Sunday, September 27, 2015

Have a Slice?

The Gates Foundation's Leveraged Philanthropy: Corporate Profit Versus Humanity on Three Fronts

Guest post by Chemtchr.
Chemtchr teaches science and advises a student service club at a public high school in a diverse low-income community. She is a graduate of the University of California-Santa Cruz and Montana State University-Bozeman, and has taught in urban community-based programs and at a tribal college, as well as in public districts. She's active in Citizens for Public Schools, and in local and state councils.

Philanthropy wonk Lucy Bernholz defines the buzzword leverage as "the idea that you can use a little money to access a lot of money."

It's hard to think of the Gates Foundation's $26 billion leverage effort as "a little money", especially since it's been spread over the globe to gain access to vastly more resources than it contributes, including U.S. tax dollars, the foreign exchange of emerging African nations, and United Nations funds for international development and world health.

Gates' leveraged philanthropy model is a public-private partnership to improve the world, partly through targeted research support but principally through public advocacy and tax-free lobbying to influence government policy. The goal of these policies is often to explicitly support profitability for corporate investors, whose enterprises are seen by the Gates Foundation as advancing human good.

However, maximum corporate profit and public good often clash when its projects are implemented.

For example, chemical giant Monsanto has partnered with the Gates Foundation, which reportedly works to suppress local seed exchanges and environmentally sustainable agricultural practices through its global agricultural charity work. Fraud-prone drug giant GlaxoSmithKline is a partner in the Foundation's work to leverage its own relatively fractional contribution to vaccination efforts, so that it centrally controls enormous world funds for purchase, pricing, and delivery of vaccines for world public health. And in its U.S. education reform charity work, the Gates Foundation has increasingly shifted its funding to promote market domination by its British corporate education services partner, Pearson Education.

The Gates Foundation, and Gates personally, also own stock and reap profits from many of these same partner corporations. In addition, the Foundation owns a profit-generating portfolio of stocks which would seem to work against the Foundation's declared missions, such as the Latin American Coca-Cola FEMSA distributorship and five multinational oil giants operating in Nigeria. These corporate investments, now moved to a blind trust whose trustees are Bill and Melinda Gates, are collaterally supported by the Foundation's tax-free lobbying and advocacy activities.

Criticism of the profit-driven philanthropy agenda is muted by the fact that many of the Foundation's "advocacy" gifts are positioned to leverage control of policy analysis and news outlets. The Gates Foundation recently undertook sponsorship of the Guardian's Global Development coverage, for instance, which now maintains a weary-but-compliant stance toward corporate domination of development aid. The Gates Foundation also literally dominates news coverage of Global Health issues.

On the U.S. Education Reform front, the Gates Foundation maintains long-time charitable support of Media Bullpen, as well as Education Week itself (see disclaimer).

Tom Paulson of Humanosphere reviewed some critical stories that reporters did get published in major news outlets last November.

The Global Health Front

In an interview with Forbes science writer Matt Herper, Gates explained how ensuring the profitablility of Big Pharma's vaccine sales will advance the health of third world populations:
Fortunately, our vaccine discovery rate has been better than the recent drug discovery rate of pharma," Gates said. "And, you know, pharma doing well is important for the world, so hopefully their discovery rate will go up.
Donor nations were shocked when UNICEF disclosed that it has been forced to pay artificially elevated prices for vaccines under an arrangement called the Advance Market Commitment, which was brokered by Gates Foundation-dominated GAVI alliance, to greatly increase drug company profits. Stakeholders also worry that industry reports of particular vaccine's effectiveness might be skewed by marketing goals.

There is no doubt that vaccines save lives, but a 2009 analysis by the British medical journal Lancet flagged a number of concerns about the Foundation's pattern of expenditures, particularly questioning the propriety of making "charitable" contributions to the World Bank's International Finance Corporation (IFC). Others have expanded on those concerns.

The 2010 Gates Foundation announcement of $1.5 billion for maternal health in developing countries over five years was welcomed, but it came heavily leveraged. Gates launched the Health in Africa Fund, through the International Finance Corporation (IFC), to establish new mechanisms to invest world health funding and national health budgets in private-sector healthcare facilities in Africa.

The Gates Foundation's funding category for Global Maternal Health includes research and development in the US of technology and treatments, and also advocacy in vulnerable African nations for government policies. Since Gates believes sustainable health systems must be privately profitable, he leverages his "maternal health" funding to effectively divert investment of available in-country funds, as well as NGO funding, into private ventures that he favors, instead of into national health plans.

The pursuit of profitability for the Foundation's corporate marketers warps the design and implementation of delivery programs. The Gates Foundation leverages its own contributions to dominate and focus external funds into its own intensive, vertically integrated programs.
Controlled from above and afar,

the programs divert all available health resources to temporary, fraud-prone drives. Vertical integration means the Foundation controls every aspect of the project, which disappears when funding is exhausted. Horizontal development of medical service capacity on the ground is frozen out, and the Foundation's opposition to comprehensive national health programs means African physicians must watch their patients die from conditions that would be treatable if a basic medical infrastructure existed.

The Global Agricultural Development Front

The Gates Foundation's philanthropic agricultural development program is partnered with international agribusiness corporations, and is aimed at promoting advanced technologies such as genetically modified crops and pesticides in developing nations. In light of this conflict, the Bill and Melinda Gates Foundation's own investments in Monsanto and Cargill, particularly, have come under heavy criticism.
In addition to leveraging control of international development funds for its Alliance for a Green Revolution in Africa (Agra) initiative, the Gates Foundation influences African governments directly to expend their own agricultural budgets to support a crop warehouse/borrowing system that binds farmers to Gates' international corporate partners, for future seed and pesticide access.

On every continent but Africa, trade differential due to profits extracted by agribusiness already results in a net flow of wealth out of the developing economies, more than offsetting charitable contributions. The payoff from a new Green Revolution for the recipients of the Foundation's charity also includes health damage and environmental degradation. African and Indian agricultural workers maintain that the Foundation's philanthropy is environmentally toxic, and undermines vital agricultural development that respects local conditions.

The recent court action by a consortium of five million Brazilian soy farmers highlights how agricultural development gifts can plunge farmers into perpetual serfdom to corporate agribusiness. As reported in the journal Nature, the farmers have successfully sued Monsanto to claw back $7.5 billion in "royalties" for the planting of seeds they had harvested themselves, for which Monsanto forcibly extracts payments. A Brazilian judge will now rule on Monsanto's appeal.

The activism of third-world environmental organizations against the Gates Foundation's take-over of UN development programs goes unreported in the U.S. press. It boiled over on June 22, however, when young Civil Society representatives staged a mass walkout of the corporate-dominated Rio+20 United Nations Summit in Brazil. The representatives of the world's actual voluntary philanthropic organizations reconvened at a summit sponsored by Friends of the Earth. Their own Rio+20 Outcome Document was delivered to over 100 heads of state and government.

The U.S. Education Reform Front

The Gates Foundation's model of leveraged philanthropy has had serious consequences in U.S. education. Many sources have criticized the specifics of Gates' profit-driven, politically enforced innovations in public schools. In Part Two of this series, I'll examine how the Foundation's corporate philanthropic model has undermined the quality of American public education, and threatens its democratic foundation.

On discussions of this blog on other forums, readers have asked for links demonstrating the direct connection between the Gates Foundation and the corporate marketing of proprietary genetically modified seeds.

The difficulty here is that the Foundation describes its projects in general terms like this:

The money will fund agricultural development projects that are already producing great results for farmers, with a goal to help millions of small farmers lift themselves out of poverty. This re-investment will be in projects that have already:
Supported the release of 34 new varieties of drought-tolerant maize.

No mention is made of partnerships with Monsanto, and "supporting the release" fails to convey how its grants to agricultural ministries helped promote "healthy" free-market agricultural policies like suspending subsidies to poor farmers, or banning traditional seeds from government seed banks.
To find the connection, you have to start at The Indypendent, by Paige Aarhus
"Why Is the Gates Foundation Helping Monsanto?"

Gates sponsorship of Monsanto in India makes no mention of collateral damage by its partner, Monsanto, there:
"Bt cotton - less miracles, more failures for Indian farmers"
"KILLER SEEDS: The Devastating Impacts of Monsanto's Genetically Modified Seeds in India"
Tragically, corruption breeds corruption, and leverage promotes leverage. What link can I give you, to document the absence of coverage of these issues on our captive media? Vandana Shiva put the pieces together on Al Jazeera.

See Diane Ravitch's response to this: "I am puzzled by the Gates Foundation."

Part Two:  the Gates Foundation's approach to leveraged philanthropy?

The Gates Foundation favors a charitable model known as a public-private partnership, which appears at first to be an enlightened model for corporate engagement. For-profit ventures are "partnered" with the government for funding, to drive positive social change.

The problem is that apparent charities are actually spending public funds, often without our knowledge or consent, and public private partnerships in education have shown themselves to be vulnerable to outright fraud as well as wasteful insider dealing. There's no open or democratic mechanism to determine public benefit, or regulation to protect public education funding from financial pillage for services it doesn't want or need.

Some for-profit corporations directly set up their own non-profit intermediary to divert government funding. For example, the Pearson Education Foundation is a philanthropy which is under investigation for its work as an intermediary on behalf of its parent corporation, global giant Pearson Education, whose 2010 US sales totaled £2.6 billion (British pounds).

In April 2011, the Gates Foundation announced a partnership with the Pearson Foundation to produce resources for its Common Core State Standards project, and Pearson simultaneously announced it was developing a complete digital curriculum to support the proposed standards. The alliance was described in this NY Times story, Foundations Join to Offer Online Courses for Schools.

Microsoft also unveiled its own $15 million research and development effort for "Next Generation" products, aligned to the new standards. Possible return on that investment is staggering, and almost every feature of the Gates Foundation's program will create a dramatically favorable business climate for the data industry.

The conservative Heartland Institute puts the cost of implementing the Common Core program at $30 billion dollars, whereas the conservative Fordham Institute, heavily funded by the Gates Foundation, argues for a range of lower possible costs. States face a confusing legal mandate to fund a voluntary national program they don't remember volunteering for. This might not be a public service.

We have to confront the likelihood that the Pearson Foundation is actually representing the profit-seeking interests of the Pearson Corporation.

Is the Gates Foundation, to an unknowable extent, locking down control of a government-mandated multi-billion dollar marketing opportunity for Microsoft and other allies?

Political Leverage Cuts across All Four Sectors, to Divert Public Funds

The Gates Foundation's Education program expends 20% of its funds for advocacy, which turns out to include support for artificial grass-roots organizations that can be used to sway local policy, according to the New York Times and the Seattle Times. Local political leverage helps to prepare the ground in different cities for specific Gates Foundation projects that tie into its vision of national standards and data-based accountability driven by entrepreneurial technological innovation.

For example, through its Next Generation Learning partnership, the Foundation is promoting technology to develop innovative learning models and personalized educational pathways.

One typical $500,000 Next Generation political grant was awarded to non-profit intermediary CEE-Trust, to "develop opportunities for entrepreneurs to launch or incubate new next gen schools and programs in CEE-Trust member cities."

Opportunities for entrepreneurs have to include easy access to public funds, so the Gates Foundation contributed $4 million dollars to preserve friendly Mayor Mike Bloomberg's control of New York City's public schools. It also recognized the New York mayor's successful reform efforts in its grants to US cities, and congratulated New York for its great progress under Chancellor Joel Klein. Klein's boast that his "tough medicine" had raised scores in the New York public schools was exposed as data manipulation, but his data-friendly legacy of entrenched entrepreneurial for-profit rating services lives on.

A Legislatively Mandated Doctrine of Accountability that Defies All Research

Unlike the government sector, philanthropy has no means to force anyone's participation. Democratic oversight of voluntary charities is unnecessary and unconstitutional, because they have no way to enforce monetary contributions or compliance; but government partnership changes all that.
Participation and compliance in standards-based and data-driven education reform isn't voluntary for Americans, especially for American children. They are already held accountable to corporate education's assessments by force of law, sometimes at great cost to their individual welfare.

 The bipartisan No Child Left Behind Act imposed an accountability and testing regime which is so unpopular now that Secretary of Education Arne Duncan called it "a slow motion train wreck". Duncan offers administrative waivers from the law's actual provisions, but only to states that meet his own even more encompassing requirements for data-driven accountability regulations.

In spite of growing public resistance, the Gates Foundation has vowed to continue its fight to impose mandated national standards and tests. It has added data-driven teacher ranking to its program, based on statistical Value-Added Metrics (VAM), all with no demonstrated public benefit or democratic mandate.

Studies at UC Berkeley have refuted the Gates Foundation's claims for its metrics, as has Mathematica Institute's own study. Notwithstanding this, the Foundation has continued its legislative campaigns in individual states, to force immediate imposition and implementation of its discredited ranking systems.
Ironically, this past week has seen serious self-examination by the business world of Microsoft's own "stack ranking" in its competitive employee evaluation system, which is credited with destroying innovation and productivity in Microsoft's stagnant engineering department for the past decade.

Public disclosure by Common Cause that the American Legislative Exchange Council (ALEC) engages in a massive state government lobbying system caused widespread revulsion, and exposed the Gates Foundation's five year grant to "educate (legislators) on beneficial ways to recruit, retain, evaluate and compensate effective teaching based upon merit and achievement" The Foundation is an active, tax-exempt lobbyist in both the legislative and executive branches, at every level.

Regulatory Capture and Institutionalized Conflict of Interest

The Obama administration has been granted over 30 waivers from the conflict-of-interest ethics pledge set forth in its Executive Order 12490. Pulitzer Prize winning journalist Daniel Golden described the entrenched Gates Foundation influence within the United States Department of Education in his Business Week story of July 15, 2010.
Today, the Gates Foundation and Education Secretary Duncan move in apparent lockstep. Two of Duncan's top aides, Chief of Staff Margot Rogers and Assistant Deputy Secretary James H. Shelton III, came from the foundation and were granted waivers by the Administration from its revolving-door policy limiting involvement with former employers. Vicki Phillips, who heads the foundation's education programs, and Duncan participated from 2004 to 2007 in the Urban Superintendents Network, a group of a dozen school leaders who met twice a year at weekend retreats co-funded by Gates.
When the federal government made $4.35 billion in federal Race to the Top awards available--favoring applicants that agree to link teacher pay to test score gains, increase the number of charter schools, and adopt common curriculum standards--the Gates Foundation paid for consultants to prepare applications for 24 states, as well as the District of Columbia.

~Daniel Golden, Bill Gates' School Crusade
The Foundation's assistance to states in pursuing the US government's Race to the Top money was contingent on applicants' imposition of a list of requirements on their own states, which would effectively assure the Foundation's future domination of the state's public education system. The first question on the Gates Foundation qualifying criteria questionnaire is, "Has your state signed the MOA regarding the Common Core Standards currently being developed by NGA/CCSSO? [Answer must be "yes"]"
This article by Joanne Weiss, Duncan's current Chief of Staff at the US Department of Education, contradicts the DOE's frequent assertions that the Common Core is a voluntary state-level initiative, and reveals its real purpose:
The development of common standards and shared assessments radically alters the market for innovation in curriculum development, professional development, and formative assessments. Previously, these markets operated on a state-by-state basis, and often on a district-by-district basis. But the adoption of common standards and shared assessments means that education entrepreneurs will enjoy national markets where the best products can be taken to scale.
~Joanne Weiss, The Innovation Mismatch: "Smart Capital" and Education Innovation
Citizens of 44 states don't know whether, when, or how their own state agreed to the imposition of the voluntary Common Core State Standards. What is an MOA, and does it have the force of law? Exactly who signed it? Has the Core already been adopted in my state, or not? The preemptive shuffling of MOAs was a smart backroom steamroller tactic, but leverage is an unacceptable substitute for transparent democratic governance on such a momentous decision.

The Pioneer Institute is a very conservative organization, which I can't claim to understand. It decisively opposes the imposition of the Common Core in this detailed analysis. I would welcome public discussion of their objections, but I know of no democratic forum where the question might even be raised.

Whether the steamroller is for our own good or in the self-interest of wealthy philanthropists can be debated. But, from all our differing perspectives, we have to call on our democratic authority to put the brakes on this politically leveraged, extralegally mandated imposition of the Gates Foundation's agenda. We, the American people, all share the right and the duty to judge our education policy for ourselves.
My thanks to education activist Susan Ohanian, without whose links this effort wouldn't have been possible.

What do you think? Is the Gates Foundation's philanthropy shifting control of our schools away from the public? Are there conflicts of interest at work? 

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