People aren’t very good at understanding big numbers, and when it comes to billionaires, they often get the zeros behind. But the calculation that one of the richest people on the planet – Warren Buffett – is so rich that he can afford to give every child on Earth 43 dollars and still have half a billion dollars left over, everyone understands it.
That’s why the Wall Street Journal news has been around the world for a few days now. According to unofficial information, the billionaire and CEO of Berkshire Hathaway is considering a plan to distribute his inheritance to a global children’s savings bank. The exact details are not yet known, but a former employee at the Bill and Melinda Gates Foundation — which is set to inherit the bulk of Buffett’s money — tells the publication that this way each child could receive thousands of dollars.
It’s a proposal that could have huge economic implications. Baby bonds have the potential to eliminate economic inequality and benefit entire generations – according to a 2019 study, they “significantly narrow wealth inequalities while improving the net asset position of young people and easing asset concentration.”
With some other billionaires bemoaning the declining birthrate, it may help another problem: roughly two in five people who don’t have children but want them cite the exorbitant cost of living as a reason for their choice.
The research on the growing inequality in the world is commented in the publication by one of its authors – Naomi Zevde, in the following way: “If we take 100 people to represent the United States and 100 dollars to represent their wealth, 40 dollars will go to only one person. “Another $40 will be in nine more. That leaves about $20 to be distributed among the remaining 90 Americans.”
Baby bonds, however, “will reduce the cash shortage of the next generation,” Zevde wrote.
It is not yet clear whether the Gates Foundation has in mind a fixed amount per child or if it will be proportional in some way to income. It is not mentioned whether the money will go to address inequality in the US or around the world, writes chronicle.bg.
As wealth inequality and the pay gap have widened during the pandemic, a growing number of billionaires are thinking of more inventive ways to allocate their assets. This includes the idea of a more equitable distribution of money, starting with the children. It has already reached the Senate with the Democrat-backed American Accountability Act. It’s a proposal that addresses the racial wealth divide by introducing $1,000 baby bonds for all newborns in the US.
As the curtain on his legacy lifts, the 91-year-old Buffett’s fortune continues to grow, even as many of the richest people report losses for the first six months. The Oracle of Omaha, as many call him, has a fortune of almost 111 billion dollars and is in fifth place in the world ranking. He could have been in first place today if he had not donated exactly the same amount to charity in the last 16 years.
He still hasn’t said how the money will be distributed to the children, but the best news is that he has already announced: He wants his money to be spent as quickly as possible – within 10 years.
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