Sunday, August 15, 2010

The Giving Pledge For All of Us

I am sure that by now everybody has heard about Bill Gates' and Warren Buffet's call on America's billionaires to donate 50% of their wealth to charity. 40 billionaires have already signed the pledge, among them the creator of Star Wars, George Lucas, New York Mayor Michael Bloomberg, and the CEO of CNN, Ted Turner.

This revolutionary and challenging idea came as no surprise from Gates and Buffet, the true leaders of American philanthropy. Now, the boldness of the idea is in the amount of money we are talking about here - $115 billion dollars of pledged donations, at least! Anyone can imagine this amount? I didn't think so. Many billionaires who have pledged are actually planning to give away more than half of their fortune, while Buffet is donating 99% of his wealth. This for me is a great example of the American spirit, the explanation of America's success, the motor behind America's strength. The only better and more powerful example of this would be the "Everyman Giving Pledge", which Stephanie Risa Stein in her post Where the "Billionaire Giving Pledge" Meets the Rest of Us urges ordinary people to "sign."

- Will we, with our ever-so-limited resources, be able to make any impact?- you would ask.
-Very much so!

The reason is that price and income level in developed and developing countries are so different that a sum that for you means nothing can actually change a life for somebody in Africa. People who live on less than $1 a day can start a small business with 2 spare dollars, much less than average American spends on Starbucks everyday! Believe me, I am not exaggerating a bit!

I just read a story of Goretti, one of the many forlorn and impoverished women in rural Burundi. With the help of CARE Goretti was able to get a loan of $2 from her women association which she spent on fertilizer. Her garden then produced a rich crop of potatoes which she sold in a local market. She earned $7.50 and was able to pay back the loan, $2.30. The rest of her profit, $4.20 she invested in making banana beer which was a great success at the local market. The next $2 loan she used on expanding her banana beer business. From her profits she was able to buy to goats, which of course are a huge asset in rural Africa. *

Thus, the solution to global problems lays not only in cash, but also in efficiency. Not all non-profits are equally transparent, not all approaches are equally effective. That is why it is so important to back donations with the knowledge of a problem you are trying to address. Yet, an average American donor, most likely, does not have sufficient knowledge of global poverty, reproductive health, or the water crisis. As a result, donors' money sometime go to projects that don't make substantial difference on the ground. The key, for me, is education of general public about global issues. We, ordinary people, do not always have smart friends as Bill Gates or advisors who will help us identify a critical problem and the best approach to solving it. So, if we don't want to waste our own money-which we don't count in billions-and at the same time want to make a meaningful impact in this world, we have to educate ourselves. Likely, we have Internet now, non-profit sphere is becoming more and more prominent, and social entrepreneurship is becoming a career for many young people.

Don't think that you cannot make a difference if your don't have a six figure salary. Don't be intimidated by the billionaires' pledge, get inspired instead and inspire others to give. Because, in the end, the billionaires' pledge won't solve all the global problems, but everyman's might.

* "Half The Sky: Turning Oppression Into Opportunity For Women Worldwide." Nicholas D. Kristof and Sheryl WuDunn.

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