Carlos Slim, world's richest man disagrees with Gates & Buffett on charitable giving. Who is right?

Per this articlethe current “richest man in the world” Carlos Slim says

“Santa Claus” in this case is an obvious reference to the Gates and Buffet foundations that are dedicated to funding various charitable causes worldwide, especially in the undeveloped world.

Is he right? Arguably, having build his fortune in Mexico, Carlos Slim has far more experience with the real world context of a less developed economy, and the limitations inherent in that scenario than Gates and Buffet. In the big picture would the Gates and Buffet gazillions be better employed in creating sustainable jobs and wealth in impoverished areas than in direct charity, ie treating the symptoms of poverty vs working on a cure?

Well, he is more well off than either of the two aforementioned men.
It certainly sounds like it would do more good. Kind of like the old adage about buying fish and/or teaching a man to fish.

Gates and Buffet do already spend their gazillions through investment. They just happen to invest in both businesses and charities, but there is nothing that prevents direct charities from being an investment in helping produce economic growth, productivity and jobs. It is not like Gates and Buffet just hand money to people. Providing vaccinations, helping homeless get housing, “Gateway to College”, getting poor farmers irrigation systems, etc (all examples from the Gates Foundation), all look like pretty good investments rather than something akin “Santa Claus”.

Is it just me, or does “Carlos Slim” sound like a pimp name?

I think he has a point, which is that business development will often do more to lift up impoverished people than charity will. But I disagree that it is always the case. There are some problems that are better handled by charities.

Either I’m being whooshed, or your adage argues in favor of Gates and Buffet. Soros is giving the man that fish- his daily wages. Gates and Buffet are teaching that man how to get lots of fish- college educations.

First of all, it’s not at clear what the argument is from his off-hand remarks. As has already been mentioned, the two are not mutually exclusive.

I would also just note that Slim received his education from a public university and benefited greatly from the privatization of a public company. So he wouldn’t be much of an exemplar of capitalist virtue by any stretch of the imagination.

Creating jobs and producing economic output is better than charity.

If you follow the quotes of economic committees and finance leaders of poor countries, they all favor economic development over charity. They’d rather lure Intel, Nike, or Ford to build a factory in their country vs having Ted Turner write them a big check.

Look at Japan. They hardly have any natural resources to draw on. They import their food and energy. If they relied solely on their cultivated lands, they wouldn’t even be able to feed themselves. They are poor in many ways similar to Africa. But, where they shine is that they know how to make things. This is amazing considering they depend on many materials that don’t even exist within their borders. They have the 2nd largest economy in the world. They produce. They don’t need charity.

Why do the “poor” Japanese produce and prosper but the “poor” Africans cannot? What do charities provide that allows Africans to replicate the success of Japan? Why didn’t Japan need it?

Depends on how you look at it, I guess. As I see it, giving out vaccinations, building infrastructure, etc is passing out fish. Providing jobs, which raise the standard of living, is teaching to fish.

Because Japan has had a fairly stable government and after WWII was re-built with some of the most modern techniques possible by a somewhat benevolent former enemy that worked to feed and rebuild the shattered nation while Africa was plundered for centuries then discarded into a warring cesspit when the colonial powers withdrew?

Edit: also Japan did need billions of dollars in aid after WWII. This is for an obviously much smaller nation with a much more homogeneous population/environment.

Can’t it be both?

Japan got massive amounts of funding following WWII. They also had existing educational, medical, and manufacturing infrastructures in place that could be rebuilt with U.S. investment, but that did not need to be created from scratch.

As noted, the ideas of investment and charity arer not mutually exclusing and Mr. Slim’s comments, (possibly taken out of context), are disingenuous as presented: Gates and Buffet do not simply hand out money to poor people, they provide funding for educational, medical, and financial institutions in order to allow the people at the local level to invest in building systems that are often currently non-existent.

They were richer than countries in Africa even before WW2. They even had enough economic development to defeat Russian military in 1904.

The nice thing about being a billionaire is you have options. :stuck_out_tongue: If he wants to spend billions to start a charitable foundation, he can do that. If he wants to then give away billions directly to poor people, he can do that, too. In light of the paragraph before Slim’s quote, I wonder how much daylight there is between him and Gates and Buffet:

So perhaps he just doesn’t want to give as much to charitable causes as Gates and Buffet do. There’s clearly a role for both types of giving. Sustained economic development requires advancement and not handouts. Vaccines and disease prevention are more urgent.

I think he sounds like a blues guitarist.

I wouldn’t take the Forbes rankings at face value. But even if the rankings are completely accurate, the difference in their net worths is academic. Forbes says Slim’s net worth is $53.5 billion, Gates’ is $53 billion, and Buffett’s is $47 billion. I think each of them has been on top of these rankings once in the last three years.

And in 1904 just about anything worth having in Africa was being controlled by European powers. It’s not hard to be more powerful than a conquered people whose wealth is being bled off.

To give you some idea Cite This is worse than comparing apples and oranges. Africa has more in common with China and even that is stretching it.

I think Slim is wrong. Sure investment and growth can help poor people but this process can be greatly speeded up by health and education initiatives funded by governments and charitable foundations. The bottom billion people in the world are too poor, illiterate and sick to participate in the global economy. You need public investment in schools and clinics to increase their productivity before they can fully participate in the market economy. And in many third world countries especially in sub-Saharan Africa, governments are too impoverished or corrupt to do much so there is an enormous vacuum that can be filled by multilateral agencies like the WHO and international foundations.

To give a concrete example, the research that led to the Green Revolution was initially funded by the Rockefeller and Ford foundations and then carried forward by governments across many Third World countries. Without the food produced by these technologies hundreds of millions more people could have died of malnutrition in the last several decades. There is every possibility that the research funded by the Gates foundation could save ten or even hundreds of millions of lives in the long run.

India was controlled by Britain before Africa colonialism. India is not as bad off as Africa.

I’ve read several competing theories from various historians and economists why Africa is poor. Some say inherent corruption. Some say ethnic wars. Some say lack of major rivers criss-crossing the continent. I haven’t seen anyone claim that massive charities will lift Africa out of poverty.

And what “wealth” has been bled off that, today, makes them unable to replicate Japan’s success? They still have their brains. What else is needed?

Not completely on point, but many people believe that Slim had his own Santa Claus to help him achieve his status, specifically the Mexican government.

Not how I read it. You can give the man fish (so he can eat for a day) or you can teach him a trade (give him a job) that will feed him for years

Charitable giving in this sense is exactly that, a gift. A single solitary giving. Give him a job and who knows how long he will hold it.

I agree that creating jobs and businesses is better than handing out charity. However, if it was that easy we wouldn’t have ~10% unemployment right now.