- The Giving Pledge turns 10: These billionaires pledged to give away half their wealth, but they soon ran into a problem
- ‘Giving away money well is very hard’
- Where has the Giving Pledge money gone?
- Jeff Bezos tops list of biggest charitable givers in 2020
- Fifth place: The Zuckerbergs
- Broader scope of beneficiaries
- Fact check: Bill Gates has given over billion to charitable causes over career
- The claim: Bill Gates has given over billion to charity
- Bill Gates, philanthropist
- Valuing Gates' fortune
- Our ruling: True
- Our fact-check sources:
The Giving Pledge turns 10: These billionaires pledged to give away half their wealth, but they soon ran into a problem
The Giving Pledge was heralded as a worthy goal when it was announced 10 years ago this week, but those good intentions have been outmatched by a mighty foe: the breakneck pace of wealth creation.
Though they’ve promised to shed at least half of their wealth for the common good, many of the billionaires who have signed the Giving Pledge are richer than ever, the Institute for Policy Studies said; it added that, “while some pledgers earnestly intend to fulfill their promises, many are unable to because their assets are simply growing too fast.”
The list of pledgers includes well-known business figures such as Tesla TSLA, -3.39% co-founder Elon Musk, Virgin SPCE, +0.03% Group founder Richard Branson, hedge fund manager Ray Dalio, Netflix NFLX, +1.03% CEO Reed Hastings and former Citigroup CITI, +1.71% CEO Sanford Weill.
“ ‘Instead of supporting charities on the front lines of problem solving, these billions end up sitting in tax-advantaged intermediaries.’ ”
— Chuck Collins, co-author of ‘Gilded Giving 2020: How Wealth Inequality Distorts Philanthropy and Imperils Democracy’
But they soon ran into a problem. Their giving can’t keep up with their escalating fortunes. The combined wealth of the 62 living U.S. pledgers who were billionaires in 2010 has increased by 95%, from $376 billion in 2010 to $734 billion as of July 18, 2020, according to “Gilded Giving 2020,” a report from the Institute for Policy Studies, a left-leaning think tank.
If these pledgers want to make good on their promises, they’ll have to “dramatically accelerate their giving just to keep up with their asset growth,” the report added.
One notable exception to the list of Giving Pledge signers: the world’s richest individual, Jeff Bezos, whose current net worth is roughly $189 billion.
He and his ex-wife launched a $2 billion philanthropic venture called Day One Fund in 2018 to address homeless and preschool education for low-income children.
Earlier this year, Bezos pledged $10 billion to address climate change. (Amazon did not respond to a request for comment.)
Berkshire Hathaway BRK.A, +2.45% CEO Warren Buffett and Microsoft MSFT, +1.78% co-founder Bill Gates and his wife Melinda Gates announced the Giving Pledge in August 2010. People who sign the Giving Pledge promise publicly to give away at least half their wealth, either during their lifetimes or in their wills.
“It’s kind of the best of capitalism,” Bill Gates said in the first TV interview about the Giving Pledge, saying that people who had made a lot of money could then use their wealth to “create good circumstances for other people.’”
A decade later, 11 of the 62 living signers who were billionaires in 2010 have seen their wealth decline because of “aggressive” charitable giving or market changes, the Institute for Policy Studies found. But the other 51 are earning money so fast they’re having a hard time giving it away, the report found.
“The Giving Pledge is a textbook case of top-heavy philanthropy in action,” it added. “What was intended to be a civic-minded initiative to encourage generosity is, instead, continuing the concentration of taxpayer-subsidized private charitable power.”
Charitable giving is partly subsidized by taxpayers, and the Institute for Policy Studies argues that for every dollar a billionaire gives to charity, “the rest of us chip in as much as 74 cents to make up for the lost revenue.”
The organization has advocated for reforming charity laws to prevent money from being “sequestered” in private foundations and donor-advised funds. “Donors should only receive a tax reduction if funds are deployed to serve the public interest in a timely way,” according to its “Gilded Giving” report.
Warren Buffett, who has called for higher taxes for the wealthy, recently said that he received “only minor benefits” from tax deductions related to his philanthropy — his combined federal and state income taxes were reduced by about 43 cents for every $1,000 of value he’s donated in the form of Berkshire Hathaway Class B shares, he said. Buffett dropped to eighth place on the Bloomberg Billionaires Index after a $2.9 billion stock donation in July.
But others say the Giving Pledge represents an extraordinary achievement.
“The Giving Pledge was an historic moment in the history of philanthropy because it created a new kind of public accountability for generosity, at least in theory,” said Jacob Harold, executive vice president of Candid, an organization that provides information on nonprofits and foundations.
“That said, billionaires are made possible by inequality and we as a society are wrestling with that right now. I would argue that if billionaires exist, I’m glad they’re giving their money away and I’m glad there’s a mechanism to organize that.”
Since it was first launched, 210 people from 23 countries have signed the Giving Pledge.
“The Giving Pledge is a multi-generational effort to help shift the social norms of philanthropy among the world’s wealthiest people and inspire people to give more, establish their giving plans sooner, and give in effective and impactful ways,” said Robert Rosen, director of Philanthropic Partnerships at the Bill & Melinda Gates Foundation, speaking on behalf of the Giving Pledge.
He added that the signers “are solidifying a new standard of generosity for billionaires — that they have a moral obligation to commit to giving the majority of their wealth to philanthropy to address society’s most pressing needs.”
‘Giving away money well is very hard’
Some Giving Pledgers may appear to be giving away their money slower than critics would because spending money for the common good is more difficult than it looks, two experts told MarketWatch.
“Giving away money well is very hard,” said Avery Fontaine, head of Strategic Philanthropy for BNY Mellon Wealth Management. “It seems the greatest job in the world. It’s incredibly stressful.
” She added, “That sounds an ‘Oh, poor me,’ type thing to say for any wealthy person,” but Fontaine noted that many donors feel personally responsible for the success or failure of the endeavors they fund.
“ ‘The intelligent distribution of money for good can be a more challenging exercise than making money in the first place.’ ”
— Jacob Harold, executive vice president of Candid, an organization that provides information on nonprofits and foundation
Because “mega-donors” have such high visibility — especially in the age of TWTR, +0.10% and , +1.54% — many wealthy families try to do their giving as anonymously as possible.
One way to stay private is to donate to a donor-advised fund, a giving vehicle that’s been criticized for its lack of transparency.
“It’s not that they’re up to anything, they just want the opportunity to fail and learn and grow without a lot of scrutiny,” Fontaine said.
Jacob Harold of Candid made a similar observation.
“The intelligent distribution of money for good can be a more challenging exercise than making money in the first place, and I think that’s why a lot of givers have not ramped up their giving,” he said. The recent $1.
7 billion gift from MacKenzie Scott — ex-wife of Amazon AMZN, +0.19% founder and CEO Jeff Bezos — to 116 nonprofits offered a “very interesting solution to this puzzle,” he said.
Others could learn from Scott’s example of giving out a large amount of money relatively quickly and making the donations “unrestricted,” meaning that the nonprofits who got the money can use the funds however they see fit. “That is a gesture of trust and humility,” Harold said.
Where has the Giving Pledge money gone?
Each Giving Pledge signer writes a public letter explaining their motivations for signing the pledge, but beyond that, there’s no official accounting of where pledgers donate their money, or running tally of how much pledgers have donated.
They give to a wide variety of causes: the Bill & Melinda Gates Foundation has focused on global health problems malaria and HIV and education in the U.S.; Salesforce CRM, +1.
78% CEO Marc Benioff and his wife Lynne have given to help solve homelessness and to children’s hospitals; Coinbase CEO Brian Armstrong started an effort to give direct payments in the form of cryptocurrency to people living in poverty.
Critics the Institute for Policy Studies argue that many Giving Pledge signers make their donations to their own private family foundations or to donor-advised funds (DAFs), which means they get a tax break, but that the money may not trickle down quickly to on-the-ground charities. (DAFs are accounts where people can put money they intend to give to charity. Donors get an immediate tax deduction, but can decide later which nonprofits get the money.)
“ Michael Bloomberg’s $1.8 billion gift to Johns Hopkins University to provide financial aid and eliminate the need for student loans is among one of ‘game changing’ donations ”
— Una Osili, associate dean for research and international programs at Indiana University’s Lilly Family School of Philanthropy
“Instead of supporting charities on the front lines of problem solving, these billions end up sitting in tax-advantaged intermediaries,” Chuck Collins, director the Program on Inequality and co-author of the report “Gilded Giving 2020: How Wealth Inequality Distorts Philanthropy and Imperils Democracy,” wrote in a recent opinion piece.
Another criticism that’s been leveled against Giving Pledgers is that their gifts have gone to “more traditional causes” education and health, said Una Osili, associate dean for research and international programs at Indiana University’s Lilly Family School of Philanthropy. “But if you dig a little deeper, you’ll see that that may be too simplistic,” Osili told MarketWatch.
Some pledgers have made “game-changing” donations, she noted, pointing to Michael Bloomberg’s $1.
8 billion gift to Johns Hopkins University to provide financial aid and eliminate the need for student loans, and recent efforts on COVID-19 testing by the Chan-Zuckerberg Initiative, the charitable organization founded by , +1.54% CEO Mark Zuckerberg and his wife Priscilla Chan. (CZI did not respond to a request for comment.)
Bloomberg — whose net worth is currently estimated at $54.9 billion — has given $8.65 billion through Bloomberg Philanthropies since signing the Giving Pledge in 2010. “Mike’s lifetime giving to date is over $10 billion — and his giving has increased every year of his life,” said Bloomberg Philanthropies spokeswoman Rachel Nagler.
Bloomberg has said he plans to give away the vast majority of his wealth in his lifetime, she added. “His joke has always been that he plans to ‘bounce the check to the undertaker,’” Nagler said.
Jeff Bezos tops list of biggest charitable givers in 2020
Amazon founder and CEO Jeff Bezos made the single-largest charitable contribution in 2020, according to The Chronicle of Philanthropy's annual list of top donations — a $10 billion gift aimed at fighting climate change.
Bezos, the world's richest person, used the contribution to launch his Bezos Earth Fund.
The fund, which supports nonprofits involved in the climate crisis, has paid out $790 million to 16 groups so far, according to the Chronicle.
According to the left-leaning Americans for Tax Fairness and the Institute for Policy Studies, from March 18 through December 7 of last year, Bezos' wealth on paper surged by 63%, from $113 billion to $184 billion.
The sum total of the top 10 charitable donations last year — $2.6 billion — was the lowest since 2011, even as many billionaires vastly increased their wealth in the stock market rally that catapulted technology shares in particular last year.
Phil Knight, who with his wife, Penny, made the second- and third-largest donations last year according to the Chronicle, saw his wealth grow by about 77% over the same March-to-December period. Knight and his wife gave more than $900 million to the Knight Foundation and $300 million to the University of Oregon.
MacKenzie Scott announces sizable donations 01:23
Fred Kummer, founder of construction company HBE Corporation, and his wife, June, gave $300 million to establish a foundation to support programs at the Missouri University of Science and Technology. It was the fourth largest charitable donation of the year.
Fifth place: The Zuckerbergs
founder Mark Zuckerberg and his wife, Priscilla Chan, delivered the fifth-largest donation on the Chronicle's list: A $250 million gift to the Center for Tech and Civic Life, which worked on voting security issues in the 2020 election.
Zuckerberg, whose wealth nearly doubled to $105 billion in the March-to-December period according to Americans for Tax Fairness and the Institute for Policy Studies, has been widely criticized and been called to testify before Congress for his company's handling of disinformation in the runup to the 2020 presidential election.
In the sixth spot was a $200 million donation made by Arthur Blank, co-founder of Home Depot, through the Arthur M. Blank Family Foundation, to Children's health care of Atlanta to build a new hospital in his name.
Nos. 7 – 10 on the Chronicle of Philanthropy's list:
- $100 million: Jeff Bezos gift to Feeding America COVID-19 Response Fund
- $100 million: Mark Zuckerberg and Priscilla Chan gift to the Center for Tech and Civic Life to ensure safe and reliable voting practices in the 2020 election
- $100 million: Stephen Ross, founder of Related Companies, a real-estate firm gift to the University of Michigan at Ann Arbor to build part of the Detroit Center for Innovation
- $100 million: David Roux, co-founder of Silver Lake Partners, a private equity firm, and his wife, Barbara, gift to Northeastern University to establish the Roux Institute
- $99.6 million: George and Renee Karfunkel, real-estate investors Congregation Chemdas Yisroel, gift to an Orthodox Jewish Synagogue
- $80 million: Bernard Marcus, co-founder of Home Depot, through his Marcus Foundation, gift to Shepherd Center to expand its neurorehabilitation hospital
- $65 million: Charles Schwab, founder of Schwab Financial Services, and his wife, Helen, gift to Tipping Point Community to build housing for people experiencing homelessness
- $63.5 million: Stephen Ross gift to World Resources Institute to support the Ross Center for Sustainable Cities
Broader scope of beneficiaries
Donors have broadened their philanthropic scope beyond the universities, medical centers and other organizations that typically comprise the year's list of top beneficiaries, according to the Chronicle.
Joining the list of top beneficiaries of 2020, were “a new environmental grant maker, a nonprofit dedicated to modernizing elections, a network of food banks, and a charity that builds housing for people experiencing homelessness.”
Two billionaires who donated heavily to charity last year — MacKenzie Scott, Bezos' former wife, and Jack Dorsey, co-founder of — did not make the Chronicle's list because no single donation of theirs was large enough to qualify. Rather than give billions to just one charity, both billionaires opted to make large donations to numerous causes.
Dorsey, whose current net worth totals $11.4 billion according to Forbes, announced in an April 2020 tweet that he would be donating $1 billion in equity to his Startsmall LLC to fund global COVID-19 relief. “After we disarm this pandemic, the focus will shift to girl's health and education, and UBI,” said Dorsey in his tweet.
Scott, whose wealth is valued at $57 billion according to the Bloomberg Billionaires Index, said in a blog post in December that she had increased her charitable donations for the year to $4.2 billion, in response to the “wrecking ball” effect of the coronavirus, which she also acknowledged “substantially increased the wealth of billionaires.”
Her $4.2 billion was divvied among 384 organizations she describes in her post as having “dedicated their lives to helping others, working and volunteering and serving real people face-to-face at bedsides and tables, in prisons and courtrooms and classrooms, on streets and hospital wards and hotlines and frontlines of all types and sizes, day after day after day.”
Paying the price: Income inequality and coron… 08:04
The nation's 644 billionaires have enjoyed a staggering rise in wealth since the pandemic shuttered the economy in March, with the group gaining almost $1 trillion in total net worth, according to a recent analysis. The spike in wealth coincides with what some economists are calling a K-shaped recovery, with the rich regaining their footing while poorer Americans struggle with lost wages and jobs.
In February, the Chronicle will publish its list of the 50 biggest donors, which counts cumulative donations, not individual gifts.
Fact check: Bill Gates has given over $50 billion to charitable causes over career
Microsoft co-founder and former CEO Bill Gates steps down from board of directors to focus on philanthropic efforts. Wochit
Corrections & clarifications: This story has been updated to reflect Melinda Gates also founded the “Giving Pledge” and to clarify the terms of the pledge.
The claim: Bill Gates has given over $50 billion to charity
Bill Gates is a consistent target of conspiracy theories, many becoming especially heightened amid the coronavirus pandemic. While the tech billionaire remains the target of scorn and suspicion online, others defend Gates, citing his history of charitable contributions.
One viral post imagines Gates’ view of the current conspiracies, writing that the billionaire has spent “30 years” of his life and “$50 billion” of his net worth “supporting humanitarian causes.”
The post, which has garnered 36,000 shares and 20,000 comments, criticizes conspiracy theorists in harsh terms for their claims, asserting that Gates has “arguably” done “more to better life on earth for humanity than any other human being to ever live.”
Gates is a noted philanthropist and has pledged a significant amount of money to research and charitable causes during the coronavirus pandemic. He has given more than $50 billion to charity since 1994. However, his wealth has grown even faster than he has donated money.
As of June 2020, Gates’ net worth was estimated at roughly than $110 billion, according to Forbes.
More: Bill Gates is not secretly plotting microchips in a coronavirus vaccine. Misinformation and conspiracy theories are dangerous for everyone.
Bill Gates, philanthropist
Bill Gates, who has been one of the wealthiest men in the world for decades, made his fortune as the co-founder of Microsoft. The company, which was a key player in the personal computer revolution in the 1990s, eventually became a corporate behemoth, and Gates became a household name as a tech titan and business magnate.
Gates stepped down as Microsoft CEO in January 2000, shifting his attention to philanthropy and other assorted projects. In March 2020, Gates stepped down from Microsoft’s board, though he maintains about 1.3% of shares in the company.
In 2010, Bill and Melinda Gates, alongside billionaire investor Warren Buffett, founded the “Giving Pledge,” a movement encouraging other billionaires to donate most of their wealth to charity either during their lifetimes or after their deaths. The voluntary group now includes more than 200 families and individuals from more than 20 countries.
More: Fact check: Bill Gates did not craft contact tracing bill
Bill and Melinda Gates have given $45.5 billion to charitable causes, including the eponymously named Bill & Melinda Gates Foundation, since 1994, CNBC reported, citing the Chronicle of Philanthropy. In 2019, the couple donated $589 million to charity, making them the seventh most philanthropic people last year.
Since the start of the coronavirus pandemic, the Gates family has pledged billions of dollars in donations and funding for efforts to fight the virus. Some of these efforts have come under scrutiny, both from regulators and conspiracy theorists who assert that Gates has malicious intentions behind the giving.
Despite these significant contributions and pledges, Gates remains one of the wealthiest people in the world.
From 2000 to 2007, Bill Gates was the richest man in the world, and rotated that title with Buffett and Mexican telecommunications tycoon Carlos Slim from 2008 to 2013.
In 2018, Gates lost the title to Amazon founder Jeff Bezos. Gates remains the second-richest man in the world, according to Forbes.
(FILES) In this file photo US Microsoft founder, Co-Chairman of the Bill & Melinda Gates Foundation, Bill Gates, poses for a picture on October 9, 2019, in Lyon, central eastern France, during the funding conference of Global Fund to Fight AIDS, Tuberculosis and Malaria.
– Microsoft on Friday announced that co-founder Bill Gates has left its board of directors to devote more time to philanthropy.
(Photo by JEFF PACHOUD / AFP) (Photo by JEFF PACHOUD/AFP via Getty Images) ORG XMIT: Microsoft ORIG FILE ID: AFP_1PV8AC (Photo: JEFF PACHOUD, AFP via Getty Images)
Valuing Gates' fortune
many high net-worth individuals, Gates manages his wealth through an investment and holding company known as Cascade Investment LLC. The company maintains a diverse portfolio of investments and assets that account for more than half of Gates’ wealth.
Gates’ remaining 1% stake in Microsoft as of June is worth more than $7 billion, while the Bill & Melinda Gates Foundation maintains over $50 billion in assets that can be counted among the couple’s net worth.
Gates has maintained this fortune both through wealth management as well as investments in the industry that first made him rich: technology. He is not unique among tech billionaires in this way.
“By the end of 2018, tech billionaires’ assets totaled USD 1.3 trillion. Their net wealth has almost doubled over five years, growing by 91.4%,” a 2019 report on global billionaire wealth from the investment bank UBS and consulting firm PricewaterhouseCoopers found.
“Many of their businesses are phenomenal cash generators. Software, internet and electronic equipment billionaires still account for 62.2% of tech wealth,” the report also said; software, internet and electronic equipment are the consumer products which Microsoft dominated under Gates’ leadership and remains a leader in today.
Gates’ wealth is also tied up in luxury assets, which he has purchased over the years. Gates’ home, which he’s dubbed “Xanadu 2.0” as a reference to the movie Citizen Kane, was estimated to be worth $127.48 million in 2017.
Xanadu 2.0 also holds the Gates family’s large car collection and a $130 million art collection including a Leonardo da Vinci manuscript. The family also has a private jet worth almost $20 million and owns a private tropical island in Belize called Grand Bogue Caye, valued at about $25 million.
Our ruling: True
Bill Gates has been a consistent philanthropist for decades. He has remained extremely wealthy while giving away large amounts of his net worth through steady increases in his financial portfolio. We rate the claim that Gates has given $50 billion to charity as TRUE because it is supported by our research.
Our fact-check sources:
- Forbes, Bill Gates Real-Time Net Worth
- Encyclopedia Britannica, Microsoft Corporation
- Microsoft, March 13, 2020 press release
- The Giving Pledge
- Chronicle of Philanthropy, Philanthropy 50 2019
- CNBC, Jeff Bezos gave away more money than Bill Gates, Mark Zuckerberg combined in 2018
- New York Times, F.D.A. Halts Coronavirus Testing Program Backed by Bill Gates
- CNBC, Bill Gates leaves Microsoft board
- Bloomberg, The Simple Strategy Fueling the Rise of Bill Gates’s Fortune
- USA TODAY, Fact check: Dr. Anthony Fauci, Bill Gates won't profit from drug remdesivir
- The National Interest, The World’s Top Ten Billionaires, 2000 to 2019
- Forbes, A Decade of Billionaires
- Investopedia, Where Does Bill Gates Keep All His Money?
- Gates Foundation Financials Disclosure From FEC Audit
- UBS, Billionaires insights 2019
- The Street, Bill Gates' House: A Look at Xanadu 2.0
- Business Insider, Bill Gates has a net worth of over $96 billion — here's how he makes and spends his money
- Breaking Belize News, Bill Gates Owns Private Island in Belize
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