I’m always mystified by philanthropic foundations and how fruitlessly they disperse their capitalism-provided funds. Bloomberg Philanthropies spends a chunk of its $8 billion on “Sustainable Cities.” The new $10 billion Bezos Earth Fund is backing climate activists. The $12 billion Ford Foundation insists, “To address the climate crisis, we must address inequality.”
Huh? Way more than philanthropy, free-market capitalism gets people out of poverty, raises living standards and cures the world’s ills. Of the four things you can do with your money—spend it, pay taxes, give it away or invest it—investing is the only one that increases productivity, the scaffolding of capitalism and societal wealth.
So my eyebrows rose when I was offered a chance to meet Raj Shah, president of the $4 billion Rockefeller Foundation. Maybe I’d be able to gather some squishy grant-making examples to make fun of. Boy was I wrong.
Perhaps the Rockefeller difference traces in part to the foundation’s founder. John D. Rockefeller was an interesting guy, much-maligned despite bringing light and heat to the masses (and saving whales). On top of his heroic business efforts, he understood where philanthropy could be useful.
A favorite book of mine, Ron Chernow’s 1998 “Titan,” describes how Rockefeller made his money, then gave it away. He looked for big projects only he could fund, such as eradicating hookworm—a parasite that struck people who walked barefoot, predominantly Southern blacks. Rockefeller funded tests for thousands of rural citizens and provided shoes. It worked. One branch of the Bill and Melinda Gates Foundation uses a similar philosophy to fight malaria and HIV.
Mr. Shah told me about the Rockefeller Foundation’s recent deal to bring reliable power to millions of people in India. Worldwide, 840 million people live without access to electricity. Hundreds of millions more get only a few hours a day of expensive government-monopoly-provided current. Digital bits drive the First World, while the Third World still needs electricity.