Bill Gates was once considered the “good billionaire.” Today, his personal life and his carefully crafted reputation as a public-minded philanthropist are eroding before our eyes.
My guest on this week’s WhoWhatWhy podcast is Tim Schwab. Tim is an investigative journalist whose recent work on the Bill & Melinda Gates Foundation has been published by The Nation, the Columbia Journalism Review, and the British Medical Journal. Recently, he has been contracted to write a book on the Foundation.
Schwab reminds us of how, during the early days of Microsoft, Gates was reviled as a greedy monopolist who engaged in unsavory business practices. He was attacked at public events and received unflattering press everywhere.
Through philanthropy, Schwab explains, Gates has worked hard to turn that reputation around. However, a deeper look reveals a philanthropic organization that is just as monopolistic as Microsoft was.
Gates’s obsession with patents and intellectual property, a mix that fueled Microsoft’s growth in its early days, is as dominant as ever — and now it impacts global health.
Schwab examines what the future might look like for the Gates Foundation and for the global public health community — which has become so dependent on Gates money. He also focuses on Melinda Gates and their third foundation partner, fellow billionaire Warren Buffett.
Schwab argues that Bill Gates has always shown us who he is. We just weren’t paying attention.
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Full Text Transcript:
Jeff Schectman: Welcome to the WhoWhatWhy podcast. I’m your host Jeff Schectman. Two years ago if you would convene to focus group to give an opinion on Bill Gates and his foundation, the response would have been overwhelmingly positive. Today, not so much. Well, the divorce, the behavior with respect to female employees, and violation of rules that any employee would know much less the company’s founder, former CEO, and chairman, and his condoning of poor behavior by his associates would be enough in and of itself to change public opinion. Add to this his relationship with Jeffrey Epstein, and the picture gets darker.
My guest, investigative journalist Tim Schwab, argues that none of this is as bad or as global as some of the actions of the Bill and Melinda Gates Foundation. Tim Schwab joins me to discuss how Bill Gates has used his position to shape public policy. What he sees is many conflicts of interests of Gates and his foundation, and how legitimate criticism of power is being positioned as conspiracy.
Tim Schwab is an investigative journalist whose work on the Gates Foundation has led the way in uncovering many heretofore unknown aspects of the foundation and its governance. He was recently signed to write a new book about Bill Gates and the Gates Foundation and titled The Good Billionaire. It is my pleasure to welcome Tim Schwab here to the WhoWhatWhy podcast. Tim, thanks so much for joining us.
Tim Schwab: Thanks for having me, Jeff. Really appreciate this opportunity.
Jeff: A couple of years ago, or even maybe just a year and a half ago, if you would ask people about tech billionaires, Bill Gates would have been the good billionaire, the one people had the least criticism of and felt the most positive about. What happened?
Tim: It’s been so remarkable. Having covered the Gates Foundation as closely as I have for the last year and a half or two years, is to see that the media narrative shifting so stunningly in the last month. It’s exactly as you say, for years, as we’ve seen the growing criticism about wealth and economic inequality in this country, as people point to the billionaire class. The perennial counterpoint was Bill Gates, who, yes, he is a multi-billionaire many times over but he has turned his fortune towards charitable ends to create the Gates Foundation, which we’ve been told ad nauseum by the news media over the last decade, is saving lives and can do no wrong.
That’s all come, it started to come crashing down in somewhat of a narrow sense. Somebody told me, one of my sources told me the other day that these private scandals bring down, expose corporate crimes. The Gates Foundation isn’t a corporation, but it is the world’s most visible philanthropy, and it functions in many ways less as a charity than it does as a political organization.
What you’re seeing in all the recent reporting, it started out with Bill and Melinda Gates were getting divorced. Then the news media was asking, why was this divorce? Then all the allegations came out about sexual misconduct or sexual allegations that go back to Microsoft, the Gates Foundation. I do want to say that, Bill Gates has denied the allegations, but the reporting is coming fast and furious, and it’s absolutely changing the way that we think about Bill Gates. I think also, it should be an opportunity for us to start rethinking the Gates Foundation also.
Jeff: One of the ironies, so one of the interesting things about this is that if you go back and read the reporting in the ‘80s when Microsoft was coming into its own, when the company was going public, et cetera that Bill Gates was seen as an evil figure at the time. Quite different than we were talking about before in terms of the billionaire class, that there was this sense of monopoly that Microsoft had, the way he took the company public. It was a very different image that existed at that point.
Tim: Yes. In some ways, we’re coming full turn. You can’t underestimate Bill Gates or his ability to reshape his public image. As you state he was one of the, remains one of history’s most storied monopolist through his work with Microsoft. It was not that long ago, though, many of us have forgotten that, that he was one of the most reviled people on earth. People threw pies at Bill Gates. He was widely ridiculed and lampooned as this kind of greedy corporate monopolist.
As the antitrust trials and allegations were mounting in the late 1990s and early 2000, Bill Gates turned his attention to philanthropy and over the next few years, played less and less of a role at Microsoft and more and more of a role as a philanthropist. He had so much money, he quickly became the world’s largest philanthropist creating what we know today as the Gates Foundation.
In the early years, it’s interesting is that the news outlets like The New York Times and The Wall Street Journal, they actually did put a critical lens on this. It was just a public relations effort by Bill Gates to remedy his public reputation. Are there ways that the Gates Foundation is actually serving the interests of Microsoft or the interest of Bill Gates or the Gates personal wealth? That kind of critical reporting to the 2000s is slowly receded until about 2010 or 2011. Then it almost disappears completely. In the absence of that critical reporting, you’ve seen that the Gates Foundation expand its size and scope in ways that are really hard to, they don’t clearly fall under a common definition of the word we use charity. Even though that’s how it’s been marketed as.
Jeff: It’s interesting because, in a way, we talk about it coming full circle, that if you look at the Gates Foundation, in a certain way, it’s almost a monopolistic effort with respect to global health.
Tim: Yes. That’s a word that you don’t hear these critical viewpoints often in the news media, but they certainly, these perspectives do a balance. You hear people describing the Gates Foundation as a monopoly and a bully. It’s not an uncommon criticism, even though we don’t hear it often of academics in the social sciences, for example, anthropologists,
sociologists who look at the Gates Foundation. They use that word to describe the Gates Foundation because of the immense power and influence that it has in these fields like global health where they fund–
All the stakeholders who are working in this field, they fund the World Health Organization, they fund the leading universities, they even fund news outlets to report on global health. NPR has its own whole reporting section about global health and development that is underwritten in part by the Gates Foundation. Through their financial giving, what we call charity, what they’re actually doing is acquiring a great deal of influence over the public discourse and that allows them to shape the agenda, to shape the priorities, to shape how we think about the field.
Jeff: The other side of the ledger though, are they doing work that nobody else is doing or that nobody else would do if they didn’t exist?
Tim: Well, at this point, and that’s a problem right now, as we’re thinking about the crisis that the Gates Foundation is going through, that if the Gates Foundation just disappeared, that would be bad for the field of global health, which is still dependent on the gates Foundation’s funding. What that highlights is not that– we’ve created an unhealthy dependency on the Gates Foundation. That a lot of ways the work it’s doing is really probably the work that governments should be doing.
The fact that we’ve seeded so much of this, the public policy arena, to the Gates Foundation, that’s a problem. Maybe they are doing, funding a lot of work that wouldn’t otherwise be done but they’re also creating these undemocratic channels that puts them at the center of the public policy discourse, instead of, especially in the way that they work in the developing world, for example.
Jeff: Is it fair to say, though, that because they have had this extreme focus, at least as it’s been reported, on the metrics of what they’re trying to accomplish, and the efficiency, arguably, of what they’re trying to accomplish, that they’re doing it in a way that I think most people think would be better than the government trying to do it?
Tim: Yes. That’s the perennial, I guess that what you call the neoliberal argument that the private sector is just more efficient at getting things done. That the Gates Foundation is more capable at managing global health, or the pandemic response, or US education, or African agriculture, or any of the areas where it works, where the Gates Foundation just brings together this nimbleness and this efficiency of the private sector to do that work.
To make that argument, we have to have a really clear and robust evaluation of the work that it’s doing, which doesn’t exist. There is a lot of reports out there about the millions of lives the Gates Foundation is saving and all the good effects of the Gates Foundation’s work, but a lot of it is funded by the Gates Foundation. There is not this robust, independent body of research that can clearly point to all the benefits that are often attributed to the Gates Foundation. I think that’s one real blind spot in this argument of the Gates Foundation, private sector efficiency.
Jeff: I guess the thing that feeds that and interested in your take on it, that the government response or what people perceive to be the government response to the pandemic further fuels this idea that the private sector could do a better job.
Tim: Yes. It was a perfect storm with the pandemic response where Trump was not responding responsibly or appropriately. He was trying to downplay the pandemic. We learned that later, that reporting came out later. He was actually purposely trying to downplay the severity of the pandemic. This vacuum of real leadership. You have somebody like Bill Gates who shows up with his big ideas and he can assert himself and become this first mover in the pandemic response, but the pandemic response that he’s presided over has played out in some really nightmarish ways where the term, ‘vaccine apartheid’ gets bandied around quite a bit. I think that’s a fair description of what we’ve seen globally where rich nations, like the United States, it’s like an embarrassment of riches where we have access to vaccines. Everybody can get vaccinated in this country if they want to. Whereas many or most poor nations have zero access to vaccines.
The fact that the Gates Foundation played such a large role in the pandemic response, and it led to these outcomes. We gave them so much credit on the front of the pandemic. Bill Gates was on CNN with Anderson Cooper constantly. He was in the news constantly taking credit for his leadership. If Bill Gates wants to be a leader, part of leadership has also taking to account for failures, which he and the foundation have been unwilling to do. We’ve had really inequitable and terrible outcomes of the pandemic response. I think the Gates Foundation if they’re a serious organization, they should take some accounting for these failures.
Jeff: How does that sit side by side in looking at something like the failure of the CDC, for example, as Michael Lewis details it in his book, which is just devastating in terms of how badly the government in the form of the CDC messed up?
Tim: I haven’t read Michael Lewis’s book. To be sure, there’s plenty of blame. There’s plenty of incompetence. There’s plenty of bad actors involved in the pandemic response and there’s plenty of greed. Plenty of reflection and soul searching that a lot of us could do about how all this played out. Whatever you want to say about the CDC or the Federal Government, at the very least, it’s a democratic process. It happens through their accountability. There’s checks and balances. There’s some level of transparency. You can file a Freedom of Information Act request to find out what the government was thinking, what the government was doing. None of those features exist around a private billionaire philanthropy. These mechanisms don’t exist around the Gates Foundation. The backend now trying to interrogate their role in the pandemic response, for example. Just trying to raise those questions or do that investigation it’s so much more difficult than investigating, for example, the CDC. What that highlights is the undemocratic model of power of the Gates Foundation. We can’t elect or un-elect Bill Gates. He’s just here and he’s going to take as much power as we give him and over the last decade, we’ve given him a lot.
Jeff: Talk a little bit about the way that power has exercised itself, particularly with respect to shaping public policy for the benefit of the foundation, as you see it.
Tim: I don’t know that if it’s shaped it to the benefit of the foundation, as much as it’s steered the world into the worldview or the ideology of Bill and Melinda Gates. Gates comes into the public policy arena with a real pension, for example, for technology and for patents, which comes from his days at Microsoft. I haven’t taken a close look at Gates in US education, that’s coming for example, but I’ve talked to enough gallows who’ve said that he’s tried to push education in the classrooms in a way that clearly shows that bias. Certainly, he’s done that in fields like agriculture. It’s fine and there’s maybe a time and a place for it, but when you have somebody like Bill Gates, he’s just one individual who is able to really shape entire fields, then it’s another level of influence than you are I have. That’s because of the enormous wealth that he has and because he’s able to channel that wealth into power through philanthropy.
Jeff: It’s interesting, we talk about monopoly as we did before, and you bring up the issue of patents, that his actions that he took at Microsoft back in the ‘80s and what he’s done with the foundation, that there’s really a clear pattern with respect to the way he operates.
Tim: That’s been a real feature of Bill Gates and the Gates Foundation to work in the pandemic. Not to get too into the weeds, but a problem in the pandemic response, we have these vaccines, this is the cure for the pandemic, for the Coronavirus. If we can get vaccines, we can stop the Coronavirus. But reason we can’t get vaccines out to people is because we don’t have enough supply and why don’t we have enough supply? Because we don’t have enough manufacturers? Why don’t we have enough manufacturers? Because the handful of vaccines that we have are controlled through patents and exclusive licenses. It’s not that any capable manufacturing facility anywhere in the world can just start producing these vaccines. You’ve had a number of facilities around the world talking to the news media saying, “Hey, we have idol production capacity, or we could be producing vaccines, but we can’t because we can’t access the vaccine technology.”
The real sticking point in this debate is around the patents and the intellectual property. Bill Gates and the Gates Foundation has used its bully pulpit to defend that model in ways that– A lot of public health experts now are saying is a main source of the problem of why we haven’t been able to produce more vaccines. Now, you also have countries all over the world now that are actually mounted a formal challenge to waive those patents and intellectual property. Joe Biden, the President of the United States a few weeks ago, he publicly supported this effort. After, that really changed the tide and suddenly the Gates Foundation came out with this mealy-mouth late stage ninth inning support for waiving the patents.
Jeff: I wonder though if what changed the tide, and I agree with you that it has changed dramatically, but I wonder to what extent the tide was changed by all of these other personal issues surrounding Gates and his inability to defend his position because of that.
Tim: It is so strange this confluence of media narratives that came to play this spring. Right before the divorce announcement, news was coming out about this issue about vaccine apartheid and journalists were finally putting a critical lens, a magnifying glass to the Gates Foundation’s role in the IP and the patents issue. Then suddenly, on top of that, you have the divorce announcement. In a way, the divorce announcement and these allegations of sexual impropriety surrounding Bill Gates has been a distraction though from the Gates Foundation because now we’re so interested in the details of Bill Gates personal behavior that I think in some ways it’s been a distraction from the work of the foundation and the failures and the controversy of the foundation. That’s what I was trying to do with my recent essay in The Nation to say, “This is a rare opportunity that we’re putting a critical lens on Bill Gates. We should not squander that opportunity. We should take a step back and widen the lens and see that it’s not just about Bill Gates personal behavior with women in the workplace or allegations of his personal behavior, but it’s also about the Gates Foundation and the power that it wields and the abuses of power that you could see surrounding the Gates Foundation.’
Jeff: Is there a danger that the unraveling, whether it’s a public relations unraveling or literal unraveling of aspects of the Gates Foundation, will have an adverse effect on global public health?
Tim: It’s like I said earlier, there is a widespread dependency right now on the Gates Foundation. Many of my sources have explained it to me that if you’re working in global health and you’re not directly funded by Gates, then you’re only one degree removed from Gates funding. Everybody’s funded by Gates in one way or the other. If the Gates Foundation were to disappear tomorrow, that would create major problems in global health, but that’s not an argument to say that we need to preserve the current model of the Gates Foundation. It’s to say that “Well, how did we ever get into a situation where two people have so much power over such a vital field? Why do Bill and Melinda Gates? How would they create such dependency on their billionaire philanthropy? Is that a good model of governance,” suddenly now you have Bill and Melinda are getting divorced and the foundation is in a public crisis. There’s all these questions surrounding the future of the foundation, and whether it will continue to support this work. How did we end up in this situation where we thought this was a good model is clearly this is a moment of reckoning, where we should understand that this is a terrible model of governance and we should rethink how we got to this place and think about a better way forward.
Jeff: If we look at the origins of the foundation and how the power came to be accumulated over time. Did they simply or did Gates realize this was an unfulfilled need and that this was an area that he could take over?
Tim: I mean, sources have told me in my reporting that, the billionaire philanthropist class, they like to kind of stick out their own territory. If Bill Gates is making a big play in global health, then or one corner of global health, then another billionaire will examine a different corner. I probably shouldn’t cite this, because I don’t know all the details but I think if I’m not mistaken, Michael Bloomberg does a lot of his philanthropic work. He does a lot of that around non-communicable diseases like obesity and tobacco, things like that. Whereas the Gates Foundation is focused on things like polio and malaria and now they’re doing the pandemic response, of course.
I think there is some idea that, a billionaire with big ideas goes in and wants to find out how they can really assert themselves and fill a gap that they see or do something new or do something different. I think that does play into it. Sure.
Jeff: I guess, is there a danger that if these things blow up as certainly this foundation might, that it’s discouraging for other philanthropists and that that could have a negative effect over the long run? Is that a concern? Should that be a concern?
Tim: Yes, it’s interesting to talk about the foundation blowing up or unraveling and I guess we should address that. I mean, we don’t really know what’s happening with the Gates Foundation. When the divorce happened, Bill and Melinda Gates gave this kind of– they telegraphed this business as usual message that they would remain co-chairs and the foundation would continue. What I’ve argued recently is, it’s hard to obviously, it’s not going to continue as business as usual, that’s clearly having to change.
My view is, I don’t understand how Bill Gates can continue to be the face of the foundation. Given all these allegations of sexual misconduct. The Gates Foundation has manufactured such a strong brand, woman forward brand, equity centered brand, that these allegations just seem radioactive next to it. The foundation is absolutely changing. I don’t know that it’s going to dissolve or fill up, so many different directions this could go. A week ago, I think the Wall Street Journal reported that they’re considering developing an independent board, which is such an obvious step for them to take, something they could have done years ago.
I mean, people don’t realize, but the Gates Foundation is a $50 billion organization run by three people, Bill and Melinda Gates and Warren Buffett. Any organization, institution, company of that size is going to, just as a matter of good governance, have a divorce and independent board. You can just imagine the biases and blind spots and the problems that can emerge when you have three people and it’s their money running this Charitable Foundation. That’s one obvious way that the foundation can change and absolutely, I think that this will be a learning moment for the world of philanthropy. Maybe it’s a way to think about creating separation between donors and charities.
I just got off the phone with a source who was talking about this trend of giving while living, not waiting until you die to give away all your money, which is fine and good, but it also creates an opportunity for the donors that are benefactors to actually control how their money is used, instead of passing it on to– after they’re dead to a number of other people to figure out how to use the money. Maybe that’ll raise some questions too about, all the tech billionaires coming down the pike and is it such a good thing for them to be giving away their money as philanthropists and in ways that create so much conserve and acquire so much power and influence for these billionaires through philanthropy?
Jeff: Yes, I mean, people already make jokes about Melinda gates and Mackenzie Scott Joining forces.
Tim: Yes, I have heard that. McKenzie Scott has gotten a lot of good press and credit for giving away such a significant sum of money. It’s more than– maybe it’s more money than anyone gave away last year. I can’t remember the number, it’s several billions of dollars, but the quirk of this is that by the end of the year, she was richer than she started because Amazon’s stock went up much. It’s the same phenomenon you see with Bill and Melinda Gates, their personal wealth is increasing over time, not decreasing. We hear ad nauseum in the news that they’re plowing a fortune into solving the world’s problems, but they’re actually getting richer year over year. I don’t know, it’s a certain paradox in how this whole billionaire philanthropy has been sold to us that really needs reexamination.
Jeff: Talk about how Warren Buffett fits into this because there’s his involvement in the Foundation, and the broader framework of this whole Giving Pledge, which is something that he and Gates cooked up.
Tim: Yes, and this is such an interesting– I’m glad you brought this up. Warren Buffett is one of three trustees of the Gates Foundation, and he’s one of three main donors and in 2006, he pledged to give away most of his money, he’s giving some to his kids’ charities that each of his kids have a charity or several of his kids have their own charities, but most of the money he’s given to Bill and Melinda Gates Foundation and that made him a trustee.
Warren Buffett is somebody who’s had a very long career as an investor, he runs the company, Berkshire Hathaway, and he’s had a pretty squeaky clean reputation all these years, but to say that there isn’t plenty of room to criticize, the investments he’s made but certainly on a personal level, he’s kind of enjoyed this squeaky clean reputation. It’s kind of this grandfatherly figure, this long then– He’ll do a news interview where he’ll call for more taxation of the wealthy, so on and so forth. Now he finds himself in a situation where he’s at the middle of– well, he’s not the middle, his name hasn’t been brought up too much but he’s one of the main donors to the Gates Foundation, which is in the middle of this really crushing public crisis.
What is Warren Buffett thinking about all this? I mean, he’s given away tens of billions of dollars to the Gates Foundation, basically, allowing Bill and Melinda Gates to use his wealth to bet their charitable mission. I mean, he’s renown for being such a prudent and cautious investor, you have to think that he’s rethinking the money he’s giving to the Gates Foundation, and how the foundation is governed, how the foundation operates. It can only be a matter of time before he has to answer questions.
I called Berkshire Hathaway last week, I didn’t get a response but that is a big question. He has a lot of power over the foundation. As a donor, there’s a lot of money he’s scheduled to continue to give to the foundation. He’s given $2 billion a year in the last few years. It’s a big and open question what Warren Buffett is thinking in all this.
Jeff: Finally, what is the best and worst case that you think can come from all of this exposure to the foundation right now?
Tim: Oh, I think worst-case is that somehow that we returned to a business as usual scenario, where the crisis and the allegation dies down and the Gates Foundation resumes life as normal with Bill and Melinda Gates. They’re divorced, but they continue to run the foundation together, kind of in the same way that they always have because that would fail– that scenario would fail to address a lot of the structural problems that have come to light related to billionaire philanthropy and the Gates Foundation, particularly. I mean, a best-case scenario is you would suddenly have a very robust public conversation about the Gates Foundation and the model of philanthropy it represents.
There are so many ways to regulate and to reform philanthropy, you could even have the dissolution of the Gates Foundation in the table, but it’s just simply too big and too powerful to continue, as it always has. I think that there’s such an opportunity for Congress, for the IRS, for the Washington State Attorney General, for the public to really think hard and think critically about the Gates Foundation, and the best-case scenario is that it really changes substantively in the years ahead.
Jeff: Of course, we can’t underestimate as you pointed out before, the ability of Bill Gates to just change the public conversation and to do a really good PR job.
Tim: Yes. I mean, he has unlimited resources and he has shown us before that he can transform his public image from one of the world’s most reviled tech titans into one of the most beloved and warm philanthropists. Don’t underestimate what Bill Gates can do. It’s really interesting to see how this all plays out.
Jeff: Tim Schwab, I thank you much for spending time with us.
Tim: Thank you, Jeff. Really appreciate it.
Jeff: Thank you and thank you for listening and joining us here on the WhoWhatWhy podcast. I hope you join us next week for another radio WhoWhatWhy podcast. I’m Jeff Schectman. If you liked this podcast, please feel free to share and help others find it by rating and reviewing it on iTunes. You can also support this podcast and all the work we do by going to whowhatwhy.org/donate.