Conservative morality has enshrined the billionaire philanthropist as the ideal model of do-gooding. The Gilded Age robber barons who built our public libraries and universities are held up as the reason why we do not need government social welfare programs (or to continue funding those libraries): merely enforce private property rights and let Christian piety take care of the poor. When the rich get super-rich, and they've bought all the gold-plated cocaine straws they can use, they'll start donating their excess bags of gold coins to the less fortunate. Well, the L.A. Times has just torn that well-worn cliche a new one with it's lengthy, scandalous expose on the robber baron of the 21st century, Bill Gates.
The world's richest man, Bill Gates, with his wife, Melinda, runs the world's largest private foundation, which had an endowment in excess of $34 billion until, as you recall, in 2006 the world's second-richest man, Warren Buffet, decided to double it. That brought its total assets to $65.95 billion—10 percent of all "charitably-held" assets in the United States (by comparison, the U.S's next-largest foundation, the Ford Foundation, had assets equal to $11.61 billion in 2005).
The Gates' do-gooding earned them Time's People of the Year award in 2005 and Buffet's gift garnered even more attention, cementing the image of the beneficent rich in our collective consciousness. Thankfully, the L.A. Times, in another stunning example of why we still need the mainstream media, has devoted extensive resources to a 7,000 word, two-part investigative piece on where all that money actually comes from. The answer? Businesses that around the world are doing people harm as part of their daily work, including frequently causing the very problems Gates and his ilk claim to be interested in solving.
Remember, in order to qualify as a non-profit charity, the Gates Foundation is only legally required to give away 5 percent of its assets annually (that's still around 1.5 billion— the $800 mil the Gates Foundation gives away every year as part of its Global Health Iniative alone is approximately equal to the entire budget of the U.N.'s World Health Organization). The rest of that money is plowed back into the capitalist system in order to make MORE money. And the capitalist system? It ain't pretty.
Prepare to be SHOCKED as you read of Nigerian villages subsisting in a heady smog of chemical-rich emissions put out by gas-flaring energy plants owned by companies with hundreds of millions of Gates' dollars in it. Be AMAZED at good, hard-working Americans put out of their homes by predatory lending pushed by sub-prime mortgage companies—20 out of 25 of the top sub-prime lenders recieve Gates money! Learn the TERRIBLE MATH of how the investment world works. After all, can you expect a man who made his fortune (and still makes it) zealously guarding copyright and intellectual property laws for his software to promote making cheap AIDS drugs available to the world's poor, even if he's spent $287 million on HIV research?
The Times' scribes, Charles Pier, Edmund Sanders and Robyn Dixon, are kind enough to note that it needn't be this way: they detail the effort that others, such as the Ford Foundation, the John T. and Catherine T. MacArthur Foundation (shout out to NPR what what?) and the Rockefeller Foundation, go to to ensure socially responsible investing. They point out that the Gates' tacitly admit to the possibilities of socially responsible investing by refusing to invest in tobacco companies (although they do invest in cigarette package manufacturers, but who's looking?). They even point out that good management techniques of respecting labor rights and community benefits usually produce healthy companies, and that in general ethics-based investing keeps pace, profit-wise, with the usual junk. But is that enough? Can we afford to wait until the costs of global warming, for example, start to outweigh the benefits?
I personally doubt it, but let's at least get rid of the myth that capitalism on its own can solve any of these problems.
And if you aren't fascinated by the ins and outs of the investment word, there's also sex, child slavery and chilly responses from lawyers to recommend the story. Here's part one, on Nigerian health iniatives funded next to giant noxious fume-emitting industrial plants, AIDS drugs and 'Cancer Valley.' And here's part two on sub-prime lending, mortage fraud, child slavery and how ethical investing could work.
BONUS : Foreign Affairs magazine has a ridiculously long article this month on how Gates-style charitable donations to specific-disease-related programs in African countries destroys the general health care infrastructure. I have not read it yet but it looks juicy.
--Ethan Heitner |
Tuesday, January 9, 2007 10:11 AM
