Dr. Rajiv Shah

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0:31Dr. Raj Shah is dedicating his life to solving the problems of health and hunger. After getting a medical school degree, he began his career at the Gates Foundation. From there, he joined the Obama administration as the head of the USAID. And now he's the head of the Rockefeller Foundation. I had a chance recently to sit down with Raj Shah to talk about his passion for solving these global problems.

0:55So tell us, what is the Rockefeller Foundation? I know the Rockefeller name, but what is the foundation? What does it really do? Well, the foundation was created more than 100 years ago by John D. Rockefeller. And the idea was very simple, was to use science and innovation to lift up as many people around the world as possible. And over that period of time, this foundation has helped create the field of modern medicine, invest in international public health, launch a green revolution through agricultural sciences that helped almost a billion people move off the brink of hunger and starvation. And today, our big focus is around climate and energy.

1:31So if I said to you, I have a great idea for the Rockefeller Foundation, what's your polite way of saying no? Well, it depends on the idea, I guess. But in general, we love hearing about new ideas. is we do tend to be a little more directed and focused than perhaps other institutions. You know, almost 50 % of our giving is focused right now on ending energy poverty around the world, which we can talk about. And so we tend to sort of set our strategies and then go find partners that can add value to implementing those strategies, as opposed to just taking in recommendations broadly. Now, recently you wrote an article about the importance of climate change and what you're trying to do about it.

2:12What is your idea of how we can tackle the climate change problem? Well, we actually are very concerned that the larger global effort to fight climate change is missing a major, major focus on developing and emerging economies. The reality is if all of the wealthy countries, the United States, Europe, China, live up to the policies they've already committed to, then 75 % of all future emissions will come from 81 countries that today are classified as housing more than 3 billion people that live in energy poverty. And right now, we're on path to provide those people with electricity and energy through coal, heavy fuel oil, natural gas, and other sources of power that will continue to drive emissions.

2:57We're trying to change that pathway for those billions of people to focus much more on renewables. I've often thought that one of the problems with climate change and getting people to do it is that the benefits are not going to be felt in your lifetime. Most likely, your great-great-great-grandchildren will see the benefits of what we do now. and it's hard to get people to change their conduct for their great-great-great-grandchildren. How are you going to solve that problem? How are you going to get people to really care about reducing the use of carbon? Well, David, I'll tell you, we're seeing the impacts in communities we work in around the world right now.

3:29The reality is we've already seen downward pressure on agricultural output in Africa and parts of India and Latin America that are increasing the number of people who are hungry and the number of communities that are threatened. We're already seeing tremendous changes to coastal communities, whether it's in Bangladesh or in South America, that are reducing people's livelihoods and access to fisheries and sources of protein. And we're already seeing women working in salt flats, whom I was with them just last winter, working in extreme heat in India and some even perishing through trying to make a dollar a day or two dollars a day doing bat-breaking work in 110, 112 degree weather.

4:08So this is a crisis that's affecting people, especially vulnerable people and poorer communities right now, which is why the foundation is so focused on fighting climate change. And you're putting a large number of your resources and personnel into this effort? Absolutely. In fact, we're all in on addressing climate change. And as an institution founded originally on the resources that came from Standard Oil, we've divested of fossil fuels in our endowment. We're making a commitment to run our operations in a net zero manner by 2040. And we're very committed to making sure our partnerships help change the trajectory of climate change, especially in developing countries.

4:46Now, recently you've also written a book called Big Bets. We'll go through the book and some of the big bets you've made, but what gave you the idea of writing a book so young in your career about your career already? Well, I mostly wanted to just make the point that when you work in social impact or when you work on issues like global development, which I've had a chance to work on at the Gates Foundation under President Obama at USAID and now here at the Rockefeller Foundation, you don't have to settle for incrementally doing good. So much of human charity is about sort of doing a little, doing what you can and feeling good about it.

5:22And I wanted to introduce the idea that you can actually try to solve some of the world's biggest, most challenging problems. And in fact, if you look at our philanthropic history, not mine personally, but that of the Rockefeller Foundation as an institution or what the Gates Foundation has done as an institution, I think their biggest wins have been thinking of solving problems globally and moving hundreds of millions or tens of millions of people out of really dire living conditions into a much more bright future. What's about making little small incremental bets that are easier to get done?

5:53Why isn't that easier to do than the big bets, which could fail? Well, ironically, big bets require making lots of small incremental bets along the way. We're trying to bring power and electricity through renewables to a billion people who live literally in the dark with less electricity per person than it takes to power one light bulb and one small appliance in their home through the course of a year. We don't solve that through one large effort. We're going to solve that by collecting and aggregating thousands of small actions from people around the world. But here's the difference. When you aspire to do something big and bold, you can then talk to leaders who want to be a part of solutions at that scale.

6:35I can sit down with Larry Fink at BlackRock and design financing instruments that can bring billions of dollars. I can talk to the heads of those putting together the COP climate negotiations at the UAE and structure new initiatives that can mobilize the kinds of resources we need. Or I can partner with colleagues at Tata Power and say, let's build 10 ,000 rural mini grids and move 25 million people out of power, out of energy poverty. Those types of solutions, in my view, happen when you dream big. This is the Bloomberg Businessweek Minute brought to you by Amazon Business. I'm Carol Masser. The 84-year-old leather goods maker Coach is on a hot streak lately thanks to a new generation of consumers.

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9:11My parents are from India. Where did they settle? Well, they started actually in Pasadena, California. My dad was an engineer who was working on the Apollo programs for a company called Bendix that was designing components on Apollo missions. But they quickly moved to Detroit, Michigan, and my dad had a 30-year career at Ford Motor Company. And your mother? My mom is an early childhood education specialist, and she started a Montessori school and ran that throughout my childhood. All right. So you grew up in the Detroit area, and I assume you were a superstar student. Is that right? I was a pretty good student, and I grew up in an Indian American community that was pretty focused on being a good student.

9:50You went to University of Michigan? I did. Go blue. And what did you want to study there? Well, I started in engineering because I grew up in a family where you're either going to be a doctor or an engineer, and I thought I'd be an engineer, maybe be an auto designer was my sort of early plan. But quickly switched to literature, science, and arts and started studying economics and policy. All right. So when you graduated from Michigan, I assume you did reasonably well there. I did. You decided to go to medical school at the University of Pennsylvania? I did. And, but medical school wasn't enough.

10:23You also wanted to get another degree as well. You know, in reality, I think I felt I was supposed to be a doctor because I just sort of grew up with that. And I got very interested in politics and policy. So I wanted to learn about health economics. And I joined an MD, PhD program at Penn Medical and the Wharton School. Then did you set up shop to become a doctor? I didn't. Did that disappoint your parents? Well, it did at the time. It may be not disappointed, but it made them awfully nervous. But after I took my last set of board exams, my then-girlfriend and I, now wife and I, got in my car and drove 14 hours to Nashville, Tennessee, from Philadelphia, in order to volunteer on Al Gore's presidential campaign when it was during the primaries.

11:08It was, yeah. So when he did not become president, what did you do? Well, I found myself unemployed for a little while, and I started dabbling in political consulting and doing some other things. Did that make your parents nervous that their well-educated son had no problem? no job? Very nervous. And frankly, they and everybody else wanted, and I even wanted to, you know, thought, okay, gosh, now I should go back to medicine and just be a doctor and do a residency. But then I got a phone call from a friend who I met on the campaign who said, you know, Bill and Melinda Gates were setting up this foundation and they had big aspirations for what they wanted to do.

11:42And they were looking for someone who knew health economics and medicine and had some perspective on global health issues. So I interviewed for a job. JOHN YANG, MD, And you got it? JOHN YANG, MD, I did. JOHN YANG, MD, So what was the challenge you had there? You wrote about it in your book, but why don't you describe what you tried to do there over the two or three-year period of time you were there? JOHN YANG, MD, Yeah. So this project was really their big initial effort. Bill and Melinda had read an article about a disease called rotavirus that was killing 400 ,000 kids around the world every year.

12:16And in that same article, they pointed out that a company, Merck, was rolling out a vaccine in the United States to address rotavirus, where kids actually didn't die of the disease. And so they had the very simple question of why couldn't we get the vaccines to every child on the planet, in particular those that need them to survive. So your project was to get this vaccine to everybody in the world, essentially every child who needed it. Well, every childhood vaccine that existed to every child who needed it. And so we studied the global birth cohort of about 105 five million kids at the time.

12:50We assessed the data and concluded that probably about half of those kids were getting some form of robust vaccination that could save their lives from infectious diseases and half were not. So did you eventually meet with Bill Gates when working on this problem? Yeah, and I write about this in the book because I learned from Bill the power of asking a simple question. It wasn't just one meeting, but he would pull us all together quite regularly and say, you know, what does it take to vaccinate every child on the planet? We were trying to get to a cost analysis of that problem, which required really deconstructing the challenges.

13:22And it was interesting because what I learned in that setting was sometimes complexity can make it hard to engage. And Bill just insisted on finding a simple answer to a simple set of questions. And that helped us craft a strategy that made a big difference. You point out in the book that you couldn't vaccinate all the children in the world by yourselves. The Gates Foundation had good resources but not unlimited power to do everything. So you had to engage countries. And you point out in the book that one time you went to meet with President Chirac of France, and you didn't have shoes that were appropriate.

13:55What happened? Well, what we learned as we were doing the work was that the vaccine industry wasn't even producing enough vaccines for kids in low-income countries, effectively. And so we needed to restructure the way the world financed vaccines. We put a proposal together for the world's big, for a big and first social impact bond to solve that problem. And we were effectively seeking France's support to make that bond viable. And so Bill and I met with President Chirac at the Elysee Palace. And I was coming from Seattle, and I just had old shoes and didn't have, I had actually left the new shoes I bought for the meeting back in Seattle.

14:36And so I was wearing shoes that had a little hole in the bottom of it. And I was just self-conscious about that. And so we sat in the meeting and the meeting went great. President Schrock said, we're not only going to make this happen, but I'm going to direct my finance minister, Nicholas Sarkozy, to create this project with you guys. And that ended up transforming global immunization and vaccinating nearly a billion children over 20 years. But when I called Rick to ask him about what Bill thought of the meeting, which I thought was a home run, he was sort of ribbing me a little bit and said, well, Bill thought the meeting was fine from a content perspective, but he was really concerned about your footwear.

15:14And at the time, I was just a young kid working at the Gates Foundation. I was terrified that that was actually true, and I learned they were just making fun of me. Well, you survived that. But after you'd accomplished that global immunization program, you said you wanted to do something different, so you decided to leave. What did you do next? Well, I was at Gates for a while, and after President Obama got elected, I got a phone call to join the Obama administration. And it had always been my dream since I left medical school to work for Gore that I'd get a chance to serve in an administration.

15:48And so I moved to Washington, D.C. So you went initially to work for the secretary of agriculture, who is, I guess, still the secretary of agriculture. He is, Tom Vilsack. He's had a couple tours of duty in that position. So you later got asked to be the head of USAID. What is USAID? Well, the United States Agency for International Development is America's prime development and humanitarian agency. It was founded by John F. Kennedy, and it has a very clear and direct mission. And the idea is bringing dignity, security, hope, and opportunity to the poorest parts of the world makes us all safer and makes us all more prosperous.

16:28So you got that job when you were 50 years old? I got that job when I was 36 years old. 36 years old. You're running USAID. How many employees does it have? We had 11 ,000. And did you feel qualified to run something that big? Well, you know, at the time, I did until, you know, the work started. So I was confident that I had ideas and experiences that could help the agency be successful. But it wasn't until the Haiti earthquake happened effectively on my first week on the job that I realized I needed a lot of help. So the massive earthquake in Haiti occurred. USAID is going to take the lead for the U.S.

17:03in trying to redevelop and fix the problems in Haiti. And so you go to the OVO office and you hear something you're not supposed to hear, which is the Vice President of the United States, Joe Biden, now the president, saying, is this guy really able to lead this effort or something like that? Is that right? Yeah. So President Obama called me actually the day before, right after the earthquake happened, and said, first time I took a call from a president, and said, Raj, I'm putting you in charge of a whole of government efforts, civilian and military, to respond to this tragic crisis, which ultimately led to more than 250 ,000 people perishing just two hours from our shores.

17:40And so the next morning in an Oval Office briefing, I got there just a few minutes early because I was terrified of being late. Your shoes were okay? My shoes were fine. I walk in and President Obama and Vice President Biden were over by the window, Biden facing out and Obama facing the sort of door when you come in. So he saw me come in. And Vice President Biden was in the middle of saying to President Obama, are you sure about this guy Raj Shah? He's only 36. He just got here to Washington. And the person who leads FEMA, Craig Fugate, has much more experience leading these efforts. Maybe we should ask Craig to help.

18:17And Obama saw me and walked over right away and said, Raj, come in, sit down. And then next thing I knew, everybody poured into the meeting room, and we very quickly got right into the work. What ultimately happened in Haiti? What did the United States government do through USAID that helped ameliorate the problem? Not solve it, but ameliorate it. Well, in reality, we mounted really the fastest and largest humanitarian response in history at that point. And we did it because we were able to do it, not because USAID did everything, but because because we were able to, as I write about in the book, kind of open the turnstiles and invite in colleagues from the Federal Emergency Management Agency as well as the Department of Defense and use all of those assets and capabilities.

19:03So people must say to you all the time, you've done a lot of things, you should run for office. Do you ever think about running for something? I do. Since I was a little kid, I've always been enamored of the concept of public service. And frankly, my time in government taught me that if we have the right kinds of leaders in place, we can get a lot done. So you had decided after a while, you've been at USAID for a while, maybe it's time to leave and do something else. And then all of a sudden, another crisis comes along, Ebola. So what was your responsibility and how did you tackle that problem?

19:32Well, USAID carried the responsibility of working with the Centers for Disease Control to really mount a response in West Africa and contain and ultimately limit the disease before it spread around the world. Right, so after Ebola problem is more or less solved, I wouldn't say you've eliminated Ebola completely, but it addressed the problem. You decided finally to leave, and you then pursued what I've called the highest calling of mankind, which is private equity. You set up your own firm to invest in, I'd say, electrification projects around the world, is that right? That's correct. And you had two very big backers.

20:08Dick Blum was one of them, and David Bonderman the other. Yes. We started the process of building a small firm, partnered closely with a larger firm, TPG, and started identifying projects and raising funds. And I got about a year and a half, two years into that, about a year and a half into that, and the opportunity at the Rockefeller Foundation came up, and I ultimately felt that that was more aligned with what I wanted to do. So you became the president of the Rockefeller Foundation. How many years ago now is that? Six. Now, the Rockefeller Foundation is very famous over 100 years. It's not nearly as big as the Gates Foundation.

20:45So how do you deal with the challenge that people think you have unlimited amounts of money but you really don't? You know, our resources really should be society's risk capital to solve tough problems. And we think of it that way. So we're not trying to pay for solutions at scale. We're really trying to build partnerships that either allow companies to build out renewable electrification to reach people who are very poor and make that profitable and viable on a commercial basis or get governments to do things that are transformational like we did during the COVID crisis here in the United States.

21:20So do you worry about the problems of the dysfunction of the U.S. government sometimes? I mean, clearly, we see the U.S. government, the Congress can't get its act together in passing bills and so forth. Is that something you address or is nothing you can do about that? We work on that every day, because whether we're working to expand diagnostic testing during the COVID crisis here in the United States or working to reinvest in global development efforts abroad, U.S. government leadership is almost always critical to success. And the truth is, if you work behind the scenes quietly, as you know, you can get Republicans and Democrats to collaborate and partner, and you can find those partners who want to do the right things.

22:03They're not always the loudest voices. They're not usually screaming on cable news, but they are in fact the ones who make things happen. Let's go through some of the leaders for whom you've worked. Al Gore, I don't know if you worked that closely with him. You got to know him a bit. What kind of leader was he or is he? Well, I worked less closely with Al Gore. I was a very junior member of his campaign and I've gotten to know him more in recent years as we focused on climate change. And I just think he's extraordinarily smart, very, very disciplined and extremely persistent in his beliefs. GEOFF BENNETT, presidente of the United States, President of the United States.

22:36What about Barack Obama? How do you find him as a leader? Well, President Obama I learned a lot from just by watching the way he worked. And in my view, he had this unique ability to be extremely determined, passionate, and also preternaturally calm in any given moment. But you sort of knew that underneath that calm was an absolute determination to sort of win in the long run, whether winning was on a major foreign policy issue or on some domestic transformation of our economy. What about Joe Biden? At the time, Vice President Biden was, you know, he was just so personable, like, especially during my some tough moments.

23:16I gave a speech called the National Prayer Breakfast Speech and was actually quite nervous about it for a number of reasons. And he was the kind of leader who'd come and put his arm around you and say, you know, you got this in much more colorful ways. What about Hillary Clinton? You've worked with her when she was Secretary of State? What was that like? Well, I learned from Secretary Clinton just the power of toughness. There are times, especially in government, where you take hits and where people critique what you're doing if you're trying to be a change agent and trying to make change happen.

23:49And I learned early on from her that this is a woman who's taken a lot of hits and just keeps going. And if you care about what you're doing and you believe you're trying to help other people and you see a path to making a difference, you have to have a strong shell. WILLIAM BRANGHAM, So as you look back on your career, what are you most pleased that you have achieved so far? Well, the big bets that worked, the effort to vaccinate a billion children and save 16 million child lives over two decades through the establishment of the Global Vaccine Alliance, the effort to prevent Ebola from spreading out of West Africa and into the rest of the world when the CDC was estimating 1.6 million cases and we ended Ebola through bold action with less than 30 ,000 cases and less than 11 ,000 deaths and not one case of transmission in the United States.