A Wealth Of Ideas: Davos Speech Sets a Plan to Use Market Forces
To Help Poor Countries; 'We Have to Find a Way'
By ROBERT A. GUTH
January 24, 2008 6:58 p.m.
Free enterprise has been good to Bill Gates. But on Thursday, the Microsoft Corp. chairman called for a revision of capitalism.
In a speech at the World Economic Forum in Davos, Switzerland, the software tycoon called for a "creative capitalism" that uses market forces to address poor-country needs that he feels are being ignored. Outgoing Microsoft Chairman Bill Gates talks to The Journal's Rob Guth about his concept of creative capitalism. (Jan. 23, 2008)
"We have to find a way to make the aspects of capitalism that serve wealthier people serve poorer people as well," Mr. Gates told world leaders at the forum.
Mr. Gates isn't abandoning his belief in capitalism as the best economic system. But in an interview with the Journal last week at his Microsoft office in Redmond, Washington, Mr. Gates said he has grown impatient with the shortcomings of capitalism. He said he has seen those failings first-hand on trips for Microsoft to places like the South African slum of Soweto, and discussed them with dozens of experts on disease and poverty. He has voraciously read about those failings in books that propose new approaches to narrowing the gap between rich and poor. In particular, he said, he is troubled that advances in technology, health care and education tend to help the rich and bypass the poor. "The rate of improvement for the third that is better off is pretty rapid," he said. "The part that's unsatisfactory is for the bottom third -- two billion of six billion."
Three weeks ago, on a flight home from a New Zealand vacation, Mr. Gates took out a yellow pad of paper and listed ideas about why capitalism, while so good for so many, is failing much of the world. He refined those thoughts into the speech he gave at the annual Davos conference of world leaders in business, politics and nonprofit organizations.
Among the fixes he called for: Companies should create businesses that focus on building products and services for the poor. "Such a system would have a twin mission: making profits and also improving lives for those who don't fully benefit from market forces," he said.
DAVOS 2008
Read updates from the World Economic Forum in Davos, Switzerland, and see complete coverage of the annual event.
• Issue Briefing: Doubts Dog DavosMr. Gates's Davos speech offers insight into his goals as he prepares to retire in June from full-time work at Microsoft -- where he will remain chairman -- and focus on his philanthropy, the Bill & Melinda Gates Foundation.
Mr. Gates sees a role for himself spurring companies into action, he said in the interview. "The idea that you encourage companies to take their innovative thinkers and think about the most needy -- even beyond the market opportunities -- that's something that appropriately ought to be done," he said.
His thoughts on philanthropy are closely heeded because of the business success that made Mr. Gates one of the world's richest men. His eight-year-old charity is expanding rapidly following the 2006 decision by Warren Buffett to leave his fortune to the foundation. That donation, at the time valued at about $31 billion, increases to some $70 billion the hoard Mr. Gates says will be given away within 50 years of the deaths of him and his wife.
<snip> Belief in Technology
A core belief of Mr. Gates is that technology can erase problems that seem intractable. That belief was deepened, Mr. Gates says, by his study of Julian Simon, a now-deceased business professor who argued that increases in wealth and technology would offset shortages in energy, food and other global resources.
Mr. Gates wove the influence of such optimists into his comments Thursday. "In the coming decades we will have astonishing new abilities to diagnose illness, heal disease, educate the world's children, create opportunities for the poor and harness the world's brightest minds to solve our most difficult problems," he said.
Describing himself as an "impatient optimist," Mr. Gates said he would ask each of his Davos listeners to take up a "creative capitalism" project in the coming year.
And he vows to keep prodding them. "I definitely see, once I'm full-time at the foundation, reaching out to various industries -- going to cellphone companies, banks and more pharma companies -- and talking about how...they can do these things," he said.
entire article @ The Wall Street Journal Link: (subscription required)
http://online.wsj.com/article/SB120120041750814009.html
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