Gates and Buffett urge billionaires to give away half their money

Billionaires giving money away isn’t so unusual. When the billionaires giving money away are Bill Gates and Warren Buffett, it’s good, but old, news. But when billionaires Gates and Buffett call out their fellow billionaires to pledge 50 percent of their fortunes to charity, people notice. The billionaire philanthropists announced a campaign Wednesday to persuade America’s billionaires to sign a “Giving Pledge” to donate most of their wealth to the causes of their choice.

The Gates Buffett charity pledge

The latest Gates Buffett charity drive is called “The Giving Pledge.” The Associated Press reports that the two men, who have become friends and philanthropic colleagues, are asking the super-rich to sign a pledge making a public statement that they will donate either during their lifetime or at the time of their death to the charities of their choice. Buffett, chairman and CEO of Berkshire Hathaway Inc., said in a letter introducing The Giving Pledge that he couldn’t be happier with the decision he made in 2006, when he gave 99 percent of his roughly $47 billion fortune to charity.

Billionaire philanthropists

Buffett’s billionaire philanthropy will eventually split most of his shares of his company between five charitable foundations, with the largest sum going to the Bill and Melinda Gates Foundation. Reuters reports that Bill and Melinda Gates have so far given more than $28 billion of their money to their foundation. Since the Bill and Melinda Gates Foundation began in 1994, it has given away more than $22 billion for health improvements in poor countries and to improve access to education and career opportunities for Americans.

The billionaire list

On the billionaire list, Bill Gates had held the title of world’s richest 14 of the past 15 years. He was beat out for number one on the billionaire list in 2010 by Mexican tycoon Slim Helu, whose fortune swelled by $18.5 billion in 12 months to an estimated $53.5 billion. Gates is now ranked second richest man in the world with $53 billion, while Buffett came in at No. 3 with $47 billion.

Will billionaires give money away?

The U.S. has at least 400 billionaires — the most in the world — with a net worth Forbes estimates at $1.2 trillion.  If Buffett and Gates could convince America’s billionaires to give half their fortunes to charity it would transform the nature of philanthropy. Fortune, which broke the story, reports that IRS facts for 2007 show the 400 biggest taxpayers had a total adjusted income of $138 billion, and just more than $11 billion was taken as a charitable deduction — about 8 percent. If all the billionaires give money away, however unlikely, about $69 billion would flood the coffers for the common good.

Gates Buffett charity goals

The campaign began just over a year ago, when Gates and Buffett — who represent a combined net worth of $90 billion, according to Forbes — invited several billionaires to a secret dinner meeting in New York. MSNBC reports that the group settled on a goal of 50 percent of net worth. They set up a website, givingpledge.org, to promote the campaign. If the individuals on the Forbes 400 list of richest Americans pledged half their net worth to charity, that would amount to $600 billion.