F. Scott Fitzgerald, the novelist, said the rich are different from us. His contemporary (and rival) Ernest Hemingway countered with, “Yeah, they’re richer”.
That’s certainly true of Warren Buffett, though whether he’s smarter than us or Jimmy – his margarita loving namesake – well, that may be questionable. because Warren, not Jimmy, just gave 31 billion or so to the Billy Gates Foundation. I’m not so sure about Billy’s intellect either – once you take him out of a computer lab. Consider that both gentlemen were true blue entrepreneurs who benefited the world and acquired wealth with their talent in a unruly themepark called Capitalism. Then they walked down the road to Foundationworld. Why would you win the Indy 500 with a Hemi 440 and then putt putt to your next race in a flathead four? Why a foundation â€“ a structure that reeks of non-private ownership, like your local school board. And how responsive are they to consumer needs?
Why would free-swinging brawlers like Buffett and Gates set up foundations to cure the world’s ills. Why not a corporation in one form or another – the same structure that not only generated the riches under discussion – but provided products and services that answered the world’s needs. Who will be more highly motivated; the technicians, support and management personel blessed with options and ownership or salaried foundation people? I mean, having won the golden grail in the rough and ready barroom of capitalism, why seek a second prize (cure of cancer â€“ discovery of the ultimate energy cell â€“ regeneration of the heart, etc) in a monastic environment?
I suppose the motivation is avoidance of taxes. But that’s not a satisfying answer. Pay the penalty, I say, and get on with your quest. And in case the motive force is to publicly display one’s generosity, well, simply renounce the profits and other perks of corporate ownership.
And another problem. Foundations drift from their founders’ intentions – just ask the ghost of Henry Ford. Most of His non-incentivized foundation employees are lucky that Henry sleeps in the cold, cold ground. Even worse, foundations fail like government programs fail, but profits and losses â€“ the ultimate barometer of success – are not there to administer the merciful coup de grace. A 31 billion dollar kitty will nurture failure for a hundred generations of Buffetts.
Let the Buffetts of the world show their gratitude to the system that created their wealth. Want to cure Aids? Set up a corporation with the shortest mission statement in businessdom: “reward owner/investors and cure Aids”. Give the shares to Aids sufferers, friends, names picked out of a Bulgarian phone book, or the faculty at Johns Hopkins. It’ll beat a foundation every time! And what’s that bucolic expression? “You oughta dance with the one that brung you.”