Ethics & Public Policy Center

An Impressive Foundation, an Unimpressive Book

Published in Philanthropy on December 17, 2007

Yuval Levin

Yuval Levin is the Hertog Fellow at the Ethics and Public Policy Center and the editor of National Affairs.

Since leaving the White House, Bill Clinton has become a rather prominent figure in philanthropic circles–which is surprising, since it was never quite his intention. Just a few months after returning to private life, he launched the William J. Clinton Foundation with no clear aim in mind for its work. Its mission, he declared, was “to promote the values of fairness and opportunity for all” and to move Americans and others “beyond differences to a common future of shared responsibility, shared benefits, and shared values.” Not exactly a plain and concrete purpose.

In its early months, the Clinton Foundation seemed likely to do little more than mouth such vague platitudes and support others who would do the same. It served mostly as a platform for Clinton himself, and its handful of staffers were unsure of how to think about their role. By mid-2002, the foundation had 12 employees and had spent almost no money.

But that summer, Clinton was asked to offer closing remarks at the International AIDS Conference in Barcelona, Spain. After he spoke, he was approached by Denzil Douglas, the prime minister of the tiny Caribbean nation of Saint Kitts and Nevis. Douglas asked Clinton for help contending with problems his government was experiencing in its dealings with manufacturers and distributors of AIDS medications. The disease is rampant in much of the Caribbean; at that point, President Bush's enormous AIDS relief effort and the international Global Fund to Fight AIDS, Tuberculosis, and Malaria had not yet been funded. The prime minister found himself facing astronomical prices for drugs and unable to make medicine available to the citizens of his country.

Clinton saw an opportunity to give his foundation some direction. HIV/AIDS offered a sensible first cause on which to focus, and helping Saint Kitts afford AIDS drugs, particularly by gathering up commitments from other donors that might build on each other, could be a manageable first project. When the Clinton Foundation began to examine the issue, however, its staff discovered that the problem was more complicated than it seemed–and perhaps offered a unique opportunity to make good use of their founder's prominence and connections.

The Caribbean nation, along with most of its neighbors, was paying more than seven times the listed market price for the most common AIDS medications. Because they had very little bargaining power, these governments were dependent on an assortment of middlemen who were taking huge cuts and severely diminishing their purchasing power. They simply didn't have the leverage to negotiate directly with manufacturers.
There was no way the Clinton Foundation could raise enough funds to purchase AIDS drugs for needy patients in the Caribbean. Instead, the foundation had to find ways to lower the price. This was the insight that launched Clinton's novel approach to philanthropy–an approach that depended, to be sure, on his personal celebrity and contacts, but which, once demonstrated, could well offer a replicable model for others.

Rather than underwrite the governments' costs, and rather than shame and browbeat manufacturers into artificially lowering prices, the foundation decided to help pool demand and create a market. High prices made it impossible for the Caribbean states to commit to a reliable long-term contract for purchasing the drugs. They could not offer manufacturers a steady and significant demand, which therefore made the supply expensive; but the demand couldn't grow, or become more reliable, as long as prices remained so high. It was a capitalist Catch-22. The foundation, relying on Clinton's contacts and ability to draw attention, managed to obtain commitments from a large number of small governments–first in the Caribbean, later in Africa–to place large (and long-term) orders for drugs, provided that prices were significantly reduced. This commitment to a steady demand allowed the manufacturers of AIDS medications, particularly generic versions of the most popular drugs, to commit in turn to far lower prices.

Using market consultants drawn from top Wall Street firms, the foundation showed the pharmaceutical companies exactly how the new arrangement, with its large and regular demand, would allow them to sell their drugs at a profit. The drugs would not be donated, and the arrangement would not be a matter of charity: the governments paid for the drugs, and the companies profited from their sale. What the foundation offered was just a reorganized market, a way out of the Catch-22. The foundation's own resources were spent not buying drugs but hiring consultants and linking buyers with sellers.

It was a new way to think about the role of a prominent but modestly sized philanthropy. Once the Clinton Foundation came up with this approach, the former president decided to see where else it might work. The foundation has since almost entirely avoided direct grantmaking, partnering instead with groups engaged in similar efforts to, as Clinton puts it, “reorganize public goods markets” and to leverage the reputation and rolodex of its founder in ways that may prove more lasting than checks in the bank. In much of its work, the foundation has sought to see its philanthropy as an intermediary between buyers and sellers, helping to expand markets and thereby lower costs–making it easier for governments and for other philanthropies to provide goods and services.

In the past two years, for instance, the Clinton Foundation has sought to apply the approach it used to lower the cost of HIV drugs to alternative energy markets. It found many municipal governments in the U.S. and abroad that wanted to replace their fleets of trucks and buses with natural gas and fuel-cell vehicles. But prohibitive prices–a single, custom-built fuel cell bus costs over $2 million–prevented any single city from taking the initiative. Again, the Clinton Foundation collected commitments from cities worldwide, creating sufficient demand for mass production, efficiency gains, and competitive prices.

Through its Clinton Global Initiative, the foundation has recently been linking businesses with NGOs to devise strategies for people in poverty-stricken countries to create wealth, participate in global trade, and reduce their dependence on foreign aid. The foundation has likewise undertaken an education initiative, with working groups exploring ways to improve opportunities for children in economically unstable communities and nations.

To its great credit, the Clinton Foundation discovered a unique philanthropic niche. It recognized that its comparative advantage lay in market creation, and by linking buyers with sellers it could help unleash an immensely beneficial set of market forces. It's a philanthropic strategy with considerable long-term promise.

The foundation is still very young, and its efforts–even its first effort, to help poor nations buy AIDS drugs–are all still quite new. It remains to be seen how this new approach to philanthropy will fare, and just how dependent this concept will be on Bill Clinton's unique circumstances. But the story of how the Clinton Foundation came upon this new approach, and how it has so far sought to enact it, surely needs to be told, and would make for a fascinating and instructive book.

Unfortunately, Bill Clinton has not written that book. Those who have followed the work of his foundation these six years had reason for optimism when word came that Clinton would author a work about philanthropy. Giving, as the book is titled, might have told the story of Clinton's original hopes for his foundation, his discovering a new way to think about what the organization could do, and the lessons he has learned from this novel approach. It might have surveyed the landscape of contemporary philanthropy, exploring ideas like philanthro-capitalism, microfinance, incentive prizes, and social entrepreneurship.

But it was not to be. The bo
ok's subtitle (“how each of us can change the world”) offers an early warning that these hopes would be dashed, and indeed the book turns out to bear closer kinship with the original vague mission statement of Clinton's foundation than with the innovative work it has done since 2002. Rather than a sustained examination about his efforts and emerging trends in philanthropy, Clinton offers a seemingly endless laundry list of donors and givers, each certainly (though not equally) worthy of praise, but the whole not held together by any discernible structure or order.

The book is divided into what at first appear to be thematic chapters, with titles like “Giving Money,” “Giving Time,” and “Giving Skills.” But almost every one of the examples related in each chapter could easily have been placed in any other chapter. None offers a case about how best to give, nor a theory of philanthropy, nor a vision of effective aid. None wrestles with difficult questions about why some kinds of giving fail, or why some approaches to philanthropy might be counter-productive. All simply inundate the reader with example after example, wave upon wave of good-hearted benefactors, passing by in haste and in no logical sequence, never pausing to linger, linked by no apparent aim, going nowhere in particular, like a parade without a marshal, or a middle without an end. When at last the end does come, the reader feels good, having encountered so many exemplars of goodness, but has learned nothing.

“I wrote this book to encourage you to give whatever you can,” Clinton tells his readers at the outset. But he never seems quite certain who his readers are. The great bulk of examples–very nearly all–are tales of the rich and famous, struck by a personal tragedy or a heartrending story, and moved to donate to, or raise funds for, a cause. Yet Clinton is loath to conceive of his book as a guide for the wealthy, and so never directly addresses himself to the special social responsibilities of the well-to-do. Instead, he speaks in populist tones and holds up elite examples–making it difficult for either the rich or the rest to take much away from the stories. Midway into just about every story, moreover, we find that the subject is a personal friend or acquaintance of the former president. There are high-priced lawyers compelled to start programs to send school books to Africa, investors moved to quit their jobs and tutor underprivileged students, and entrepreneurs who want to give back. Just about all of these seem like genuinely noble stories, to be sure, but no effort is made to turn them into an instructive whole.

At the end of many of his examples, Clinton seems to realize that most of his readers are unlikely to be quite as wealthy or prominent as his subjects, and he tacks on an assurance that everybody else can do good too. “Most of us aren't public figures like Mia Farrow, Don Cheadle, or George Clooney,” he writes after describing the efforts of these actors to alert people to the carnage in Darfur, “but each of us has the ability to do something.” Unfortunately Clinton never spells out what that “something” might involve. “Of course, most people can't give that much to others,” he writes elsewhere after describing the philanthropic efforts of the owner of the Slim-Fast brand, “but there's a lot anyone can do.”

Even those stories that might seem to offer some insight into ways of giving that work are piled under mountains of painfully trite generalities. “Bob Harrison doesn't make quite as much money working to save our kids as he did at Goldman-Sachs,” we are told after a heartwarming story about an affluent activist working to curb obesity, “but the good he does is a rich reward.”

Those readers willing to stipulate at the outset that some rich people are also good people will find almost nothing additional to learn from the book. There are a few plugs for favorite charities (“if you want to do something that will really help children and leave you feeling good about yourself, volunteer for Make-a-Wish”), a few examples so odd they are interesting (“when hurricane Katrina devastated New Orleans, thousands of musicians lost their instruments”), and some suggestions that are at least good for a laugh (“think of all the exciting things that creative teenagers could do if every high school had its own NGO”). But there is not an overriding theme for either philanthropists or the general public to learn from.

Worse, there is no real argument for philanthropy or charity. Clinton never considers why it is good for people to help others help themselves, or why this obligation is particularly expected of the wealthy. The closest he gets amounts to a variation on “giving makes you feel good”–a rather thin case for thoughtful philanthropy. He might have explored the question as an observer of human nature, and written about our intuitive moral obligations, our innate sense that great wealth carries additional duties and responsibilities. Or he might have addressed the topic as a student of society and politics, and reflected on the structure of American civil society, or on our national mores, or on the role that private associations have always played in our communal life. Anything. But there is nothing to suggest he has given the question much thought.

Even Clinton's discussions of his own foundation's work are fractured and divided among chapters in a way that leaves them difficult to follow, and makes it hard to see just what is so novel and important about his genuinely innovative work. He lays out something like a personal philosophy of giving only once, in describing his first meeting with Sir Tom Hunter, the Scottish entrepreneur and philanthropist. “I was struck by the similarities in our approach,” Clinton says of Hunter and himself. “We both believe in programs that have a large impact within a reasonably short time frame at the least possible cost.” But given this description, which would of course apply to almost any donor at any time and under any circumstances, one is left to conclude that the Clinton Foundation may have stumbled blindly into its new market-focused mode of helping.

The book lays out the basics of the Clinton Foundation's AIDS project in a chapter about “non-profit markets,” even though the key to the approach was precisely to understand and respect the profit motive at work in the pharmaceutical industry's decision-making. The foundation's more recent work on energy-efficient vehicles is presented in a prior chapter, making it difficult to follow the development of Clinton's interesting new methods.
The book's penultimate chapter is entitled “What about government?” and so holds out the promise of some discussion of Clinton's creative new way of acting as an intermediary between governments and private sector companies for the public good. But the chapter turns out to be a catalogue of ways to lobby governments for various policies and, inevitably, a directory of assorted rich and famous people who have done so effectively in recent years.

It is in this chapter on government, too, that the book's political undercurrent is strongest, and it offers some clue to the book's otherwise inexplicable vagueness and confusion. Reading it, one becomes acutely aware of Clinton's complicated challenge in this year when his wife is running for president. He needs to tell the story of Bill Clinton the philanthropist without stepping on the toes of Hillary Clinton the candidate, without stealing her thunder or getting in her light.

This balancing act begins in the book's introduction. Telling us that for most of his career he was too ambitious and driven to devote much thought to charity and philanthropy, Clinton then writes:

“Hillary was a different story. When I met her in law school, she was involved with a local project to provide legal services to poor people. She took an extra year to study the special needs of children at the Yale Child Study Center and the un
iversity hospital. When she graduated, she decided not to pursue prestigious and more lucrative law firm opportunities and went to work for the Children's Defense Fund to help poor children. When she came to Arkansas to be with me and taught in the law school, she ran the legal aid clinic and prison project.…My wife was my first role model for what it means to be a public servant without public office.”

He goes on to note that during his time in elective office, too, his wife always pursued charitable projects, and that “now that we've switched places and I do public service as a private citizen, it's the human impact that I find most rewarding too.” He does not return much to his wife's activities until the chapter on government. But there, when he does get back to politics, it suddenly becomes apparent why this book was written as it was. This is not Bill Clinton's updated autobiography, and it is not the story of his promising charitable foundation, or the lessons he's learned about giving. Rather, this is Bill Clinton's It Takes a Village–a book his wife wrote while he was president. The Clintons have indeed “switched places,” and this book is his effort to humanize her by casting them both in a softer light. The book is a cavalcade of feel-good stories and empty platitudes, and–again like Hillary Clinton's 1995 book–as it ends, it too becomes a case for fairly conventional left-wing politics.

“Government matters,” Clinton tells us in this next-to-last chapter, and “that's why one of the most important ways of giving time, money, knowledge, and skills can be in an effort to change, improve, or protect a government policy.” This is, then, a kind of crescendo for the book, where all the strands converge, not around a mode of philanthropy, but around political activism.

And yet, even as it issues in a standard progessivist agenda, Clinton's book signals a centrist convergence in American views about the role of the private sector in helping those most in need, at home and abroad. Bill Clinton is, of course, a man of the left; indeed, probably the most highly regarded liberal in America today. But in this book, and by his example, he is pointing to the crucial role of private nonprofit efforts to advance all manner of social improvements, from education to conservation to ameliorating poverty. As President, Clinton in some key respects “normalized” the Reagan revolution by putting some of its key premises beyond dispute and outside the reach of partisan squabbles. Now, as a private citizen, he seems to be doing the same for the conviction that government should not be expected to solve every problem, and that private philanthropy has a crucial role to play in the moral and social life of our country, a role that should not be crowded out by public efforts. His rhetoric about the principles of philanthropy in this book–about efficiency and transparency, good business practices, and respect for profit–may conclude in advocacy for familiar left-wing causes, but the rhetoric itself is far from the traditional approach of the left to philanthropy. And rhetoric matters. In this respect, too, Clinton's book may well be a welcome and promising sign of the political times.

Clinton's unique political situation, as it comes into focus toward the end of this very quick book, does help to explain its soft and mushy feel, and goes some way too to make sense of its aimlessness. But juxtaposed with the impressive innovations and the growing success of the Clinton Foundation, this book is doubly disappointing. It is, to begin with, dismally boring and painfully pointless, but it is also, more importantly, a serious missed opportunity.

The Clinton Foundation offers a model of a new kind of philanthropy, and its example may well open the way to a novel twenty-first century approach to using nonprofit foundations to help connect those in need with those who can help, and to use the power of the profit motive–and thus the power of freedom and prosperity–to improve the lives of those who suffer.

It is a model of philanthropy without enormous financial investment, in which the donor invests time and expertise to persuade two sides to take a risk and strike a bargain for their mutual benefit. It is a model that emphasizes the proper structuring of incentives, a clear sense of accountability, respect for the legitimate role of profit, and leveraging philanthropy to the greatest effect. These principles are not new at all. But the Clinton Foundation's way of pursuing them is relatively innovative, and effective.

In its first iteration, as an almost entirely unplanned experiment, this model surely requires the celebrity, the connections, and the personal charisma of Bill Clinton. But if it works over time, it will offer structural lessons that could prove persuasive to foundations, governments, companies, and private actors in positions to apply the model elsewhere, and without the need for Clinton's towering presence.

A serious account of the model, of the thinking behind it, of how it has worked and where it has not, would be of great use to the world of philanthropy. A book about giving, written by Bill Clinton, would therefore be most welcome. But for the time being, the former president seems to have other ambitions in mind.

– Yuval Levin is a fellow at the Ethics and Public Policy Center and senior editor of The New Atlantis.

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