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UCL IIPP Blog

Can billionaire philanthropists save us?

Photo by Sharon McCutcheon on Unsplash

By Laurie Macfarlane

This blog is a follow up to the recent event ‘Philanthropy and the State: who is funding what and why?’ The event is part of IIPP’s ‘Who owns what and why’ series. The recording of the event can be watched here.

T o some, Bill Gates is a model of how capitalism is supposed to work. As a leading tech innovator, he enriched himself while improving the lives of others, and then used this vast wealth to support good causes.

That Bill Gates has donated an enormous amount to philanthropic causes is undeniable. Since 2000 the Bill & Melinda Gates Foundation has grown into one of the largest philanthropic foundations in the world. With an endowment of nearly $50 billion, the foundation has funded everything from schools and universities to malaria control and the development of Covid-19 vaccines.

But not everyone agrees that the influence of billionaire philanthropists is so benign. Anand Giridharadas, author of Winners Take All: The Elite Charade of Changing the World is one of them. In a recent conversation with Professor Mariana Mazzucato for IIPP’s ‘Who owns what and why’ series, Giridharadas said that Gates and others like him are responsible for pushing a form of “elite-led, market-friendly, winner-safe social change”.

Although they talk about changing the world for the better, in practice their actions resemble “token acts of do-gooding to keep their privileges the same”. Not only that, public acts of philanthropy are often used to divert attention away from the dubious means by which their wealth was initially accumulated.

Bill Gates is no exception: not only did Microsoft benefit from large-scale public investments, as Professor Mazzucato highlighted in her book The Entrepreneurial State — much of Gates’s wealth derives from Microsoft’s position as a quasi-monopoly. By the mid 1990s, Microsoft had captured over 90% market share of the world’s personal computers. It was only after his reputation was tarnished during Microsoft’s antitrust trial in 2000 that he turned to philanthropy, which in Giridharadas’s view was a deliberate effort to rescue his reputation.

“The Covid-19 pandemic demonstrates why we can’t rely on billionaire philanthropists to solve the world’s problems.”

But despite successfully reinventing himself a philanthropist, Gates was widely criticised in April this year after refusing to support the calls to waive Covid-19 vaccine patents, with some accusing the billionaire of “perpetuating vaccine apartheid”. Although his comments made headlines around the world, in reality they were nothing new: throughout the pandemic Gates has used his influence to ensure that pharmaceutical companies were granted exclusive intellectual property rights to lifesaving medicines, regardless of how much public funding they had received.

As Mohim Mookit recently asked: “Should we be surprised that a monopolist-turned-philanthropist maintains his commitment to monopoly patent rights as a philanthropist too?”

For Giridharadas, this is “the elite charade of changing the world”. Billionaire philanthropists co-opt language associated with social change while avoiding questions of power and structural change, and ultimately end up preserving the status quo and their role within it.

The Covid-19 pandemic demonstrates why we can’t rely on billionaire philanthropists to solve the world’s problems. “Plutocracy will always be plutocracy. The only solutions to our shared challenges are those that are public, institutional, democratic and universal”, Giridharadas said. “In other words: they solve the problem at root, for everyone.”

If philanthropy can’t do this, then what can? His answer is not new: the state. Only democratically elected governments have the capacity and the legitimacy to act in the collective public interest. Philanthropic donations are already tax deductible, which means they are in effect subsidised by the public purse. If the wealth of billionaires was taxed properly, it could be used to serve the interests of democracy, not plutocracy.

States can also shape and co-create markets by setting the terms of business, but only if they recognise their power to do so. According to Giridharadas, this means being much firmer with corporations about what they must and must not do to trade legally.

Even Bill Gates seems to agree, at least in part. In 2019 he wrote that “the rich should pay more than they currently do, and that includes Melinda and me.”

Giridharadas is clear that governments are often far from perfect, and they shouldn’t try to do everything. But rethinking the role of the state, and developing the capacity to think and act big, will be essential if we are if we are to tackle the major challenges of the 21st century.

Luckily, that is the very essence of what IIPP was established to achieve.

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UCL Institute for Innovation and Public Purpose

UCL Institute for Innovation and Public Purpose

Changing how public value is imagined, practiced and evaluated to tackle societal challenges | Director: Mariana Mazzucato | Deputy Director: Rainer Kattel