Interesting Times: Buffett and Birthright

What Jewish billionaires can learn from the world's two richest men

By SAUL SINGER
June 29, 2006 12:11
4 minute read.
saul singer 88

saul singer 88. (photo credit: )

 
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The numbers are staggering. Warren Buffett, the world's second-richest man, has given most of his fortune to the foundation of Bill Gates, the world's richest man. Buffett's gift is the largest in history: $37 billion, based on current share values. That's more than twice - adjusted for inflation - what John D. Rockefeller and Andrew Carnegie gave away, combined. And it more than doubles the size of what was the world's largest foundation to $60 billion in assets - about the GDP of Kuwait. Even before this, Bill Gates credited his friend Buffett with inspiring his decision to give away most of his wealth. Now Buffett has set the same example, and added a new precedent: massive giving to someone else's foundation. Buffett had his own, not-insignificant foundation, and said he would have given his fortune to his own foundation if his wife, who ran that foundation, had not died in 2004. Then he "came to realize that there was a terrific foundation that was already scaled-up - that wouldn't have to go through the real grind of getting to a megasize like the Buffett Foundation would, and that could productively use my money now." What a novel concept: giving the bulk of your fortune not to your own foundation, or to your own family to spend, but to where it can be spent most effectively. It is the philanthropic equivalent of the business concept of economies of scale; the first mega-merger in the world of giving. Now the Gates Foundation will be able to do the two main things it is doing - tackling deadly diseases in the developing world and reinventing high-school education in the US - with even more resources. Using the results-orientation of the business world, Buffett and Gates will probably do a better job spending their own money on these causes than the UN or the US Department of Education would have. IF THE Buffett-Gates philanthropic model catches on among the billionaire set it could have a significant impact on the world. Twenty years ago Forbes found 140 billionaires in the entire world. Just three years ago they found 476. And this year the magazine reported on 793 billionaires with a total net worth of $2.6 trillion. Given that over a billion people live on less than $1 a day, such a sickening concentration of wealth seems like a ringing moral indictment of capitalism. But what if our globalized economy became a giant engine for privately-funded efforts to solve the world's problems? We can only hope that the example of Buffet and Gates does become the norm among the mega-rich, leading to a more effective transfer of wealth from one end of the spectrum to the other than any redistributive tax or other coercive system could achieve. The implications for the Jewish world of this model are substantial. The 12th and 14th richest men in the world, Michael Dell and Sheldon Adelson, are Jewish. About 20 of the 25 New York City billionaires on the Forbes list are Jewish. Six of the billionaires, together worth over $16 billion, live in Israel. Some of these Jewish billionaires might want to join Buffet and Gates in addressing mega-problems with their mega-wealth. There is no shortage of deserving causes. But one such worthy mega-cause is reversing the demographic free fall of the Jewish people. WHEN BUFFETT cast about to find the most effective way to spend his philanthropic dollar, he settled on the Gates Foundation. Luckily, the Jewish world already has a philanthropic project with the ambition and capability of putting at least $1 billion to good use: birthright israel. Birthright brought its 100,000th participant to Israel this year, among 22,000 18 to 26-year-olds from around the world. A new Brandeis University study has found that birthright participants are more connected to Israel and the Jewish people than their peers who applied but were not able - because of funding limitations - to join the free, intensive, 10-day educational trips. The study also found increases - some dramatic - in participation in on-campus Jewish activities and the desire to marry someone Jewish and raise Jewish children. Birthright is now trying to raise $40 million in matching funds which, combined with $20 million from the Israeli government, would fund 30,000 participants. But even this is not enough to fully fund the waiting list of applicants; and that waiting list would be much longer if birthright had not throttled back its marketing efforts in order not to disappoint even more potential participants. Each year the age cohort that qualifies for birthright includes 80-100,000 young Jews. About 85 percent of Jews celebrate a bar or bat mitzva; let's say that our goal is for participation in a birthright trip to become a similarly universal norm. Funding this dream would cost about $170 million a year (not counting critical follow-on programs), so doing so over a decade or two would be an ideal project for Jewish multi-billionaires looking for a mega-project worthy of their vision and fortune. ELSEWHERE IN this newspaper, Michael Steinhardt - a birthright founder - writes of the $100-million Fund for Our Jewish Future he is trying to create: "The Fund will be the first peace-time, non-crisis drive of this magnitude, signaling the community's fundamental embrace of Jewish education." Who will take up Steinhardt's challenge? Some Jewish billionaires should, of course, join Buffett and Gates in trying to alleviate global suffering. Judaism has always believed in taking responsibility for humanity, not just for its own people and community. But if Jews do not take up our own cause, no one else will. Birthright may be the first, most obvious, and most ready mega-project of the necessary Jewish renaissance, but others are waiting to be created by Jews with the resources and vision of Warren Buffett and Bill Gates. saul@jpost.com

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