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"My God, I've Become An NGO"

By Roger M. Williams
Foundation News & Commentary
May/June 2005

On an international level, HIV/AIDS has become the pestilential equivalent of Mark Twain's famous dictum: "Everybody talks about the weather, but nobody does anything about it"—at least nothing really significant.

The William J. Clinton Foundation has worked its way into the diverse landscape of organizations attempting to cope with AIDS and is doing something about it. With a modest budget but a compact, rapid-response structure, the young foundation is making a mark among the most underserved victims of the disease—children.

They represent one-sixth of the world's annual AIDS deaths, but receive less than 5 percent of the treatments administered. At present, fewer than 25,000 children are being treated, nearly half of them in Brazil or Thailand.

High Marks, High Hopes

The foundation receives unusually high praise from nonprofit organizations, although it makes grants to none of them. In mid-April, when the foundation described an initiative aimed at nearly doubling the number of treated children in ten countries, Dr. Paul Farmer, the widely extolled founding director of Partners in Health, told a packed press conference, "We've never faced a project with such optimism as the one being announced today."

And Stephen Lewis, UN special envoy for HIV/AIDS in Africa, said with obvious feeling, "As I get concerned about a number of aspects of the pandemic . . . I always instantly turn to the Clinton foundation because it responds with such extraordinary urgency. . . ."

The setting for those ringing endorsements was the foundation's New York City office—situated not on Madison Avenue or the Upper East Side but on 125th Street in Harlem, amid pawn shops and beauty supply stores. The foundation occupies two floors in a well-appointed building that also houses a busy office of the Social Security Administration. But a slowly building Harlem Renaissance—this time commercial rather than artistic—is also evident in the form of up-to-date banks, sophisticated restaurants and a thriving Starbucks.

In its approach, its means of operation, and the commitments it makes and keeps, this is an impressive foundation. Two central facts quickly emerge: All of the key players are old Clinton hands, with none coming from the foundation field; and Bill Clinton himself is the organization's most impressive asset. He's not only its raison d'être, driving force and soul, but also its entrée to influence, money and being taken very seriously. Indeed, to understand the dynamics of the Clinton foundation is to understand the power of celebrity and popularity in today's world—not just in the United States, the temple of high celebrity—but everywhere that modern communications reach.

Volunteers as Backbone

Another significant foundation fact is the extent and importance of volunteers. "In 2002, when we started our AIDS initiative," says Ira Magaziner, who directs it, "we were an all-volunteer organization, and we remained that way for 15 months. We wanted to make sure we were being effective before we started raising money. Volunteers still form our backbone. Take our water and sanitation project [a spin-off of the AIDS initiative]; the volunteer team for that includes a senior partner at Goldman Sachs, a Merrill Lynch executive and an official of Oxfam."

Until prodded, Magaziner neglects to mention volunteer number one—himself. The tall, soft-spoken businessstrategy consultant and Clinton loyalist spends "essentially all" of his time on foundation affairs, but receives no compensation.

Magaziner, de facto chief of staff Bruce Lindsey and public relations director Jim Kennedy are so divorced from the structured world of philanthropy that none of them knows whether they work for an actual foundation—despite the organization's official name. (Turns out they don't—it's a 501(c)(3) "public charity.")

The foundation is headquartered in Arkansas. So is the new Clinton Presidential Library, which the foundation provides financial and volunteer support, and the even newer Clinton School of Public Service, at the University of Arkansas in Fayetteville. The school is billed as the nation's first graduate-level institution for public "service" versus public policy or administration.

The school is housed in a converted railway station. (Aides say Clinton deliberately situated the library in a neglected part of Little Rock in order to draw attention and development there. So far, almost $1 billion in new investments—shops, restaurants, condominiums—has poured into the area. One could be pardoned for mistaking the library for a big-box store anchoring a new shopping center.) About the public service school, Lindsey says, "We'll be much involved in its day-to-day operation and bring in notable figures to do the same."

Dollars, Deals and Dependence

Although the AIDS program makes the news and gets the lion's share of the budget, the Clinton foundation has an expanding set of other interests. One is the Harlem Small Business Initiative, which works to support the renewal of the area. Clinton confidants say that project stems from more than the foundation's presence in Harlem; it also reflects the kinship he has always felt—growing up in the South—with black people.

Two other programs are also New York-centered: a series of conferences with New York University on reconciliation between the Christian and Islamic worlds and an ongoing partnership with City Year—the largest recipient of support from AmeriCorps, which Clinton organized while president.

In May 2005, at least in part because of the heart bypass surgery the former president had undergone last fall, the foundation expanded its involvement with health to the problem of obesity in American children. This project, which will be conducted in partnership with the American Heart Association, grew out of the chilling realization that today's children may end up being the first generation with a shorter life expectancy than their parents.

Whether or not they know what kind of foundation they have, Clinton's people know about leveraging charitable dollars and making imaginative deals. "We've done that with our AIDS work in Harlem," Kennedy says, "and with the Princeton Review, which wanted to fund minority scholarships. Review officials figured that Clinton's involvement would get the world to pay attention, so in exchange for a partnership in behalf of their scholarships, they agreed to donate a percentage of their book sales to us." ("We had no idea of becoming a grantgiving organization," says Lindsey, adding with a chuckle, "We wanted people to give grants to us. At some point, of course, it would be nice to have enough money to make grants.")

What do those concerns of the Clinton foundation have in common? By the standards of its top officials, at least, they reflect the organization's mission: "to strengthen the capacity of people in the United States and throughout the world to meet the challenges of global interdependence." That's a franchise broad enough to encompass almost any initiative you can imagine and exclude none. It perfectly suits a man of wide-ranging interests and restless intellect.

Charting the Course

When Bill Clinton completed his presidential terms, he says with a characteristic flash of self-deprecating humor, "I was too young to quit [working], too inept to play golf, too out of shape to play saxophone and too much of a Calvinist to lay [Southern for "lie"] down." So he studied our handful of activist former presidents, especially Jimmy Carter, and concluded that, like Carter, international activism would suit him just fine.

First, however, Clinton had to pay off his considerable legal bills (accumulated in defending himself against impeachment charges), and write an autobiography (My Life, Knopf, 2004). Those two tasks dovetailed very nicely.

Then he turned to the future. Clinton told a National Foundation of Infectious Diseases audience this past March that in 2002, "Nelson Mandela and I were at the International AIDS Conference in Barcelona, when the prime minister of St. Kitts & Nevis approached me about the favored approach to the AIDS crisis, 'I love all this, you know, no stigma, no denial. But we've got no denial in the Caribbean. We have no money and no systems.'"

Clinton replied, "Well, what do you want me to do about it?" The prime minister said, "Come set up a healthcare network and get medicine to everybody in all these countries." Clinton said he would, "But I had just 14 employees running all my operations in Harlem…. I had no clue how to begin. I just knew that unless somebody was committed to helping these countries systematize their approach, and getting the medicine out there, people who didn't have to die were going to keep dying like flies. And I knew that, in the end, it would undermine democratic governments."

At some point along that journey, Clinton added, he looked in the mirror while shaving and blurted, "My God, I've become an NGO!"

Five months later, the fledgling foundation's AIDS initiative got underway, with Magaziner—a right-wing target during the battle over Clinton's first-term healthcare plan—at the helm. He has taken its budget from $1 million in 2002 to $15 million this year. There were and still are three emphases: care and treatment (not prevention); working with governments through their ministries of health (the program operates only in countries it's invited into); pursuing only new ideas, "not," in Magaziner's words, "duplicating what exists."

Financial support comes from Western governments, multilaterals like the World Bank and private foundations and individuals. The private entities are not solicited; they come on their own, and their contribution is accepted only if they're "entrepreneurial and risk-taking," explains Magaziner. "We can't deal with risk-averse foundations. We can't honestly tell people we're going to succeed and not going to waste some money."

One of the initiative's most enthusiastic supporters has been the Children's Investment Fund Foundation, the creation of a London hedge-fund manager, Chris Cooper-Hohn, who pours an outsized portion of his company's profits into the foundation. It quickly provided multi-year funding (so far about $3.25 million) for the Clinton AIDS initiative. Most attractive, says Cooper-Hohn's wife, Jamie, was the program's "potential to effect sustainable change at such a large scale," providing an "excellent risk-return ratio."

Real Value Added

The AIDS initiative has concentrated its efforts on behalf of children on reducing the cost of drugs and testing. Judged by foundation-provided statistics, the project's success is startling. For example, in midsummer 2002, the cost of a "firstline regimen" of anti-retroviral drugs was $1,600; in spring 2005, it was $140 (for generics). The standard test for kids used to cost a minimum of $20; now it's $2.50. The foundation has made drugs and tests available in 38 countries, a huge increase, and that number will rise to 60 by year's end.

"When we came into the AIDS field," Magaziner recalls, "people said, 'What are they going to contribute, a lot of speechmaking?' I guess that was understandable. But once we started getting the drug prices down, and got things moving in China and South Africa, I think we and our contribution were accepted."

Mindful of the jockeying that sometimes takes place in the AIDS field, the Clinton foundation has made a point of being collaborative—"but not," Lindsey says, "deferential. Although we don't try to one-up anybody, we assess our and the president's capabilities and background, and look for gaps, areas in which we can add value."

The nature of those Clinton capabilities is obvious—Kennedy terms it "using the bully pulpit"—but their range and the skill with which this instinctive, consummate politician uses them can be surprising. As Magaziner notes, his intervention at any stage of a prospective project can not only seal the deal but also accelerate the pace at which the project gets under way. "He can generate political will where little exists. He made a real breakthrough for us with top officials in China—the first-ever agreement for the ministry of health with a private foundation."

Clinton is what Lindsey calls "a real scorekeeper. He wants to be able to count results from everything he's involved in." It's therefore notable that he is in the process of bestowing major powers on a "policy board." Virtually all of its seven members are veteran Clinton aides, not subject experts: "We can get the advice we need from outside, but on the board we need people who can manage. Lack of good management is the reason many foundation programs fail."

Inaugural Initiative Meeting

In late January, the Clinton foundation announced the Clinton Global Initiative, an annual effort to combine the resources of global corporations, nongovernmental organizations and governments in solving some of the world's most pressing problems. The initiative will hold its first meeting September 15–17, 2005, in New York City, coinciding with the 60th session of the United Nations General Assembly.

The nonpartisan conference will focus on reducing poverty, using religion in reconciliation and conflict resolution, enhancing governance and implementing new business strategies and technologies to combat climate change. Participants will be asked to commit to acting to address one of the issues discussed.

"[W]hat we begin during three days in September will not end with the closing session of our event," said Clinton. My foundation will take the ideas we develop and keep working with our global initiative participants and others to achieve tangible results." (More at www.clintonglobalinitiative.org.)



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