Doug Wilson
With the stroke of a pen last week, financial giant Warren Buffett donated $31 billion to the Bill and Melinda Gates Foundation and changed the philanthropic world as we know it. Buffett’s contribution makes the Gates Foundation the largest foundation in the world; indeed, it is now nearly six times the size of the Ford Foundation.

Big money makes for a big story, so Buffett’s donation has garnered a great deal of media coverage. And rightly so. But the public would be well-served to do more than gawk at Buffett’s mammoth gift. Instead, we should compare it to another “gift” – one given by the federal government to the victims of Hurricane Katrina a little less than a year ago.

To date, the federal government has spent $19 billion (approximately 60 percent of Buffett’s entire gift) to help Katrina victims.

The money has not been spent wisely.

In fact, the New York Times reports that “government investigators have found fraud and waste consuming more than one in every 10 dollars.” Cases in point: Ten thousand mobile homes manufactured for Katrina victims sit unused in Arkansas at a monthly storage cost of $250,000; numerous FEMA employees and general contractors have been or will be charged with fraud, price-gouging and phantom “expense” reimbursement claims; thousands of Katrina victims have filed false claims for food and hotel reimbursements and have found countless other ways to game the system. According to Times’ report Eric Lipton, as much as 21 percent of the $6.3 billion in aid sent to victims was improperly distributed.

Ah, yes, government inefficiency.

Now contrast that inefficiency with the Gates Foundation, whose goal—“to help reduce inequities in the United States and around the world”—is much more ambitious than simply helping out hurricane victims. Do you think Warren Buffett, a man who made an empire by making smart business decisions, would give $31 billion to an organization that would waste 10 percent (that would be over $3 billion!) of his donation?

No way!

Because of numerous safeguards and an overall culture of accountability, the Gates Foundation would never stand for the fraud and abuse that so often marks government intervention on behalf of the poor or “victimized.” Consider a few reasons why the foundation is so effective and able to earn the trust of someone as wealthy as Buffett:

Strict adherence to setting measurable goals and holding grantees accountable for results.

- Commitment to hiring experts who can oversee gifts and partner with charities to conduct effective problem solving.

- Minimal red tape and bureaucracy. Focus on results, not the process.

- Management style based on competence, trust, compassion and sacrifice.


Doug Wilson

Doug Wilson is the the co-author, with Edwin Feulner, of Getting America Right: The True Conservative Values Our Nation Needs Today.

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