Pandemics, climate change high on billionaire Bill Gates’ agenda
In Australia this week, he warns of the critical need to prepare for the next pandemic which could be far more brutal and man-made. In a wide-ranging interview after speaking at the Lowy Institute on Monday, the Microsoft co-founder says demand for tech skills across business will absorb many workers laid off in the recent tech slump but that AI will shake up the industry within 12 months. And he shared his ambition to give maths back its mojo in the American classroom. Australia should watch closely.
Billionaires Jeff Bezos, Richard Branson and Elon Musk pour billions of dollars of their fortunes into the space race and seek out new worlds.
Bill Gates has pledged at least half of his fortune into this world, fighting to bring equality in access to health, energy and education.
“There is this huge failure of market capitalism to look at some of the needs of the poorest. Their voice in the marketplace is very small,” he says. The incentive to come up with a malaria vaccine is very low compared to the economic and human benefit of smashing malaria.
Gates argues that donors can have a huge impact on global inequity. “You can literally save lives for $US1000 and there isn’t much around that should be as fulfilling as that.”
Grants from The Bill & Melinda Gates Foundation now run to $US65.5bn ($93bn). An annual budget of $US6bn before Covid will be $US9bn by 2026. The Gates Foundation is the second largest contributor to WHO programs, a sad reflection of declining national contribution.
Like private equity, Gates can make higher-risk long-term bets. One such bet has almost halved child mortality in Africa from 10 per cent to 5 per cent. More recently Gates has been helping small farmers in poor countries adapt to climate change.
Gates’ close friend and long-time partner in philanthropy is the Oracle of Omaha, Berkshire Hathaway’s Warren Buffett, who since 2006 has contributed $US45bn to the Gates Foundation.
“We had been friends for over 15 years when to my complete surprise Warren said to me ‘that the most rational thing I could do is put most of the money into your foundation’,” says Gates. “We offered to rename it – he wasn’t interested in that.”
Gates’ friendship with the 92-year-old sage remains close. “Four days before I flew to Australia I went to Omaha and had dinner. Then I went to West Virginia to see Senator Manchin,” he adds.
Senator Joe Manchin is the powerful chair of the Senate Energy Committee who steered through America’s Inflation Reduction Act offering investment incentives around renewable energy and climate action.
Gates has been a big lobbyist for the legislation which drew criticism in Davos last week for skewing investment funds away from Europe. Business in Australia would like the government here to match the IRA.
Gates says there are two main complaints about the IRA. The first is the domestic manufacturing requirements to get the electric car credit. He argues that may be fixable through free trade agreements which could expand the definition of where components come from.
“The current administration at least has good will on that and will try to do that,” he says.
“The other claim is that the tax credit for things like clean hydrogen will mean that some of these pioneering projects will go to the US. And that is just true.”
Gates says the purpose of these projects is to reduce the cost of bringing hydrogen to the world after which 10-year tax credits will fall away.
“Australia is as likely to be a net exporter of green hydrogen as any place in the world. It will have very cheap solar and wind electricity and it is near to Asia and in the long run that will significantly play to Australia’s advantages,” he says.
On his trip down under Gates has brought teams from the Gates Foundation and from his Breakthrough Energy Ventures Fund which now sits at $US2bn invested in transition technology, from direct air capture to hydrogen and nuclear power.
A packed schedule includes a meeting with the Prime Minister, the Clean Energy Finance Corporation and later this week a philanthropy dinner organised with his old Microsoft friend and philanthropist Daniel Petrie.
Last year Gates published a book, How to prepare for the next pandemic, in which he warns against complacency and urges countries to invest in resilience.
“Compare the economic cost of being prepared for the next one to the cost of this one, over $US10 trillion economic loss,” he says. “With the pandemic we were foolish not to have the tools, the practice and global capacity to be on standby like we do with fire or earthquakes.”
He says the chance of a new epidemic could be higher than 1 per cent given the risk of bioterrorism. “It could have had a 5 per cent death rate. Smallpox has a 30 per cent death rate,” he says.
Turning to the tech slump, Gates says the percentage of total tech jobs lost is actually quite small given the huge growth during the pandemic, and that many will find new jobs in the broader economy with companies needing digital expertise.
“I don’t think we will have people saying I used to be able to write C Code and nobody needs to understand user interface and internet and security, we have just got too many people and here I am shining shoes. Demand for that expertise is very high,” says Gates.
But within 12 months, Gates says people will be tearing their hair out as AI delivers many more efficiencies in the near term than expected. “There will be a lot of angst about AI’s impact on job categories including technology jobs,” he predicts.
The latest levelling up effort by Gates is in the US with $US1.1bn towards maths teaching, currently at a 50-year low based on test results. “It is a tragedy that it is taught so poorly. Maths is a way of understanding the world.” Out with quadratic equations and calculus. “Every voter should understand statistics and they have domains, sports, health where you could make it very interesting.”
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Billionaire Bill Gates has muscled up the world’s biggest philanthropic foundation – his own – to take on new pandemics and climate change.