“It was the biggest single gift anyone ever gave anybody for anything.”
That’s how Bill and Melinda Gates describe Warren Buffett’s $30 billion donation in an open letter to the famous investor, 10 years after his historic gift. The letter, released publicly today, is a report to Buffett on the progress toward the Bill & Melinda Gates Foundation‘s goals to prevent childhood death, end disease, and improve the lives of people around the world.
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Buffett’s unprecedented gift doubled the size of the Seattle-based Gates Foundation’s endowment — increasing its capacity to take on some of the world’s biggest challenges.
“That’s an incredible thing,” said Bill Gates in an interview with GeekWire. “It really energized the foundation, and half of what we’ve gotten done in this last decade is because Warren trusted us.”
So what have they done with Buffett’s billions? Some of the money has gone to the Gates Foundation’s work in education, agriculture, and financial services for the poor. But the bulk has gone to global health, supporting the Gates Foundation and its partners in areas such as vaccine distribution, access to contraceptives, and scientific research to help the world’s poorest people.
As Gates explains, under normal circumstances, someone receiving an investment from Buffett would report back to him with a traditional financial bottom line. If anyone talked about something other than profitability, Buffett would say, “Wait a minute, what game are we playing here?” Gates said.
“In the philanthropy game, you’re going for different outcomes — saving childhood lives, having kids grow up without malnutrition or disease, so that they can achieve their full potential.”
But there are ways to measure progress. The childhood mortality rate — the number of deaths among children younger than 5 years old — is the most important number, write Bill and Melinda Gates in their letter.
The reason, they explain, is that parents who believe their kids will survive are likely to have fewer children, giving them more time and money to devote to each child they have. Families and countries with low rates of childhood mortality have a better chance to escape poverty.
Worldwide, the childhood mortality rate has been cut in half over the past 15 years, from 12 million deaths in 1990 to less than 6 million in 2015, falling at an increasingly faster rate.
Gates is clear about the reason: “Vaccines are why we’ve seen an acceleration in getting that down,” he said.
Return on Buffett’s ‘investment’
In their letter to Buffett, Bill and Melinda Gates talk about vaccines in terms that the billionaire chairman of Berkshire Hathaway can appreciate. Bill Gates recalls the deal-loving Buffett pulling coupons out of his pocket when they visited a McDonald’s together in Hong Kong.
Along the same lines, Bill Gates calls saving children’s lives “the best deal in philanthropy.” And Melinda Gates calls vaccines the best “deal within the deal,” calling them “the biggest reason for the drop in childhood deaths.” Every dollar spent on vaccines translates into $44 in economic benefits, they say.
“We believe this investment will be like buying Berkshire stock 30 years ago,” Bill Gates writes.
Bill and Melinda Gates haven’t shied away from controversial positions, including their public stand in favor of contraceptives in the poorest countries. In the letter, Melinda Gates says she has held onto a note from Buffett about the stance on contraception, reading, “It was gutsy, and it was right.”
Melinda Gates writes, “For the first time in history, more than 300 million women in developing countries are using modern methods of contraception. It took decades to reach 200 million women. It has taken only another 13 years to reach 300 million— and the impact in saving lives is fantastic.”
Bill Gates has also used his outsider status to push for autopsies to better understand why young children die. This was traditionally controversial among grieving parents, but a new type of minimally invasive autopsy by the Childhood Health and Mortality Prevention Surveillance (CHAMPS) network is making inroads and gaining acceptance.
Gates explained, “I think that’s a case where by knowing very little, a question that those in the field have not chosen to go after, the outsider can say, “Well wait a minute. Yeah that might be hard, but boy let’s really try because it would be so valuable.’ “
Even with the progress in childhood mortality and vaccines, Bill and Melinda Gates acknowledge that there have been setbacks over the past decade. For example, they write, they had hoped to see an HIV vaccine and a more effective malaria vaccine by now. The 2008 global financial crisis was a “huge setback” for global health, reducing aid from donor countries, Bill Gates writes.
‘The future will surprise the pessimists’
But they end their open letter to Buffett on an optimistic note.
“Polio will soon be history,” they write. “In our lifetimes, malaria will end. No one will die from AIDS. Few people will get TB. Children everywhere will be well nourished. And the death of a child in the developing world will be just as rare as the death of a child in the rich world.”
“We can’t put a date on these events, and we don’t know the sequence,” they conclude, “but we’re confident of one thing: The future will surprise the pessimists.”
Much as his generation got swept up in the digital revolution, Gates told GeekWire that he hopes people today see the potential to make an impact through science, technology and philanthropy, improving the world by paying attention to the issues affecting its poorest people.
“That sense of progress, the sense of opportunity, I hope that comes across to people,” he explained, “because we need to draw people into this work, whether as careers, or givers to these causes, or just the political voice that these equity issues should stay on the agenda.”