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Originally published June 16, 2010 at 10:04 PM | Page modified June 16, 2010 at 10:59 PM

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Donate your money, billionaires challenge the rich

Can a little peer pressure make the ultrarich more generous? Bill and Melinda Gates and Warren Buffett are launching a drive to persuade billionaires to give away the majority of their fortunes.

Seattle Times business reporter

Can a little peer pressure make the ultrarich more generous? Bill and Melinda Gates and Warren Buffett are launching a drive to persuade billionaires to give away the majority of their fortunes.

What started as a series of very private dinners last year became a public campaign Wednesday when they called on their fellow billionaires to sign a "Giving Pledge," to donate most of their wealth to philanthropic causes of their choice.

The pledge isn't legally binding, but they hope the effort will generate more money to address important social problems and set a standard that becomes the norm, former Gates Foundation Chief Executive Patty Stonesifer, now an adviser to the Gateses, said in an interview.

The potential for philanthropy is huge — the United States alone has at least 400 billionaires with a net worth that Forbes estimates at $1.2 trillion. If those billionaires gave the minimum pledge of half of their fortunes to charity, that would triple the current amount of charitable giving in the United States.

"That could be transformational," said Phil Buchanan, president of the Center for Effective Philanthropy. "It could have a dramatic effect on some of the toughest social challenges that we face. But people have to do it first."

Only 17 of the 400 wealthiest Americans listed by Forbes magazine were among the top 50 donors in the country, according to a tally of the nation's leading philanthropists last year by the Chronicle of Philanthropy. Those top 50 donors gave a total of $4.1 billion to charity in 2009, while total giving in the United States was about $300 billion.

Buffett, who pledged to give away more than 99 percent of his $47 billion fortune, was the main driver of the initiative, which has the support of a couple dozen billionaires, Stonesifer said. In a letter published Wednesday that outlines his pledge, Buffett said fate can be "wildly capricious" in leading some people to be rich and others poor.

Buffett said he was inspired not by the rich but by the generosity of ordinary people who sacrifice more to contribute hard-earned dollars to churches, schools and other organizations.

The idea came out of a series of private dinners the Gateses and Buffett held in New York and the San Francisco Bay Area over the past year. They will invite people who take the pledge to meet at an annual event to share ideas.

Four couples already have signed on to the pledge, Stonesifer said. They are Los Angeles philanthropists Eli and Edythe Broad; media entrepreneur H.F. "Gerry" Lenfest and his wife, Marguerite, of Pennsylvania; and two Silicon Valley pioneers: venture capitalist John Doerr and his wife, Ann, and former Cisco Systems Chairman John Morgridge and his wife, Tashia.

The Giving Pledge does not involve pooling money or supporting particular causes. But philanthropic efforts have the most impact when different nonprofits and foundations unite around the same cause, often bringing in support from businesses and policymakers, Buchanan said.

"There are so many pressing human needs and the temptation is so great to want to address all of them," Buchanan said. "There's going to need to be collaboration among philanthropists to move the needle in significant ways."

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Having too much wealth is a burden, Buffett said.

"Too often, a vast collection of possessions ends up possessing its owner," he wrote. "Were we to use more than 1 percent of my claim checks on ourselves, neither our happiness nor our well-being would be enhanced."

Washington state is home to six billionaires: Gates, Microsoft Chief Executive Steve Ballmer, Microsoft co-founder Paul Allen, Amazon.com Chief Executive Jeffrey Bezos, wireless entrepreneur Craig McCaw and Oakley sunglasses creator James Jannard, who lists his residence in the San Juan Islands.

"This is an exciting idea and sets a new standard for charitable giving," said Susan Coliton, vice president of the Paul G. Allen Family Foundation. Allen was out of the country and unavailable for comment. He has been ranked among the top philanthropists for years, Coliton said, adding, "I am sure he will be interested in learning more about this challenge from Warren Buffett and Bill and Melinda Gates."

McCaw declined to comment. Ballmer said recently that he and his wife preferred to keep their philanthropy private and anonymous. Calls and e-mails to Bezos' office went unanswered, and Jannard's assistant in California said he was out of the office and could not be reached Wednesday.

"We agree with Andrew Carnegie's wisdom that, 'The man who dies rich, dies disgraced,' and we also believe 'He who gives while he lives also knows where it goes,' " the Broads said Wednesday in a statement along with their pledge to give 75 percent of their wealth to charity.

Giving may be rewarding, but it's not that easy, they said.

"Philanthropy is much harder than running two Fortune 500 companies."

Kristi Heim: 206-464-2718 or kheim@seattletimes.com

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