Linsey McGoey, No Such Thing as a Free Gift: The Gates Foundation and the Price of Philanthropy (London and New York: Verso, 2015).
Amidst our daily struggles with the burdens autism imposes on our children, each of us has probably asked a still larger question: How could such a thing happen? A generation is being decimated, everyone sees it and knows it, and yet those in authority assure us that there is no real problem and not much needs to be done about it. That is not how a genuinely democratic and caring society would respond, so we inevitably wonder: Has something gone terribly wrong with our political system, our basic machinery for distributing wealth and power?
In fact the system has taken a sharp turn for the worse, as revealed to devastating effect in No Such Thing as a Free Gift: The Gates Foundation and the Price of Philanthropy. A sociologist of public health at the University of Essex who has served as an advisor to the World Health Organization, Linsey McGoey has studied intensely why public health systems often fail. She has explained how government drug regulators succumb to a “will to ignorance”, how Merck managed to double its share value in spite of the Vioxx scandal, how GlaxoSmithKline escaped prosecution for suppressing trial results that showed that its antidepressant Seroxat was ineffective and could lead to suicide, and how the inherent shortcomings of randomized clinical trials have “led to the licensing of numerous drugs with adverse effects that were either innocently undetected or deliberately ignored because they could not be easily measured.”
All those failures, she suggests in this book, are products of a deeper failure of our current economic system, which is neither socialism nor genuine free-market capitalism. Nor is it the “mixed economy” of the mid-twentieth century, where governments curbed corporate power and offered welfare measures that spread prosperity to the middle and working classes throughout the Western world. The regime under which we now live is often called “oligarchy”, but the oligarchs themselves prefer the term “philanthrocapitalism”. It concentrates enormous wealth in the hands of very few individuals, who use their money to rig legislation and markets in their favor, thus growing their wealth still further. But that (according to the philanthrocapitalists) actually works to everyone’s benefit: the superrich can then draw on their vast resources and their business skills to attack all kinds of social ills. In philanthropy, they propose to take the same ruthlessly efficient methods they use to maximize profits and apply them to fighting global poverty and disease, and they promise to do it far more effectively than cumbersome welfare bureaucracies.
Philanthrocapitalists have won (or perhaps purchased) fulsome praise from the media, from Bill and Hillary Clinton, and indeed from just about all politicians to the right of Bernie Sanders and Jeremy Corbyn. Of course the richest and most celebrated of this aristocracy are Bill and Melinda Gates. Both of them have enjoyed the ultimate accolade – fawning interviews with Stephen Colbert. As Bono pithily said of Bill, “He gets shit done.”
The difficulty, Mr. Bono, is that we the people don’t decide what gets done. Philanthrocapitalism necessarily involves giving up democracy for a plutocratic dictatorship – unelected, accountable to no one, and not subject to the Freedom of Information Act. It is an ideology based on the hope that Bill Gates and his cronies will spend some of the money they stole in the service of mankind. Possibly they will, but they will spend it on their terms, on projects they choose, and with strings attached. And that is not an adequate substitute for a tax-supported social safety net. To give just one example, health economist J. Paul Leigh estimates that the annual cost of autism to the US economy is $268 billion and rising rapidly. Paying for that would wipe out the entire Gates fortune in a matter of months.
Though the philanthrocapitalists claim to have discovered a brilliantly innovative approach to charity, in fact there is nothing new here. John D. Rockefeller pioneered the science of corporate giving – utilitarian, efficient, results-oriented – and every large foundation over the past 120 years has followed the same business model. The Rockefeller Institute employed it in support of medical research, including the development of a yellow fever vaccine. (It didn’t work.)
McGoey reminds us that at first, in the early 1900s, philanthropic foundations had a terrible public image. They were suspiciously “viewed as mere outposts of profit-seeking empires, only cosmetically different from the corporations that had spawned them, a convenient way for business magnates to extend their reach over domestic and foreign populaces. They were a ‘scheme for perpetuating vast wealth’, the US Attorney General George Wickersham said, one ‘entirely inconsistent with the public interest’.” And McGoey shows that Digital Age robber barons are no less predatory and ruthless than Gilded Age robber barons were: “Today, some of world’s most celebrated philanthropists, from Gates to George Soros, earned billions through business tactics that have compounded financial instability, eroded labour protections, and entrenched globaleconomic inequalities.” So why are they celebrated as heroic public benefactors? Why have we forgotten what we knew a hundred years ago?
Mainly it’s because foundations today have much more money to give away. Even accounting for inflation, the Gates Foundation is far richer than the Rockefeller Foundation ever was, and therefore has far more clout. A very large sector of our economy – including academia, scientific research, charities, NGOs, and the media – have grown dependent on foundation grants. They are not inclined to question the grantors’ business tactics or philanthropic priorities, least of all in the case of the hugely powerful Gates Foundation: “While positive news stories appear almost daily, only a small handful of media and academic articles have suggested there may be a downside to the foundation’s activities.”
One obvious reason is that Gates has contributed to media organizations that are supposed to be covering his activities, such as PBS and ABC News. (Jeff Bezos hasn’t been so charitable, and perhaps for that reason we hear much more about brutal working conditions at Amazon.) In 2013 the Gates Foundation paid Ogilvy, a PR firm, $100,000 to promote the message “Aid is Working: Tell the World.” Representatives of the New York Times, the Guardian, NPR, NBC, and the Seattle Times were summoned to the Gates headquarters to confer about emphasizing “success stories” in covering global aid – rather than failures, corruption, and programs that profit Western corporations without helping people in poor countries. The Gates people called these journalists “strategic media partners”, a fairly explicit signal that they were no longer independent watchdogs, but collaborators in a planned campaign to burnish the image of philanthropists, presumably including Bill and Melinda Gates. And in 2012 the Gates Foundation doled out more than $25 million in media grants, subsidizing NPR’s Global Health Beat and the Guardian’s Global Development page. But the history of global aid is littered with failures, and we can’t develop successful policies unless we know what doesn’t work. If a Gates project goes horribly wrong, will these “strategic media partners” report it? Here’s a possible answer to that question: some years back Microsoft developed its own blacklist of unsympathetic journalists, and succeeded in getting John Dvorak fired as a columnist for PC Magazine Italy.
True, in recent decades, as the fantastically rich have become ever richer, they have invested more in global philanthropy. And yet, McGoey concludes, all this giving hasn’t “had any effect on reducing economic inequality. In fact the opposite appears to be the case. What to make of the fact that growing philanthropy and growing inequality seem to go hand-in-hand? Does philanthropy actually make the rich richer and the poor poorer?”
In many ways it does. Foundations receive generous tax breaks, so governments lose revenue that might otherwise pay for social programs. And philanthropies often use that tax-free money to undermine the social safety net, as when the Gates, Broad, and Walton Family Foundations support efforts to replace public schools with for-profit schools. The Gates Foundation has forcefully promoted international patent protection, which obstructs the development of cheaper generic drugs for poor countries. “Microfinance” (i.e., small loans) has been touted as a boon to the world’s poor, but it is usually just another form of loansharking, with a negligible impact on poverty. The profits have been reaped by investors in microfinancial institutions, which would not have been possible without $20 billion in subsidies from governments and private foundations. Now you begin to see why economic inequality is increasing.
Philanthrocapitalists congregate at schmoozefests like the Skoll World Forum at Oxford and the World Economic Forum at Davos. Michael Milken has his own Milken Global Conference, which attracts movers and shakers although (or perhaps because) he is a convicted Wall Street felon. At these ultra exclusive parties, the ultra rich and the ultra powerful network, trade favors, decide what’s best for the rest of us, and end up wealthier still. Clinton lieutenant Frank Guistra has secured donations (or at least pledges) to the Clinton Global Initiative, ostensibly to fight poverty. But only about ten percent of the contributions are devoted to doing good: the rest fuels the Clinton political machine, and Guistra has used the process to enrich himself. “Generosity can be very profitable,” he brags.
Anthropologists have observed that in every culture, gift-giving enhances the power of the giver and the dependency of the recipient, who is effectively obligated to give something in return. In her book Dead Aid, Zambian economist Dambisa Moyo argues that foreign aid only increases African dependency on the rich nations and prevents the development of truly self-sustaining local economies. This is twenty-first century imperialism, allowing Western nations to dictate African economic and social policies. Because poor countries don’t have effective legal protections again corruption, labor exploitation, and environmental degradation, it is relatively easy for politically connected Western investors to move in and take over their resources. (Though McGoey writes from a leftist perspective, on the right Peter Schweizer drives home much the same point in Clinton Cash). If Third World countries received no foreign aid but were allowed to determine their own economic and health policies, sell their exports freely to the rich countries, and produce generic versions of patented drugs – that is, if they were genuinely independent nations – they would be far better off. However, at the very mention of Dambisa Moyo, Bill Gates becomes almost unhinged. “Having children not die is not creating a dependency, having children not be so sick they can’t go to school, not having enough nutrition so their brains don’t develop. That is not a dependency”, he sputtered. “That’s an evil thing and books like that – they’re promoting evil.” (Don’t take it personally, Ms. Moyo. Gates calls us “baby-killers” too. He says that about anyone who disagrees with him.)
Autism is nowhere mentioned in There is No Such Thing as a Free Gift, but the autism community will find this book intensely relevant, in part because it has quite a lot to say about vaccines. McGoey is obviously not an antivaccinationist. She argues that Gates-supported vaccination campaigns have successfully combatted polio and measles in Ghana. But she wonders whether it makes sense to devote billions of dollars (by no means all of it Gates money) to eliminating polio, which is now a very rare disease. Dr. Arthur Caplan is a polio survivor and certainly no “anti-vaxxer”, but even he feels that Gates polio campaign is seriously misguided, in that “government budgets and resources in poor nations are diverted from other far more pressing local problems to try and capture the last marginal cases”. It’s a kind of medical imperialism, where a superlatively wealthy white guy in Seattle decides public health priorities for Pakistanis and Afghanis. When the Taliban assassinated vaccinators, Gates announced that he would “sit down with the Pakistan government to renew their commitments, see what they’re going to do in security and make changes to protect the women who are doing God’s work and getting out to these children and delivering the vaccine.” But shouldn’t the Pakistanis decide whether the program is worth continuing? Gates sounds very much like the old Victorian colonialists who took over their country, all the while proclaiming that they were protecting women and doing God’s work.
And McGoey acknowledges that the consequences of overvaccination may be considerably worse than the misallocation of health resources. She notes that while India has succeeded in eliminating wild polio, “for now”, the oral vaccine apparently produced an epidemic of Acute Flaccid Paralysis. The Gates Foundation funded trials of the HPV vaccine among Indian girls, seven of whom died following the shots. An Indian parliamentary committee judged the deaths coincidental but also concluded that the testers had grossly violated standards of informed consent – telling the girls that the vaccine offered “lifetime protection” from cervical cancer (far from proven), failing to record adverse reactions, and often not securing signed consent forms at all. McGoey is as far on the political left as Michelle Bachmann is on the right, and she sees that some of the congresswoman’s allegations about Gardasil were off-base (it doesn’t cause mental retardation per se), but McGoey also acknowledges “an uncomfortable reality: some of her concerns may be warranted.” McGoey has the guts to say that Gardasil can sometimes result in autoimmune disorders or death, and she is not convinced that the benefits outweigh the risks.
As a sociologist who specializes in “global pharmaceutical regulation and the governance of clinical trials research”, McGoey knows all too well that Western drug companies frequently test their products in non-Western countries, where human beings can be treated as so many guinea pigs. In India more than 2000 drug trial subjects died between 2007 and 2013, but the companies involved paid out (minimal) compensation in fewer than 25 cases. Because government regulation is lax and recordkeeping is spotty, corporations can always argue that these people died of some other cause. Not until 2013 did India’s Ministry of Health require pharmaceutical companies to provide free medical care for test subjects who suffered adverse reactions.
Princeton ethicist Peter Singer (who has tried to justify euthanizing severely handicapped infants) has called Bill and Melinda Gates two of “the most effective altruists in history”, but for Indian health activists that is a joke in very poor taste. “Whose impact on India’s health policies have been worse?” one of them asks, and another protests bitterly that “The Gates Foundation just leaves chaos.” They especially resent what is so often implied in the Western media, that developing countries wouldn’t have health care systems if it weren’t for Bill Gates. However progressive and enlightened we imagine ourselves to be, we are still in the grip of an old imperial mindset that presumes that Third World nations aren’t capable of managing their own affairs. Most Gates Foundation grants for global health are awarded to First World NGOs, universities, and for-profit companies; very few go to individuals or organizations based in poor countries.
A similar kind of arrogance is manifest in yet another disturbing trend: foundations increasingly focus on a few sharply defined goals, consider grant applications on an invitation-only basis, and dictate to grantees exactly how their money should be spent. This makes philanthropy an inflexible top-down affair, effectively excluding applicants with genuinely new ideas and approaches. “Many senior scientists resent being jerked back and forth whenever a powerful donor like the Gates Foundation decides to prioritize a new area,” McGoey concludes. “If a research team is forced to prioritize research or policy decisions stipulated by a donor who monitors and punishes any divergences from the donor’s demands, there are no limits to a donor using philanthropy as a veneer for increasing personal or corporate profitability, something that’s often detrimental to science and the public welfare…..A close-knit group of donors are increasingly controlling who can apply for funds, which sorts of grants will be considered, and which strategies should be pursued by grantees. The voice of grant recipients, those with the most in-depth knowledge of the social programmes they are seeking funds for, are increasingly eclipsed.” Though the Gates Foundation is particularly dictatorial, this authoritarian tendency pervades the philanthropic world, and it makes truly independent research (into the causes of autism, for instance) well nigh impossible.
Most foreign aid is “tied”, with expensive conditions attached for the benefit of corporations. The US government doles out billions in food aid but compels the recipients to buy food from US agribusiness, which can be very costly. Likewise, if the Gates Foundation simply gave grants to poor countries and allowed them to decide their own health care priorities, they might spend the money on things other than vaccines (clean water, for instance) – but that would do nothing for GlaxoSmithKline. The Gates Foundation has partnered with (and sometimes invested in) Monsanto to promote the use of GMO seeds in the developing countries, which may well win a captive market for Monsanto seeds, but has had disastrous economic and environmental consequences for small farmers.
The Gates Foundation is a big investor in Coca-Cola, and has given grants to promote business opportunities for the beverage giant in developing nations. Put aside the question of whether a tax-exempt “philanthropy” should be spending money to assist a highly profitable multinational corporation. Consider that skyrocketing consumption of surgary drinks and junk food in poor countries has resulted in a public health disaster, with epidemics of diabetes, obesity, cancer, stroke, and heart disease. The death toll from these chronic diseases has overtaken that of infectious diseases, but the Gates Foundation practically ignores the former and focuses single-mindedly on the latter. The World Health Organization used to denounce the importation of junk food to developing countries, but lately it has muffled those criticisms, and for an obvious reason: the Gates Foundation now contributes 10 percent of the WHO budget, more than any other donor (including the US government). That means that President Obama (whom we elected) has less influence over WHO than Bill Gates (whom nobody voted for). As health experts David Stuckler and Martin McKee have shown, “global health is ruled by a few private donors who make decisions in secret. The capacity to decide what is relevant and how it will be addressed is in the hands of very few, who ultimately are accountable to their own interests.”
At this point in the argument, someone inevitably objects that surely the Gates Foundation has done much good, and lists a few worthwhile charitable ventures. True enough: if you give away billions of dollars for thousands of aid projects, some of them are bound to work. But is this case built on highly selective evidence? McGoey insists that we look at the whole picture, weighing the benefits and costs of everything the Gateses have done in business and philanthropy. On that scale, she finds that the harm far exceeds the good – and that the Gateses have stifled critical examination of their work.
In the end McGoey sees some ominous similarities between Gatesianism and Stalinism. Both were supremely confidently that they could solve every problem through “scientific” planning and a command economy, whether the orders came from Moscow or Seattle. Both concentrated maximum power and wealth at the center. Neither had any patience with democracy, local knowledge, or transparency. And (I might add) both demonized and exiled dissenters (whether Leon Trotsky or Andrew Wakefield), and both used propaganda (or, as we prefer to call it, public relations) to create a cult of personality around the Infallible Leader.
Or maybe there’s a better analogy, closer to home. McGoey concludes her discussion of Bill and Melinda Gates with that memorable line from The Great Gatsby: “They were careless people, Tom and Daisy – they smashed up things and creatures and then retreated back into their money or their vast carelessness or whatever it was that kept them together, and let other people clean up the mess they had made.”
On both the left and the right, social critics sense that there is something deeply corrupt in the way we live now, but the old paradigms developed by Adam Smith in the eighteenth century and Karl Marx in the nineteenth century no longer adequately explain it. With extraordinary insight and original investigation, Linsey McGoey understands how this twenty-first century mess was made. Her voice is reasoned and never shrill, her research is solid, and her courage is remarkable. Rather than spin far-fetched conspiracy theories, she simply shows what the oligarchs are doing in plain sight, which is frightening enough.
Jonathan Rose is the author of The Intellectual Life of the British Working Classes and The Literary Churchill: Author, Reader, Actor.