Staying the Course: 5 Takeaways From Bill Gates' $20 Billion Infusion into the Gates Foundation

It’s been dubbed “one of the most significant donations in the history of philanthropy,” and in terms of sheer magnitude, that description fits. Announced yesterday, Bill Gates’ $20 billion infusion into the foundation he’s led alongside Melinda French Gates for over two decades will no doubt springboard him into the top spot for 2022’s biggest givers, while further cementing his reputation as a titan of philanthropy. And it’s a welcome counterpoint to the narrative that a sagging stock market has dampened the flow of philanthropic giving from the wealthiest among us.

In a press release, the Gates Foundation announced plans to use the gift to expand its giving by 50% over pre-COVID levels, from roughly $6 billion to a goal of $9 billion a year by 2026. That’s a colossal figure, even by the standards of the world’s largest grantmakers, and will even further cement the Gates Foundation’s global preponderance in its chosen fields.

That said, Gates’ commitment, though gigantic, does little to signal any true departure from the plan at the world’s largest foundation. In a post on his blog, Gates wrote, “Our focus will remain the same — but at this moment of great need and opportunity, this spending will allow us to accelerate progress by investing more deeply in the areas where we are already working.”

Following a year of uncertainty regarding the foundation’s long-term future, this latest development is another milestone in Team Gates’ quest to project stability. The pandemic, the Gateses’ divorce and Warren Buffett’s departure from the board shook things up. The assembly of a new board of trustees and, now, this $20 billion vote of confidence are signs that this gargantuan grantmaker isn’t going anywhere, at least for the next several decades. It can also be viewed as a response to the rise of mega-donors like MacKenzie Scott, who have been running circles around the sprawling foundation in recent years. For better or worse, this new $20 billion strengthens the increasingly stodgy-looking institution’s place as the biggest game in town.

So while it mainly signals more of the same, the ultra-mega-uber gift does reflect some important realities about the current state of Gates World and its possible future. Here are five takeaways to keep in mind.

This is a necessary ramp-up

In his blog post announcing the move, Bill Gates reiterated his intention to empty the safe, writing that “My plan is to give all my wealth to the foundation other than what I spend on myself and my family.” He went on: “I will move down and eventually off of the list of the world’s richest people.” With a current net worth Forbes pegs at $122 billion (that’s before this latest commitment), the 66-year-old still has quite a task ahead of him, especially as his fortune-building apparatus at Cascade Investment and elsewhere continues chugging along.

If Gates does intend to make good on his word, shoveling tens of billions at a time into the foundation needs to become the norm going forward, not the exception. And at the other end, $9 billion worth of grantmaking a year still represents the floor, not the ceiling, if we’re talking about wealth redistribution. Staggering as it may be, giving at that level will likely be necessary if the foundation still plans on spending down within 20 years after the death of both Bill and Melinda — as it has long indicated.

Also, let’s not forget that as things stand, Buffett’s chunk of the foundation’s endowment must go out the door within a decade of the nonagenarian’s passing. That’s roughly $56 billion committed or earmarked so far. All told, we’re talking about well over $100 billion in grantmaking still to come, a figure that will involve regular tranches of this size transferred from the Gates war chest. You have to wonder, given that it will take the foundation three years to ramp up to $9 billion annually, is the foundation, with its highly targeted, top-down approach, built to move that kind of money out the door that quickly?

It’s about getting the Gates philanthropy narrative back on track

Bill Gates’ GatesNotes blog entries have long been, in part, about setting a tone and creating a narrative around Gates giving. Reading his latest, that remains true to a striking degree.

Part of the impetus behind the rollout of this gift is no doubt to shore up the Gates brand, battered lately by COVID, conspiracy theorizing, divorce, and a scandal over his many meetings with Jeffrey Epstein. Even as the machinery of the Gateses’ global giving operation hums along, Bill Gates isn’t the vaunted philanthropist he once was.

The factors I just listed are part of that story, and so is the sense that as MacKenzie Scott and other avant-garde mega-givers enter the field, Gates giving no longer represents the cutting edge. There’s a certain competitive streak in Gates’ blog entry, in which he doubles down on his guiding principle that funding “innovation” across multiple fields will yield the improvements to the human condition that the foundation has long pursued. While Gates doesn’t cite any other up-and-coming apex donors by name, it isn’t hard to picture them there in the background, along with their competing approaches to big giving.

Melinda and Warren are sticking with the program (according to Bill)

For Bill Gates, the other part of getting the narrative back on track is reassuring us that the foundation’s other two longtime trustees still have their hearts in it.

Melinda French Gates, who divorced Bill last year but remains co-chair of the foundation’s board, agreed to depart the foundation if she and Bill decide they cannot work together within a two-year window, which is still pending. According to Bill, their working relationship remains intact. “I think all the evidence I see says that we’ll be able to run the foundation together forever,” he said in Forbes. Although we’ve heard no indication otherwise from Melinda, the fact remains that the governance of billions of dollars in aid spending — perhaps impacting millions of lives — is still subject to one divorced couple’s ability to remain on good terms. That’s one of the staggering realities of big-donor philanthropy on this scale.

Warren Buffett is the other longtime member of the Gates Foundation’s ruling triumvirate, and his departure as a trustee last year sent yet another shockwave through Gatesland. Again, though, any potential drama there has been downplayed, and the assumption has been that upon Buffett’s passing — he’s 91 years old — the majority of his nearly $100 billion fortune would find its way to the foundation.

That remained the assumption until rumors began circulating that the Oracle of Omaha might choose a different course, moving most of his money to his own family foundations — specifically the Susan Thompson Buffett Foundation, already the nation’s largest reproductive rights philanthropy. Buffett declined to substantiate those reports, which appeared in the Wall Street Journal. Bill Gates, meanwhile, said that although “I never want to behave in a way that I take Warren’s generosity for granted,” he has no reason to think Buffett’s commitment to the Gates Foundation has changed.

This cements the Gates Foundation’s global power

Bill Gates and the foundation like to downplay their preponderance in global affairs, making the point, as Gates does in his latest blog post, that philanthropy’s resources are minuscule next to those of government and the private sector, and that grantmakers’ main strength lies in innovation and risk-taking. There’s truth to that, but it soft pedals the magnitude of the Gates Foundation’s influence on the world stage, especially in the realm of global health.

You don’t have to engage in wild conspiracy theorizing to recognize that any private organization giving out enough global health and development money to make it, effectively, one of the largest aid spenders in the world, will inevitably loom large over that arena. The prospect of further billions pouring forth from the Gates spigot every year will only expand the reach of the institution’s agenda.

The trouble is that Gates essentially refuses to engage with questions of the foundation’s power and influence, instead painting this now-$70 billion behemoth merely as a site for experimentation and innovation, and not as a site for the exercise of political and social clout. This approach reveals what may be Bill’s biases, but it also limits the foundation’s impact. As we often argue, technocratic giving isolated from a critique of power arrangements as they stand can only achieve so much.

Bill Gates remains a model for philanthropy — of a certain kind

A big part of the messaging around this gift has been that Bill Gates is “walking the talk,” stepping up during a time of overlapping crises with the kind of massive philanthropic commitments other billionaires would do well to emulate. In Forbes, Gates called out other (unnamed) mega-philanthropists on exactly that score: “It’s as though they’re trying to maximize how long their foundation can exist, as opposed to, are there some high-impact things they can do now?”

Tom Tierney, one of the Gates Foundation’s new board members and a co-founder of the Bridgespan Group, said the gift is “a call to action for the world’s wealthiest to do more, now.”

Gates’ apparent stance against perpetuity puts him in alignment with an ongoing trend among philanthropic up-and-comers, many of whom echo MacKenzie Scott’s now-famous pledge to “empty the safe” while they’re alive. As other commentators have noted, this latest gift reaffirms Gates’ own spend-down promises and may reinvigorate the stale Giving Pledge movement.

That said, Bill Gates’ unquestionable influence in the philanthrosphere elevates a particular kind of increasingly old-school strategic philanthropy founded on what are basically effective altruist, capitalism-friendly “earn-to-give” principles, though the foundation doesn’t use that terminology.

If Gates’ vast and expanding philanthropic commitment does spur more billionaires to open their wallets, that could be a good thing. But those commitments will more than likely complement, not contradict, the ability of the very rich to expand their fortunes. As Gates put it in the conclusion to his blog post, referring to his personal investments through Breakthrough Energy and elsewhere, “Overall, I expect that the work in these areas will make money, which will also go to the foundation.”

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