I bumped into billionaire philanthropist David Rockefeller in an odd place last week… Seljandsfoss, Iceland.
Rockefeller was apparently celebrating his 92nd birthday in Iceland.

Karl Olafsson was supposed to be our SuperJeep driver for the day. But “the Rockefellers tied him up for the week,” so he recommended another of his drivers at his company.
We pulled up to Seljandsfoss with our substitute driver. And what do you know, Karl is there too, with the Rockefellers. And hardly another soul. The drivers tell us “more and more celebrities are coming these days… Eric Clapton has been here… Clint Eastwood… They come because they can be regular people here. They’re never hassled at all.”

20070614-imageI didn’t hassle Rockefeller… I didn’t say anything. My six-year-old son and I simply walked around him to go behind the Seljandsfoss waterfall – one of the few big ones that you can walk behind in Iceland. We were traveling the South Coast… on our way to go up to the glacier and see the black sand beaches (any proper surfer checks the surf wherever he is).

If you don’t know, David Rockefeller just sold a 1950s Rothko painting for $70 million a few weeks before this trip – a painting he had bought for less than $10,000 in 1960. Now you might think… what’s a rich guy going to do with that money?

You might be surprised… Rockefeller will likely give it away. Rockefeller actually tried to give the painting away… He offered it to the Museum of Modern Art. The museum told him it didn’t need it… it already has several 1950s Rothkos.
Rockefeller’s “career” these days is giving his fortune away. He’s already given away one quarter of it and has more to go…
He has inspired other rich men to do the same. Bill Gates – the world’s richest man – cites Rockefeller as an influence in his decision to “quit” Microsoft to focus on philanthropy full time. His Gates Foundation has more than $33 billion to give away.

Warren Buffett, the world’s second-richest man, has pledged to give away just about all of his wealth to philanthropy when he dies – all tens of billions of it.
“Rich people don’t give away enough of their money,” some like to say.”That’s why we need the government to tax it away from them and give it to those who really need it.”
I chuckle inside when I hear this… These folks obviously don’t know the first thing about economics. (If you have caught yourself saying this, then please read the simple book Economics in One Lesson by Henry Hazlitt.)
Here’s the way I see it: Thankfully, Bill Gates lived in a great country where entrepreneurs are free to generate wealth. Before Bill Gates, there was no Microsoft. He created billions of dollars out of thin air. He created thousands of jobs, many millionaires, and some billionaires.

Luckily, all his profits weren’t taxed away every year, so he could grow his net worth from thousands into millions, and then billions. Now, he is giving away billions of dollars, and he’s trying to put those dollars to the very best possible use.
On Monday of this week, I was in New York at Bill Gross’s stamp auction. He gave away all the proceeds to charity as well, more than $9 million. It’s the largest gift ever to Doctors Without Borders.
Taxing the rich and having the government redistribute the money to the poor is a popular thought. It seems simple and obvious. But I would prefer to let Bill Gates create jobs and wealth for thousands of people, than to tax him and give that money to the government to use less efficiently.

I also prefer to invest in countries that see freedom as the way to prosperity… 50 years ago, Iceland was the poorest country in Europe. Now, after opening up its economy, it’s the second richest… and still a fantastic place to invest.
Good investing,

Article by Dr. Steve Sjuggerud