The scale of the charity thus unleashed is unprecedented. Mr Buffett already gives away 5 per cent of his Berkshire Hathaway shares annually and has promised to part with 99 per cent of his fortune. Most readers of the Fortune magazine exclusive in which the Giving Pledge was rolled out were pleased with the idea. (The article, which has the tone of a press release, was written by Carol Loomis, an old friend to Mr Buffett and a bridge partner to Mr Gates.) Yet the most striking thing in the hundreds of letters posted on the magazine’s website was the level of anger in many of them. “I guess Mr Bill Gates will give all his money to India,” runs a fairly typical negative comment, “since he was so fond of outsourcing all American computer systems analysts/programmer jobs to India.” The Gateses and Mr Buffett may have misjudged the public mood. In opening their wallets, they have opened a debate on whether it is right that they should have so much money to begin with.
Americans have more material inequality than any other western nation, and yet they tolerate it more uncomplainingly. Maybe the explanation lies in Americans’ very materialism. Naively, they associate money with purchasing power and not with any other kind. If a person is worth $50bn, that means that he can, if he wishes, buy 50m really nice flat-screen televisions or a million new M-Class Mercedes. It is not much to be jealous of.
Americans have a hair-trigger sensitivity, though, about money being converted into political power. Corporate lobbyists are essential to any well-functioning modern democracy, yet figure in the public imagination as outright scoundrels. In January, a Supreme Court ruling overturned limits on corporate funding of campaign advertisements. The decision was the right one on free-speech grounds, but it has divided public opinion. The president attacked it in his State of the Union address.
If there is something wrong about businessmen campaigning through their money, there should be something even more wrong about businessmen governing through their money. Yet governing through money is what most present-day philanthropy does. Very few billionaires “give away” their money, in the sense of surrendering control over it. They deploy it, through tax-exempt foundations, to ends of their own choosing, and this can have disruptive effects on democracy, no matter how noble the hubristic billionaire believes his aims to be.
The Gates Foundation, for instance, has pledged $650m to schools in recent years. It has awarded millions of dollars to individual states to compete in the administration’s “Race to the Top” programme. It has made $100m in grants to Hillsborough County, Florida, to develop more rigorous teaching standards. These may be excellent ideas (certainly school teachers have shed too much accountability since they unionised in earnest in the 1970s), but education’s gains are democracy’s losses. Private wealth amplifies government powers beyond what is constitutionally sanctioned. It distorts incentives. It can render authorities reluctant to enforce regulations or laws against a benefactor.
“If you make mistakes with your own money,” Mr Gates said in June, “you don’t feel as bad about it as if it’s someone else’s.” The problem is that charitable foundations, when they work with government, end up drawing in taxpayer money as well. Mr Gates often speaks of the importance of “leveraging” his investments, and Mr Buffett said of his fellow billionaires, “if you can show them how their money can be leveraged ... that really appeals to them.” Clearly Mr Gates sees an almost formal decision-making role for billionaires in a new constitutional order. There are philanthropists on one hand and what he calls “the democracy” on the other. “Our system in the US is a mixed system,” he told the talk show host Charlie Rose last month. “Government and this NGO sector are kind of complementary to each other.” Mrs Gates said: “there’s no agenda in the Giving Pledge”. But billionaire philanthropists share an interest - a class interest - in maximising control and leverage, varied though their charitable preoccupations may be.
The Giving Pledge puts the billionaires it exhorts on a slippery slope. If it is not to be mere rhetoric, then it must bring peer pressure into play to convince them that there is something wrong about holding on to the bulk of their wealth. Political considerations are more decisive than moral ones. If everyone on the Forbes 400 list of the world’s richest pledged half his fortune, $600bn would be disgorged. Until recently, it would not even occur to voters to tap that wealth through taxes. But two things have changed. First, American taxpayers of modest means have pledged - involuntarily, through bail-outs and stimulus plans - considerably more than $600bn to protect the economy that did them so much harm and the billionaires so much good. Second, the pace of high-tech innovation has slowed dramatically. When the entrepreneurial goose stops laying golden eggs, the political case for leaving its wealth alone weakens considerably. By providing a new benchmark against which the rich can be found wanting, the
Giving Pledge will weaken it further.
hair-trigger: Tipo de gatillo especialmente sensible. Como éste, cualquier cosa que reaccione ante el menor estímulo.
slippery slope: Pendiente resbaladiza. Que se encuentran en una situación extremadamente difícil.
when the entrepreneurial goose stops laying golden eggs: Cuando los emprendedores dejen de ser la gallina de los huevos de oro.