A foundation in the United States is a type of charitable organization. However, the Internal Revenue Code distinguishes between private foundations (usually funded by an individual, family, or corporation) and public charities (community foundations and other nonprofit groups that raise money from the general public). Private foundations have more restrictions and fewer tax benefits than public charities like community foundations.
The two most famous philanthropists of the Gilded Age pioneered the sort of large-scale private philanthropy of which foundations are a modern pillar: John D. Rockefeller and Andrew Carnegie. The businessmen each accumulated private wealth at a scale previously unknown outside of royalty, and each in their later years decided to give much of it away. Carnegie gave away the bulk of his fortune in the form of one-time gifts to build libraries and museums before divesting almost the entirety of his remaining fortune in the Carnegie Foundation and the Carnegie Corporation of New York. Rockefeller followed suit (notably building the University of Chicago) and gave nearly half of his fortune to create the Rockefeller Foundation.
Meanwhile, in 1914, Frederick Goff, a well-known banker at the Cleveland Trust Company, sought to eliminate the "dead hand" of organized philanthropy and so created the first community foundation in Cleveland. He created a corporately structured foundation that could utilize community gifts in a responsive and need-appropriate manner. Scrutiny and control resided in the "live hand" of the public as opposed to the "dead hand" of the founders of private foundations.
Starting at the end of World War II, the United States's high top income tax rates spurred a burst of foundations and trusts being created, of which many were simply tax shelters. President Harry S. Truman publicly raised this issue in 1950, resulting in the passage later that year of a federal law that established new rigor and definition to the practice. The law did not go very far in regulating tax-exempt foundations, however, a fact which was made obvious throughout the rest of that decade as the foundation-as-tax-refuge model continued to be propagated by financial advisors to wealthy families and individuals. Several attempts at passing a more complete type of reform during the 1960s culminated in the Tax Reform Act of 1969, which remains the controlling legislation in the United States.
Warren Edward Buffett (/ˈbʌfᵻt/; born August 30, 1930) is an American business magnate, investor, and philanthropist. He is considered by some to be one of the most successful investors in the world, and as of March 2017 is the second wealthiest person in the United States, and the fourth wealthiest in the world, with a total net worth of $73.3 billion.
Born in Omaha, Buffett developed an interest in business and investing in his youth, eventually entering the Wharton School of the University of Pennsylvania in 1947 before transferring and graduating from University of Nebraska–Lincoln. After graduating at 19, Buffett enrolled at Columbia Business School of Columbia University, learning and eventually creating his investment philosophy around a concept pioneered by Benjamin Graham–value investing. He attended New York Institute of Finance to specialize his economics background and soon after began various business partnerships, including one with Graham. After meeting Charlie Munger, Buffett created the Buffett Partnership. His firm would eventually acquire a textile manufacturing firm called Berkshire Hathaway and assume its name to create a diversified holding company.
Buffett has been the chairman and largest shareholder of Berkshire Hathaway since 1970, and his business exploits have had him referred to as the "Wizard", "Oracle" or "Sage" of Omaha by global media outlets. He is noted for his adherence to value investing and for his personal frugality despite his immense wealth.
Buffett is a notable philanthropist, having pledged to give away 99 percent of his fortune to philanthropic causes, primarily via the Bill & Melinda Gates Foundation. In 2009, with Bill Gates and Mark Zuckerberg, Warren founded The Giving Pledge, whereby billionaires pledge to give away at least half of their fortunes.
He is also active in contributing to political causes, having endorsed Democratic candidate Hillary Clinton in the 2016 U.S. presidential election; he has publicly opposed the policies, actions, and statements of the current U.S. president, Donald Trump.