Bill Gates, come on down
Bill Gates is giving away his money
On a recent Twitter thread, he announced that he’s giving another $20 billion —yes, that’s billion with a “b” — to the Bill and Melinda Gates Foundation.
Bill and Melinda are no longer a thing, marriage-wise, but they continue to co-chair their foundation. With their new gift, and Warren Buffett’s recently announced annual $3.1billion kick-in, the foundation is now worth about $70 billion.
As Tristan Bove reports in Fortune magazine, this new injection of capital allows for a healthy increase in the foundation’s charitable payouts, as well as an increase of 50% in its budget, all of which will power its mission:
The annual payout to charitable causes supported by the foundation is expected to hit $9 billion by 2026, and will focus on mitigating climate change, improving food security, reducing childhood deaths, ensuring equal access to education and gender equality, and preventing future pandemics while eradicating emerging diseases.https://fortune.com/2022/07/13/bill-melinda-gates-foundation-20-billion-record-donation-warren-buffett/
Gates points out the challenges of recent years — worsening climate crisis, pandemic, and the war in Ukraine among them — require a dramatically stepped-up humanitarian response.
This is a good thing
I’m grateful to Bill, and to Melinda. And to Warren Buffett. They’re doing great things with their great wealth, and they’re setting an example for others — at least, for other billionaires.
Whether billionaires should even be billionaires is another question. What does any individual do or create that is worth sequestering that much money in a private fortune?
I suspect Mr. Gates might consider such a question to be prompted by the age-old resentment of the haves by the have-nots. After all, I haven’t built a foundational tech empire that has changed the way we all live.
And to his credit, Bill Gates has also said his ambition is to become less rich. He’s currently at either number four or five on the
List of Obscenely Wealthy world’s wealthiest individuals list. It’s a list he aspires to remove himself from, “eventually.”
Along with a (small) number of other uber-rich individuals including Warren Buffett and George Lucas, Gates’ plan is to devote the bulk of his enormous fortune to philanthropy rather than leaving it all to his kids. In this, he appears to share the same philosophy as Mr. Buffett, who has said, “Leave the children enough so that they can do anything, but not enough that they can do nothing.”
But let’s be clear. Compared to you and me and everyone we know, no matter how much Bill and Warren give away, they’ll still be very, very rich. So will their kids.
I’ve got a suggestion
With respect, Mr. Gates — may I call you Bill? — what if you take your wealth divestment strategy even further? After you’ve endowed your foundation with enough money to keep it going in perpetuity and you’ve left your kids the $10 million or so that you consider “enough,” of course.
Once that’s all taken care of, how about you join us here in the middle class? We’d love to have you, and you might find that life in the middle of the pack offers real benefits.
Think of the simplicity
You won’t need multiple estates or horse ranches in Florida or a list of properties scattered all over the country, if not the globe.
In the middle class, you only need one house. Or maybe one house and a family cabin at a nearby lake, but really, that’ll be plenty.
Sure, it might be a bit of an adjustment downsizing from a place like Xanadu 2.0, the Gates family home on Lake Washington. I mean, 66,000 square feet is a lot of breathing room.
But consider the time and effort you’ll save, not having to maintain all that, as well as not having to schlep back and forth between it and all your other homes.
Trust me, you can learn to live in 2400 square feet. Or even 1800, or less. It’s cozy, and it’s much easier to find your glasses. And with only one house, you won’t need multiples of everything — clothes, cars, Roombas, spice racks.
You won’t have much use for a private jet anymore either. Think how much smaller your carbon footprint will be.
No more personal staff
Oh, you might have a housecleaner and a lawn service. Some of us middle-class folks do. But that’s really it. No personal assistants, no house managers, no private chefs and their minions always rattling around the house.
In the middle class, there is actually more privacy. It’s also conducive to functional fitness. You want a glass of water or a kombucha? Get it yourself. If you want a personal trainer, buy a gym membership. You’re middle class, so you can afford it. Maybe.
True, your current assistants (because we don’t say “servants” anymore) will be out of a job. But I’m thinking you can find them positions on your foundation staff.
Wait, there’s more
Being middle class offers social interactions that you just don’t get at the tippy-top of the economic citadel. Just think of the adventures in popular culture that await you:
- Shopping at Target
- Flying commercial — wait’ll you try economy!
- Meeting folks while standing in line at Chipotle
- Driving your own car, almost all by yourself
Your social life will change too. Less fundraising galas, more backyard barbecues. Casual conversations at the dog park (you do have a dog, right?). Chatting with neighbors who walk past your house — because you will actually have neighbors who live close enough to your house to walk past it.
Your concerns will shift
I’m not suggesting that it’s all pickle ball and block parties in the middle class. You will still be worried about climate change and the war in Ukraine. You will certainly fret over the state of the nation. But you’ll find other issues centering your attention.
Mostly, these will have to do with trying to remain in the middle class. That part’s not getting any easier.
For instance, if you really go whole hog on this experiment and maybe acquire some kids who don’t have a $10 million legacy, I promise that you’ll no longer worry about your kids having too much money.
You’ll be gnashing your teeth over whether they can afford to go to college. Or if they’ll ever have the down payment for a house. You’ll worry that, as modest as your lifestyle is, your kids won’t be able to attain it.
You will be exquisitely aware that one wrong move on their part, or one twist of fate — a poor decision, a badly-timed layoff, a health crisis — can demote them from middle-class to struggling.
Should that happen, you will find yourself in an increasingly common middle-class dilemma. Do you take on a second mortgage or otherwise sink yourself further in debt (the average U.S. household now owes $155,622) to bail out your kids? Or do you wish them luck and keep your tenuous grasp on your middle-class status, in hopes of avoiding being a burden to those kids later on?
Speaking of later on, even you, Bill, would surely like to retire someday. If you’re serious about the full middle-class experience, you’ll want to draw down your portfolio until you have an amount saved for retirement that matches the middle class average. That sum ranges from $107,000 to $168,000, depending on whether you trust the Government Accountability Office or a recent ConsumerAffairs survey.
I’d venture to guess your wine collection is worth more than that. I did say it would be an adjustment.
Income disparity looks different now, huh?
You’re a very smart guy, Bill, and exceptionally well-informed. The issue of income inequality is one you’re very aware of, and globally, it’s one in which your foundation seeks to have an impact. You’re doing more than most rich folks, and more even than some governments, to eradicate extreme poverty.
But now that you’ve joined the middle class, you’ve given up your position in the top 0.1% of Americans (to be clear, I’m referring here to economic status, not character or innate worth; it’s kind of gross how we confuse those things, isn’t it?).
So when Elizabeth Warren and others remind you that that the wealth owned by the billionaire class, the top one-tenth of one percenters, is just about equal to the collective wealth shared by 90% of Americans, it kinda hits you where you live.
Honestly, it kinda pisses you off. Because it’s not just that the uber-rich have gotten richer — it’s that they’ve done so at the expense of the rest of us. They haven’t so much created new wealth for themselves as they’ve redistributed it upwards.
Income equality hasn’t always been so out-of-whack. As Hanauer and Rolf point out, if the more equitable distribution of the post-WWII decades, roughly from the mid 1940s to the mid 1970s had held steady, you and I down here in the middle class would be breathing easier:
. . . the aggregate annual income of Americans earning below the 90th percentile would have been $2.5 trillion higher in the year 2018 alone. That is an amount equal to nearly 12 percent of GDP—enough to more than double median income—enough to pay every single working American in the bottom nine deciles an additional $1,144 a month. Every month. Every single year.https://time.com/5888024/50-trillion-income-inequality-america/
For non-billionaires, that much more in the paycheck wouldn’t just be budget dust. It would be life-changing.
The article was written in 2020 at the height of the pandemic, but nothing has happened since to reverse that trend. Inflation, here and abroad, is only squeezing the middle and working classes harder. Now that you have to fill up your own gas tank and do your own grocery shopping, you know what I’m talking about, right, Bill?
So, okay, things aren’t so rosy down here
Another Time.com article, this one by Alana Semuels and Belinda Luscombe and dated April 28, 2022, addresses how the U.S. economy is leaving the middle class behind. Home prices are up 20% and everything else costs an average of 8.5% more than it did a year ago. Meanwhile, average hourly wages, adjusted for inflation, are down by 2.7%
The writers talked to dozens of middle-class folks all over the country. They found that many of them are, indeed, pissed. And worried. Feeling insecure about their own finances and their kids’ futures, if they even think they can afford to have kids.
Anger, insecurity, fear, hopelessness: none of it is good for democracy.
So I have another suggestion, Bill
Forget what I said about joining the middle class. Not like you were about to take me up on it anyway. But how about, in addition to all the good work your foundation is doing in developing countries, you add another element to its mission?
What if you made it your goal to reform income disparity here at home? To end the current Gilded Age and return to the more balanced wealth distribution of the post-war era? What if CEOs went back to earning 20 times what their workers are paid, like they did in 1965, instead of earning roughly 370 times what their workers make, as they do now?
In 2019, the Economic Policy Institute noted that CEO compensation had grown 940% since 1978. During the same time, worker pay rose only 12%.
And again, that was pre-pandemic and pre-global inflation. Things haven’t exactly turned around since.
This is a problem
A great, big, hairy, badly behaved elephant in the room, this problem is. Income disparity on this scale strangles dreams and adds to the diseases of despair that have soared in the U.S. for ten years. It creates fear and rage and division. It threatens the stability of our country.
Truth be told, Bill, the middle class is in a mess, and it’ll take some real innovation and heavy-duty investment to fix it. And it will need people to lead by example.
People like you, Bill.
You’ll still be welcome at my barbecue.