This is the cover story of the November 21, 2011, issue of Forbes Magazine.
The Republic of Chad, a landlocked desert dictatorship once described
by FORBES as the planet’s most corrupt, is a strange place to find Bill Gates.
Yet there he was in September, beside Chad’s Qaddafi-trained president,
General Idriss Deby. “He and I walked around giving polio drops to a
bunch of kids,” recalls Gates. “I shared in confidence with him some
views of how he might be even more effective in the way he manages his
campaign.”
Yes, a far cry from hunkering down with Paul Allen in an Albuquerque motel to reimagine how the world conveys information, or with Warren Buffett
in Sun Valley to brainstorm the future of philanthropy. But to Gates
diplomacy with thugs is now just as important, a dispassionate component
of what he views as his final legacy. “The metric of success is lives
saved, kids who aren’t crippled,” says Gates. “Which is slightly
different than units sold, profits achieved. But it’s all very
measurable, and you can set ambitious goals and see how you do.”
Notice the words: metric, measurable, goals. While Gates’
vaccine-based giving—closing in on $6 billion to fight measles,
hepatitis B, rotavirus and AIDS, among others—is part of the largest,
most human-driven philanthropy in the history of mankind, what’s missing
in his language are the individual humans.
In many ways that’s the point. Gates’ clipped manner in discussing
the children he and his wife met in India and Africa (“Melinda and I
spend time with these kids, and we see that they’re suffering; they’re
dying”) disappears when the underlying numbers come up, his speech
getting more rapid, his voice ever higher. “A 23-cent vaccine,” he says,
“and you’ll never get measles,” a disease that “at its peak was killing
about a million and a half a year; it’s down below 300,000.” Gates
rattles off milestones in the history of global health and the prices of
vaccines down to the penny, but blanks on the name of one of his
favorite vaccine heroes, John Enders, the late Nobel laureate, or Joe
Cohen, a key inventor of the new malaria vaccine Gates helped bankroll.
It’s heady, historic stuff: America’s richest man—he’d be the world’s
richest had he not already given away so much money—still in his prime
(he just turned 56), with the reputation, resources and determination to
stamp out infectious disease. “I’d be deeply disappointed,” says Gates,
if in the next 25 years he can’t lower the death toll by 80%.
Otherwise, “we’re just not doing our job very well.”
Sitting with Gates, overlooking the Bill and Melinda Gates
Foundation’s gleaming new $500 million campus, full of glimmering
reflecting pools and glass edifices, it’s possible to see a future with
exponentially less pain and suffering. It’s also a remarkably incisive
exercise in getting inside the brain of one of history’s greatest
business visionaries. By dissecting with him and his wife, Melinda, how
he tackles this grand human problem, you can also learn intuitively how
he built Microsoft. How a mechanical genius methodically tackles an
abstract problem. And perhaps most of all, how power and capital—both
literal and political—can be spent to maximize positive impact on the
world.
Bill Gates’ plan to eradicate disease stems from a bold concept: The
demographic theories of Thomas Malthus, generally accepted for the past
two centuries, are wrong. Specifically, that subsistence eventually
translates into population growth, and population growth eventually
translates into misery.
Bill and Melinda Gates grappled with this concept years before
forming their foundation, and months before even getting married, on a
prewedding 1993 African safari. Their vacation had been planned around
watching predators and prey—Darwin in action. “You go to see the
animals, and you go to see the savanna, and it’s gorgeous,” says
Melinda. But they instead found themselves pondering that classic
Malthusian riddle: “Why is that woman walking along the road with sticks
on her head, a baby in the belly and a baby on the back?” Gates had no
immediate reason to challenge 200 years of dogma: “We know how to get
agricultural productivity up, but not that much,” he says. “Jobs,
unrest, education—a high population density makes solving all those
problems harder.”
So in 1997, when he and Melinda first ventured into public
health—their eponymous foundation would come into being in two
years—they focused on birth control, funding a Johns Hopkins effort to
use computers to help women in the developing world learn about
contraception. The logic was crisp and Bill Gates-friendly. Health =
resources ÷ people. And since resources, as Gates noted, are relatively
fixed, the answer lay in population control. Thus, vaccines made no
sense to him: Why save kids only to consign them to life in overcrowded
countries where they risked starving to death or being killed in civil
war?
It wasn’t dissimilar from the formula that he was developing behind a
multibillion-dollar push into education reform. In that case, he based
his giving on this formula: Success = teachers ÷ students. Smaller class
sizes would result in more attention per student and smarter kids.
But much as Gates loves elegant solutions, his greatest achievements
have resulted from perseverance and adaptability. It took three versions
to get Windows right, and the Xbox originally lost billions. He’s not
afraid to challenge assumptions when they don’t work. And in education
he’s had a clear reversal: Class size, it turns out, is not the best
determinant of student outcome. Teacher quality is. So after spending a
fortune, Gates shifted course.
That same epiphany for his public health philanthropy came even
earlier. Bill’s dad had set up a dinner at Seattle’s posh Columbia Tower
Club with the Program for Appropriate Technology in Health (PATH).
While the meeting started with birth control—among other efforts, PATH
taught Chinese condom makers to test their products before shipping
them—Gates began consuming data that startled him. In society after
society, he saw, when the mortality rate falls—specifically, below 10
deaths per 1,000 people—the birth rate follows, and population growth
stabilizes. “It goes against common sense,” Gates says. Most parents
don’t choose to have eight children because they want to have big
families, it turns out, but because they know many of their children
will die.
“If a mother and father know their child is going to live to
adulthood, they start to naturally reduce their population size,” says
Melinda.
In terms of giving, Gates did a 180-degree turn. Rather than prevent
births, he would aim his billions at saving the kids already born. “We
moved pretty heavily into vaccines once we understood that,” says Gates.
He could have focused on clinics and doctors, but that doesn’t scale.
“The magic tool of health intervention is the vaccine, because they can
be made very inexpensively,” he says. “We had to choose what the most
impactful thing to give would be—not just money, but our time, energy,
voice.” Melinda, his partner in all things philanthropic, echoes that
thought: “Where’s the place you can have the biggest impact with the
money? Where can you save the very most lives with those resources?”
More heavily than anyone ever had—even John D. Rockefeller, whose
Rockefeller Institute for Medical Research pushed many key discoveries
in 20th-century virology—he changed the global dialogue when it came to
vaccines, which a decade ago had become controversial because of
now-disproved autism fears. The first Gates vaccine donation, $100
million, directed at the United Nations and administered by PATH,
focused on getting existing vaccines to kids. To celebrate the gift,
Bill and Melinda hosted a dinner for vaccine experts at their
66,000-square-foot home on Lake Washington. After Gates asked his
guests, “What could you do if you had even more money?” the room
exploded with new ideas. That’s when he decided to blow up his original
foundation and, in 1999, reconstitute it as the Bill & Melinda Gates
Foundation, endowed with $21 billion, instantly making it one of the
largest charities in the world. The endowment is now $36 billion, with
$25 billion given away.
But the vaccine epiphany just unlocked an entirely new set of
problems. Yes, he could use his money to save lives through original
research. Gates’ munificence has resulted in vaccines for meningitis and
malaria. And yes, he could keep increasing the efficacy of those
vaccines by creating a so-called cold chain—a storage and distribution
system within host countries. He’s done that, too.
But again he ran into the scale problem, one inherently market-based. How do you encourage Merck, Pfizer, GlaxoSmithKline
and other pharma giants to produce enough expensive vaccines for
children who need them most but can afford them least? The answer, Gates
increasingly believed, lay in making Adam Smith’s invisible hand more
visible, giving the newly formed market a benevolent shove in the
direction of free enterprise.
Here’s the truest definition of power: When you have the ability to
not just solve a problem but also to create a sustainable market that
addresses it. “There was nobody you could a write a check to,” remembers
Gates, who stood ready a decade ago to buy billions of vaccine doses.
In the 1980s Unicef had tripled the percentage of children who got basic
vaccines for polio, diphtheria, tetanus and other diseases by
corralling public funds, negotiating on price with other aid agencies
and deploying thousands of aid workers to deliver them. But those
efforts still fell woefully short of the need, and new medicines hitting
the U.S. market faced an intolerable 15-to-20-year lag before reaching
the kids of Tanzania or Nicaragua. “The chance of death from those
diseases is 50 times greater in poor kids than in rich kids!” says
Gates, his voice rising.
The first critical step, he realized, was forging a lasting
public-private partnership. The public half of that equation was solved
quickly with his checkbook: Previous attempts had faltered due to lack
of funds and infighting among aid organizations over scarce dollars. But
the private component was trickier. Compared with manufacturing pills,
making vaccines is difficult and expensive. Drug companies wanted to
immunize kids in, say, Afghanistan, but couldn’t count on demand that
would be large and predictable enough to cover their costs. They faced
the unappetizing choice of being humane or profitable.
So back in 1999 Gates traveled to Bellagio, Italy to hammer out a
solution, along with Unicef, the World Bank, the UN, various pharmas and
aid groups. The result was the Global Alliance for Vaccines &
Immunisation, now called the GAVI Alliance, which Gates ultimately
backed with a $2.5 billion pledge and personal will, exhibiting the
tough-guy tactics, when necessary, that earned Microsoft
the fear of its rivals and enmity of U.S. antitrust regulators. “Bill
was a little like a poker player who put a lot of chips on the table and
scared everyone else off,” says Seth Berkley, who ran a Gates-funded
AIDs vaccine effort and is now GAVI’s chief executive.
Gadiola Emanuel
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