Even to raise such a question, especially in such hyperbolic language, may seem like a blasphemy after Warren Buffett’s donation to the charitable foundation set up by Bill Gates, by far the biggest act of philanthropy recorded. Not only will this donation double the size of an organisation that is universally acknowledged as the world’s most effective operation against diseases such as Aids and malaria, Mr Buffett’s generosity has also been widely praised as an example for other billionaires who want to give something back to a world that has given so much to them. It has even been hailed as the dawn of a golden age of philanthropy or, alternatively, as a return to the volunteer spirit of the Victorian era, in which private giving, rather than government spending, was the main driving force for redistributing income, combating poverty and promoting science, education and arts.

Why, then, as an instinctive liberal who believes that private initiative generally delivers better results than public spending, did I start this article on such a discordant note?

Partly because dogmatic opponents of all state activity are already using Mr Buffett’s astonishing combination of wealth and generosity to create the impression that public health, international development and global warming can be adequately handled by private charity. This is a dangerous illusion. Even if all billionaires were as generous as Mr Gates and Mr Buffett, their combined fortunes would not remotely match the public spending on international development, not to mention the infinitely larger sums governments spend on domestic poverty alleviation, public health, education, research and culture. To suggest that philanthropy could ever be a straight substitute for public spending is simply right-wing propaganda.

Of course, Mr Buffett cannot be blamed for the way political propagandists may try to exploit his actions. Why then do I find him at fault? Because of the way he gave the money — in a single enormous lump, to what is already by far the largest and most dominant charitable institution. This reinforcement of monopolistic giantism contradicts all the principles of the competitive capitalism that created Mr Buffett’s fortune.

One could understand why a Russian oligarch might put all his money behind the world’s biggest foundation, run by a man notorious for his ruthlessly monopolistic practices at Microsoft, but it is depressing to see a man such as Mr Buffett, who is renowned for his shrewd understanding of competitive markets, succumbing so totally to the Stalinist belief in “economies of scale”.

Even more depressing is Mr Buffett’s unwillingness to think for himself in setting objectives for a foundation or some other imaginative structure that would increase competition in the marketplace of philanthropic ideas. Mr Buffett’s lack of originality is all the more surprising, given his famously quirky and inquiring intellect, and his statements a few years ago that he would give his money to charitable causes that nobody else was willing to support. If we were living in the 1950s, he said, he liked to think that he would have used his fortune to promote higher education for black Americans in the segregated South.

The causes supported by the Gates Foundation, by contrast, suffer from no such lack of attention. Of course, more money could always be spent on Aids or malaria research. But if there were ideas suitable for the Bill and Melinda Gates Foundation that were being held back merely by lack of money, then Mr Gates could readily find it himself, either by tapping more of his vast personal wealth or by spending some of the foundation’s capital, instead of insisting that it must accumulate in perpetuity.

To get a sense of Mr Buffett’s missed opportunities, one has only to look at the record of another great American philanthropist. George Soros, widely believed to vie with Mr Buffett for the title of the “world’s most successful investor”, has not made nearly as much money, but he has far outshone any other philanthropist in giving it away.

Mr Soros was in London this week launching his new book, The Age of Fallibility, a personal testament on the philanthropy, social philosophy and political activities that have turned him into a significant figure in global politics. His Open Society foundations — whose activities have ranged from supplying dissident movements with photocopiers and fax machines so that they can promote civil society in Eastern Europe, to paying the salaries of the entire Russian scientific establishment after the collapse of the Soviet Union in order to prevent nuclear scientists emigrating to rogue states such as Iraq — have played a significant part in what was arguably the most important and benign event of our lifetimes, the miraculously bloodless collapse of Communism.

I am not suggesting that Mr Buffett should have gone into politics or devoted himself to such lost causes, at least in America, as gun control or drug law reform. All I am saying is that Mr Buffett, with wealth far greater than Mr Soros’s and an intellect at least his equal, could have created another dynamic, competitive new market in social, scientific or philanthropic ideas. By creating a new foundation or network of foundations with its own philosophy and charitable criteria, Mr Buffett could have made a real difference to the world. Now he will not.

Times Recommends

• Treat Africans as part of the human jigsaw
• Too bitter a pill for me to swallow
• This Bill is a panic measure in a tarnished age