These Difficult Times

Warren Buffett effectively told the world this past Sunday afternoon that he wants his children and their progeny to do anything they want, but they can't do nothing.

Mr. Buffet later appeared in an interview with Charlie Rose on Tuesday night alongside Bill and Melinda Gates. Charlie Rose said to Buffett: "You famously said ... you wanted to leave your children with enough money to do whatever they wanted to do, but not nothing."

"So [my children] can do anything but not nothing," Buffet responded. "I don't believe in dynastic wealth. It's nice to leave something to kids. I can understand how somebody would want to leave their farm or their small business or something that they built, all of that, to their children. But dynastic wealth, the idea that many generations should be able to go without doing a thing, if they wish, simply because they came from the right womb -- that really strikes me as flying in the face of what this country is about. I mean we believe in a meritocracy and equality of opportunity. And dynastic wealth flies in the face of that. So I really felt that if you had a choice between having a foundation like this, doing tremendous things for people all over the world, or having a bunch of people that, as they say, came from the lucky sperm club..." [laughter]

An interesting part of Buffett's move is what he calls the "debilitating effects" of wealth, something that Buffett has seen afflict the rich.

"I love it when I'm around the country club, and I hear people talking about the debilitating effects of a welfare society. At the same time, they leave their kids a lifetime and beyond of food stamps. Instead of having a welfare officer, they have a trust officer. And instead of food stamps, they have stocks and bonds." New York Times

How can such a rich, powerful, and skillful business man have this attitude upon wealth? What does this mean about his attitude toward ensuring that his children live satisfying lives? And what does it mean to leave a legacy for your children? For your society? I find it fascinating that such a person would intentionally remove from his children's grasp a vast sum of fantastic and unfathomable wealth. This, to me, is an incredible expression of what wealth can do to a person.

Buffet notes his displeasure with "dynasties". Why would he dislike them?

Does it make more sense to divert your wealth into philanthropic endeavors which bestow the world with the ability to stop easily-preventable deaths, than to allow your children and grandchildren to inherit all your wealth?

Gates also mentioned how he was influenced by Andrew Carnegie's "Gospel of Wealth" which helped him think about philanthropy and set very high goals. Gates said:

"The whole idea [that] leaving wealth to your children actually would not be the best idea for society or for them, that came out of things that Warren was talking about right around the time we met him. I was starting to thing think that, oh jeez, this is a problem I'll have to deal with. This is some very good advice about that."