Exactly 30 years ago Malcolm Forbes’ most enduring brainchild–a ranking
of the richest people in America–came to fruition. The Forbes 400 proved
a phenomenon as soon as it launched. Three decades later it’s an
American icon. Each of the 400 stories testifies to the American Dream.
When measured together, they serve as an annual marker for the dynamism
of free enterprise.
For this 30th Anniversary Issue, we decided to raise the bar : Rather
than congregate only on the printed page, what if we actually summoned
the 400 to come together in person? Specifically, what if the most
financially successful people in America, leveraging their resources and
the results-driven mind-set that created that success, tried to solve
the world’s most intractable problems? To literally change the world?
So on June 26, 161 billionaires and near-billionaires gathered at
the New York Public Library for The Forbes 400 Summit on Philanthropy,
the greatest-ever meeting of its kind. Oprah Winfrey kicked off the day,
and Warren Buffett and Bill Gates also gave keynote talks. Melinda
Gates, Diane Von Furstenberg and Jacqueline Novogratz headlined a panel
about giving to women and girls. Marc Andreessen, Marc Benioff and Jim
Breyer talked about using tech-driven metrics to improve philanthropic
efficacy. Jon Bon Jovi chatted with Steve Forbes about using fame as a
force for good. (And he ended the event with a
once-in-a-lifetime ukelele duet for charity with Buffett.)
The highlight of the day was a roundtable featuring six all-time
great philanthropists — Warren Buffett, Bill and Melinda Gates, Steve
Case, David Rubenstein and Leon Black — who have collectively pledged or
given over $100 billion to charity (with the heaviest lifting from the
first three, who also spearheaded The Giving Pledge). With just the
smallest nudging from yours truly, this historic sextet provided one of
the great primers on how to give back effectively — and why it’s
important.
FORBES: For the first time the phrase “this panel needs no
introduction” is actually true. The big question: Do people who’ve been
successful have a moral obligation to give? Is it an emotional
decision–”I can do good”–or an intellectual decision–”I feel an
obligation to do good”?
MELINDA GATES: It’s both, but I won’t say the emotional piece is
because I have an obligation. Any time you give, it has to be from your
heart. One of the amazing things about philanthropy, at least for us, is
getting out into the world and talking to people. And you realize how
similar people are in terms of what they want and their needs. So, for
me, it’s a heart tug that I feel and that I carry every time I come back
home, be it
Seattle or
New York.
But then it’s your intellectual head that you have to put on, which
says, “Okay, so I met that one person” or “that one family” or “that
group of villagers,” but how do I impact tens of millions? How do I use
this money that’s at our disposal to have the very biggest impact?
DAVID RUBENSTEIN: I agree. My theory is, number one, you should give
money because when you give money, it’s selfish. Nobody who gives away
money says, “I feel terrible about myself. I hate myself for giving away
that money.” You feel better about yourself, and when you feel better
about yourself, you’re gonna live longer, because your emotional health
will be better.
Second, you might actually help somebody. You never know. All the
times you try to do something, it doesn’t always work. But sometimes you
might actually help people. And it’s a natural human instinct to help
other people. And third, you might get to heaven more quickly. Now, I
can’t prove that, but why would we take a chance?
You can only do three things with money. You can give it to your
children, you can give it to your executor to give away or you can give
it away while you’re alive. And my theory is, it’s much better to give
it away while you’re alive. How much can you give to your children
before you completely spoil and ruin them? Very few people who inherit
gigantic sums have gone on to change the world for the better. Generally
the people who’ve changed the world for the better are people who made
it on their own and ultimately didn’t want to just distribute wealth to
somebody else. If you can give away as much money as you can while
you’re alive, you’ll realize the benefits that I just mentioned, you’ll
feel much better about yourself–and your children will feel much better
about you.
STEVE CASE: And there are three different ways to give. One is to
give money, write a check, which is important. Two is to give your time
and really focus on the issue with passion. And three, essentially, is
to give your reputation, leverage your network and try to plug people
together. Initially [my wife] Jean and I did some startups. We gave a
fair amount of money away. Then we started investing in kind of what we
thought of as not startups but speed-ups, organizations like Habitat for
Humanity and Special
Olympics, trying to expand their efforts.
For probably seven or eight years we actually didn’t have a website,
which is odd given all the money came from the Internet. We thought it
would be better just to kind of quietly do it. But then we realized we
really weren’t using our most unique and precious assets, which are the
ability to connect people together, build collaborations, shine a
spotlight on issues. Which really led us to commit to the Giving Pledge.
It wasn’t so much making a public commitment–it was more trying to
leverage everybody’s expertise and create a network effect around the
givers.
FORBES: Melinda, you talked about giving around something you’re
personally passionate about. You and Bill have given to a lot of things,
such as vaccines, that are very abstract and far away from us. How do
you get people excited about things like that?
BILL GATES: The best thing is to encourage people to get out and see
the things. If you get somebody to go to Africa and see the beauty and
yet also get a glimpse of what happens to children, that malaria’s this
awful thing, not just in terms of deaths but the number of kids who are
permanently damaged, never able to learn–they’ve had either malnutrition
or malaria–it really draws you in. There’s no substitute for actually
going and seeing it.
Same thing with schools. If you go to an inner-city school and see
some of the pathologies that can develop in terms of how there’s
security [checks] and people aren’t really going to the classes much,
and then you go to a place a few blocks away that’s, say, a charter
school run on a different basis, and you see that contrast, you really
want all the kids to have what you see at the second place.
So I think you’ve got to have genuine experiences. That’s kind of the
retail end. And then you, a little bit, step back and say, “Okay, what
is it about that system? Why isn’t the combination of the market plus
government able to solve that?” Who’s really studying how you reward
teachers? Who’s really studying why they’re good? What is the
institutional framework that would change that? That involves working
with experts, doing a lot of thinking. But it’s got to be that kind of
retail experience that creates this dedication.
WARREN BUFFETT: I’m not sure whether it’s intellectual or emotional,
but when I was born in 1930 the odds were 40-to-1 against me being born
in the United States as opposed to someplace else. I was a male. The
odds were even money on that. So now I’m down to 80-to-1. You don’t want
to bet on 80-to-1 shots normally, but I got lucky. As Bill says, if I’d
been born a few thousand years ago I’d have been some animal’s lunch,
because I’d have gone around saying, “Well, I allocate capital,” you
know, and the animal would say, “They’re the kind that tastes the best.”
I can’t run fast. And I can’t climb trees. And so here I am, by pure,
pure luck, born at the right time, the right gender as it turned out,
compared to my sisters who were just as smart or smarter than I am, in
the right place and in a system where allocating capital pays off like
crazy.
I don’t feel guilty about that. I do feel grateful about it. I’ve got
a whole bunch of stock certificates sitting in a box. They’ve been down
there for 40 years. I haven’t even looked at ‘em for years. You know, I
could go down there and fondle ‘em occasionally, but that’s about all
they’re good for. I mean, they have no utility to me. They have all
kinds of utility to the people that Bill and Melinda are talking about.
Incredible utility. And what can they do for me? They can’t do anything
in a practical manner. And so, it just seems so obvious to get ‘em where
they’re useful.
FORBES: Who’s had an epiphany moment regarding philanthropy on a massive scale?
WARREN BUFFETT: I can’t remember back that far. I can’t remember what we had for lunch. [Laughter.]
MELINDA GATES: I’ll tell just one story. Bill and I had already
decided after we were engaged that the money that had come from
Microsoft would go back to society. That was a given. We both came from
families that believed in that and believed in volunteerism and civic
work.
On our first trip to Africa, a few months before we were to be
married in the fall of 1993, we went to see the animals, and the safari.
We had a group with us. We had an amazing trip. We didn’t go to see the
poverty. But you can’t but help be in Africa, see the people and say,
“Well, what’s going on here? Why is it that the women are the ones that
we saw doing so much work, carrying loads on their heads, a baby on the
back and a baby in their belly? And the people with shoes on, smoking
cigarettes, were men.” We just kept asking ourselves, “Well, what’s
going on here?”
That started us. For us as a couple, it’s been not only an
intellectual journey but a really fulfilling journey in terms of what we
learn together.
LEON BLACK: My wife was diagnosed with melanoma cancer five years
ago. It was a misdiagnosis where a recurring plantar’s wart on her foot
for five years turned out to be a stage two melanoma. That was very
scary and a wake-up call. She’s fine, which is the great news, but even
better than that, we took a page out of
Michael Milken‘s
approach and what he’s done with prostate cancer, where he’s been able
to reduce morbidity rates in prostate cancer almost in half over the
last 20 years, and say, “Maybe we can make a difference in starting a
melanoma research alliance and empower the best and the brightest, on
the condition that they collaborate, that they work with each other,
that they share their research.”
Fast-forward to a kind of Who’s Who scientific advisory board,
getting it out on a global basis to make a difference. We’ve gotten 30
or so young investigators involved. This was a field where, really,
nothing had happened for 40 years. That was the frightening thing we
learned when my wife was originally diagnosed. And now this is one of
the areas that is most hotly pursued. That was our personal moment.
STEVE CASE: We’re giving, all of us, because we want to have an
impact. We want to change the world. And how do you have the maximum
impact, ideally, with the most modest investment? That’s what we are,
whether you’re an investor or an entrepreneur starting a company: How do
you take a little bit of resources and have the broadest possible
impact? So, looking for ways to get leverage and maximize the impact is
not about the input of writing the check. It’s about the output, what
actually happens.
We’ve all learned that it’s hard. It takes a lot of work. But if all
you do is write the check and then figure you’re done, it’s actually
kind of like investing in a company. A venture capitalist writes the
check, but then the real value they provide is the expertise they help
to guide that investment, the network that surrounds those entrepreneurs
in terms of people they can bring into the organization. Trying to take
those same lessons and apply them to this role, I think, is very
important.
DAVID RUBENSTEIN: Most of the people who got into The Forbes 400 got
there by having an idea and pursuing that idea as long as they could.
And it created great wealth for them. They didn’t really care about
making the money so much as pursuing the idea.
I think in Bill’s case, you were interested in proving that the
software you could develop was the best software in the world. And so
the same principle really applies in philanthropy. You have to have an
idea of something you want to do, and you put into it the same passion.
And I want to agree with Steve. The ancient word philan , for
philanthropy, as the Greeks invented it, had nothing to do with giving
away money. Philanthropy means love of humanity, love of people. For the
ancient Greeks that meant giving your time or your energy and your
money. Everybody doesn’t have the ability to be in The Forbes 400 and
give away large sums of money. Most people in the United States really
only have the ability to give away their time and their energy and their
ideas–some money but not nearly the kind of money we’re talking about
represented here.
So, I really hope that the philanthropy movement, which Warren, Bill
and Melinda have really helped develop as a global phenomenon, is seen
not just as wealthy people giving away money but wealthy people giving
away their time, their energy and their ideas and encouraging other
people to give away whatever they can–ideas, energy or time.
FORBES: To the extent there’s an obligation to give back, is there
also an obligation to do so publicly–to show that those who’ve achieved
incredible success give back to society?
STEVE CASE: To get the maximum leverage, the maximum network effect,
some of that is doing it publicly and trying to get other people to
rally around your cause. The idea of the Giving Pledge and making a
public commitment, we thought, would motivate others, not just the
wealthy.
FORBES: Where did the 50% number in the Giving Pledge come from?
WARREN BUFFETT: I said zero, and Bill said a hundred, so we
compromised. It came out of the air. But I would bet that most of the
people who’ve joined the Giving Pledge will not only give more than 50%,
I think they’ll give appreciably more than 50%. And they’re doing it.
You have to have a cutoff point, but I don’t think we’ve reduced
anybody’s expectations by using that number.
MELINDA GATES: I want to go back to t he public-versus-private idea.
Bill was already very visible because of the business. But for me it
would’ve been nice to just kind of be private. Early on we were doing a
lot of things behind the scenes privately. I liked to fly under the
radar screen. It was nice when we could go into countries and, you know,
the ?government didn’t know we were there, so I could go see projects
on the ground very anonymously.
But what I’ve learned is that your voice in these things matter. If
you’re going to galvanize people around a particular issue that you care
about, if you want to galvanize governments to give money around big
causes or other philanthropists to come together around the cause that
you care deeply about, you’ve got to be more public about it and you’ve
got to use your voice. And one of the knock-on effects is that you do
end up inspiring other people.
WARREN BUFFETT: It’s a fundamental premise of the Giving Pledge: It’s
important for people to declare themselves. A wide spectrum of people,
different ages and interests, everything else, are explaining why, to
them, it’s important that they give half or more. Are all going to hit
with a given reader? No. But a few will. And that’s what counts.
BILL GATES: In dinners around the United States and in China and
India and other places, this topic has come up a number of times.
Perhaps the most interesting was when I was in the Middle East, actually
in Jeddah. There was a wealthy group really struggling with it. But one
of them mentioned that in the Koran it actually says the reason to talk
about your philanthropy is if it encourages other people to do the
same. And in that case you have an obligation to talk about your
philanthropy.
It’s a tricky thing. Are you trying to get credit for it? Or are you
just trying to be able to share what’s worked and what’s not worked?
It’s been fantastic where you can get groups together who can talk about
what makes it fun, what makes it not be fun. Should you have staff? How
do you involve colleagues and children? Being off by yourself, that’s
one option. But I don’t think you’ll learn quite as much or enjoy it
quite as much if you can’t find a group of fellow travelers.
STEVE CASE: This issue was a big topic at this last Giving Pledge
meeting: How do you influence others beyond what you’re doing,
particularly governments? You could start with a premise of you could do
what you’re doing on your own. That’s great. You could say, “Let’s
network that together with other givers and have more impact.” That’s
great. You could then go another level and say, “How do you interact
with companies and create public/private partnerships that really
integrate what you care about and do what maybe hundreds of companies
are doing on–on a global basis?” That has even more impact. And then the
final step is, how do you integrate governments and leverage what
they’re doing or influence what they’re doing?
Do the risky things in this world. And then, when you’re looking to
scale them, plug into governments. That gives you even more impact.
Having a big impact on these big issues requires stepping out of your
comfort zone and trying to create that network effect.
FORBES: Five of the people on this panel are Giving Pledge signers:
What has surprised you guys most when talking with each other?
WARREN BUFFETT: I think we’ve had more success than we anticipated. I don’t know whether Bill and Melinda would agree with that.
BILL GATES: I think that the fact that people really want to have a
frank discussion and they have such great stories about what’s brought
them to give, it kind of reinspires everybody when you get together.
WARREN BUFFETT: I’ll tell you one surprise. I’ve been with Bill and
Melinda in Beijing and then again in Delhi. And it was amazing to me. We
had about 50 people, I would say, at both of those dinners. They have
the same concerns. They obviously have some different views from their
culture and some different attitudes about what the government should do
and that sort of thing. But there are a lot of common characteristics
between the billionaires in Beijing and Delhi and New York.
MELINDA GATES: That generation, the generation that makes the
wealth–we’re seeing a lot of movement in the tech sector in
India–they’re very energized to not only give money back but to do what
you’re hearing so many of the people in the room talk about today, which
is to use their brains against something that they see in their country
that needs change.
You really make sure you get to that first generation of wealth
before it’s handed down to the next generation, because sometimes the
second generation feels like, “Well, I’ve gotta hang on to it. It was
given to me. And I’ve gotta pass it along.” But the first generation
says, “Hey, we made it, and it’s ours to give away as well.” That’s a
common theme we’re seeing across the world.
WARREN BUFFETT: That’s true in the United States, too. In talking to
people, if they inherited it themselves, they feel they’re breaking a
covenant to some extent if they don’t continue that policy. That’s not
universal. But I can understand that. That’s a very understandable human
reaction. But I try to talk ‘em out of it.
DAVID RUBENSTEIN: Many people who are in the 1% are very afraid of
being identified as having an enormous amount of wealth, and they don’t
want the publicity associated, perhaps, with announcing they’re giving
it away. But I think that’s a false concern. Because of The Forbes 400,
people know who the wealthy people are. And I do think that those people
who have the wealth are almost certainly gonna give it away anyway,
because there’s not many other things you can do with it. I don’t think
you can give that much of it to your children.
The greatest impact of the Giving Pledge will actually be outside the
United States in time, because other people still look to the United
States as a leader, as a moral leader in certain ways and as a leader in
philanthropy. I believe other parts of the world will see that what
we’ve done here has helped make the United States a better place and to
make the lives of people better.
The thing that’s most surprised me is that people come up and thank
you, dramatically. You build a company, and you’ve made a lot of success
in business–nobody ever came up and said thank you for doing that. When
you give away money, people come up to you and say, “Well, it’s great.
You’re a patriot.”
And I say, “Well, no, a patriot is somebody that went in the
military, somebody who is a policeman, a fireman, a teacher. Giving away
money to help the federal government is not necessarily a patriotic
thing.” But people think that you’re doing patriotic things. And it
makes you feel good, even though the truth is you’re not any more
patriotic than anybody else.
And I’ve been surprised at how much attention some modest gifts get.
You can give a relatively modest amount to certain causes, and people
get enormously excited about it. Sometimes you can give away hundreds of
millions of dollars or billions of dollars, and you sometimes don’t get
the attention because people can’t grasp the enormity of what you’re
doing. In some cases you’re changing the face of Africa, but you
probably don’t get the same impact as if you gave a lesser sum to some
institution in the United States that everybody knows.
STEVE CASE: David gave money to the Smithsonian National Zoo to promote panda sex. That got a lot of attention.
DAVID RUBENSTEIN: Panda conservation!
STEVE CASE: I have a question for Bill and Melinda. I think what
Warren did, giving away such a significant amount to the Gates
Foundation, with essentially no strings attached, no naming rights–he
didn’t say, “Oh, rename it the Gates & Buffett Foundation”–was
really an unbelievable charitable gift. I think it inspired everybody.
One piece of it that I think got some people concerned, and I
understand why he did it, was ten years after your death it all has to
be given away.
WARREN BUFFETT: Yup.
STEVE CASE: How much of a burden does that create–that amount of
dollars being deployed that quickly? Do you worry about that? Do you try
to make sure to keep him healthy?
BILL GATES: We tried to switch him from Coke to Diet Coke, but that’s not working.
WARREN BUFFETT: Diet Cherry Coke.
BILL GATES: We’ve had so much time to learn about various things, it
won’t be a problem at all. Those dollars will have just as much impact
as the other things we’ve given. But it’s fascinating. Our time frame is
more like 20 or 30 years after we pass away. You’d call that a pretty
small different point of view. There are other people who believe in
perpetuity. And that’s perfectly fine. You know, there were some
historical foundations like Rockefeller that’s sort of perpetual. And
there are some that aren’t as well known that spent their money. The
more you think about it, having a finite limit makes sense. Because you
can really go after a particular thing and count on the rich people of
the future to understand better what problems need to be addressed and
exactly who should go after those problems.
MELINDA GATES: Warren has influenced us hugely in our giving.
Originally, when we set our will up, we said, “Okay, the foundation
would live, you know, 50 years beyond the last of us.” We’ve recently
moved that into 25 years.
Warren’s thinking about, “Don’t leave it to your children.” That
influenced us hugely. Take big risks. As he says, “Swing for the fences.
Don’t go for the easy pitches.” I mean, that rings in your ears,
particularly when you’re going to do something that takes some guts,
right? He’s just been an unbelievable inspiration to us and continues to
be in this philanthropy.
FORBES: How do you maintain your enthusiasm given the inevitable challenges and setbacks you face?
WARREN BUFFETT: Well, if you take five different items that might
affect the lives of millions of people, and one of ‘em’s going to
succeed, and that’s more or less your probability going in, you should
not get discouraged at all about the other four. With the bigger money,
you should be doing things that can change lots of lives. And you should
be doing things that have some real chance of failing. If they’re easy,
let somebody else do ‘em–or they’ve probably already been done. So
failure is not failure. If you’re Alex Rodriguez, and he bats .350, you
can say, “Well, he didn’t hit .650, but .350 is terrific.” It’s the same
way in philanthropy. You should not get discouraged about the fact that
one out of five, two out of five or maybe four out of five don’t work
out the way you want it. If one out of five does, and you change
millions of lives, you should feel very good about what you’ve done.
STEVE CASE: Building the businesses that led to the success that
gives you the opportunity to give back, there were struggles as well.
There are very few overnight successes. That persistence, that
perseverance, I think, is an important skill set in anything you do.
We also know the difference between success and failure sometimes is
inches. And just staying with it and having that perseverance and not
giving up, and being fearless, is the difference between success and
failure in anything you do.
LEON BLACK: I would go a step further. People are on The Forbes 400
because they are tenacious problem solvers. They had challenges, they
had goals, and none of those goals were achieved easily. It took them
years to get to where they got to. And I would just say in the field of
philanthropy, it’s a broader canvas of a problem-solving challenge,
whether it has to do with fighting poverty or disease or improving
education. It’s almost as if so much of what came before is the
experience and the education for all of us to then be able to paint on
that broader canvas.
And the rewards with this other canvas are so much more refreshing.
Much of the world that I’ve lived in the last 30 years is the world of
Wall Street, of finance. The goal has been to make money. And when you
deal with teachers and scientists, you’re dealing with so many brilliant
young people, where money is just foreign. It doesn’t matter. I find
this unbelievably refreshing to see this type of brainpower out there
and the dedication.
DAVID RUBENSTEIN: I tell students all the time, “You have to ignore
what your parents want you to do. Because if you do just what your
parents want you to do, you’re gonna be miserable in life. Find
something that you’re passionate about that you want to do, because only
if you find something you really love will you be successful.”
And the same is true in philanthropy. If you find something that
you’re doing because it’s socially acceptable, you’re never really going
to enjoy it. Just as you experiment with many different jobs until you
find something you love, experiment with philanthropy. Find something
you really love, where you think that you’re making the difference and
your existence on the face of the earth is justified by your doing
something that’s really made the world a better place for some other
people.
www.usamedia2014.blogspot.com
OBAMA: Mr. President, Mr. Secretary General, fellow delegates, ladies and
gentlemen, I would like to begin today by telling you about an American named
Chris Stevens. Chris was born in a town called Grass Valley, California, the son
of a lawyer and a musician. As a young man, Chris joined the Peace Corps and
taught English in Morocco, and he came to love and respect the people of North
Africa and the Middle East. He would carry that commitment throughout his
life.
