The friendship between Warren E. Buffett and Bill Gates has been forged over a shared passion for such homespun American treats as cherry Coke, burgers and college football. They delight as well in loftier pursuits, like playing bridge and solving complex math problems.
But, more than anything, what Mr. Buffett’s $31 billion gift to the foundation that Mr. Gates runs with his wife, Melinda, shows is a common disdain for inherited wealth and a shared view that the capitalist system that has enriched them so handsomely is not capable alone of addressing the root causes of poverty.”A market system has not worked in terms of poor people,” Mr. Buffett said yesterday, in an interview taped earlier in the day for “The Charlie Rose Show” on PBS.
As for any thought he might have had in giving the bulk of his billions to his three children, Mr. Buffett was characteristically blunt. “I don’t believe in dynastic wealth,” he said, calling those who grow up in wealthy circumstances “members of the lucky sperm club.”
Genuine friendships within the highest tier of corporate America are rare, because of the demands of the jobs as well as the myriad forces that can turn shared interests into embarrassing conflicts.
But the bond between Mr. Buffett and Mr. Gates, the two richest people in the United States and arguably the two most influential in American business in recent years, has lasted more than 15 years. It has been sustained, according to people who know them, in large part by a very high level of intelligence and a conviction that their vast wealth has given them a larger responsibility to society.
“When you are as smart as Warren or Bill, I think it’s hard to find people to talk to,” said Donald E. Graham, the publisher of The Washington Post, who has spent time together with the two men. He called Mr. Buffett’s gift “the most creative thing that anyone has done and the way he has done it underscores how much admiration he has for Bill.”
What was most surprising about Mr. Buffett’s decision was not so much that he was giving his wealth away but that he was asking someone else to pursue philanthropy on his behalf.
Like Mr. Buffett, corporate titans like Sanford I. Weill, the former chief executive of Citigroup, and Henry M. Paulson Jr., the chief executive of Goldman Sachs who has been nominated to be Treasury secretary, have promised to dispense with their own wealth. But they, like most of those with huge fortunes, are expected to set up their own charitable foundations to carry out their wishes. For Mr. Buffett, a hallmark of his skill as an investor has been his self-denying quality. He has often described his task running Berkshire Hathaway, the insurance holding company that serves as his investment vehicle, as finding the best corporate managers, investing heavily in them and getting out of the way — an approach that he now plans to follow with Mr. and Ms. Gates.
“I would be terrible at it,” Mr. Buffett said yesterday, assessing his abilities as a philanthropist. “I like to look in the mirror and ask myself whether I’m doing O.K. And there are a lot of people whose opinions I don’t want to listen to. So you have to be a little more diplomatic than I am.”
In past interviews, Mr. Gates, who just turned 50 and is 25 years younger than Mr. Buffett, has referred to himself as the student in the relationship (“I study him,” he has said).
But while business itself has not been at the core of their relationship, Mr. Buffett invited Mr. Gates to serve as a director of Berkshire Hathaway and said that he had bought a small piece of Microsoft a long time ago just to keep his eye on Mr. Gates.
Mr. Gates said yesterday that Mr. Buffett had first mentioned the idea in passing on his wealth to the Bill & Melinda Gates Foundation about a year and a half ago. Then in recent months, the two men, who play bridge online and vacation together, delved into more specifics as Mr. Buffett discussed just how impressed he had been with the work of the foundation, which devotes the greatest amount of its resources to improving health conditions in developing countries.
“Then it was like, ‘Wow, is he serious about that?’ ” Mr. Gates recalled in his interview with Mr. Rose. Followed by, “Wow, are we ready for that?”
The two men were first introduced in 1991, when Mr. Gates, who then kept his nose close to Microsoft’s grindstone, was persuaded by his mother to attend a meeting where Mr. Buffett and Katharine Graham, then the publisher of The Washington Post, were present.
Mr. Gates was reluctant to go, fearing that Mr. Buffett was only interested in narrow financial subjects. “What were he and I supposed to talk about, P/E ratios?” he recalled for an article in Harvard Business Review.
But they hit it off immediately, plunging into an in-depth dissection of I.B.M.’s prospects. Yesterday, Mr. Gates credited Mr. Buffett for encouraging him, in the early 1990’s, to read a copy of the World Development Report, put out by the World Bank, that analyzed poverty levels around the world, thus sparking his interest in philanthropy.
One thing they don’t have in common is the way they live. Mr. Buffett, who still inhabits the house in Omaha that he bought for $31,500 in 1959, frequently lured Mr. Gates to his home turf to participate in local bridge tournaments. Mr. Gates built a huge mansion on the shores of Lake Washington not far from Microsoft’s headquarters in Redmond, a suburb of Seattle. And he is a much more enthusiastic world traveler, though he persuaded Mr. Buffett to accompany him on a trip to China in 1995.
But they both are devoted workaholics who go to their offices just about every day they are at home. In public, there is a relaxed towel-snapping aspect to their relationship — as if they are making up for all those jocular moments that passed them by during their younger, more intensely ambitious years.
In an earlier interview with Charlie Rose, Mr. Buffett explained the role he played in Mr. Gates’s engagement in 1994 to his wife, with whom he has had three children. The couple flew into Omaha, where they met Mr. Buffett at Borsheim’s, the jeweler that Berkshire Hathaway has owned for years.
“Look, Bill, this is none of your business, but when I got married, I spent 6 percent of my net worth on the ring,” he recalled saying to Mr. Gates, who at the time had a net worth already well into the billions. “I don’t know how much you love Melinda.”
Mr. Gates can get his jabs in, too. He has said publicly that his daughter calls Mr. Buffett “the man who works at Dairy Queen,” a needle at Mr. Buffett’s oft-expressed love for the company, which he owns, and its signature product.
Mr. Gates has also credited Mr. Buffett with crystallizing his own feelings about inherited wealth. The son of a successful lawyer in Seattle, Mr. Gates rebelled at his own privileged upbringing, dropping out of Harvard and starting Microsoft with several close associates.
But in the end, a decision that will double the wealth of what is already the largest charitable foundation in the world seems to have been largely the result of a shared belief in the power of lasting, creative partnerships. Mr. Buffett, for example, has worked with a close associate, Charles T. Munger, for decades.
Mr. Gates has had similar partnerships. He co-founded Microsoft with a childhood friend, Paul G. Allen, and presided over Microsoft’s rise to its current status with Steven A. Ballmer, a dorm mate at Harvard, whom he named chief executive in 2000 when he elevated himself to chairman of the board.
“In business, I had a great partnership with my partner Charlie,” Mr. Buffett said yesterday. “And I have seen what happens when you get two people together that are totally in sync but also have different ways of working towards a common goal.”