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Buffett silent on Bill and Melinda as he resigns from Gates Foundation In the middle of a three-page note marking the donation of half his Berkshire Hathaway Class A shares over 15 years, Warren Buffett dropped a small bombshell.
He's resigning his post as one of three trustees for the Bill and Melinda Gates Foundation.
Bill Gates and Melinda French Gates are the other two trustees. Just after May's Berkshire annual meeting, they dropped a big bombshell with the revelation they are getting a divorce,
Buffett didn't mention that development, or either Gates, in his note. He did say he's been a trustee ("an inactive trustee at that") at only one recipient of his annual stock donations, and "I am now resigning from that post, just as I have done at all corporate boards other than Berkshire’s."
Buffett praised the foundation's CEO, Mark Suzman, as "an outstanding recent [2019] selection who has my full support," adding, "My goals are 100% in sync with those of the foundation, and my physical participation is in no way needed to achieve these goals." 
In its story on Buffett's resignation, The New York Times said it raises "new questions about the future of the foundation" just as its "reputation for global philanthropy has been overshadowed lately by reports of Mr. Gates’s questionable conduct in work-related settings."
The Times quotes Benjamin Soskis, a senior research associate for the Center on Nonprofits and Philanthropy at the Urban Institute, which receives funding from the foundation, saying Buffett's statement is "paradoxical."
"On the one hand, the absence of a reference to the Gateses is pretty striking given the events of the last couple months. On the other hand, it points to the possibility of a future, healthier board where personal relationships are less salient and the perspectives people bring in as trustees and the checks that they play on each other are what’s more important." The report notes that in an email to the foundation's staff, Suzman acknowledged that "Warren’s departure raises questions about the foundation’s governance."
Buffett's resignation also raises questions about the current state of his longtime friendship with Mr. Gates that produced their "Giving Pledge," which encourages wealthy people to "commit to giving the majority of their wealth to philanthropy."
Halfway there With this year's donations worth $4.1 billion to the Gates Foundation and several other foundations run by family members, Buffett has given away half the Class A shares he owned in 2006 when, in a Fortune interview, he laid out his plan to give away almost all of his fortune over many years.
At that point, his net worth was an estimated $40 billion. Today it is $101 billion. (Bloomberg looks at "Why the Richest Americans Can’t Give Money Away Fast Enough," with critics suggesting they "need to step it up.")
In his note marking the "midway point" of his plan, Buffett writes that it is "painless" to "give away money that will never be of any real use to you or your family" that he has accumulated by simply "doing what I love to do" with "no sacrifice."
He also downplays his gifts, saying, "A much more admirable form of philanthropy than mine involves the giving of personal time and effort. I’ve done little of that."
He praises the "heroes" who get no recognition when they "mentor the young, assist the elderly or devote precious hours to community betterment."
What about those tax deductions? In the wake of the ProPublica article on relatively small tax bills for very rich people, Buffett notes contributions can "generate significant tax deductions" but the benefit is "far from automatic."
Because he has great wealth but little income (a key complaint generally of the ProPublica piece), Buffett says his foundation donations have led to "only about" 40 cents of tax benefits for every $1,000 of stock he's given away.
Buffett does think "(i)t is fitting that Congress periodically revisits the tax
"Overtime" Buffett stresses in his note that it's "no swan song."
"I still relish being on the field and carrying the ball. But I’m clearly playing in a game that, for me, has moved past the fourth quarter into overtime."
Ted Weschler gets ProPublica's attention In a new article on how some very wealthy investors have used Roth IRAs to "amass vast untaxed fortunes," ProPublica writes that Berkshire portfolio manager Ted Weschler had $264 million in his Roth account as of the end of 2018.
In his response, Weschler writes that the account's growth "has been a function of careful stock selection, exceptional luck and a multi-decade time period ... implemented in a way that was available to all taxpayers with an appropriately long investment runway" and "not the product of exclusionary tax strategies." Even so, he supports "modifying the benefit afforded to retirement accounts once they exceed a certain threshold."
The main focus of the piece is how, in 1999, PayPal co-founder Peter Thiel stayed within what was then a $2,000 annual limit on Roth IRA contributions by using the small amount of money in his account to buy millions of shares of his PayPal startup, not available to the general public, at a very low per-share price.
After later selling those shares and buying others, all within the Roth, ProPublica says the account is now worth $5 billion. Barring a government legal challenge, none of it will be taxed as long as he waits until he's nearly 60 years old in 2027.
BUFFETT AROUND THE INTERNET Some links may require a subscription
BERKSHIRE STOCK WATCH
BERKSHIRE'S TOP U.S. STOCK HOLDINGS - June 25, 2021
Berkshire's top holdings of disclosed publicly-traded U.S. stocks by market value, based on today's closing prices.
Holdings are as of March 31, 2021 as reported in Berkshire Hathaway’s 13F filing on May 17, 2021, except for Apple, Bank of America, and U.S. Bancorp, which also include shares held as of March 31, 2021 as disclosed in New England Asset Management’s 13F filing on May 17, 2021.
In addition to U.S. stocks, shares held as of December 31, 2020 of China's BYD, as listed in Buffett's 2020 letter to shareholders, are included. The price of those shares in U.S. trading is used to approximate the current market value of the position. The value of the stake as a percentage of the company's market value is fixed at what was listed as of December 31, 2020 in the letter.
The full list of holdings and current market values is available from CNBC.com's Berkshire Hathaway Portfolio Tracker.
QUESTIONS OR COMMENTS
Please send any questions or comments about the newsletter to me at alex.crippen@nbcuni.com. (Sorry, but we don't forward questions or comments to Buffett himself.)
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-- Alex Crippen, Editor, Warren Buffett Watch
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