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Dark Cloud Over Good Works of Gates Foundation 325

Posted by CmdrTaco
from the behind-every-fortune dept.
theodp writes "Justice Eta, a Nigerian infant, has an ink spot on his tiny thumb to show he was immunized against polio and measles thanks to the Bill & Melinda Gates Foundation. But Justice still faces respiratory trouble, which locals call 'the cough' and blame on fumes and soot spewing from 300-foot flames at a nearby oil plant owned by Itallian energy giant Eni, whose investors include the Bill & Melinda Gates Foundation. Part one of an L.A. Times investigation reports that the world's largest philanthropy pours money into investments that are hurting many of the people its grants aim to help. With the exception of tobacco companies, the foundation's asset managers do not avoid investments in firms whose activities conflict with the mission to do good."
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Dark Cloud Over Good Works of Gates Foundation

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  • by eldavojohn (898314) * <eldavojohnNO@SPAMgmail.com> on Sunday January 07, 2007 @12:34PM (#17498064) Journal
    This is "the dirty secret" of many large philanthropies, said Paul Hawken, an expert on socially beneficial investing who directs the Natural Capital Institute, an investment research group. "Foundations donate to groups trying to heal the future," Hawken said in an interview, "but with their investments, they steal from the future."
    I'm sure that the Bill & Melinda Gates Foundation had good intentions when supporting firms such as Eni. Some people might call this the price of industry. They might point at the industrial revolution that the west went through with mills and plants galore. But the key difference is that these people aren't suffering for their future. They aren't building an infrastructure or priming their economy. Because the firms running these plants are most likely foreign based. Meaning that the profits are probably shipped outside of the country. If the company was setting up jobs & providing services and money in the economy, then I'd almost be tempted to overlook the asthma & health problems associated with these companies. The problem is that I'm almost certain none of that wealth is returning to the local community.
    Like most philanthropies, the Gates Foundation gives away at least 5% of its worth every year, to avoid paying most taxes. In 2005, it granted nearly $1.4 billion. It awards grants mainly in support of global health initiatives, for efforts to improve public education in the United States, and for social welfare programs in the Pacific Northwest.
    And that's the problem. It's run like a business when it's supposed to be losing money. In today's world, it's easy to make money with more money. And certain foundations take advantage of that. I'm sure the Gates' foundation found it lucrative to invest in companies like Eni. After all, the company is avoiding environmental limitations imposed in its home country or the United States. And, in this manner, the foundation stays wealthy. Never losing money but always apparently "helping" people.

    You still see the Gates Foundation doing good things [sundayvision.co.ug] but why is it that so many foundations of insurmountable wealth are somehow ignorant of the economic problems they persist for those they try to help?
    • Re: (Score:2, Insightful)

      by alexgieg (948359)

      the profits are probably shipped outside of the country. If the company was setting up jobs & providing services and money in the economy, then I'd almost be tempted to overlook the asthma & health problems associated with these companies. The problem is that I'm almost certain none of that wealth is returning to the local community.

      How about the taxes that company pay to the local government? Isn't that wealth returning to the local community, even if in an indirect way?

      Beside, suppose that company

    • "It's run like a business when it's supposed to be losing money."

      Right, and when it (or any charity, for that matter) runs out of money...?
      • Right, and when it (or any charity, for that matter) runs out of money...?
        It should run out. The Gate foundation has a timeline in which to spend all that money. A certain number of years after Bill and Malinda join the great billionaire club in the sky/center fo the earth.
    • by Phil-14 (1277) on Sunday January 07, 2007 @01:25PM (#17498468)

      Actually, firms like that do hire (and train) a lot of locals; I know this is the case in Nigeria.

      The main gist of the article seems to be "The Bill and Melinda Gates Foundation invests in oil companies, pharmaceutical companies, etc., and those are all the font of evil..." and relying on the modern American's quasi-religious belief that this is the case to make their point. It has enough anecdotes to make it appear as if it's proved its point, but the plural of anecdote is not data.

      • Re: (Score:3, Informative)

        by TubeSteak (669689)
        The main gist of the article as I read it, is that The LA Times (and others) dissapprove of the "firewall" between the Gates' Foundation investments & charitable giving.

        Essentially, the Foundation's mission isn't allowed to influence its investment strategy & this setup is set to be formalized even further.

        The LA Times (and others) want this to change so that the investments support or at a minimum, do not detract from, the Foundation's goals.
        • Re: (Score:3, Insightful)

          by Planesdragon (210349)
          The LA Times (and others) want this to change so that the investments support or at a minimum, do not detract from, the Foundation's goals.

          Why not? The Foundation is a Federally Recognized NFP charity, which gives it some tax benefits on the belief that it will do good with its money. A foundation can do FAR more good by moral investing than outright giving.

          If Gates & Co. wanted to ruthlessly make money via investment, they should have set up a holding company and pledged a dollar amount to the founda
          • by ivan256 (17499)
            A foundation can do FAR more good by moral investing than outright giving.

            That is a dubious assertion, because usually you can't invest against something, and if your investment dollars don't fund a highly profitable venture, somebody else's will. Perhaps you can do no harm by avoiding "evil" investments (who's definition of evil do you use, anyway), but you can rarely do additional good by not investing.
            • "you can't invest against something"

              That's not entirely true. Microsoft has been doing it for a very long time. They do it every time the give huge price breaks to companies and governments who wave a Linux conversion at them. They also have traditionally done it when they helped out with the piracy of Windows. I can't remember if it was Ballamer or Gates that said it, but one of them made the comment about massive piracy in Asia, that they would be able to use that to turn them into legitimate custo
      • by itlurksbeneath (952654) on Sunday January 07, 2007 @01:57PM (#17498778) Journal

        "... the font of evil..."
        Verdana?
      • Re: (Score:3, Insightful)

        by Brandybuck (704397)
        I've never understood why the oil and pharmaceutical industries are considered so evil. Bring electricity to a poor village in Africa and you're an evil person. Create a medicine that cures a fatal disease and you're an evil person. It doesn't make sense. Do people really want there to be no electricity and medicine?

        The reason most often given for these industries' evilness is "obscene profits". But their solution in every case is a stifling regulation that drives out smaller companies, leading to ever grea
        • Re: (Score:3, Informative)

          by adpowers (153922)
          Well, in the instance of oil companies, many of their plants are in poor regions and have very bad environmental records. The article talks about how one plant in South Africa has had dozens of spills or leaks in the last decade or so. These companies have the technology to clean up the plants (they use it in other locations), but since the locals are poor and the government regulations are lax, they going on poisoning the population. If you making tons of profit, you can definitely afford to clean up your
    • by mysticgoat (582871) on Sunday January 07, 2007 @05:12PM (#17500584) Homepage Journal

      Parent post used the phrase "having good intentions", which triggered these thoughts.

      BG is driving his new Hummer along a back road in the mountains, just for the pleasure of it. The only other traffic is a 1954 Chevy pickup truck driven slowly by a migrant worker with his wife and two kids crammed in the cab beside him and all their worldly possessions neatly bundled up under a tarp in the back. BG falls in behind them as they go into some tight curves, planning on passing when the road straightens out again. But a tire of the pickup blows out with a bang, the pickup swings wildly from side to side, and ends up in the ditch.

      BG performs the duties of care expected of all drivers who come upon an accident. He stops and determines that everyone is okay. The pickup is wedged in the rocky ditch but safely off the road; it doesn't pose a hazard. He offers to call for assistance on his cell phone.

      Then, with the best of intentions, he offers to use the winch on his brand new Hummer to pull the pickup out of the ditch, and the family is most grateful for that. After the truck is back on the pavement, he helps as best he can with changing the flat (without getting grease on his fine new clothes). The family beam in gratitude and drive off toward the railroad crossing a few hundred yards down the hill. He watches them go as he wipes the dust off the winch cable (so it will again be all bright and sparklely when he winds it back onto its spool).

      The railroad warning lights come on; the pickup's brake lights come on; but the pickup doesn't slow down. It rolls right into the side of the second engine of the freight train, and is immediately spun around to slam broadside into the next car, and then is tumbled like a cartwheel across the road. The tarp rips open and pieces of simple chairs and a table, neat packages of clothes and torn bedding, fly everywhere. The roof pops off the cab, and migrant worker body parts sail through the air.

      This is most unfortunate. But there is no one blame here. Since BG is a "software engineer" and an entrepreneur, there is no reason to expect him to know that the brakelines should have been inspected after a vehicle is winched out of a ditch. If not for his action, the family would still be alive, but he did act with good intentions. He is blameless in the matter of their deaths.

      Now what if this was the case instead:

      BG is concerned with the plight of migrant workers who have to travel the difficult mountain roads. He decides that instead of getting that fun Hummer, he would buy a brand new tow truck so that he could help these poor people who are constantly getting stranded on life's back roads. If the same scenario played out while he was driving his tow truck, he would be culpable for the deaths of the migrant family.

      When he bought the tow truck, he also bought into the expectation that he would have the same concerns for safety and the same basic knowledge expected of a tow truck operator. Therefore he should have known to inspect the underside of the pickup after winching it out of the ditch; he should have recognized the distinctive odor of leaking brake fluid; and in any event he should certainly have taken the basic precaution of pumping the brake pedal a few times before letting the pickup drive off. If he did not know to do those things, he would be negligent in the duty of care expected of the position he had chosen to put himself in, and he would be facing charges of negligent manslaughter or wrongful death.

      When you intentionally spend your money to offer free assistance, you take on a higher duty of care wrt the consequences of all your associated actions. You are expected to have done your studies so that you can deliver what you are offering with the same degree of safety as the minimum expected of others who do the same work. That means more than knowing how to safely operate the tow truck winch; it means knowing how to evaluate your work so that you are not creating a greater crisis down the road.

  • I was expecting (Score:5, Insightful)

    by hsmith (818216) on Sunday January 07, 2007 @12:35PM (#17498072)
    I was expecting something about windows, but this is a valid "conflict of interest" I would contend. Maybe the foundation wouldn't get such a good rate of return going with "safer" companies, but it would help people in the long run. But then again, if these companies are providing employment, closing them down could be bad for the workers in the country. A bad double edged sword to have.
    • by Qzukk (229616)
      But then again, if these companies are providing employment, closing them down could be bad for the workers in the country.

      Or the Foundation could spend a few extra million bucks to clean up the smokestacks. But that would require being a charity, which investment firms aren't.
      • Or the Foundation could spend a few extra million bucks to clean up the smokestacks.

        The Foundation does not own those smokestacks.
        • by Karzz1 (306015)
          The Foundation does not own those smokestacks.

          True, but in many cases the foundation does own controlling interest in the companies that do own the smokestacks.
        • Re: (Score:3, Insightful)

          by Qzukk (229616)
          The Foundation does not own those smokestacks.

          Charities own little kids with cancer?
    • The first problem (the health problems) seems easy enough to solve. Move the town a few miles upwind. From what I could tell from the pictures, some newly constructed quality housing is one of the next steps that area needs anyhow. Yes that cost $$$, maybe that could be the next project for the Gates Foundation.
  • by Anonymous Coward
    How do they compare with the Stephen & Melinda Gates Foundation?
    • Re: (Score:2, Insightful)

      by jinx0r (1048088)
      Oh my god, how shortsighted. Investing in INDUSTRY in these countries IS A GOOD THING. These people need jobs. These countries need to be integrated in the Global Market. People need to quit criticizing investments in the third world. Investing in the third world IS philantropy, and Bill Gates is the biggest Philanthropist of the 21st century at this point. Shortsightedness... aargh!
      • I think you are overdoing it. Gates is giving these people vaccines in return for rights to continue investing in environmentally toxic companies. Which I suppose is better than what Nike is doing, which is nothing. Again all billionaires and billion dollar companies have hidden agendas.

    • Well, at least one moderator gets the joke, but there's a lot of whoosh going on here.

      (hint [colbertnation.com])
  • by Anonymous Coward on Sunday January 07, 2007 @12:39PM (#17498100)
    If you look closely at all of the funds that you can choose from,
    you may well find that most of them have big oil, or questionable companies like Microsoft or Walmart.

    It is very difficult, on inspection to make good picks that really fit your morals.
    But this is the key problem. When you look at stocks or funds you look at the profit to you, and often do not see or ignore the negative things that you may be contributing to.
    • Re: (Score:3, Interesting)

      by westlake (615356)
      If you look closely at all of the funds that you can choose from, you may well find that most of them have big oil, or questionable companies like Microsoft or Walmart.

      why stop at the 401K?

      where did you think your bank, your HMO, your employer, your church invests its money? probably not always, perhaps not ever, in companies that meet your own standards of purity.

    • by vocaro (569257) * <trevor@vocaro.com> on Sunday January 07, 2007 @03:13PM (#17499516)

      When you look at stocks or funds you look at the profit to you, and often do not see or ignore the negative things that you may be contributing to.

      There's an entire class of funds that solves this problem. It's called SRI: socially responsible investing [wikipedia.org]. Funds in this category avoid companies involved in military weapons, gambling, tobacco, etc., and they invest more heavily in companies with good track records in dealing with the environment, fair treatment of employees, and so on. Because these funds are focused more on morals than on profit, they typically don't have returns as high as other funds, but that's a small price to pay for being a socially responsible investor.

      If you're interested, start by checking out Domini [domini.com] and Pax World [paxworld.com]; they're two of the largest and oldest SRI funds.

  • WTF? (Score:3, Insightful)

    by jav1231 (539129) on Sunday January 07, 2007 @12:44PM (#17498138)
    This looks like another "lets connect the dots" piece. Perhaps it will draw attention to the problem and a definitive study can be done and a cleanup will follow. Pieces like this inevitably come off looking like their saying the Gate Foundation would be better off not existing at all. Always with the negative vibes. Hey, I'm not a Gate fan and certainly not a Windows flag-waver, but the Gates Foundation to me is the only positive thing I can see Bill doing. I'm all for it.
    As to the guy above who thinks charities should be losing money not making it, that is just idiotic.
    • Well, charities are supposed to be a zero-sum game ... they take in donations and ideally distribute the bulk of the funds after picking off an "administrative charge" for themselves. Of course, in many charities the administrative costs somehow exceed the amount actually distributed to the target population, but whatever. Many people look at the likes of Bill Gates as being paragons of greed, and that's true so far as it goes, but a lot of so-called charitable organizations are no better.

      The Gates Found
  • by Blakey Rat (99501) on Sunday January 07, 2007 @12:59PM (#17498250)
    The US never had any jobs or industries, and we did just fine!
  • Always doing good, well, it depends on your definition of whats good I guess. Leading a country to be industrialized and within an overseeable number of years belong to the world economy is surely a definition of good that I'd be able to think Gates has.
    I mean; its lead by the wealthiest man in the world, who grew up in America. What do you expect his position to be?
  • Tough Call (Score:3, Insightful)

    by Joebert (946227) on Sunday January 07, 2007 @01:33PM (#17498538) Homepage
    he was immunized against polio and measles
    Let's take a look at what Polio actually is.

    Poliomyelitis, often called polio or infantile paralysis, is a virally induced infectious disease which spreads via the fecal-oral route.

    Now let's take a look at our options.

    1) Accept help from someone funding somthing that is making it tough to breathe.
    2) Eat shit and die.
  • by Anonymous Coward on Sunday January 07, 2007 @01:34PM (#17498552)
    For those that are not familiar with Nigeria, this is not a standard case of industry versus activist.

    The Niger delta is in serious trouble; the environmental contamination there is beyond anything you would believe. My company had been contracted by one of the large oil companies there to investigate cleanup of some of their contaminated sites. They gave us some project specs.

    The sites were huge. Gigantic. The scale of the project was larger than anything we had ever considered, and we work on some pretty large projects. Our existing cleanup efforts include some of the largest contaminated sites in the U.S. and Europe. We went to the delta to do some investigating and preliminary tests, and were shocked with what we found. On average, each contaminated site was 10x larger than the specs we were provided.

    The environmental "mess" there is huge, and terribly depressing. It's a beautiful region, but you cannot imagine the scale of the contamination. It would take decades upon decades of pouring billions of dollars into remediation to bring the delta region near the environmental standards of the U.S. or Europe, neither of which are particularly high.

    Furthermore, in terms of economics; these giant oil companies are ugly, monopolistic ventures with high levels of foreign and domestic (Nigerian) government involvement. They do things no "sane" company would do.

    Don't respond with the usual, "These people wouldn't be better off with no jobs" bullshit. These companies have literally destroyed the region, annihilating the local agriculture and local industry. Not through competition, but through force; the region is so polluted that nothing but a resource extraction company can survive there. As far as I'm concerned, this represents use of force; which should be prohibited under capitalist frameworks.

    It's really sad what is going on over there.
  • by nursegirl (914509) on Sunday January 07, 2007 @01:37PM (#17498586) Journal
    These ideas are ones that have been influenced by the book "The Best Democracy Money Can Buy".

    Most health professionals working in HIV/AIDS in third world countries regularly state that the only way to really tackle the AIDS epidemic is for drug companies to allow generic drugs to be made and given to people in third world countries, while allowing the expensive, patented, proprietary medications to continue to be sold in first world countries.

    Of course, Merck et al haven't been too eager to open that intellectual property floodgate, and they've either said "No" outright, or volunteered to donate a small percentage of drugs (much less than addressing the epidemic would require).

    Any other multinational corporation with substantial patents and IP concerns must wonder be aware that reducing the patent protection from big pharma could eventually affect them as well.

    So, when Bill Gates donates large amounts of money to buy patented medications, he's equally protecting the sanctity of human life and the sanctity of international IP laws. Convenient way to look great, do good things, all while protect his own interests.

    Sometimes "good" is the enemy of "best" and rich & powerful people using their money to buy drugs at ridiculous prices allows them to avoid pressuring our world governments to level the playing field a little for the poorest of the poorest.
    • Greg Palast wrote an article about this a while back...

      Killing Africans For Profit and PR [informatio...house.info]
    • Re: (Score:2, Insightful)

      by Kreigaffe (765218)
      Yeah.. no.

      The way to stop the AIDS epidemic is to stop all those poor Africans from constantly fucking everything that moves without ever using a condom. Yeah. Medicine is fine but it's reactionary, and doesn't STOP the spread, it only helps those already CAUGHT by the spread. A more cautious culture about sex, that includes a lot of condoms, would STOP the spread. And then you'd have less people to treat.
  • by kbox (980541)
    ... I would pull all funding for everything, Stick my middle finger up and say "fuck the lot of ya".
    I'm no fan of bill gates, But this bashing he constantly recieves is petty and infantile.
    • And you would take a massive tax hit because of it. Bill gives money because he gets to claim the deductions. If he was -really- concerned about making the world a better place he would stop trying to import human sewage, radioactive medical waste untreated blood into American landfills [house.gov] (the company involved, Republic Services Inc NYSE:RSG has received non-trivial investments from Bill).
      • And you would take a massive tax hit because of it. Bill gives money because he gets to claim the deductions. If he was -really- concerned about making the world a better place he would stop trying to import human sewage, radioactive medical waste untreated blood into American landfills (the company involved, Republic Services Inc NYSE:RSG has received non-trivial investments from Bill).

        Umm... Giving away 30 billion dollars when you make a few hundred million in that year on investments isnt' a good tax dodge. If your accantant tries this I'd maybe try to change accountants.

  • ...we SERFS are. By toeing the line, we stop real change. Why should Africans be pleased to have jobs, even when the outcome is a polluting mess on their doorstep? 'Jobs' (no not Steve), are a recent phenomenon - they arent the only way to get by, but any attempt to be self-sufficient is being marginalised by big capital.

    Did it ever occur to anyone that having a 'job' is the same as being a serf? Did it ever occur to anyone that a man with 10 acres and some basic tools doesnt need a job at all? There

    • Re: (Score:3, Informative)

      by bmajik (96670)
      You have a romanticized view of African history. I don't know what motive you have for pinning the ills of the world on whites and on capitalism, but a cursory examination of reality will show that Africa and Africans had their own share of self-made problems prior to white people even existing, much less being able to read, build armies, or colonize other lands.

      An inconvenient fact reparitionists tend to overlook is that the majority of slaves sold to North America from Africa were captured by warring Afr
    • Re: (Score:3, Insightful)

      Self-sufficiency is a pretty fantasy; as wonderful as it sounds, entirely too few people actually want to live that way.

      Take the situation in the article as example. The children were being vaccinated against polio, a disease that has claimed lives throughout human history. WIthout someone working a modern job at a medicine company to manufacture the vaccine, or the needle to inject it, or operating the plane to fly the vaccine to the region or the truck to drive it to the village, etc., how would these chi
  • by Jugalator (259273) on Sunday January 07, 2007 @03:03PM (#17499412) Journal
    But Justice still faces respiratory trouble, which locals call 'the cough' and blame on fumes and soot spewing from 300-foot flames

    So in other words, Gates is operating from Mount Doom in Mordor...
    Come on, tell us something new here!
  • In perspective... (Score:4, Insightful)

    by Mr. Picklesworth (931427) on Sunday January 07, 2007 @03:05PM (#17499430) Homepage
    People here don't seem to realize that Gates' foundation has donated more money to AIDS research than some countries have. Those countries, I might add, contain numerous toxic waste spewing "plants", and probably in greater number than that one which is partially funded by Gates.

    So, why don't we go whine about those countries as well? After all, they are doing less good and more harm.

    Or, as always, is there a double standard here?

    Now that that's out of the way:
    Yes, I think that they should probably be more careful with exactly who they are funding.
    However, I do not think that this single faltering is a reason to condemn their giving of free money which could otherwise be kept (mostly) to suit one's own greed.

  • ...is through education. That, and protection of it's industries while they're still developing. Once multinational corporations start entering the picture, that industry is pretty much closed to the country which results in most poor countries selling bananas or catering to tourists.
  • Seriously?! (Score:2, Insightful)

    by Anonymous Coward
    I'd love to see what Bill Gates could do that slashdotters wouldn't rip into him for. He's separating himself from his brainchild to spend more time with his family and devote more time to giving away his fortune for a good cause. The rest of the world can see how this is a good thing. Anybody reading this remember when Warren Buffet made the largest donation in history? Remember where it went? I guess he must just be ignorant to donate such a large sum to such an evil foundation, or perhaps he's also
  • M$ (Score:3, Insightful)

    by minus_273 (174041) <aaaaa@NOSPAM.SPAM.yahoo.com> on Sunday January 07, 2007 @05:15PM (#17500616) Journal
    The $ in MS in the subject line just makes it more classy. nice.
  • by Money for Nothin' (754763) on Sunday January 07, 2007 @05:53PM (#17500966)
    So the asset managers are incompetent and don't know what the goals of the customer they work for are. The asset managers aren't serving their customer (the Foundation) in a manner consistent with their objectives.

    People have been fired for lesser offenses. The Foundation needs to remind those managers who they work for, and inform them that their actions are not aligning with the goals of the Foundation...

    No evil here (at least not intentionally). No, rather, this is more of the usual, more-mundane story that comes out of any sufficiently-large organization: the institution has a set of strategic priorities, but the upper management that make the strategic decisions (Bill and Melinda Gates, the management directly beneath them, etc.) aren't managing the lower management who manage the operational aspects (e.g. the asset managers who invest the Foundation's money).

    It's just the usual story of incompetent management... Read Dilbert if you require further explanation.

    I do wonder what Warren Buffet thinks though, now that he -- the America's 2nd-richest person -- has decided to pour 85% of his entire net worth into the Foundation over a period of several years, on the basis that it does good work and is managed well...
  • by Locutus (9039) on Sunday January 07, 2007 @09:20PM (#17502824)
    Do you think Bill Gates is really thinking social responsibility when picking his investments? Look how he's run Microsoft for a clue to THAT question. He's looking for profits and ROI and it's doubtful he directs his investment managers to be concerned with social consequences of his investments. IMO.

    LoB

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