No matter how much Warren E. Buffett has been criticized for not giving away more of his billions, he is unlikely to waver from his belief that the best thing he can do is leave all his money to charity after he’s dead. That way, he reasons, he can keep using his investment magic to keep multiplying the amount available for his philanthropy.
Mr. Buffett, 67, who is worth an estimated $21-billion, owns more than 40 per cent of the stock in his Berkshire Hathaway investment company. He has made clear that he and his wife, Susan T. Buffett, will give the Buffett Foundation all of their stock upon their deaths. Such a gift would instantly make the Buffett Foundation the nation’s largest, overshadowing the Ford Foundation and all others.
Although Mr. and Mrs. Buffett have devoted many of their gifts to date to the cause of population control, he told the Omaha World-Herald in May that they would place no restrictions on how the Buffett Foundation could spend the huge bequest.
“I’ve told the trustees that they can do anything they think is the thing to do at the time,” Mr. Buffett said. “I tell them that their decisions above ground will be a lot better than mine six feet underground.”
Mr. Buffett added: “You don’t know what the major problems of the world will be or what the funding sources will be or anything. So they have total discretion.”
One of the foundation’s directors, Mr. Buffett’s daughter, Susie, told The Chronicle that she did expect that population control would be the foundation’s top priority.
“That’s what my father has always believed was the biggest and most important issue, so that will be the focus,” she said. “I feel as his child that it’s important to carry out his wishes. It’s his money.”
Mr. Buffett’s plan to give away most of his money posthumously was slammed in a highly publicized speech last April by Ted Turner, the Atlanta media mogul.
“It really is imperative that the richest people step forward and make a contribution. Warren Buffett and Bill Gates [of the Microsoft Corporation] give almost nothing away,” said Mr. Turner, who later announced a pledge of $1-billion to help the United Nations.
“Warren Buffett, he’s a decent human being, he said he’s going to give his money away when he dies for population control,” continued Mr. Turner. “He may live 20 more years. By then, the world’s population is going to double again.”
Mr. Buffett has not commented publicly on Mr. Turner’s remarks. In 1993, he told Forbes magazine that he preferred to make his big gifts later in life after his Berkshire Hathaway stock grew in value. “When I am dead, I assume there’ll still be serious problems of a social nature as there are now,” he said. “Society will get a greater benefit from my money later than if I do it now.”
Mr. Buffett’s daughter, Susie, said that she was irritated by Mr. Turner’s statement.
“My father is not just going to dump a bunch of money all over the place so that he can say, Look, I gave away a billion dollars,” she said. “The last thing in the world my father cares about is getting any attention for anything.”
She added: “There will be zillions of dollars there when he dies, and it will all go out to charity. If my father found something now that he thought was worth giving $1-billion to, he’d probably do it. But in the meantime, it keeps growing, and it’s all going to get given away someday.”
“Anyone who is giving away money has the right to give it to whatever they want to give to,” Ms. Buffett said. “Other people can criticize it, but it’s their own business.”
Even before it receives its giant windfall, the Buffett Foundation has been handing out millions of dollars to a variety of causes.
The private fund, which does not accept grant applications, has assets of $22.7-million and gave away nearly $10-million in the fiscal year ending June 30, 1997, according to its informational tax return.
Many of the Buffett Foundation’s grants went to organizations that promote population control, including: five totaling nearly $1.4-million to the Population Council in New York, one for $500,000 to the Center for Reproductive Law and Policy in New York, and 16 worth nearly $1.4-million to Planned Parenthood organizations across the country.
Roger Lowenstein, in his book, Buffett: The Making of an American Capitalist, wrote that Mr. Buffett and his wife were firm believers in population control but for different reasons.
While Susan Buffett “was largely inspired by the poor living conditions of people, and particularly women, that she had seen in the third world, Warren conceptualized in macroeconomic terms,” Mr. Lowenstein wrote. “He had a Malthusian dread that overpopulation would aggravate problems in all other areas -- such as food, housing, even human survival.”
The Buffett Foundation has supported many charities that have no interest in population matters, however -- giving especially to organizations in its home state of Nebraska. The fund provided $370,400 to the Boys and Girls Club of Omaha, gave smaller grants to Nebraska colleges for scholarships for minority students, and distributed 15 grants of $1,000 each to Omaha public-school teachers who won the Alice Buffett Outstanding Teacher Award, which Mr. Buffett named for an aunt.
Warren Buffett has found an unusual way to fill up the coffers of his foundation.
For 16 years, Mr. Buffett, in his role as chairman of Berkshire Hathaway, has given its shareholders the power to choose the recipients of the company’s annual charitable contributions. Owners of stock are allowed to designate one to three charities or private foundations that will receive an amount -- $16 this year -- for each share of Berkshire Hathaway stock that they own. The company then makes donations to the designated organizations by handing over cash or stock.
Each year Mr. Buffett makes his own private foundation the recipient of much if not all of his own shareholder-designated gifts, which allows him to put millions of dollars into the organization that do not come directly from his personal accounts.
According to its tax returns, the Buffett Foundation received more than $6.6-million from Berkshire Hathaway -- presumably Mr. Buffett’s designated gift -- last year.
Mr. Buffett created a second, much smaller, private foundation in 1990 in order to allow members of his extended family to make gifts of their own.
Each year, this fund -- the Sherwood Foundation, named for the forest in the Robin Hood legend -- allows each of the following to distribute up to $100,000 to the charities of their choice: Mr. Buffett’s daughter, Susie; his sons, Howard and Peter; his sister, Doris Bryant; and Astrid Menks, a long-time friend.
Mr. Buffett is quiet about most of his own charitable gifts.
Some non-profit leaders privately wish that their famous-son investor would lavish more money on Omaha charities through his foundation or from his own pocket than he apparently does.
Others praise Mr. Buffett for making clear his interest in population issues and never leading local groups to expect more than he will deliver.
“He has succeeded in not setting up false expectations on the part of charities in Omaha,” said an Omaha charity official who asked not to be named. “At the same time, we’re all quick to point out that we all benefit from the people in Omaha who are part of the wealth run-up of Berkshire Hathaway over the years: dozens of people here who are ‘Buffett millionaires’ because they are long-time investors in the company.”
In his most public role in philanthropy, Mr. Buffett is the major force behind the annual Omaha Classic golf and tennis tournament that each year benefits one of four charities: the Omaha Theater Company for Young People, Girls Incorporated, Boys and Girls Clubs, and the Omaha Children’s Museum.
Sandy Parker, president of the board of the Omaha Children’s Museum, which will receive about $800,000 from this year’s tournament, said that Mr. Buffett wanted to be sure that the charity would use this year’s receipts for something substantive and long-lasting.
“If he is going to raise that kind of money, he wants to know that you’ve got a plan,” said Ms. Parker. “He wants to know that you’re not going to go out there and buy 200 pounds of candy with it, but you are going to do something with it, you are going to make things happen.”
In Omaha, the member of the Buffett family who makes charity things happen most visibly is Mr. Buffett’s daughter, Susie.
In recent years, she has served on the boards of the United Methodist Community Center, the Omaha Community Foundation, the Joslyn Art Museum, the Methodist Hospital Foundation, Girls Incorporated of Omaha, Boys Clubs of Omaha, the Nebraska AIDS Project, the United Way of the Midlands, and others.
“I’m very fortunate that I don’t have to work every day of my life,” said Ms. Buffett. “I think it’s important for me to give back as much as I can because I am lucky.”
Ms. Buffett recently led a successful drive to raise $9.3-million to restore a landmark Jazz Age theater in downtown Omaha now known as the Rose Blumkin Performing Arts Center.
One contributor gave $1-million to the effort: her dad’s Buffett Foundation. Rose Blumkin is a long-time businesswoman and friend of the Buffett family. “My father supports the things that he’s interested in,” said Ms. Buffett.
Soliciting for charity is very different for the daughter of a billionaire than it is for the typical fund raiser, Ms. Buffett said. Having wealth in the family “can work for you and against you,” she said. “For you, because you can get in a lot more doors. Against you, because there’s definitely an attitude with some people of, ‘Why isn’t your Dad writing a check instead?’ -- which some people have said directly to me.”
What’s more, Ms. Buffett said, “there are people who feel that maybe my father hasn’t given to their causes and so they don’t want to give to something that I’m working on. I mean, I get sort of punished for what other people think he should be doing. Not often, but it does happen.”
Even so, many charities are grateful to have an association with any of the Buffetts and their philanthropy.
“There are many organizations that have benefited from their generosity, not only funding but also advice and counsel, which is equally important,” said Marzia Jones, director of development at the American Lung Association of Nebraska.
“Warren Buffett would be an asset to any community,” said Ms. Jones. “He could live anywhere in the world. We’re just lucky he chooses to remain here in Omaha.”