The Wall Street Journal Classroom Edition

When investor Warren Buffett was in his 20s, he studied biographies of America's historical business titans, from banker J.P. Morgan to oil tycoon John D. Rockefeller to steel magnate Andrew Carnegie.

He was primarily drawn, of course, by their ability to accumulate vast fortunes. But he was also intrigued by the way the tycoons became philanthropists. Mr. Rockefeller and his son, John Rockefeller Jr., used their millions to cure disease, launch the green revolution in agriculture and fund countless arts and cultural programs. Mr. Carnegie founded the nation's first library system and a famed concert hall.


	Even among billionaires, the Pledge signers are a special group. It's one thing to make a billion dollars.It's another thing to give half of it away.

"One way or another, we form ideas about what we're going to do if we turn out to be wealthy," Mr. Buffett says. "For me it was in my 20s, reading what those other people had done."

A NEW EXTREME

Over the past year, Mr. Buffett has carried his philanthropy to a new extreme and, in the process, sparked a revolution in the world of giving. Through his launch of the Giving Pledge in June 2010 with Microsoft founder Bill Gates, Mr. Buffett has unlocked billions of dollars for philanthropic causes, and created the most powerful movement in American philanthropy since Andrew Carnegie released his famous "Gospel of Wealth" treatise in 1889.

The Pledge itself is simple. Its signers have to be billionaires. And they have to promise to give at least half of their fortune to charity during their lifetimes. So far, 69 billionaires have signed the pledge, representing more than $150 billion in philanthropy. The signers are diverse in their politics and causes—ranging from fighting cancer to housing orphans in Africa to helping farmers in Appalachia. Still, they are united in their mission: to inspire the world's wealthy to give a larger percentage of their wealth to charity.

Mr. Buffett says that while many of the givers had already committed to give half of their fortune away, others were inspired for the first time to promise a specific number. And a few decided to make their first gifts ever.

Facebook billionaire Mark Zuckerberg hadn't announced any real philanthropic plans before signing the Pledge last December. He announced his signing with a gift of $100 million to the public school system in Newark, N.J. "People wait until late in their career to give back," Mr. Zuckerberg says. "But why wait when there is so much to
be done?"

Joe Mansueto, 55-year-old billionaire founder of the Morningstar investment-research company, was always planning to give away some of his fortune to charity. Yet he didn't know how much he would give or when. Then one afternoon, in August 2010, he received a phone call from Mr. Buffett. "He told me that if enough people sign the Pledge, we could really have an effect on giving in our society over time," Mr. Mansueto recalls. Mr. Mansueto was quickly convinced. "Both Buffett and Gates have inspired me and set this incredible example to the world of the responsible way to have wealth."

SPECIAL CLUB

Even among the world's growing ranks of billionaires, the Giving Pledge signers remain a special group. It's one thing to make a billion dollars. It's another thing to give half of it away. By reaching out to billionaires in India, China and other countries, Messrs. Gates and Buffett hope to make the club even more global.

"Hopefully, you get people who want to be part of this club or fraternity of people who have defined where they want to go with their philanthropy," says Ronald Perelman, the New York billionaire, financier and Pledge signer.

Messrs. Buffett and Gates make constant phone calls and hold regular meetings with possible signers. They also hand out some of the most sought-after invitations on the planet, with their regular "Pledge dinners," where billionaires can speak for up to 12 minutes about their giving and their views on philanthropy. Mr. Buffett says the talks are designed to "share their experiences and inspire others."

One billionaire who was lured by the dinners was John Paul DeJoria, the "shampoo billionaire" who co-founded the Paul Mitchell hair-products empire. He and his wife went to a Pledge dinner in California last year. After hearing other people's stories and meeting Messrs. Buffett and Gates, they decided to join.

Mr. DeJoria says he plans to give his money to a wide variety of causes that he already supports—from funding agricultural projects in Appalachia to supporting orphans in Africa.

"We have a choice," he says. "We can make our kids billionaires and it will ruin them. Or we can realize how blessed we are and try to spread those blessings around. My view has always been that success unshared is failure."

ADDITIONAL READING

"Small Sacrifice, Big Return" profiles Giving What We Can, a nonprofit that asks people to make long-term salary pledges to charity.

"Strength in Numbers" looks at how nonprofits are trying to make up the shortfall in donations.

"Philanthropists in Waiting" reports on schools that are teaching students how to give back when they grow up.

WEB RESOURCES

The Giving Pledge: This website profiles the people who have agreed to give a majority of their wealth to charity.

The Chronicle of Philanthropy: This online news site features information and trends in philanthropy. A subscription is needed to read some content.

VIDEO

WSJ Magazine's "Innovator of the Year Awards" gives this year's philanthropy prize to The Giving Pledge.

OBJECTIVE
Debate whether the wealthy have a duty to be philanthropic

OVERVIEW
In the past year, Warren Buffett has carried his philanthropy to a new extreme and, in the process, sparked a revolution in the world of giving.

STANDARDS
NBEA: economics and personal finance; NCEE: decision-making, money, income; NCSS: individuals, groups and institutions, civic ideals and practices

REVEW
Read the article "The 1% Solution" and answer these questions:

1) How has Mr. Buffett sparked a revolution in the world of giving?

2) How do Mr. Buffett and Microsoft Founder Bill Gates persuade their fellow billionaires to make the pledge?

ACTIVITY IDEAS

• Why would someone such as Facebook founder Mark Zuckerberg, who is in his 20s, make the pledge so early in life? Use the Internet to research where some of his money has gone. Do you think his age influences the causes he supports? Discuss as a class.

• Use the Internet to research the causes of three billionaires who made the Giving Pledge. Why do you think these philanthropists selected these specific causes for their money? For example, Bill Gates is not an expert on malaria, yet he has donated millions of dollars to help the cause. Why? Discuss your findings as a class.

• Do you think the billionaires who sign the Giving Pledge are doing so for altruistic reasons or because it's good for their image? Or is it both? Discuss as a class.

• Pledge letters from those who have signed the Giving Pledge are available for download on the group's website. Review these letters. Are there any common reasons for making the pledge? Which letter was your favorite? Explain.

• Who are the philanthropists in your town? Do you have any buildings or other landmarks named after individuals? If yes, research that person and discuss his or her contribution to your community.

• Paul Mitchell hair products co-founder John Paul DeJoria says "success unshared is failure." You might not be a billionaire, but how can you apply this statement to your life? When you are successful at something--academics, sports, playing a musical instrument, etc.--how do you share it? Explain.