How best to spend $60 billion?
In this weekend’s Washington Post Bill Easterly generously offered Bill Gates some financial advice on how to spend his Foundation’s money. To highlight one:
Money plus technology is 5 percent of the solution; the other 95 percent is delivery and implementation. By all means, invest in developing those new vaccines. But more imagination is desperately needed in creating incentives for the delivery of such products to the poor.
The Boston Globe’s Drake Bennett agrees with Easterly that one of the main challenges for Gates will be knowing if his ‘customers’ are satisfied (ht: Jessica Gottlieb). But what should you do if you only have $1 to spend?
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A humble suggestion to the Gates/Buffett Team
William Easterly offered his advice to what he calls “the new Bill and Melinda Gates/Warren Buffett Axis of Altruism” with his “4 Ways To Spend $60 Billion Wisely” Washington Post, July 4.
Three of Easterly’s suggestions, number 2. It's not about the money, 3. Beware of technological quick fixes and 4. Don't believe your own press, sounded extremely sensible to me, but, on number 1.The business world and the developing world are worlds apart, I choked, since given the track record of Bill Gates and Warren Buffett I had imagined the potential good they could do if, with that kind of financial resources, they tried to help some poor developing countries to break out from their aid dependency, by teaching them a little bit about what it takes doing business. Gates/Buffett should know! And learning to do business by doing business is an as-good-as-it-gets- approach to sustainability.
I am not too experienced in this aid-business, but having recently been one of those rare Executive Directors of the World Bank who got there with only a private sector background, I know exactly that the following is what I would tell team Gates/Buffet to do:
Take at least half of the money and set up an organization that copycats the International Finance Corporation (IFC), which is the entity the World Bank Group uses to promote sustainable private sector investment in developing countries, helping to reduce poverty and improving people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses.
Such an organization, with such Directors as Gates/Buffett could have a tremendous and sustainable impact on the poor developing countries helping them for instance to put up schools for certified bilingual nurses; construe retirement home for foreign senior citizens; do environment projects designed to compensate, against cash payments, for the developed world’s many environmental sins; and exploit all those great new opportunities that are out there to be taken, the moment poor countries learn not to focus exclusively on agriculture and textiles.
But besides helping the poor countries directly, hopefully in a self sustainable way too, they would also do so indirectly by putting some competitive pressure on the rest of all the development actors that are currently living sort of cozily in quite uncontested markets.
So Team Gates/Buffet, why don’t you follow that old advice of doing what you’re good at, pro-bono (not that Bono) instead of making a too a drastic career change that will just risk wasting your talents. By the way, if the would need a manager to start it up? Well Peter Woicke, the former managing director of IFC who had to retire because of age, at an unseemly young age, might be available to help out, the first steps.
Posted by: Per Kurowski | Jul 6, 2006 12:18:38 AM
Thanks for the long contribution Per. I too was a little surprised by that first part. I would agree that the two world's are different, but would also say that the public sector and donors perhaps have much to learn from the operations and efficiencies of private firms, both small and large.
Posted by: Pablo Halkyard | Jul 6, 2006 9:37:16 AM