now and think about giving. And we hope, actually, a lot of people will end up choosing to give during their lifetime because it's not just about giving their money. They can wait until the end if that's what they want to do, but when people start thinking
Warrenabout philanthropy and putting their minds to it, it can change society. And so it's neat to get together and to get to talk with people about how they are thinking about their philanthropy.
QuestionerThe pledge is a contract or a moral obligation?
WarrenIt's a moral obligation. We don't want people to go to their lawyers and have them tell them that they need a 40-page document with 28 escape clauses or something. If I would say that almost everybody would make a pledge like this, would keep it. And it's a serious pledge, but it's not a legal pledge, it's a moral pledge.
QuestionerThis is not about the Gates Foundation. This is about this idea that you hope people will buy into. The driving idea is to have people think about philanthropy. Think about what?
WarrenWell, it really came out of some dinners that we had with people who are engaged in philanthropy, and it was so wonderful to hear what they were doing, their excitement, how they changed over time. We decided that that was so helpful to us, and it drove up the energy in the room for I think everybody through three different dinners we did like that, that the discussion became, okay, how do you draw other people in? People tend to wait. They may not know all the neat things going on. And so through those discussions, the idea of a pledge came up, and actually by the third dinner it was quite concrete. Keep it simple. It's not a pooling. It's not saying some way of giving is right. It's a pledge, and the people who take that pledge will be getting together and celebrating the diversity of the way they do things.
QuestionerHow did the dinners come about?
OtherWell, we started originally I think talking about just the idea of what stimulated us to give back and how do you stimulate other people to do it? And I think Warren initially started that conversation with us, and we said, well, let's get some other people together to talk about this. And so then we had this idea of having this first dinner, which David Rockefeller hosted. And then from there it kind of just took on a life of its own because people brought in their own thinking to it and their own ideas, and then that's where we ended up landing on this idea of, yeah, let's give a pledge. And I think one of the cool things we learned in the dinner is that we know this philanthropy is very personal, and so to us it doesn't matter what people give, whether it's to the culture or to climate or to humanity or societal issues. It's what they're driven by that gets them to give, and we just want to make sure that
Otherthey're thinking about giving, and there's a lot of energy around that now.Take me back to the first dinner and what it was like, and what was the feeling, whatwere the questions?
WarrenWell, we didn't know going in. I mean, and David Rockefeller was very nicely hosted this dinner, and we had maybe seven,mostly couples. There might have been one or two that were there singly. And we just started going around the table, and I asked each, either couple or individual,to sort of give a story of the evolution of their own philanthropic thinking and how theygot where they are now and what they hope to accomplish. Well, it was incredible because it was probably two hours to get around that table, Charlie. They wanted to talk about their ideas, and they wanted to listen to the others. I mean, they were just as interested when the other person was talking as when theywere. So by the time we got around that table, I think maybe we were starting to form a littleidea that if this sort of enthusiasm and commitment could be talked about to others, that theremight be many people out there who really have sort of postponed thinking about whatthey're going to do with their wealth and all of that to get active now. And what were the kinds of questions people asked? Well, everyone has their own story of what cause drew them in, how they involved theirchildren, how they learned about that cause. And they had a lot of questions. Critics came up that there were a lot of different ideas around, but the general energyand kind of a wish that you could share how much fun it is and that people knew what impactyou could have. And one thing Warren likes to say is no one said that they felt bad that they'd giventhe money. Everybody felt more fulfilled, were able to use their creativity in some special ways,and they wanted to think about how you would share that. And what it's ended up being is this very straightforward pledge that's going to leadto people getting together on a regular basis. But Charlie, I would bet if of the three dinners, maybe there were 20 or so couples involved,I would bet that a number of them, as committed as they'd been before, left with new ideasand an even firmer determination to get on with it in terms of what they'd already believed. I mean, it was, you know, maybe that's what happens at church services. I don't know. But all I can tell you is it was noticeable.
QuestionerHow are you going to choose who you're going to reach out to to propose a pledge?
OtherWe thought we'd start with you, Charlie.
OtherYeah, there you go.
CharlieWell, the people who came to the dinner, actually several of them came to us right after and said, I'm really interested in this idea. So we already have four people that have said to us, look, we want to be included in trying to help get others to give. But we'll reach out to the 20 or so couples that came to the dinner, you know, after this, after we start talking about it more. And then we and they will continue to reach out to others to say, this is something that's doable. This is something we'd like to get people to sign up for. Is there a structure? Is there a process? Is there an organization to be? There's a website called givingpledge.org that people can go to. And that's where we will put up all the pledges. There will be people who sign the letter that say, I'm going to give away 50 percent. The letter will be up there, the pledge. And then people will write a bit, like a one-pager, two-pager, about how their philosophy of giving. Those will all be up on that website. And as well, that website will link to other places. There are a lot of other people that have been giving for a long time or think about giving. There's a website called bouldergiving.org that actually helps people think about how do you give your money away. And we'll link out to those places.
QuestionerSo, Warren, somebody comes to you and says, I've been reading about this. Tell me why I should do a pledge.
WarrenWell, you should do it only if it appeals to you personally. It's your money. And I'm not going to tell you how or why. I can tell you what it means to me. And I can tell you what it's meant to a number of other people that I've talked to over time. It's different for every person. They've got different kinds of assets. They've got different interests. If somebody in their family was hit by a specific illness, they're much more likely to be interested, for example, in research on that or something of the sort. But what I would tell them is at least think about it and decide what you want to do. The many, many people, you know, rich people live longer. It's one advantage of being rich. And so often those wills are made by people in their late 80s or early 90s when their faculties aren't as good, when their thinking isn't as good. It's part of the reason I made a decision when I did, you know, four or five years ago because I did not think my thinking if I lived to be 90 would be as good as my thinking at
Other75 or as clear.And we just want people to decide what they want to do but to listen to the experienceof others who have decided to go in a given direction to see whether it appeals to them.And I think it will appeal to many.What has it meant to you?
OtherWell, I've had a philosophy really sort of all my life on what should happen with myBerkshire share.So every share is going to go to charity.And the truth is I've had everything in life, everything in life I've ever wanted.I have never given away any money that's caused me to give up a movie or a dinner or a tripto Disney World or anything of the sort.So it's cost me nothing.So I have these little pieces of paper in a safe deposit box which I bought about 40or 45 years ago and they've grown in value enormously.And what they are is they're claim checks on something in the future.I don't have anything I need in the future.All kinds of other people have all kinds of needs.And it's a way of cashing those claim checks in a way where people's lives are changedfor the better.And mine's already changed for the better.I mean, it couldn't get any better.And if those little pieces of paper can translate whether it's into children avoiding diseases,becoming better educated, whether people having a better life in their old age, whatever itmay be, it's terrific.And I think a lot of people feel the same way.What has it meant to you to be engaged in a philanthropic effort that touches the livesof other people?
OtherWell, it's become really our full-time focus.And there's so much that can be learned.There's great progress that gets made.There's setbacks.There's partnerships you find.People who work in the field, people who do science.And it's been way more fun, way more engaging than we would have anticipated.And the opportunities are so clear.Now, you know, our way of going about it is one of many, but it's been really the mostspecial experience, I'd say, for me personally and for us doing something together as a couple.
OtherAbsolutely.I think, and if you'd said to us, would we be as involved as we are now, at the age aswe are now, if we looked back, you know, when we first got engaged or first got married,we wouldn't have known that we were going to be so drawn in and that it would be sucha deepening part of our lives.I was just in India in March.And the person I wanted to come back and talk to about it was Bill.Bill just got back from India Saturday morning.
OtherWe spent a lot of Saturday talking about then what he learned in India. So to be able to do it together and to see how it's evolved over time for us as a foundation and as a couple, I think that has been really engaging for us. And as we talked to these other families when they came to these dinners, hearing how they got started, where they started in one place and they evolved, I think that's what it's like for anybody that gets involved for whatever issue that they choose.
QuestionerAre there reasons that people don't do more today?
OtherWell, I think they postpone the decision very often. Because it's complicated? Because they don't quite know how to go about it? Some people, you know, think, you know, how would I start a foundation or something of the sort? Or how will I handle it? Just assume that they've got a private business that's worth a great deal of money. But, you know, they think, how can I actually start giving money away now without giving away my business or something? And there's answers to all those sort of things. And actually, in talking to these people at these dinners, we learned how they dealt with problems like that. But until they listen to somebody else, some people may just decide, I'll think about that tomorrow.
QuestionerIt sounds like these were emotional dinners. I mean, people talking with...
OtherThey were. People were telling their life story. I mean, I felt like a psychiatrist at some point. I mean, they talked about, you know, most of them had children, or many of them had children that participated with them. Some of them had children that opted out from it. I mean, they had all kinds of different experiences. And people were fascinated by it. I mean, you know, you've heard Bill and Melinda just now tell about their story.
QuestionerChanging their minds.
OtherYeah. And we heard tale after tale like that. Charlie, I think in our San Francisco dinner, it may have taken us three hours to get around a table where like seven couples spoke. I mean, they opened up. They really opened up.
CharlieIt's a real mind shift if you've been making money. You know, giving away is a bit different. And you're not sure if you're going to find your way in it. You're going to find something. So it requires taking a little bit of a leap. And you don't know how fulfilling that's going to be. You know, you need to pick your scope because otherwise you're going to get more requests than you'll know how to deal with. You need to think about the structure and how you involve people.
WarrenBut it is so fulfilling.And these are very talented people.Society is better off if they choose to take some of their insights.You know, some of the great people they know who also want to work in a philanthropic wayand draw them in.If they're collaborating with others.You know, even though there's no agenda in the Giving Pledge, we do expect that peoplemeet each other and find common causes to work on together.No matter what it may be.And we saw a little bit of that in the after-dinner conversation.So we want more critical mass around this.We want more lessons.We want more, hey, think about it now.Get involved in an earlier way.And the people at the dinner said, yes, this is very straightforward.But it's something they felt that really should be done.I think there's two things that you bump into.One is people feel they will be swamped with requests.I mean, they see their life just being a big lion outside their office or something of the sort.And nobody's looking forward to that.And the second thing I think they worry about is their money being used effectively.I mean, they'll read a story about this charity or that charity.They're used to having measurements in their own businesses or whatever it may be.Things that are very specific.They're used to thinking about doing something through other people to help people 10,000 miles away.So they want to learn more about how do you do this right.And if they listen to the kind of people we listen to, they will learn more about how to do it right.And we'll teach them how to say no to those people they get lied to.
QuestionerTalk a bit more about the emotion of what it was like in the room with people at these dinners.It's such a pivotal place to turn you guys into creating something special.
WarrenI think that's what surprised us the most.We went into these dinners and you kind of didn't know what to expect.But to hear couples really talk about how they wrestled with this over time.I heard one couple said, it was really sweet.He said, I always know my wife is going to bring up a big topic about philanthropywhen we're driving together on a long drive and she turns the radio down.And they went on to talk about the most substantial gift they'd ever given.Their first enormous gift and how that then led to a lot of other gifts and how they think about it.So what was so neat about the dinners was people talking about sort of how they thought
Questionerthis early part of their life of making the money but then how their mind was starting to shift.And how some of the really small gifts were impactful to them but how the large gifts were too.And then to hear them share with one another.Here's where I started with my target.I didn't really know where to go in this space but here's how I learned.And then somebody else would say, oh but I thought of that in education too.How did you tackle this particular piece?Because a lot of people are talking about in some cases education in the United Statesif that's what they're interested in or climate change.So I think that's what drew us in.And one of the things Peter Singer talks about in his book about saving lives is he says,you know, we do what our reference set does.And so if you see somebody in your reference set doing what feels right to youand you see them having success in it, actually making change,you're more likely to act and you're more likely to be at your best.And I think for us sitting around that table, we were sitting with our reference setand we were hearing amazing things we didn't expect to hear.
QuestionerWhat's the metric of success?
QuestionerI think it's saying that we've gotten people earlier in their life,in this reference group of people, in this set of billionaires,to think earlier in their life about how they're going to give money back.Whether it's during their lifetime or whether it's at their death.But that they've planned for it.They haven't pushed that decision off.And they've really started to think about it and to get going.And if we've done that amongst this set and said,that really is the way to think about philanthropy,you should think about these resources going back to society,then I think we would have started the conversation and felt great about it.In 2008, I just looked at the most recent estate tax figures.The estate tax forms that were filed, a little less than 40,000 of them,showed estates of about $230 billion.That's one year in the United States.About 12% of that was left to charity, of that $230 billion.I would hope 10, 20, 30 years from now that that number is a lot bigger than that.And I'll bet it will be.If this is a roaring success,what are the possibilities and the difference it can make?Well, the history of philanthropy is an amazing thing.You know, the libraries in America, Carnegie had a lot to do with that.Some of the medical research, Rockefeller had to do a lot with that.
OtherHighlighting causes that later became something that the government got involved with.Looking at the schools that the blacks were going to in the South,Rockefeller gave a lot of money to thatand really showed the incredible injustice that was there.So we're building on a legacy of some brilliant work that really made a difference.And even in this era, we have people like George Soroswho have been creative going into the new societies in Eastern Europeand trying to get those going.I think he made a huge difference.He took a big risk.That's so creative.And people like Chuck Feeney who've done amazing things.So if you look, there are models.Now, we want diversity.We don't want people to fall into exactly the same patterns that other people havebecause the new ideas are so catalytic.But it really makes a difference.And it's kind of the best of capitalism.Somebody makes money, which is very enjoyable.As Warren said, you lack for nothing.And then hopefully, you're taking that abilityand you're being smart that you say,okay, I was lucky.Now, let me create good circumstances for other people.In education, I know there's a lot of philanthropists that are funding things.It's making a huge difference in global health and climate.There's a broad set of things that would never happen without philanthropy.But the point is, and you said this to me in a previous conversation in November of 2009,it's really when you think about what could be doneand how huge the problems are,what we're getting from philanthropy today is just a small beginning.Beginning.It is just the tip of the iceberg.But it can be used as a wedge on so many societal issues.If you look back 250 years ago,Adam Smith used to say that it was almost futile to even know what was going on around the worldbecause you couldn't reach out and help somebody on another continent with their issues.Well, now, we're so connected as a world, both from transportation to communication.We even have people at very small levels.You can go up on the website and give something through Kiva.organd help a woman with her farm in Africa.Or in the U.S., teachers now post what they need in their classroom.And through DonorsChoose.org, I can go say, or Warren can say, or one of these philanthropists,I want to make sure she gets the lesson plan funded that she needs or her science lab.We're that connected.So whether you want to give in your local community,
Warrenyou want to give to something in the United States,you want to give something across the globe, it's easy to do now.And I think, for me, that's the moment in time that we're at now in philanthropy.And that's why this is so exciting.And this is 50% of wealth being pledged.But there are people who've got similar impulses that just don't have money,but they can pledge 10% of their time or something of the sort.The idea is really to have everybody thinking about the subject.Now, we can't do it totally retail, but everybody has the opportunity,whether it's to mentor some young kid or whatever it may be.And I give them every bit of credit, maybe more, than some guy like mewho just hands over some stock certificates.And that is, in fact, a very important point.It is the notion of connecting to what you can do is not limited to being a billionaire.This is not a billionaire's club that somehow has gotten together to say,maybe we can make a difference.It is a powerful idea that has potential.And it's the right thing for that set to do.But really, lots of people are talking about giving back.And people do things that are a lot more difficult than I think any of the three of usor the billionaires do themselves.When they're giving their time or they're giving half of what they make in a weekand they have modest means, to me, those are some of my heroes in philanthropy.You're saying this is what we think is right for the people that we know,but there's lots of people that we hope will be inspired by thisand lots of people we already know that are giving.That's fantastic.You mentioned Peter Singer, who has a whole series of ways at certain income levels,way below a billion dollars, that you can make a certain percentage of that moneyand the difference it can make.Absolutely.Or the Solwin family, who went and talked about this year the book that they wrote.They gave half away as a family where they said,we're going to take $800,000 and give that away and sell our dream house.And they were hesitant to go public with it because they said,they weren't trying to make a statement, but they felt so good about itand they were inspiring others that they decided that was something they should talk about.What are the lessons you have learned?Well, you've got to get into the specific areas to start learning.Some problems are very difficult.Education is so important.Every little bit of improvement can help there.
OtherIn fact, you have said education is much harder than global health.
OtherIt may be.
OtherChanging.
OtherYeah, it's not as subject to breakthroughs.We found that there are lots of people out there who aren't getting funded,whether it's education innovators, whether it's scientists doing new vaccines.And it takes time before you can draw those people in.And so I love the fact that lots of philanthropists focus on a pretty small number of things.If you do everything, then you're not going to get the joy of really knowing it deeplyand having that expertise.For us, we pick a couple of things.The health and education are the biggest things.And we're very happy we did that.We're going to stick with those because it's our focus.But we've got to cover the waterfront.We've got to have lots of different giversbecause there are many causes that we're not involved in that have got to be backed.There's a kind of group support that comes out of it.And that's why we'll gather, after people do pledge, we'll gather them once a yearto really talk about these issues and to let them have workshops.We hope this will take on a life of its own.So they'll talk about how did you get started?What were the hurdles?What target area are you in?How did you think about your kids?And let them really muddle through those ideas.And we'll keep joining because we'll keep learning, too.We hope that this takes on its own life and that they continue to gather.People wrestle with the idea about how to get their kids involved in it.And some of them have been successful at it.Some of them haven't been.But there will be more that will be successful if they listen to the ones that were successful.
QuestionerIt is said that the entrepreneurs today, younger entrepreneurs,are thinking more about philanthropy earlier than they ever have before.Is that your observation?
OtherI think that's fair.Most of the examples from the past, people waited fairly long.And now when you have things like technology fortunes that are made in your 30s or 40s,that's kind of different.You can get to your 50s or even earlier and actually consider,should I shift my attention to this?Or can I, in parallel, keep doing my work and yet be giving my wealth awayin a way that has impact?I, at first, was reluctant to have the two different activities.And I talked about that and found a way of making it work.And you're going to have a lot more decades of very successful people
Otherdeeply engaged in these issues.That really wasn't typical if you go back in the history of philanthropy.If somebody comes to you and says, look, I want to do it the way you did.I want a hands-on involvement.Should I do it or not?What would you say?If you're enthused to do that, then clearly you should do it.Because the trips you take, the people you meet will draw you in as muchas whatever the wonderful contribution you made in making that fortune.And it broadens you as a person to be involved in these things.You've been involved in it longer full-time than he's been involved in full-time.What's the evolution in your thinking about philanthropy and its possibilitiesand its potential?
OtherI used to sometimes almost worry.I'd go out in the field to these trips to India or Bangladesh,and I'd think, oh my gosh, am I going to come back overwhelmed?Because there's so much need.But in fact, you go on the trips, and every time you do one,you come back and you see a nugget or a possibility or a way to do something.And so I would come back so energized.And then Bill and I would get to sit down and talk about it.And we'd read a whole lot more.We'd talk to experts around us.And we'd learn the whole systematic problem,and then they would show us what's possible.So every time we came back, it was a building on itself.And I would say that's still the way of our philanthropy.We're still learning in all the areas that we've chosen, our target areas.But we really did at some point say, these are our targets.These are the places we're going to focus.When Warren made his unbelievable gift in 2006, he said,keep doing what you're doing.Don't try and broaden out, but keep taking risks.And I think that's the thing we keep doing is saying,let's focus on these areas and get better and build over timeas a couple and as an organization with those that surround us.
OtherYeah, I think people get put off at first becauseas somebody who's analytic, you first have to level set and say,oh, wow, these schools are way worse than I thought.And the food situation of a poor person in Africa is way worse than I thought.And you think, OK, that's kind of a downer.But as soon as you know that level and you say,look at where they get women's groups in,you get better seeds, or you encourage government to takeits resources and use them in a better way,you start to see the success stories.And so as Melinda was saying, the theme at that point is much more,
QuestionerOK, we know where it is, and we're no longer ignoring it. You've talked to people on a global basis. You've talked to people in London and Paris and elsewhere. How is their response different than the American response, if it is?
OtherWell, I'd say one divide we saw is that if it's a first-generation fortune, if the person involved made that fortune, they feel a latitude to decide, OK, a lot of this should go back to society and to pick exactly what that theme is. And because America's had more of those self-made fortunes where you could get enough capital, there was risk-taking that it can happen in a dramatic way, we've had more philanthropy. Where you see in places like India and China, now some of that taking place. There are great examples of people who've committed to give away not just half, but in some cases virtually all of their money. So I'm not sure there's that much cultural difference. I do think it's valuable to get that initial innovator thinking hard about what should happen to these, what Warren calls, claim checks.
QuestionerThe idea, too, that is fascinating to read about this is a sense of how desperate the money is needed. Now, as much as you guys have, and as much as the Foundation has, there's so much more needed, that the central fact is the need for more funds. It's huge.
OtherAnd anybody who gets into this, their funding can only be catalytic, it can only be the wedge, the money that comes out of philanthropy will still be tiny compared to the world's needs. And so you have to always say, how can the thinking that comes from these organizations, or the risk that these organizations will take, because they'll think of a problem in a different way, or they'll tackle something in a different way, with their money, how will that then spread to actually change a societal issue? And that's how you've got to, when you focus on the big issues, that's how you've got to think about it. And that argument, incidentally, there will be certain people and if you can show them how their money might be leveraged, that really appeals to them. Leverage is an idea you understand.
QuestionerYeah, other people, it's just the emotional, looking at a child that's been paralyzed, or something, people respond to different motivations, but the leverage aspect is an important aspect. And this is the first generation, I think we can say, that these issues really are kind of solvable. Can everybody on the planet have access to good education? Can everybody on the planet have access
Otherto the food that they need?Can we take the American dreamof opportunity and renew thatby having a better education system?These things are within reach. If you were a philanthropist50 years ago,you just weren't going to seethat the full achievement was possible. If you narrowed your visionto your neighborhood or your countryand that was a good wayto go about it. But the amount of wealth in the worldreally is phenomenal now. And incentive systems meansthat it's very unequally distributedand those incentive systemsare very good things. What allows you to havethose incredible incentive systemsand yet equity? Well, philanthropy is one of the answers. Government programs along with philanthropyare really the way that you can haveaccess to both worlds. I would argue even in terms ofthe wealthy giving to philanthropy, I would argue thatit's not a bad thing in terms of your family. I mean, if you look atthe Rockefeller familyand the dozensand dozensthat come from John D. Sr., I think the fact that he behavedas he did in terms of philanthropyand that his son then behaved that way, I think it's set a tonefor a family that is vastly differentthan where you've seen peoplebehave in exactly the reverse manner. I would say very few familieswould be hurt in any wayby having active participationin philanthropy and I think manywould be helped a lot. In my own case, I think it's beenvery, very good for my family.
QuestionerTell me how.
OtherWell, I've had three childrenand I enable them, my wife and Ienable them to have their ownand I think they've become better sensitizedto the problems other people have in this world. I think they raise their own childrenin turn better. I think they have better valuesbecause they've actually been ablereally through my wife,initially probably 99% responsible,but they havebeen sensitizedto what you can doin this worldand they've gone out and done itand they've combined their own energieswith the money that was allowed to themand I think they have a better feelingabout themselves. I think their children have a better feelingabout them. I know their parents have a better feelingabout themselves. I think a philanthropic familyon balance, I mean there's all kindsof exceptions, but a philanthropic familyon balance is going to feel betterabout themselves and their progenythan a family that has beenhanging on to every single penny. Who would have guessed that a few years agoa Pulitzer Prize winning book, Mountains Beyond Mountains,
Otherwould be about Paul Farmerwho really was backed initiallyby this incredible philanthropist in Boston,Tom White, who at age 63in 1983 he meets Paul Farmerwho's 23 going to Harvard Medical School.They hook up. Paul starts a clinic in Haiti.He's now got multiple clinics in Haiti.He's now gone to Rwanda and is workingwith the Rwandan government to transformthe Rwandan health system.Because of that linkage, there are now college studentsand I know high school students, it's requiredreading to read that book.Kids are starting to think about philanthropyin a different way and saying that's a possibility.I could actually change somethingin the developing world like this guy did.But he needed to be backed by somebodyso the pieces have to go hand in hand.I think you've got that generation thinkingearly on about how do I give backand what would it mean to my life to give back.I think that's a great thing.Are we down the road looking at something more than justa website? Are we looking at a structureand an organization that if this thing really getsoff the ground in a way that's remarkable,you will need more than a website to do it?
OtherWhy are you smiling?
OtherI think it will be a movement that does growand probably gets organized in some way.You can feel that from the 20 or so we interacted.They not only want to be doing what they're doing,they want to carry the message to others.They want to proselytize.They do.Plus, there is this aspect of it.I think it's a good thing.I think it's a good thing.Plus, there is this aspectabout being smart about it,both maybe in the way youhandle the assets to get intothe giving stream and thenonce it's in the giving stream,how does it be smartermaybe tax-wise for some people?Who knows?They will want to share ideas.Obviously,we should helpand they should help in setting upsome kind of facility over timethat regularly hasa forum forsharing those ideas.There will be peoplethat have different ideas about where the philanthropyshould go.I'm not there to judge them,but if they have a good case,let them make it to other people.I think these four families that have already saidthey definitely want to be part of it.The Broads, the Lenfest, the Mortgages,the Doors, they will also startto talk about it and talk amongst their friends.I think it will have an energyof its own and that groupwill decide exactly how this gets carried outand it will probably change a little bit over time
Otheras they learn what works when we get the first group together in the fall and say what really resonates. That was the idea, just to get it rolling and get the momentum to happen and then see what organically comes out of it. But to really get people to say this is the right thing for this group to do. These people are doers. There were no shrinking violets.
QuestionerI want to go back to that. Tell me what you heard in these meetings that just touched you.
OtherThere's people like Chuck Feeney who have given almost everything away. That's quite a phenomenal story. People like Ted Turner who felt he was blazing new ground and wanted other people to do it as well. Then you have people who found needs that were what pulled them in. They didn't even expect to be pulled in but the more they knew about the need and the impact, they felt, boy, we really should do this thing. Many of them talked about their parents and how proud their parents would be. I think the other thing that was really touching in one of the dinners was as people talked about their children and how do you include them or not. One of the families talked about how they had an initial target on health and human services as a couple. Their kids were just getting into their 20s having their own careers but they'd given the kids a little bit of money to let them start to figure this out too. How the kids have now drawn them in a slightly different direction and what the kids want to do with the money. They say, look, we're now giving as a family. We enjoy doing it together. When we leave and what's left to give is in the hands of our kids and we feel great about how they're doing it. They felt phenomenal about that.
QuestionerAre there things that government should do in order to make this project better?
OtherI think it's very important that when philanthropy shows something can work that there's some mechanism through the democracy to have government benefit from the kind of experimentation that philanthropy puts forward. I think our system in the United States is a mixed system where we have so much philanthropy in an innovative way giving to many different causes. We've actually grown up so that government and this NGO sector are kind of complementary to each other. It was interesting in China everything is the government today. When we were saying to people you should give or what are you thinking about it, they were sort of saying boy, there's not an established set of things to give to. Maybe these wealthy people in China, part of what
Otherthey need to do is help get that goingso that it's very clearokay, here's how you give to schools,here's how you give to ruralneedy people. The United States isway down the learningcurve on that and many of thoseorganizations are supported by a mixof philanthropy and the government. So I do think there's a bestpractice from thiscountry. You may not know these numbers, butif anybody does, you would. If you just took thenumber that's on the fortune400 list of billionairesor whatever the list stopsand they would make this pledgeAbout $600 billion.$600 billion.
QuestionerYeah, yeah. I'll settle for $550. Okay, but staywith me. Think about what that's what I want to do. What that could do and then think abouthow much of whatever thenut is that the Gates Foundationhas today and what percentageyou use every year. What are you talking aboutin terms of annuallya contribution to a whole range of thingsthat have a need?
OtherPeople give at least 5% becausethat's the minimumdistribution. You have togive 5. Yeah, you can think about$30 billion coming outof a number like that.$30 billion a year is a phenomenalnumber even if you're splittingit amongst dozensof causes. The catalyticchange that would come out of thatwould be huge. A lot of thatwould be spent in the United States. Some of it would go outside the UnitedStates. There'sfertile territoryin both places. Don't forgetalso about foundations pushing on each otherand pushing each other's thinkingto improve, constantly improve. We've learnedfrom so many people that got on earlyon in the charter school movement. The Broad Foundation in education, we sharea lot of goals, but they look at it in a slightlydifferent way. Chris Hahn andJamie Cooper Hahn out of London,they have the Children's Investment Fund. We happen to hook up with them on some HIVAIDS grants. They have made our grantsbetter by pushing on our thinkingabout how we give that money out and how our grantees use the money.
QuestionerWhat is that thinking that so influenced youthat you think is so important that you've learnedabout how to make the grants and how to push it out?
OtherThey'll go through and they might takea problem in a slightly different way than usand they'll say, okay, you're giving your money in this waybut how does the HIV piecehook up with nutrition? The mother has to be able toeat and feed her baby. You're doing these nutritiongrants but are you really thinking about the linkages? In their case, they had gone one step
Otherfurther than we had in their grant making.We backed up a little bit and said, okay, let'slook at our grants in that way.You want to have that intellectual discoursewhere you're both coming at a problemfrom a slightly different way of thinking about itor even thinking about the resources and making sureyou're measuring it. We thought we were great at measuring.Turned out they were slightly better. We learned from them.That's a great thing.
CharlieCharlie, going back to that $600 billion,there's new wealth being created all the time so that sets the tone for countless, I mean we're talking trillions over time because it isn't just a static one-time thing. There will be more coming next year and the year after and they will look at what people did before and what you hope to do is establish a new norm.
QuestionerEstablish a new norm in terms of what's appropriate.How did you settle on 50%?
CharlieWe talked about it in that group.Why not?That number came out of the group.
QuestionerAbsolutely.
CharlieIt's not a maximum.You'll take a hundred.I think there will be some people. Chuck Feeney already has.
QuestionerAbsolutely.
CharlieWay beyond 50.The sentiment in the discussion was get people in because once you get in it'll be rare that somebody will stop at 50%. In a sense if you say to them join this group that's committed to give the majority which has a clear, simple sound to it and take it from there.If you make that bar of coming in which does involve thinking about your estate and your assets and different people around you so it's not an easy step to take but once you take that step our bet is that the average giving in this group, although there will be many ways to measure it, will be far in excess of that 50%.Once you get going and you start giving there's a momentum.That was even true for us early on where we kind of thought we knew how much we were going to give and then we enjoyed it so much we started giving more in our lifetime and I think we'll see that amongst you.
QuestionerWhat was the enjoyment?
CharlieKnowing that you could give a child the chance in the United States to get a great education and all we're doing if we can do that is setting them on their way. It's up to them then but you're handing them the opportunity.You're getting them to that starting line because our parents could afford a great education.I think there's two ways it's fulfilling. One is the outcome just like when you do work and make a great product it's the outcome. It's also the process because in education
Otheryou're meeting teachers who are frustratedbut care. You're meeting students whohave potential that hasn'tbeen realized and when you sit downwith groups like that you've got a commoncause and you're going to go after itsomebody's going to come up with a new ideajust the activityof being involved for thosewho choose to put the time inis every bit as stimulatingas any piece of business making money activity.
OtherAnd you believejust in terms of the specifics and we've talkedabout this on this program beforewhat you can do in terms of hungerwhat you can do in terms of povertyand if you raise the poverty levelit'll affect the population questionI mean the numbers forchildrenthe fatalities in children will stun youif that can't make you want to make a commitmentthe fact thatit can be brought downwe're at about 9 million children diea yearit's one of many causesit's one that happens to grab meand there aredifferent things people can do to goafter thatand philanthropywill be very catalyticin terms of how quickly we get that downto 6 million to 3 millionandthink of how much more justthe world isin 1960 that number was 20 millionand now we have a lot more birthsso we've made some good progressbetween philanthropy, sciencegovernment givingthere areproblems that appear intractablewhen put on the right coursethings can improvea huge amount
QuestionerWarren, you've made a lot of people richyou know a lot of people that are richI know some that aren't on that Forbes listI could add to that a littledo you think there is within those peoplethat you knowthat this ought to resonateand is likely to resonatebecause you know who they areyou know how they think
WarrenI'm positivesome of them are self-startersmany are in their 80snow and some of them have given awayvery substantial amountswe're not talking 50%we're talking about 90 or 95%with these peopleand others will join inyou know I don't likeI never go out and solicit anybodypersonally on thatbut once they actually see the existenceof this sort of thingand they see some of the peoplethat are mutual friends of ours do itmore money come outand I think over time Warren introduced usto some of those friends over the last 20 yearsand just again hearing what they had already doneand what the possibilities wereif it was educationyou know stimulated our thinking aboutoh that's actually possibleit's knowing that it's possibleI think is what drives a lot of people
Warrento say oh it's doable I want to do itCharlie I've got this group of about 50 or 60 peoplethat get together every two yearsI call it the Graham group after Ben Grahamthe talk the evolution of my philanthropic thinkingI would say that in the42 years we've been doing itthat was probablylistened to more carefullyand remembered best by the people in that groupof any talk we've had in that whole timeI mean that I am sure thataffected some of those 58 peoplein what they did in the subsequent10 or 11 years soif we can get that out of one talk by Bill
CharlieWell what was it you think that maderesonated so much in that talkIt was a logicaland emotional storyof how somebody fairly youngyou know he's still youngbut how he got towhere he was because he didn't start therehe didn't start thereand it was compellingI mean people were on the edge of their seat I wish I'd taped itbut I will guarantee youthe 50 or 60 people in that roomthat listened to thatsome of them changed their behavior because of thatand they're glad they did
OtherIt was even surprising to me because Ithought this would be fun to talk aboutbut you know I could feelthe same sort of dedicationfanaticism you know wow this isobvious this should be donethat I'd brought to the softwareworld my whole lifethat speech was somehowmore fun to give than almost anyspeech I'd givenwhat looked to be complicatedokay you know geez health isn't that a supercomplicated thing actually could beboiled down to a few metrics likethe number of childrenwho survive and a few conditionsthat cause that and a few thingslike vaccines you need to go after itand so it's not necessarilythat specific thing but I thinkpeople were surprised that wowyou know he doesn't likethings that are soft he doesn't like thingsthat aren't measurablehe's clearly had a lot of positive feedbackin his career and hereyou can see that shiftandit reallywas catalytic for mejust going through it.
OtherWhen Bill was getting ready for thatspeech we actually took several long walks because hewas thinking through it to think through how you'regoing to explain your giving to somebody else is actuallypretty tricky and then right after it we tookseveral walks which is how we tend to process togetherto say okay based on thatand even kind of what we heard in the room is there anythingwe want to change about our giving too and that'swhat's so great when you go to try and tellsomebody else why you've done what you've done in the
Warrenframework in which you're doing it and soit ended up being very fun for both of us that Warrenhad asked.
OtherYeah and in a sense when we met these20 couples we asked them to do the same thingthey didn't know when they came to it they weregoing to be asked to do it so they had to do itspontaneously but they rose to theoccasion. And the question was what did you askthem?
WarrenThe question I asked themand everybody answered it wastell me the evolution of yourphilanthropic thinking how did you get to where you arenow because you didn't start this wayandthey told their stories I meanit may have been in terms of things personallywithin their family it may have been the factthey struggled for a long time to make their firstyou know dollars and it was a long timein their life before they got there but oneway or another they each had their journeyand as people listen to those journeys they wereaffected just like my group wasaffected when Bill gave that talk.
OtherI think you said once that he tookthe speech more seriously than any speech youhad seen him faceever before.
WarrenIn quitesome time yeah in terms of justreally stopping and thinking it throughdeeply thinking through how he wanted toexplain how he'd come tothe various pieces of it yeah definitely.
OtherSo what we can hopecomes out of this in part is back to yourpoint that people ask themselvesto think about howthey.
WarrenWell Susie was there withme and she said why aren't you giving more of that?
OtherI know.It is a powerfulidea and congratulationsand thank you for taking this timeto talk about it.
WarrenThegiving pledge is the ideathink about it yourselfand think about the ideas that have beenexpressed here and clearly thinkabout the kinds of thingsthat motivate youthink about what it is that touches yourown heart and what it isthat affects your own emotionbecause that is where you will findthe deepest satisfaction.Thank you for joining us.See you next time...........