Discussions regarding wealth, ostentation, philanthropy and Mormonism abound in the Bloggernacle. We’re relatively wealthy people here in our slice of cyberspace, and we don’t mind moralizing about our wealth, either. From a layperson’s point of view, I think I perceive two camps regarding wealth-distribution among Mormons: the amateurs, who talk about wealth according to their relative fields of expertise (be it economics, law, or what have you) and the professionals, who are actually wealthy and engaged in the process of wealth redistribution and philanthropy. I’d submit that the Bloggernacle is almost exclusively composed of the amateurs, myself included, which is unfortunate, because I believe we could learn a great deal about the nature of wealth and faith by involving some of the professionals in our discussions. Jon Huntsman? Dave Neeleman? Consider this your invitation to permablog at BCC.
In that vein, I’ve watched and re-watched a recent episode of Charlie Rose that I think is very germane: Rose’s interview of Bill and Melinda Gates and Warren Buffett.
If you haven’t seen it, it’s an absolute must-see insight into the world of high-end philanthropy as well as a fascinating view of the challenges major-league charities face. The interview took place shortly after the announcement by Buffett that he was donating the equivalent of more than 37 billion dollars to the Gates Foundation. You can watch the episode here, but permit me to transcribe a bit of Warren Buffett’s view of philanthropy and wealth. I don’t necessarily subscribe to his view, but I find it worthy of discussion nonetheless:
Rose: People have been speculating, as you know, for a long time about why you haven’t done this before, and you were saying you haven’t done it before…
Buffett: …My logic is that philanthropy, philanthropic needs would be huge today, tomorrow, 20 years from now, a hundred years from now, and if people were going to devote their money to philanthropy, the ones that were high-compounders should take care of the high philanthropy 20 or 40 years out.
Rose: And that would be you.
Buffett: Yeah, and I really thought, it made way more sense [instead of] to give a million dollars 30 years ago, which might have been all that one had available, to have it compound, and people who are low-compounders should take care of the current needs. I mean, if I ran a university, and I had two wealthy alumni and they were going to supply all the money, I would take the guy who wouldn’t do very much with the money and use his money currently, and I would have the other fellow compound for me (laughs). So anyway, it’s been a convenient way to think, anyway, and that has been my philosophy on it, but now is the time.
Later in the interview, Buffett refers to money and the process of amassing wealth and philanthropy as “the second act of the money, in effect. You amass these claim checks — that’s what money is, in effect, which money is on society, and then you figure out the best use for them.”
There are two concepts in here I find fascinating, with possible repercussions on how I give my money: first, the notion of making the best use of money from a simple money-management point of view. It makes sense to me that those who are better at multiplying their money should give later, to maximize the amount of money being given. That said, the notion of withholding gifts until the donor deems him or herself “ready” seems repulsive. There seems to be an implicit balancing test here: if we give everything we have as soon as we get it, we may place the group as a whole at a disadvantage — but if we hoard for too long, then the group is bound to suffer. As a side note and example, it may be in the immediate best interest of high-income tithepayers to hold off on their tithing payments until January, as this year’s alternative minimum tax rules reduce the benefits of a taxable donation. The average tithepayer, on the other hand, probably will see little to no benefit from a delay in the date of tithepaying.
The second notion is in the second Buffett quote: the concept of money as a “claim check” on society. In other words, money can mean more than a simple subsitute for direct barter of goods and services – it essentially represents a future obligation of society. We hold onto money and amass it, and with it comes a potential social power. Money can be defined in different ways, whether as a medium of exchange or store of value, but Buffett, by gaining such enormous wealth and donating it to a specific cause, has essentially forced society to take an interest in his cause and revealed money as a store of social power. This is perhaps a new and better way for Mormons to conceive of money; currently we strongly associate money with the evils of the world, and eschew more than is sufficient for our needs. However, we can also view money as a means of social change and a potential long-term tool for doing good.
Lessons: don’t fear money and put off paying tithing. Slim that camel down, cuz we’re headed right for the needle’s eye, folks!