There are some obvious parallels between Bill Gates and John D. Rockefeller, including their enormous wealth and their epic clashes with federal antitrust zealots in the Justice Department. But one less obvious similarity between the two greatest donors of their times is their devotion to medical philanthropy.
Somewhere between two-thirds and 80 percent of the $530 million John D. Rockefeller gave to charity went to medical research. The Bill and Melinda Gates Foundation is only two years old, but it’s already a major medical donor, giving more than $685 million, or 48 percent of its grants, to the field of medical research and development. Both chose medical philanthropy because they saw it as an underserved area where foundation dollars could make a significant difference.
Rockefeller’s grants in this area were numerous and dynamic, and the foundation’s programs were run by men who had a passionate—and sometimes hubristic—devotion to ridding the world of disease. These men saw themselves as generals leading the armies of public hygiene into battle. Rockefeller Foundation grants also transformed medicine by raising the standards of medical education, helping to turn a cozy and somewhat slapdash American system of doctor training into the most envied professional training available in the world. And the foundation created a premier medical research institution, Rockefeller University, which boasts 21 associates who have won the Nobel Prize, including six laureates who are current faculty members.
The Gates Foundation, by comparison, has a much more focused agenda and evidences none of the hands-on zeal that saw hundreds of Rockefeller doctors flying around the world to inoculate villagers from Bangkok to Bolivia. Gates—a significantly more active donor than Rockefeller, who mostly left the details to his subordinates—is more concerned with developing tools that can be used to promote public health, especially vaccines. He is far more willing to allow others to distribute the fruits of the research he funds and so far shows no interest in Rockefeller’s brand of institution-building. But if Gates has a more narrow focus to his giving, that is in part because he is building on the organizations and research that Rockefeller created.
It’s now been 100 years since John D. Rockefeller began his medical campaign with the creation of the Rockefeller Institute for Medical Research (now Rockefeller University). Can lessons be learned from Rockefeller’s medical giving? One person who thinks so is Bill Gates Sr., father of the Microsoft tycoon and one of the four members of the Bill and Melinda Gates Foundation’s inner circle. “It seems like every new corner we turn, the Rockefellers are already there,” the elder Gates told a Rockefeller University centennial conference last December. “And in some cases, they have been there for a long, long time.”
Guides and go-betweens
A with so many of his grants, John D. Rockefeller was persuaded to donate money to medicine by his principal philanthropic adviser, Frederick T. Gates. Before Gates joined Rockefeller’s staff in 1893, he was a Baptist minister who would often hear doctors in his congregation lament their inability to heal their patients. In his memoirs, Gates recalled that he became “convinced that medicine as generally taught and practiced in the United States was practically futile.”
In 1897 Gates wrote a memorandum to Rockefeller proposing that he create a medical institute. Over the next three years, Rockefeller’s lawyer, Starr Murphy, met with leading practitioners of medicine for advice. (One possible reason for the delay was Rockefeller’s ardent support of homeopathy. Gates had read the leading homeopathic text and thought it a “masterpiece of unconscious humor” and “the wild imaginings of a natural fool turned lunatic.”)
But then in 1901, John D. Rockefeller’s first grandson, John Rockefeller McCormick, died at age three from scarlet fever. McCormick’s doctors said that there was nothing they could do to prevent the death. Gates and John D. Rockefeller Jr. used the tragedy as a catalyst to persuade the elder Rockefeller to relent. “Gates was the brilliant dreamer and orator,” John D. Rockefeller Jr. later recalled. “I was the salesman—the go-between with Father at the opportune moment.” With pressure from both of them, Rockefeller agreed to create the Rockefeller Institute for Medical Research in 1901.
The Rockefeller Institute stayed small for its first five years, not acquiring a permanent building until 1906. But it was the first of several medical philanthropies Rockefeller was to create.
And nudging him whenever possible was Frederick Gates. Until his retirement in 1923, Gates made sure that Rockefeller’s charity was primarily medical in nature, even after the Rockefeller Foundation was created in 1913. Had another faction prevailed, Rockefeller Foundation spending might have taken an entirely different course.
The Rockefeller foundation had a protracted birth, largely because the foundation’s trustees spent two years trying—and failing—to secure a congressional charter. After the foundation received a state charter in 1913, the core group of advisers were split over what the foundation should do. According to historian Robert E. Kohler, one faction—led by Jerome Greene (John D. Rockefeller Jr.’s private secretary), Rockefeller Jr. adviser Raymond Fosdick, Starr Murphy, and former New York City police commissioner Arthur Woods—wanted the foundation to become what Greene called a “university of human need,” focusing on a wide variety of social problems, including immigration, housing, prison reform, and conservation.
Gates resisted these plans, calling Greene’s idea of small grants in many areas “scatteration.” He thought that the Rockefeller Foundation should concentrate its funds on solving big medical problems. The Rockefeller Foundation board spent four years in argument, but Gates eventually prevailed.
The strategy the foundation pursued was three-pronged: building institutions such as the Rockefeller Institute, reforming medical education, and directing public health campaigns.
The Rockefeller Institute was a pioneering organization. The medical equivalent of a think tank, scientists at the institute were largely free to pursue whatever research they thought was promising. “Laboratories were organized around investigators selected for their intellectual gifts and representing highly diversified areas of medical science,” notes institute historian René J. Dubos. The institute was also the first organization of its type to affiliate with a hospital.
The institute’s first triumph came in 1907, when researchers used a newly developed serum to help stop a meningitis epidemic in New York City. Among the discoveries of the institute in its first 20 years were methods of freezing blood (which led to the first blood bank, aiding wounded British soldiers on the Western front during World War I), the discovery of the spirochete that causes syphilis, and the invention of powerful drugs to fight sleeping sickness. The institute also sponsored the research of Alexis Carrel, whose efforts to show how organs can survive outside the body (including a chicken heart that beat continuously for 34 years) led to a Nobel Prize in 1912.
In 1965, the Rockefeller Institute became a university, which now admits 25-30 graduate students a year. Among its greatest achievements: the discovery of the link between DNA and heredity, popularizing the use of electron microscopes, and pioneering work on the nature of antibodies.
The reform of medical education was a major Rockefeller Foundation goal. The “full time in medicine” campaign encouraged medical schools to hire faculty that spent all their time educating future doctors, instead of hiring moonlighting doctors to teach an occasional class. Rockefeller grants also helped reform nursing training, including the creation of the first nursing school, at Yale in 1923.
But the Rockefeller medical effort that most resembles the funding of the Gates Foundation is its public health program, begun in 1909 when a crusading doctor named Charles William Stiles persuaded Gates and other leading Rockefeller advisers to take on hookworm, a parasite long prevalent in the South and in other tropical and subtropical climates. While hookworm did not kill, it made its victims lethargic and unwilling to work. The Rockefeller Sanitary Commission was created, headed by educator Wickliffe Rose, an original trustee of the foundation.
A cure was available: thymol. But Rockefeller staffers found that changes in behavior, such as better sewers and regular shoe wearing, would also prevent the worms from entering a body. To convince skeptical locals, they hid their inoculation efforts under the guise of a traveling road show. “COME OUT, BRING YOUR FAMILY, SPEND THE DAY, AND HEAR THE DOCTOR TALK!” the posters commanded, and the locals dutifully showed up. “Anyone can see the workings of that wonderful instrument, the microscope, by simply asking the man in charge,” the posters said, and once infected patients saw the squirming worms inside their bodies, they downed the thymol and got better. While waiting for their specimens to be prepared, the Southerners ate box lunches and engaged in many rounds of lusty hymn singing. (“Onward Christian Soldiers” was a favorite.)
These methods seem corny today, but they were highly effective. Working with state and county officials, Rockefeller Foundation officials sent inspectors to a quarter-million homes in half of the counties in the South. By 1920, hookworm in America had been checked.
While it was officially Rockefeller policy that the foundation acted in cooperation with local and national health authorities, it was also true that Wickliffe Rose and his successors saw themselves as commanders fighting a world war against disease. Raymond Fosdick, who was the foundation’s president in the 1930s and 1940s, recalled that Rose “thought of the world as a field of strategy in the conquest of disease, and whatever his objective he followed its trail across oceans and continents.” Historian Robert Shaplen notes that Rockefeller disease-fighters might have gone around the world as many as 20 times in their careers—in an age before the jet airplane.
But if Fosdick envisioned his team of doctors as an army battling disease, malaria would become that army’s Vietnam.
The battle began in 1923, and in 1938, Rockefeller officials decided to build on their spectacular success in stamping out the disease-laden gambiae mosquito, which was spreading malaria throughout Brazil. In cooperation with the newly created World Health Organization, the foundation decided to launch another attack using a new insecticide—DDT. From 1958 onward, the effort also received substantial U.S. government assistance. The Global Eradication Program was underway.
At first, as Malcolm Gladwell notes in a recent New Yorker, global eradication was highly successful thanks to DDT, which “saved millions—even tens of millions—of lives around the world, perhaps more than any man-made drug or chemical has done before or since.” But problems arose: the rich bribed officials to ensure that their homes weren’t sprayed, insecticide went missing, and weakened sprays were used instead. Eventually, DDT lost its potency, as the few mosquitoes that survived developed a resistance and came back to infect.
In 1963, U.S. government funding for the Global Eradication program ended. Environmentalists, inspired by Rachel Carson’s Silent Spring, campaigned against the insecticide. In 1969, the Global Eradication Program officially ended, and with it the Rockefeller Foundation’s great campaigns in public health entered a new era. The foundation is still active in public health issues, but on a much smaller scale than in the past.
So what exactly has Bill Gates learned from Rockefeller? Gates Foundation officials say they have studied the Rockefeller Foundation’s global health programs in detail. Dr. Gordon Perkin, director of the Gates Foundation’s global health program, says that the Rockefeller programs “had an incredible impact with a modest (by today’s standards) investment. Indeed, the Rockefeller programs have given inspiration to Bill and Melinda Gates that they too could contribute to significant changes in global health through their foundation.”
Like the Rockefeller Foundation, Gates has settled on global health because he feels it’s an underserved area where philanthropic dollars can make a serious difference. Of the limited number of interviews that Bill Gates has given about his charitable intentions, the most lengthy was to Jean Strouse for the New York Times Magazine. According to Strouse, Gates was nudged toward health-related charity by Carnegie Corporation president Vartan Gregorian (who served as Walter Annenberg’s philanthropic adviser). Gates decided to try to find an area that had been ignored by other foundations. He decided that little was being done to fight disease in the Third World.
But what is more immediately striking are the differences between the two programs, differences largely attributable to differences between the two donors.
John D. Rockefeller was never a great reader; his giving was done on the basis of short memoranda prepared for him by Frederick Gates, John D. Rockefeller Jr., and other subordinates. He rarely saw how his wealth was being used. Bill Gates, by all accounts, is an active reader fully prepared to discuss complex medical issues with experts as an intellectual equal. According to The Economist, Gates was inspired by a World Bank report that described Third World health problems. He saw “market failure on the research side. A lot of diseases exist primarily in places where there is no prospect of a viable drugs market because of a lack of resources.”
So Gates went to work. He began by hiring two experienced public health experts: Perkin, who was previously in charge of population programs for the Ford Foundation and medical programs for Planned Parenthood, and Emory University professor William Foege, who was director of the Centers for Disease Control between 1977 and 1983.
Together, they decided that spending money on vaccines for children was a promising activity. Late in 1998, Gates had a dinner at his Redmond, Washington, estate with leading vaccine experts. “It was late in the dinner, and I said, ‘If I was going to do more, what should we do?’” Gates told the Boston Globe. Seth Berkley of the International AIDS Vaccine Initiative pushed for HIV research, while “somebody else thought malaria should get more focus,” Gates recalled, “because hardly anything was being spent on it.”
Several people who attended the Gates dinner got grants. Berkley’s group got $25 million, while malaria research got $50 million. Since then the Gates Foundation has given $100 million more to efforts to find an AIDS vaccine and $70 million to find a vaccine for an African strain of meningitis.
But the largest Gates Foundation health grant so far is $750 million to the Global Alliance for Vaccines International, designed to provide a financial incentive to pharmaceutical companies by buying their products, particularly influenza and hepatitis vaccines. Since Gates’s grant, grants from the U.S. and other countries have increased the alliance’s endowment to $1 billion. In June, the alliance named as its director Carol Bellamy, formerly executive director of UNICEF and president of the New York city council.
Another interest of the Gates Foundation is in preventing childbirth deaths. “There is no health index with a greater discrepancy than maternal mortality,” William Foege told The Lancet. So the foundation spends about 15 percent of its budget ($212 million in 2000) on “reproductive and child health.” According to foundation president Patty Stonesifer, Melinda Gates is the force behind this effort. Stonesifer told the New York Times Magazine that Mrs. Gates “has a strong interest in children and early childhood.” Most of these grants go to prevent babies and mothers from dying, but the foundation did give $1 million to Population Action International “to develop a comprehensive global strategy for ensuring reproductive health commodity security.”
The Informed Donor
By all accounts—and unlike John D. Rockefeller—Gates is a very active donor. The Gates Foundation has no board; decisions are made by an executive committee consisting of Gates, Bill Gates Sr., Melinda Gates, and Stonesifer. The elder Gates and Stonesifer can approve grants of up to $1 million on their own, but any other grants have to be personally approved by the Microsoft tycoon. According to Boston Globe reporter John Donnelly, “Gates has spent hundreds of hours seeking information about the problems and successes of global health” and “hosts dinners in his palatial home where guests talk, for instance, about the intricate details of rotavirus gastroenteritis, a killer of nearly one million people a year.”
Rockefeller was interested in building institutions like Rockefeller University; by contrast, Gates insists that his money be spent on developing “tools” for long-term use. For Gates, vaccine research is an example of a tool, since a vaccine can be used for decades after its creation. This emphasis on tools, Gordon Perkin told The Lancet, is in part due to Gates’s interest in technology, since “you only have to develop such tools once and then they’re going to benefit many people far into the future.”
One major difference between the Gates and Rockefeller foundations’ public health campaigns is staff size. Gates has just seven people overseeing the public health campaign—a remarkably small number for a foundation administering hundreds of millions of dollars of grants.
The Rockefeller Foundation’s public health programs belong to the command-and-control era of management, in which decisions were made at foundation headquarters in New York and relayed to the field. The Gates Foundation, of course, is colored by the more decentralized, cooperative management style of the post-industrial age. That approach, plus the foundation’s small staff size, makes it unlikely that there will be anyone in Redmond with military pretensions issuing orders to epidemiologists in Borneo or Brazil.
Indeed, the Gates Foundation strategy is to form coalitions with like-minded entities. The Global Alliance for Vaccines International, for example, may have the Gates Foundation as a major contributor, but it also has other members on its board, representing the Pasteur Institute, the World Health Organization, the World Bank, and the Rockefeller Foundation, among other entities.
William Foege told The Lancet that Gates’s strategy is to follow Peter Drucker’s management rules: “If people in an organization know what objective they are all working for, it actually doesn’t matter how you are organized.” Foege added that with the foundation’s small staff, “there is no way you can supervise people working in global health where the people you are working with may be 10,000 miles away. You have to adopt a different concept, which is, instead of a supervising agency, you’re an enabling agency, trying to pick the right people, fund them, and let them work.”
Benchmarks to Watch
How well is the Gates Foundation doing? It’s too early to tell, but here are three benchmarks to judge its future performance.
The first measure is political. Bill Gates, reasonably enough given his tangles with the Justice Department, has been very coy about his political views. According to New York Times Magazine writer Jean Strouse, the Gates Foundation’s poverty-fighting emphasis reveals “a decidedly liberal agenda.” But so far, Gates Foundation health grants have gone largely to medicine and not to political activism. Of course, aid that improves the lives of the poor should be a primary concern of both liberal and conservative foundations.
Still, there are shades of First World-bashing to Gates’s public statements. In his Boston Globe interview, Gates said that “the world hasn’t been allocating its resources properly at all in global health. Rich governments should be doing more.” The question is, will these ruminations develop into a full-fledged lobbying effort, complete with public relations campaigns and media manipulation?
The experience of the Rockefeller Foundation provides two other criteria by which to judge Gates’s public health giving. The first is not to overreach. Rockefeller, buoyed by its early success in beating back hookworm and yellow fever, promised to eradicate malaria. The failure of the Global Eradication campaign shows the limits of foundation power. Perhaps a Gates Foundation grantee will find a vaccine for malaria, AIDS, or meningitis. But if that happens, we should realize that it will take years of trials and testing before we know that the vaccine works.
A final lesson is that money does not necessarily produce talent. Bill Gates’s money is poised to reward a successful vaccine developer. But it may well be that all the Gates grants might ultimately prove ineffectual.
In his memoirs, Raymond Fosdick was proud of the Rockefeller Foundation’s achievements. But he also realized that there were limits to what any foundation can do.
“There is a common fallacy—and even some foundation executives may not be immune from it—that money can create ideas, and that a great deal of money can create better ideas,” Fosdick wrote. “Nothing can be wider of the mark. You cannot buy scientists or poets as you would vegetables in a cash-and-carry store. . .. It follows, therefore, that a becoming modesty is a prerequisite for a foundation.” It’s easy to forget that money and effort can’t buy everything. Sometimes only patience—and luck—can bring you to your goal.
Martin Morse Wooster, a contributing editor of Philanthropy, is the author of The Foundation Builders.