Summary: Good returns from bad companies can cancel out the beneficial effects of grants.
Let me elaborate why I lost the last bit of respect for Bill Gates.
"Using the most recent data available, a Times tally showed that
hundreds of Gates Foundation investments — totaling at least $8.7
billion, or 41% of its assets, not including U.S. and foreign
government securities — have been in companies that countered the
foundation's charitable goals or socially concerned philosophy."
Source: LA Times January 2007.
I've always disliked the business practices of Microsoft. It's not
per sé that they try to do 'evil', it's something that bigger
corporations tend to do to satisfy their shareholders. Microsoft is one
of the biggest of such companies. Especially in a position of a
monopoly, it is easy to abuse it as far as legally and illegally
(market vs. settlement charges) profitable. I have always been under
the assumption that Bill Gates 'understood' that there was no way back,
and in overal it contributed to the wealth of the world. So perhaps it
may have been considered as a lesser evil.
The whole problem I still have is that they are exactly in a position
to make a profound change in the world for the better, but they don't.
When I read the following LA Times article, I was shocked. It can be very, very much doubted how beneficial the Bill & Melinda gates foundation actually is to the world. Moreover, they could be very beneficial if they would 'Put their money where their mouth is'.
Their foundation is essentially a split between 'doing good' and making
the maximum profit from investments to increase the wealth of the
organization. While this split seems innocent, the net effect of the
foundation may be negative for the world. Again, what they COULD do,
is actively try to influence the companies they invest in. A quote from
the article:
"Leadership, however, is open to the Gates Foundation. It has unique
power to move the debate, said Bauer, of Rockefeller Philanthropy
Advisors. If Gates adopted mission-related investing, Bauer said in an
interview, the shift in the world of philanthropy would be "seismic.""
Source: Ibid p. 3. (What's Ibid?)
What happens when you try to do good at one side, and ignorantly try
to make money with major externalities. Externalities that are the
eufemism for polluting abroad on a scale that we would never allow
here. Financially weak governments can complain, but have too little
influcence.
"In 2002, a study found that more than half of the children at a school
in nearby Merebank suffered asthma — one of the highest rates in
scientific literature. A second study, published last year, found
serious respiratory problems throughout the region: More than half of
children aged 2 to 5 had asthma, largely attributed to sulfur dioxide
and other industrial pollutants. Much of it was produced by companies
in which the Gates Foundation was invested."
Source: Op loc.
Again, just like Microsoft, they are the biggest and they could make
the most significant difference in the world. They seem to be unaware
that mutual funds that do ethical investment do not underperform, even
while these funds have less posibility to diversify (source: from the
same article).
When medicine are protected by the same legal rules as software, it
is murder if we do nothing to still make it available to the poorest of
the world. If we have systems that protect our sacred 'innovation',
this means that we have to have exceptions for those cases where lives
and our humanity it at stake. The problem is, those cases are no
exception. The majority of disease is in third world countries.
I think it is aweful that many people don't know about the darker
side of philanthropy. I know that many people defend Bill gates because
of this initiative. If you do not practice what you preach, you do not
deserve this kind of defence. That's PR (Public Relations), not
philanthropy.
Even some of the grants that were supposed to be 'for the good', have their sidemarks. The second article is about financing "predatory lending". It's the whole loans sector that is seen as suspect by a coalition of 240 nonprofits and public agencies that studies financial agencies. They get away with, but settlements of hundreds of millions of dollars are not rare. Imagine the amout they actually forced out of their customers. Still, Gates invested at least $367 million.
On January 11 2007, the LA Times reports that the Foundation said that they would reevalutate their investments.
Then, on January 13th they said that they would not change their practice. (source 1 and 2)
Continue reading "Philanthropy or PR? B&M Gates foundation"
