Salocin

Societal resentment? Great that Mr Buffet is in a position to show such altruism but hardly fair to be so dismissive of those who think that in a world where there are 1 billion children living in poverty, the fact that one man has $37bn to give away is itself a disgrace.

We are fortunate that the likes of Gates and Buffett have the conscience to recognise how inequitable that it is.

I would argue that most of the people who resent Mr. Gates and Mr. Buffett their wealth do not do so out of indignation relating to starving children, but for reasons much closer to home, such as their sense of comparative wealth in relation to the success of these two individuals, and the discomfort that generates.

I don't think that what they have achieved (perfectly legally and by creating products or providing funding in the right place at the right time) is beyond the ken of any educated individual, but there are many who think the wealth of a man such as Buffett is undeserved - I overheard just such a conversation in a bar yesterday, before the two individuals moved on to discuss football, never once remarking that the teenagers running around the pitch are also in the top 0.001 percentile of earners.

You obviosuly fraternize more eclectic drinking establishments than I do. I don't believe I have ever heard a conversation like that in a bar, particularly not on a world cup day.

In any case, there is a difference of degrees of magnitude between the wealth of footballers and that of a Buffet or Gates and all it really does is provide further evidence that free-market economics does an atrocious job of allocating scarce resources.

I completely disagee - I think free-market economics does an astounding job at allocating scarce resources. It allocates trillions every week, and using the world's two richest men - the very last two data points on a curve of six-and-a-half billion data points, as an example of why free-market economics is bad, is indicative of absolutely nothing.

Gates himself bemoans the fact that, even at it's present size and magnitude, the Gates fund can only afford to give away one american cent per year to each of the three billion human beings of less than average wealth.

Gates and Buffett are (consciously) following in the vein of previous philanthropists, specifically the Rockefellers. The Rockefeller foundation had (in 2006 dollars) less than 8 billion, and their actions are deemed by historians to have saved millions of lives through the second-order effects of their interventions.

The alternative to free markets is distribution by authority (i.e. governments). Even under the present system, governments (i.e. not the free market) have budgets that dwarf what Gates and Buffett have to spend, and yet their actions depend on the next election, and even when they choose to spend on aid, the effect is minimal. If a perfect system is the government without the pressure of elections, I believe there are some old books by some now-deceased leaders of eastern states that depict a method for central distribution of wealth along equitable lines. That experiment has already been run.

The wealth, the technologies and the fact that the west has the ability to help in the first place, whether it uses it or not, is thanks to the investment decisions made by the free market. You can't have it both ways.

PS. I don't know if the right word is "eclectic", but the bars where I drink near work are populated by bankers, lawyers, traders and other city employees who follow the fortunes of individuals like Buffett closely. The conversation turning to such topics after the football match was over didn't surprise me in the least.

You are of course right that using those 2 data point alone is indicative of nothing. The billions of starving people around the world (whilst fat westerners ram their faces) make a far more compelling argument and it is the west's unending capacity for unusustainable consumption which has lined the pockets of Buffet and Gates.

I'm not sure that "fat westerners" are "ramming their faces".

Neither Gates nor Buffett gained their wealth at the expense of the developing world, and the juxtaposition of their wealth with the poverty of the developing world is what motivates them to do what they're doing.

The fact that large amounts of wealth can be accumulated by individuals and the fact that the third world is very poor, when seen side by side, seems very unfair, and the emotional desire to draw a link between the two and imply that one may cause the other (because they're ramming their faces while watching millions of starving children die in their backyard, to get all Daily Mail about it) is understandable. Neverthless, it's misleading to connect the two - one group does not starve because the other eats too much, even metaphorically.

The world's poor are not poor because of free markets, but because of corruption in their own governments and because of western governments getting in the way of free markets by subsidising products that are produced locally but ought to have been imported from developing nations.

Governments are the problem, not markets. On a national level, persistent and growing disparities in percentage growth rates are not the logical outcome of free markets, but a distortion brought about by policies that were well-meaning to start with (after all, we must protect our poor steel workers/farm labourers/coal miners/textile manufacturers). The need for capital (a la Buffett) or the leveraging of IT assets using productivity software (a la Gates) are not products of an unending capacity for consumption. For what it's worth, the explosive growth in rates of birth in the developing world are far more likely to lead to a global over-consumption problem than the desire of a fat face-ramming westerner to have his volvo in metallic blue.

Drawing a causal link, implied or otherwise, between the wealth of the worlds two biggest philanthropists and the poverty of the third world is an argument that has no foundation in logic - extrapolating that argument so that one can blame "free markets" for the poverty in the third world is an argument that belongs to the less-well-informed fringes of the anti-globalisation movement and has no economic reality to it. No matter what emotional graphic metaphor you care to use to describe excess demand in the face of scarce resources - and resources were scarce before the development of modern economic theory.