I feel as if many people misunderstand how the top 1% are important to philanthropy. To be honest some of the largest donors are in the top .001% category. People claim how greedy we are. However, the data shows that the United States is in fact the most generous nation in the world. Let’s look at the data to reveal just how generous we are. According to “Giving US: The Numbers”, in 2010 total contributions to charity were $290 billion. $211 billion of this total amount was made by individuals. Family foundations contributed $19.5 billion while corporate donations were over $15 billion. Clearly, these are some large amounts.
This brings me to my next point of income inequality. True, there is income inequality however inequality exists in so many different aspects of our live. Brad Pitt and George Clooney have an inequality of women they can get or date compared to the average guy. Obese people have inequality in the terms of the calories they consume. Bill Gates has a net worth has a net worth that is over 104,000 times that of the average American. This is something that professor Don Boudreaux at George Mason has pointed out. Sure Bill Gates has a net worth that is 104,000 times the average American however does Gates enjoy 104,000 times more calories or 104,000 times more homes as the average American or 104,000 times happier than the average person . I think the average person tends to believe that Bill Gates life is 104,000 times better than their own given how much money he has. However, I would argue Bill Gates has a rougher life than most. If you look at his work schedule, how often he travels, and people always asking him for money and the stress that creates I think people would still want their old life back. Everyone wants more money, however if you got to the point of having Bill Gates kind of money it would become more of a burden. Also people like to imagine having as much wealth as someone else but never can imagine the work that has to be put in to earn that money. This is what I call invisible inputs yet visible outputs. People see the outputs of wealth or income yet easily forget how much hard work was put in to get to that point.
Bill Gates has amassed so much wealth he is giving most of it away to charity. In fact the second richest person Warren Buffett is giving all of his money to another rich person Bill Gates! Really what is happening is Warren Buffett pledged nearly all his net worth to the Bill and Melinda Gates Foundation. If anything this will reduce income and net worth inequality. Buffett and Gates are signed the “Giving Pledge” which is a pledge to donate at least 50% of one’s net worth to charity. As of 2010, 69 billionaires were signed up to give away and at least $125 billion has been promised by the first 40 donors. Of course this figure should grow since the billionaires will no doubt get richer which will increase the amount that goes to charity. I have a feeling more billionaires will join which will also increase the amount. It would be interesting to see if anyone backs out if the economy were to collapse.
What is interesting however is that Buffett and Gates want other people to not only pledge to give their money away but also pay higher taxes. My own theory on this is that they want anyone else to never become as rich as them. If you favor the estate tax, higher taxes, and for people giving all their money to charity it makes it harder to amassed large sums of wealth which make Buffett and Gates look even better in historical terms. Buffet and Gates are extremely competitive people and it seems as if they want to enhance their legacy from beyond the grave.
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