The best of 2012: The other side of Bill Gates’ charity billions

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The other side of Bill Gates’ charity billions

Bill Gates, Microsoft’s former boss has given the most money ever to health programmes around the world. But Andrew Bowman investigates and finds some negative results.

In 2011Bill Gates wrote in the Huffington Post about his first trip to Africa in 1993. He saw that many of the discoveries that can improve and save lives in the world were not available in Africa. He said that it was very worrying… he was sure that if science and technology were used better for the problems in Africa, the people would be free to do great things and they could be healthier and happier. Bill Gates started Microsoft, the computer software company in 1975. He spent 18 years making as much money as possible and in 1994 Gates started giving the money away. Giving money to charity happens a lot with super-rich people in the US. The rich can avoid tax if five per cent of investment is given away every year. What quickly made Gates different was his work with the poor – not a particular culture or religion – and the very big amounts of money.

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Bill Gates Photo of Bill Gates: World Economic Forum Under a CC Licence Gates aimed at world health and US education and was giving away billions very quickly. In 2006, his friend Warren Buffet, the businessman and the world’s third richest person promised $31 billion to the Bill and Melinda Gates Foundation. With $30 billion from Gates, this made it possibly the biggest charity ever. In 2006 his Global Development Programme included agriculture and economic development and Gates began working full-time on charity work in 2008.

In 2010 the Gates’ Foundation gave $2.5 billion in grants – 80 per cent to international projects. In total it has given over $26 billion, most of it to health projects around the world. Just compare: since 1914 the Rockefeller Foundation has given $14 billion (in to today’s values). Only the US and British governments give more to international health today. And the World Health Organization (WHO) has less than $2 billion a year.

The Foundation’s successes are of course very big. Through helping vaccination programmes, for example, it says it has saved nearly six million lives. Rich people in the world are less interested in helping abroad now and on 26 January 2012 Gates gave $750 million more to the Global Fund to Fight AIDS, Tuberculosis and Malaria. Gates says this organization saves 100,000 lives a month. His supporters believe the Foundation is making world leaders think about global health again and, through Gates’ Giving Pledge plan, they believe he is encouraging many other US multi-billionaires to give to charity. How can anyone have anything bad to say about all of this?

Gates answers to who? But charity isn’t a simple problem and people have asked questions about the way the Foundation works and the results of its work. The first question is about who answers to who. Only about five per cent of the money the Foundation gives to world health every year goes directly to talking to governments and important people. But this money - over $100 million – is very powerful. Gates gives money to all kinds of institutions including US university departments and big international development organizations. The Foundation is the most important player in many global health partnerships and one of the biggest givers to the World Health Organization. This gives it a lot of influence in planning health policy and leading ideas.

Gregg Gonsalves, an experienced AIDS activist and co-founder of the International Treatment Preparedness Coalition, welcomes the Foundation’s money, but he is worried about its power. It depends on how Gates is feeling when he gets out of bed in the morning, he says. It can change the world of global health.

The Foundation’s 26 ideas are looked at every year. CEO Jeff Rakes is very clear that the Foundation is making a careful effort to listen to what the people who give money are saying. But Gonsalves and others are not so sure about this: ‘It’s not a democracy. It’s not even a monarchy. It’s about what Bill and Melinda want. We depend on them learning.’

The Foundation is more than a collection of money and ideas, says Dr David McCoy, a public health doctor and researcher at University College London and an advisor to the People’s Health Movement. Dr McCoy says that through the money it gives it also has an influence on group of organizations and individuals across universities and non-governmental organizations (NGOs), and businesses. This means it can influence a kind of group thinking in international health, he says. In 2008 the WHO’s head of malaria research, Aarata Kochi, accused a Gates Foundation group of restricting the variety of different scientific opinions, claiming the organization only answered to itself.

Looking for miracles In what direction, then, has the Foundation been influencing global health policy? Warren Buffet said of his approach to finance that he doesn’t look for seven-foot bars to jump over. He looks around for one-foot bars he can step over. Gates says his approach to charity is the opposite: ‘We should be looking around for the seven-foot bars; that’s why we exist.’ This involves technology, which change everything - specifically vaccines. These are miracles, Gates says, because with three doses you can stop deadly diseases for a lifetime. Just as a vaccine stopped smallpox in the 20th century, science could, Gates hopes, do the same for AIDS, malaria, and tuberculosis in the 21st century. Gates has given most money to research on new drugs and vaccines, receiving 36.5 per cent of grants given between 1998 and 2007.

Ten years ago Gates helped start the public-private GAVI Alliance. He gave it a first grant of $750 million and it aims to increase immunization. Vaccines for Hepatitis B and the HiB bacteria have been brought into use. GAVI’s interest now is in new vaccines for pneumococcus and rotavirus – causes of pneumonia and diarrhoea. These could, it suggests, save nearly 700,000 lives by 2015.

Making greed good? With a belief in science and new ideas Gates’ has a vision of ‘creative capitalism’. He explained his idea at the 2008 World Economic Forum in Davos. He said, ‘There are two great forces: self-interest and caring for others.’ To help the two forces meet, the Foundation looks for partnerships in which peoples’ money is used to overcome ‘market failures’, which stop the poor getting medicine. This process is guided by non-governmental organizations (NGOs), universities, and other interested people, The idea is to pay pharmaceutical companies to sell their products cheaper and do research they would not normally be interested in. Through GAVI, the Foundation says it has lowered the costs of Hepatitis B inoculations by 68 per cent, and is supporting a $1.5 billion ‘advanced market commitment’ to develop pneumococcal vaccines.

For supporters, it’s a win-win situation: the poor get new medicines faster and cheaper; and, as the Financial Times newspaper explains, it helps pharmaceutical companies who want to work in faster-growing, poorer countries. In these countries they need to charge less and share the risks of development. But some people are worried about this situation. Tido von Schoen Angerer is the Executive Director of the Access Campaign at Médecins Sans Frontières. Tido explains that the Foundation wants business to do more for global health, and sets up partnerships with the private sector involved in decision making. These institutions are clearly also trying to influence policymaking, and so there are very big conflicts of interests… the companies should not play a role in setting the rules of the game. The Foundation itself has employed many people from the big pharmaceutical companies. Some think this is unfair. Many activists see making laws on intellectual property less strict as a better way of getting medicines to more people by lowering prices through competition and helping new ideas in companies which don’t hold on to patents. But Microsoft argued strongly for the World Trade Organization’s TRIPS agreement (the agreement on trade-related aspects of intellectual property), which makes member countries keep patents for a minimum of 20 years. Even in 2007, Microsoft was persuading the G8 to make global intellectual property protection stricter. Oxfam said this would make the health crisis in developing countries worse.

Global agreements to keep prices low and share results are required for companies receiving Foundation money, von Schoen Angerer says, ‘but could they go further? Definitely, yes. In examples like GAVI, industry gets quite beneficial deals.’ Gonsalves, himself HIV positive, explains that the pharmaceutical industry saved his life. A lot more people will be dead if we don’t have good competition with companies working on the same medicines, he adds.

The problem of IP (intellectual property) is a test for Gates. The big pharmaceutical companies are sometimes happy to relax IP for the world’s poorest nations, but not very often in new markets – which still contain most of the world’s poorest people.

Charity and capitalism or democracy? Gates’ charity wants to make businesses more charitable and to make charity more like businesses. Called ‘philanthrocapitalism’ the approach is based on non-governmental organizations (NGOs) competing for grants with their performance evaluated using business measures Gates says that the overall effect should be to save years of life for well under $100. ‘So, if we waste even $500,000, we are wasting 5,000 years of life.’ Looking at it this way the best results are achieved through projects which target specific diseases or health problems and do not work with the public health systems. The results from working with public-health systems can be slower and harder to measure. A study in the Lancet in 2009 showed that only 1.4 per cent of the Foundation’s grants between 1998 and 2007 went to public-sector organizations. But only 37 of the 659 non-governmental organizations (NGOs) were in low- or middle-income countries. In many Majority World countries, state healthcare was ruined by programmes from the World Bank and International Monetary Fund. And by the loss of skilled personnel in globalized labour markets. Now, says McCoy, NGOs have arrived to help. But these NGOs sometimes don’t fit in and can be difficult to work with effectively. This can be serious. Polly Clayden of i-Base, an HIV information and activist organization, says that some of the research Gates funds is not a good idea. But if you have HIV and somebody is paying for your drugs in a trial, perhaps you don’t really care who is paying. You just really want people to be treated. But she warns that the problem is sustainability. People who give money can change their minds. AIDS might be very important one year, and then suddenly they will give money to something diferent.

Research by Devi Sridhar at Oxford University warns that money from charities is changing public health programmes so that they are only interested in what the rich are interested in. These health problems, she writes, are not always the most important for people in the country receiving the money from the charities. The situation is repeated at an international level. With the rise of health partnerships, the proportion of global health funding coming through the UN fell from 32 to 14 per cent between 1990 and 2008 This made it more difficult for poorer nations to influence international health policy. The Gates Foundation gives a lot of support to the WHO. But the money is for projects that are already planned and not for projects decided by of the World Health Assembly. This happens a lot with the WHO’s money now.

For critics the way ‘philanthrocapitalism’ focuses on results which can be measured may hide the important goals of democracy and giving people power which are not so easy to measure. As the charity analyst Michael Edwards has asked: ‘Would philanthrocapitalism have helped fund the civil rights movement in the US? I hope so, but it wasn’t “data driven”, it didn’t operate through competition.’ He says it couldn’t make much money, and it didn’t measure its results by the numbers of people who were served each day. ‘Yet it changed the world forever.’

The fruit or the trees? Mark Harrington is Director of the Treatment Action Group, a group which is trying to find solutions to AIDS, and which has received Foundation money in the past. Mark Harrington feels that democratic governments should solve global health problems. But that if governments are not doing enough, we have to be practical. He adds that medical research and global health are both public goods: they help everyone, even if only some people pay for them. Industry will only help if they see they will make money. And charities? Well it’s better if Gates is doing this with his money than what the Koch brothers are doing with their money. The Koch brothers started the rightwing Tea Party political movement in the US. ‘Do I think it’s good that we live in a world where some people have so much money? Not really, but I don’t get to choose that. We have to work with the world the way it is.’

McCoy says it is important to make a challenge. Asking the very rich to be more charitable is not a solution to global health problems, he says. We need a system that does not make so many billionaires. But before that happens, this kind of charity is either just an interesting idea or possibly harmful to the need for a real change in the system and the political economy. Carlos Slim, the Mexican multi-billionaire replaced Gates at the top the world’s rich list. This was because of Gates’ charity. Carlos Slim compared charity work to owning an orchard: ‘You have to give away the fruit, but not the trees.’ He and Gates come from an economic system that has produced monopolies and moved wealth upwards for 30 years. We could compare the inequalities of today and Victorian times, when health benefits for the poor depended on the charity of the rich. Oscar Wilde spoke about the charity workers of that time said that seriously and sentimentally they give themselves the job of solving the problems of the poor. But their solutions do not cure the problem, They only make it last longer. Then and now, as Wilde said, the best way is to try and change society in a way that to be poor will be impossible.

As this article has been simplified, the words, text structure and quotes may have been changed. For the original, please see: http://www.newint.org/features/2012/04/01/bill-gates-charitable-giving-ethics/