My wife and I had a great discussion after my last post about the Gates Foundation’s instance that U.S. poverty could be overcome by better schools and teachers instead of a broad-based approach (like the Foundation uses overseas). She led off by saying, “Isn’t Gates a good guy? He’s giving away his money trying to help people.” My response was that putting money into bad ideas doesn’t necessarily help people. With all the publicity about philanthropy lately this has been a topic of discussion (see the New York Times Op-Ed piece “Good Charity, Bad Charity“). To be fair, I really couldn’t tell my wife if all the K-12 education projects the Gates Foundation funds are good or bad ideas.
To their credit, the Gates Foundation maintains a list of all the projects they have funded on their website. I cut and pasted information about the 128 “College Ready” (K-12 education) projects they funded in 2014 into a spreadsheet (ironically a MicroSoft product). Note: K-12 education projects are not limited to public schools, as will be discussed in Part 2.
So to start with, Wow! $93.3 million was given out in support of K-12 education projects in one year. That’s a lot of money but let’s look at it in context. According to Wikipedia the Gates Foundation has a $42.3 billion endowment ($28 billion from Gates, billions more from Warren Buffett). Assuming the endowment funds are properly invested, let’s say that portfolio grows at 10.3% per year (the average historical increase of the markets). That means that the Foundation’s portfolio should increase by $4.4 billion per year. That Wow! of $93.3 million is only 2.1% of the possible earnings of their portfolio and only .2% of the entire endowment.
Two brief thoughts about $93.3 million. First, when you spend that kind of money every year it’s going to make a difference – good or bad. Second, if they really wanted to change (good or bad) K-12 education they could be spending a heck of a lot more.
In order to get a better understanding of what the Foundation was supporting I categorized each of the 128 projects according to the blurb provided on the Foundation’s website (or if that was too vague I went to the project recipient’s website to see what their mission is). I ended up with 12 major categories plus an “other” category.
Want to know what the top-funded category was? You’ll be surprised – I think it falls in the “good” category. Read all about it in my next post.