Transcripts For KQED Charlie Rose 20171116

Foundation. If you look at the plannic, the requirement, human rights, civil rights, every one of those organizations has been founded by and nurture by professional foundations. Not spin down foundations. Because if you look at what motivates a spin down Foundation People to give money to things its really an attempt to replicate in the Nonprofit Sector, the civic sector, what the achievement that they had in the for profit sector. So they are really looking for a big bang. The problem is you dont get a big bang fast. What we know about the spending of money in a short period of time didnt correlate to what you expect if you put a lot of money in action in work in the short run. Rose music and philanthropy when we continue. Rose funding for charlie rose has been provided by the following and by bloomberg, a provider of multimedia news and Information Services worldwide. Captioning sponsored by Rose Communications from our studios in new york city, this is charlie rose. Rose Michael Rapino is here. He is the president and ceo of Live Nation Entertainment with over 80 million attemptedies around the world, live nation served more fans than the nba, nhl and nfl combined. They produced soldout tours from everyone from Bruce Springsteen to beyonce. They found success serving fans because he is a fan himself. Heres what bono says. See michael at a show and its clear what drives him youd think every gig is his first. Pleased to have Michael Rapino at this table for the first time. Welcome. Thank you. Rose congratulations. Thank you. Miles quote from bono. Rose very nice. In fact he sent me an email today saying, i was in for a treat is what he was basically saying. You love music. Yes. Rose where did that start. Just back to bono to tell you what an incredible man he is, we talked earlier. He faced time in the south of england as he was walking about the bbc to do a production for thnew record, he said i heard youre doing charlie rose and his words were charlie rose is like a smooth jazz musician. One of the best in the world. Youll have a great conversation. Thank you. That just says what he is. In between all of those promotions and building his record, he took that time. Hes incredible. Rose live music. Live music, you know. I got real lucky when i was young. Small town, canadian boy. Dont know why but early on i just felt this great love for live music. And there was a character in canada called michael cole the largest brewster in the world. I would read about him and in 1990 he stole the Rolling Stones from bill graham presents which was a legendary steal and became the first global promoter. Sitting in thunderbay reading the globe mail i just wanted to be michael cole, the idea of the man behind the concert was a real job and a sursuit. I was taken. Rose it was more than a business, it was a business that you loved. It was about something you loved. Two hours, rare in the music business. Most music executives are on the record side and they talk about their love for the record. I just love those two hours. I think those two hours of magic when youre back stage and watching the production of the you 2, jay sees or club show and watching it come alive. At the thunderbay i took a 16 hour drive to toronto to see my first big show, robert plant. It touched me really. My passion was just this two hours was magic and then from there i was going to figure out how does one become the business of lives and that was my pursuit from 20 years. Rose and music today is king. Who would have thought. Today were celebrating live nation. We went public 1 years ago. Nobody cared about us 12 years ago. For 30 years, the business was about the record. And snapster and streaming and cds and consumption around the record business and news media. Promotion was you toured to sel records. Then napster came along and digital down load and all of a sudden you started to tour to make money. Rose thats the principal Revenue Source for most artists. For young artists. When youre starting out youre going to make 90 of the money youll make in a year comes from the road. Is road now is not only the best way to connect to fans and those imaginal moments, its paying bills. So the art now, the stream and what you create is magic but the road is where youre going to pay the bills. Rose you said an interesting thing. Is there going to be enough acts for you to put on the road michael. And you said as long as they have to put food on the table theyll be touring. Its a win all around. Because the other thing that has been, if you look at technology and what its done to Entertainment Media companies, really live concerts is the only art form where Technology Enhanced it. It didnt disrupt it. Why . Rose made music better. Made the sound better. Also its not duplicatable. You will not watch u2 at home on your tv and still get those goose bums and Magic Moments with your son or daughter. Rose its a spectacular moment. You see the artist coming out right over you thinking of u2. Its also when you go and people talk about their kodak moments in life, you remember bringing that girl to the first show. You brought your son to see acdc. You brought your wife or your date to beyonce show. The average customer with two shows a year, they are Magic Moments to them. They save, they plan and those are those moments where they will put them in their memory bank. They cant watch that on a dvd at home or streamed on youtube. Its where you go experience it and it comes to life. Rose what are the biggest acts, beyonce has the biggest tour last year. Yes, beyonce is just phenomenal on her own. Grossing tour of the year. T old play right behind them. Rose do they do about the same number of concerts. Yes. Theres been a really big surge in stadium tours. Rose i know. In 2018, its all stadium tours. Five years ago again people would have said oh wheres the next u2, who is going to be the next Rolling Stones. You have taylor swift announcing her stadium tour. You have luke Bryan Country stars doing stadium tours this year. You have guns and roses and a reunion was magnificent. Overall hiphop urban music is on fire. Law mars, jayz, that is the new rock and roll for a new 19 year old so that is just selling out everywhere around the world. Country. Rose electronic dance music. Theres electronic. Rose is it coming up . I would say its kind of, it had a moment. I think its on a pause. I think it was fueling a lot of the festival business. We have some of the wildest successful ones, electronic music ensome fact electric daisy 400,000 people go to it. Ros what happens in the festival. What is that. A festival which is really a european phenomena for years. In america, you went to the hockey rink or square gardens to see your show. In europe you got to remember they only had football stadiums. They dont have hawksy and basketball arenas. You were a promoter, you created tea in the park in ireland or scottland. This was really the way artists tudor in europe for years is a festival. And then they came to america and they played Madison Square gardens. And over the last ten years ago, give a fellow from california paul in cochessa. Some of these big festivals started to con to market. They are phenomenal. Everything you love about those two hours of magic when youre 21 years old. Now im going to give you 72 hours of that. 72 hours of the great music. Rose are you on the road trying to see the tours live nation is handling. Yes. Rose you go to see the concert. The thing that im the most proud about, 20,000 employees in 40 countries. When we started, we did a few shows. So we i think have the greatest collection of creators, producers and promoters in the world who are very talented staff. And i think the dna of where we came from and where i came from is we believe we work for the artist. Its very different than maybe the record labels and others. So you got to shop. You got to show up on a tuesday night in pittsburgh and see drake. Rose and be there for the artist. Exactly. Its a local business, you know. Its a global in terms of phenomenal. Youve got to be in pittsburgh. This week drake is playing new zealand and australia. Our office is there taking care of them. Were doing, the are staggering. I just like sawing them because a kid from thunder bay when we started this business with such small scale a lot of nation will be Something Like 105 shows a day. Rose 105 shows taking place. Taking place. Im always planning when im traveling where i can stop and see a show, a festival, an artist. Rose what does live nation do are for the artist . The fundamental, an artist, when they go on the road is always going to be, always going to look for a Risk Reduction strategy and the artist is going to say who is going to take the risk when i go on the road for the year. Sofor over time theyve always looked to promoters have been the bank. When live nation started consolidating all of these local businesses and turned it into what we call this Global Business now, the local promoter now became the global promoter. So for the u2s of the world, they mighte used all small promoters historically one by one. Today when you were dealing with a band like u2, wire able to say we can take all hundred of your global days, we can do a global deal for you. Not only could we excuse for anyone else, not only can we pay you better than anyone else from a very secure state but weve got all of these resources to help price it better. Sell more tickets, drive sponsorship, understand the data behind the customer, package the record if you want, help you drive sponsor activation. Really become a full Service Platform that says when you go on the road, now you need the intel intelligence and you need the sponsor to make that come to life. We want to sell every ticket for you we want to make the pot as big as you can. 0 of artists dont sell out. So u2 and beyonce a real sale job for us. Our job 300 days a year is to get those tickets sold at jones beach on a tuesday. Using our Digital Marketing team, our sponsorship and our huge platform. How do we brate it better to the back end of the house so it does sell out in a wednesday in indianapolis. Its really become rose is it also reason the Rolling Stones and Paul Mccartney and others can play well into their 7 0s . They have an audience well into their 70s. I think you look at first of all the business is global now. Thats a real big change. When youre Paul Mccartney, springsteen, anybody now. For 30, 40 years your touring decision was i play america, i play western europe. Thats where the money was. That could support your production and your costs. Today youre making up and youre looking at, i can go to south america, cold play just got off the phone with the manager earlier today. Hes playing all throughout south america. U2 went from columbia to convenient way law. So now you got ten dates in south america, ten dates in asia, ten dates in australia. The can values now is so wide for these artists, the demand is so incredible. Paul mccartneys and etcetera, the demand is far outceding your capacity to ev play. So until you want to hang up that guitar, theres a stadium or arena somewhere in the world who wants you to perform and you havent been to half of these places. Rose how long is a tour. Traditional tour, when an artist is on a cycle, they come and say were going to do a hundred dates. Where should i go. Where is the most efficient economic way. Well take a couple weeks, give them a global map if we do 30 days in america these are the cities, 10 canada, take a month ship your production to europe, root them around the world and after those hundred dates. Were starting at the beginning talking about where is their fan based looking at all our purchase data we have historically. Pricing data. Its become a real science now how do we most efficiently get you on the road. Best cities to play. How do you price the house. And when youre finished how much of the pod is going to coe home. Rose who does well on grammies and who does well on tours or people just do good on tours and whether they have a record and going to win a grammy is another matter. There used to be a better correlation. Its changed over the years. In you look at now who is on the road. Again, most of these artists on the road may not have singles, may not be top ten hits. Urban hiphop pop music which is always going to be top of the charts doesnt mean youre rose mop pop is going to be at the top. Hiphop is coming up. Rose is it exceeding it, about to, seed do you think. I think its about to exceed if it hasnt exceeded yet technically on a global basis. Drake biggest stars in the world now. Any one of those three now. I think drake is the number one streamed artist in the world. Right up there with this week taylor swifts got a new album, she may top it for a day. Theres a complete surge on urban hiphop music thats come to the top. And translated to touring. But you look at the tour now, you look at a typical Madison Square garden 12 month calendar jones beach, youre going to have half of thats going to be, lets call them legendary, iconic artists. Havent had a single in a long time. Rose james taylor. James taylor. Bunch of great artists. Hall and oaths. Del leopard. And performers get out there. Why do we go live . We get to relive with that community. That tribe. We get to talk about 76. Rose how about country music. Country music, in america its on fire. Rose is it gaining an International Audience or slow. Slow. And its, you know id like to tell you i know why but it is an exception. It really has replaced rock in many ways. Country has become the storytelling music that rock used to be. You go to a look brain or Kenny Chesney or jason neldine show its a rock show of the past. The challenge with those artists look bryan can sell out 60 stadiums in america. If you bring them over to london you might be playing a theatre or small arena. So it hasnt tranlated yet outside rose you say yet. You think it might be i think it has become lets call it closer to mainstream i think it now has a chance to truly become the next kind of rock music for the international listener. Rose when you think about live nation, do you think beyond the business youre in in terms of concerts which has been your life blood. Does it make sense for you to represent artists . Well again, its something im proud about. If you had said to us 12 years ago when we started live nation that we would one tee have an Artist Management division. I would have said thats very unique. Nagement company in the world. T we have an Artist Management division of over 300 artists that we manage over 90 artist managers in a division called artist nation. And again im very proud of that decision. Why . Because the dna of live nation that wakes up and says we work for the artist. So think about it. Tist, im going to do a dealis with live nation. And that artist is going to say but isnt it the guy that writes the check for the tour. Is that a conflict or is that good for us . And that idea that that manager, you might not get the bestdeal. But that manager when we sit down and i explain to him thousand we can help him grow his management business. Help the manager do a better job for him. Ultimately that artist got to do the right thing for his business live. Now hopefully live nations the right answer and were going to fight hard to tbeft that. But if its a competitor well do that also. And that trust that these artists now in this division, we started this artist Nation Division with probably the two artist mentors in my life has been bono and jayz. We started rock nation ten years going and watching that grow. Rose why is jayz so entrepreneurial. I always got this question about what mentors you have in the world of business. And i always remind them that you like at these artists. They are the greatists ceos you ever met. You look at mick jagger and the Rolling Stones one of the greatest brands in history. Its the Rolling Stones lips that sells a billion dollars in ms. Rose did their streaming service work well. I think he did what i think was a revolutionary idea that the artist would kind of form that relationship. I think they realize thats an arms race when youre fighting the big boys. Its not easy. But again i think in any business pulled a left turn and found sprint. In many ways i think again he swung. May not have come out the other end on title but overall if you look at the rock nation jayz empire, hes an entrepreneur, taken many swings, his clothing line, his vodka. He called me one day and said i want to be in the sports business. Rose just like that. Geez, a lot of big boys. Next thing i know hes signing kevin durant. Now we have an incredible sports agency. Hes a rare exception, and truly one, and he delivers what he says hes going to deliver which is a great trade of a ceo. Rose if you do music, could you do sports . You know, again, we dabbled in sports. Other than with jayz, i would say that most of the sports relationships we have is on the ticket master side we own. We just renewed our nfl deal and nba. Most of the dealings are with the owners and the buildings and msg. But you know, the irony is what is every billionaire that owns a sports team and venue want is to sit down with us and talk about can we get ten more shows in my venue. Rose we have these three dates. What can you fill up the crowd with. Exactly. We always say to an owner you probably got your hockey dates and basketball dates and im going to bring you 60 dates. Lets talk about how that can work together. We always believed the 29,000 shows were going to do this year. The more shows we do, the more relationships well have with the sports owners about putting it in their venues. But well kind of stay in the content live business for now. Rose what business, okay. You may have answered that. When you, where will live nation be ten years from now other than bigger. Other than bigger. I think the interesting part of the music business is the artist is really now becoming kind of the center of his wheel. He is now looking at the business very differently. Most of our young managers that were dealing with arent the managers of the past. Its not about get a record deal, get a tour deal and go home. Its about sitting with what will the mar business be long term and how will i distribute my record and talk about my spawshesz and how will i use my data from touring and bring this altogether. So we think that this foundation of live nation thats going to spend about 5 billion a year year at midnight paying for the tour much like weve expanded in Artist Management business we think that gives us the opportunity to keep expanding in the overall music pie. I think in five or ten years, we become very important to the artist know just in his touring business but his marketing business. Distributing his music business. And all of the pieces of the pie. Rose who else do you go to talk music. Ive had, ive been a study, ive ready every autobiography of day one of anybody since i was growing up. Rose everybody in the music business. Geffen, dillon all of them. Im a student of them. Trying to figure out the landscape. Rose is there a pattern for getting there. Yes. Rose is there a pattern for getting there . Everybody would say theres one thing, hard work. Yes. I think, i too believe that the canadian in me that we grew up in canada not ever believing were really the greatest country in the world. We grow up very hungry for curiousity. And figure out how were going to get there. So i do believe that listen for whatever reason the idea that i love live and the passion i found early was 80 of the game as we know. Trr many people waking up today trying to figure out what they want to do. Wanting to do what i want to do is great. I think the idea i think manifest the outcome is probably the talent. And i sat there 20 years old, the university with one of my mentors i now work with, i said to him at 20, at 40 years old i want to run the Largest Entertainment Company in the world. Rose congratulations. How i was going to get there. Rose on a napkin. Put it on a napkin. Rose what was on that napkin. Talked about thunderbay and a university and how would i get there. First of all i needed to get some music education. Work at a big company. I had to finish my degree. I had to go start my own company and i had all these paths. Rose did you touch all the bases. I touched them all. The next 15 years i was obsessed. I worked with the largest promoter, i learned big business. I learned all of the kind of the School Discipline of how do you run a business. I started my own Concert Company in canada. Sold it to bob silverman, moved to new york, moved to london, did every course, read every book, followed every mentor. By the time i was 40 years old i launched live nation, took it over and created the largest Concert Company in the world. That single minded determination of manifesting my passion was really how i got here. Now as a canadian, the underlying theme is you never really believed you got there as i still dont. So youre hungry and you are curious every day to learn and observe. And whether it was geffen, david in l. A. , they are all inspirational. Jimmy is on my board, i talk to every day aside from the artists who i mentioned earlier who i think i continue to Stay Grounded to in terms of are we doing what we set out to do for you bono. Does his company have that. Rose beyond talent, the artists who have longevity have what. Similar how i got here. You have artists who tend to be incredible manager at the heart. Bruce springsteen knows what Bruce Springsteen stands for. We always had this big debate in the music business on the ticket price. As you know in the music business, it is the only business in the world that the minute it goes on sale, it is worth more. Think about that. This is not another industry in the world. Tesla sold for 20,000 but the minute you bought it you could sell it for 30. They just raised their price to 30. Theres not another industry in the world. Why does springsteen not charge exactly what he could get for the frawment row. Why does bono not charge. They are incredible managers. They are connecting with their fans. Theyre creating great art and what theyve done is figure out how do i know connect with these fans for a long term journey. What do i mean to that fan. And then they manifested, whether its the song, the music, the video, what the stage looks like, the price of the ticket, what shows they play, what shows they tonight play, what venues they play, what festivals they play. So i just think they all are these incredible. Rose so music recovered from the devastation of the digital revolution. Yes. Rose it killed it. Killed it. Short term. Rose short term. How did it recover. Finding new revenues. Yes. The fundmental, you look at the correlation over the ten years as the artist contract went down from the record label, his touring business went up and his endorsants went up and his facebook went up. If you take to artists during the difficult, if you talk to record executives oh my god they were panicked. You talk to artists, they werent panicked. They looked at it as an opportunity. Because the part i said earlier about the artist now really stepping from behind the platform to the front, that really happened when the internet unlocked. When rihanna got a hundred million followers that changed. For 30 years as an artist you were at the beck and call of the gatekeeper. Ey hoped your label got you a record on the radio. You hope you got racked on the record store. Now all of a sudden youre rihanna talking directly to twitter and facebook and a hundred million people. You are mtv. You dont need anyone to tell you how to talk to the fan anyone. You dont need a record label in the sense of how do i tell them about my record coming up my tour coming up. I think thats the revolution where the artist started to become empowered. Then it became a brand, solidified their brand and began to have conversations when they are going on tour, what they are doing, who they are doing, what collaborations, what shows theyre playing. What sponsors. Rose the fashion and everything else. Fashion, brands. I think then they became more liberated. So the label, the promoted whoever, you have to start moving behind the platform now and saying hey rihanna, can i help you get on the road and sell a hundred dates. Let me tell you what i can do for you rihanna so your business can excel. Thats a very different statement than what it used to. I talked about it back five, eight years ago every time i would sit down with live nation they would talk about your steaming going to win. I say thats just a distribution discussion. Thats talk supply and demand. There are more 19 year olds waking up today listening to music than ever before. We dont have a consumer problem. With the gatekeeper that 19 year old news taylor swift has a new album today. They didnt know that 20 years ago. They had to hope for mtv. Now the gatekeeper is unlocked. Today you have more consumers around the world instantly that rihanna has a new single. Rose they have a deeper connection to it judicial deeper connection. You have this massive consumer demand groog growing and then you have artists who felt i am the gatekeeper now. So when we were talking about whether the cd is going to win versus itunes versus the distribution, the artist is raising up and taking control with the direct relationship with his fan. People like spotify and eventually apple talking directly to the artist, how can i help you solidify that relationship started to excel. I think we at live nation because we really do believe we work for the artist, i wish i wrote, you know, purple rain. But we didnt. They did. Theyre the true artists and if we can help them get to more shows max mime their time on the road then we become very valuable. Rose its a pleasure to have you here. Thank you so much. Thank you. A pleasure. Rose well be right back. Rose more than 500 billion annually is expected to foreinto the plan trick center. They will transform americas civic sector landscape Joel Fleishman is law and public saul e at duke university. His new book putting wealth to work changes the world of philanthropy. Here is Darren Walker president of the Ford Foundation. I am pleased to have both of them at this table to talk about philanthropy today, its impact, and how long foundations should exist and what are the new rules or new perspectives on foundations so im pleased to have my friends here to talk about that. The main thesis of this is that the trend towards giving while living is endangering the long term survival of endowed perpetualal in substitutions and that endangerment is not good. Yes, this is correct. Rose explain that. The reason the endangerment is not good, if you looked at the American Philanthropic landscape nonprofit organizations the ones we all know working on the environment, human rights, civil rights. Every one of those organizations has been founded by and nurtured by perpetual foundations not spinal down foundations. If you look what motivations a spin dumped foundation for people to give money to things its really an attempt to replicate in the Nonprofit Sector the achievements they had in the for profit sector. They are really looking for a big bang. The problem is you dont get a big bang fast and what we know about the spending of money in a short period of time doesnt correlate to what you would expect if you put a lot of money in action in work in the short run. Rose theres an exception to that. The woman who gave a lot of money to help develop the hiv virus cocktail. Thats right. The aaron diamond foundation, Irene Diamond here in new york. This was an unbelievable circumstance. Rose one shot chance. One shot chance. She was trying to figure out what she did with the money. Her husband had died and the aids epidemic was breaking about 1980. And he sshh she said wouldnt it be wonderful if we put a lot of money into this. She founded the new york aids which in turn found the cocktail for aids and saved millions of lives. Thats an exception. You cant imagine that kind of thinking thing happening other than by chance. Rose you run a perpetualal sustaining foundation. Do you agree with him. I agree we need to retail brate the discourse because its become imbalanced. Its not an either or, its a both. We need foundations like rockefeller and carnegie and we need those donors who seek to have a Significant Impact during life tomb to be able to do that. But i think joel book rightly points out that the conversation in philanthropy has become so distorted towards the notion of a spin down as the only option. I think what his book seeks to do is to rebalance the conversation. Rose is that what you want to do rebalance it. I agree with everything darren just said, a question of rebalancing it. And i say in the book both kinds of philanthropy is important. Depands how much money you got and what you are trying to do with the money. If its a problem that can be handled with the amount of money you got in the time you want to intend by all means to it. But the problem is people trying to tackle big problems that are complex that cant be solved. Like cancer research. They have to be iterative time and again. Rose in todays environment weve got so many people making so much money from Silicon Valley and technology, fortunes quickly. They are younger and more entrepreneurial on the other hand or more problem solving oriented and more hands on oriented. And all those things make them want to achieve and make impact faster. I admire their motivation to do it. And the book really tries to explain to them what kind of questions they should ask themselves before they bet the farm on something basically. Rose okay. Heres the other argument and you would know this too. Some say that perpetual Foundation Run by really smart people like you, that it tends to, youre less risk oriented. Well first of all i think, charlie, no one was more of an entrepreneur than henry ford or carnegie or rockefeller. Im not sure i accent the notion that this new generation of Business People are any more entrepreneurial than a hundred years ago iconic names of industry were. I also think that risk is something that we are in the business of taking at a place like the Ford Foundation. And the risks that we take is investing in institutions. Joels point is that certainly doing something in a big way, placing a big bet on something, some cure is important. But institutions are what continue to perpetuate the innovation that we have in our society. These ideas dont just fall from the sky. They are generated usually within some institutional framework. Who builds those institutions, who sustains those institutions. I think joels point is we need to Pay Attention to that. Rose you said there has been an amazing thing and i wrote it down, about the open society foundation, george social just gave 18 billion dollars or more. And you said that there is no footprint today thats deeper, wider and more impactful than any other social Justice Foundation that know of. That is true because George Sorros is in over 45 countries around the globe. There is no foundation that works in as broad a geography, in as varied a set of domains of investing, and grant making than soros. So even though the Ford Foundation is known quite widely and i appreciate your comment. I actually yield to mr. Soros and our friends at osf, they are doing amazing social justice philanthropy. Rose is this going to be, is this timed or is this perpetual. It is perpetual. Its perpetual now. He started, he first said he was going to spend it down about 11 years ago. About four years ago he published an article preface to a book and he said he changed his minds. He says the problems are so big, it would be selfish of me not to let this thing go on. Rose do you agree with a lot of people who say give it now. Give it now when youre still young rather than waiting as george has done. George is 86 or 70. Yes. Rose Warren Buffett was going to wait and then changed his mind partially influenced by bill gates and his wifes death because she want to do it before she died. But he decided to go ahead and give it then to the Gates Foundation. Part of it. Thats what Warren Buffett d didnt give the whole gift. His estate is worth two times what he gave to the Gates Foundation. And even bill gates himself, jr. Has been quoted as saying hes cut down what hes giving to the Gates Foundation because they cant find enough things they think are manageable. Theyre spending 4 million a year from their endowment. They cant find enough things to do where they think they can achieve the kinds of impact the scale they want. Rose do you have the same problem. The issue is institutional. So this is the challenge for philanthropists is to approach your philanthropy with some humility because the institutions that are necessary to achieve the objectives you might wish may not be there. And thats this question of the real capacity of a system to absorb billions of dollars and actually execute on that with efficiency and with impact. I think thats what the Gates Foundation has found in our area because we really focus on human rights, on women rights issues, Racial Justice in the united states. This is an area that is frail. This is, they are not large numbers of organizations in the u. S. Working on Racial Justice. Theyre not large numbers of big philanthropy investing in those areas. So for us, we are seeking actually to bring in some of the new donors and were seeing that with people like the balmers and who care about those issues and who are investing big. Rose i say gave it all to Bryan Stevenson myself. I couldnt agree more. Im happy to say Bryan Stevenson is a trustee of the Ford Foundation and hes an amazing person. Rose the point i forgot to make, some people say give it when youre younger because you will be more smarter wiser about how you want to give it. Some people wait until theyre too old. Its not either or. Thats the point that was made before. My view is when i said it, the previous book i said with tom tyranny is you need to think of creating some kind of plan which takes account of the problems that can be significantly benefited from giving now and thing that need to be saved and worked on over the long run. The point that darrens making is very interesting was one of the things that philanthropies d i was the director of the north American Program for ten years. One of the things it did basically said we want to do something about the problems of mental disability, particularly alzheimers and things of that nature. They put together a consocial annual at the university of california San Francisco medicl school. They gave them nearly a Million Dollars to staff it up. Its an example where there wasnt enough capacity on the ground and that can benefit from short term dollars. Most people who care about medical research give money to universities for all practical purposes. That brings up an interesting question because one of the Things Congress is considering doing in the new tax bill is one, putting an excise tax on the wealth of foundations which we havent had before at the level at which they are talking about doing. The other thing theyre talking about doing is changing the configuration of a charitable contribution production. And the initial studies of it still very early because this is all announced within the last week, but what the initial study shows it could infact diminish giving 10 or 5 billion dollars if they put the kind of change they are talking about. We know 80 on of the gifts given are taken as charitable deductions. We know that. The tax records show that. The problem is if you start chinning away at it, what are you going to do. What are you going to get the money to devote to the problem that society needs. Particularly universities are perpetual foundations themselves. They exist forever. That also seems to be a target of congress who talked about putting in some kind of tax on the university earnings which has never happened before. So i mean they phase out the charitable deduction doesnt make any sense. They phase out the value of the charitable deduction. And phase out the estate tax. Estate tax as well. Rose what is the cautionary tail of henry ford, ii. The cautionary tale of henry ford, ii is one that manifests at the Ford Foundation. That is the impulse to do good cannot always be predetermined or through a crystal ball. And henry ford, ii was a complicated man. He as i have come to know him through the correspondence between himself and george bundy, he was Rose Foundation president. Indeed. He was a model of contradiction. He was a forward looking man and yet he didnt want women on the board of the Ford Foundation. He was an innovator and talked about equality and yet he was challenged by the foundation support for the Civil Rights Movement in part because of the criticism it brought to the ford motor company. And henry ford ultimately although he initiated the Ford Foundation in 1950 as an independent foundation from the beginning saying it would not be a family foundation. He and his brother were the only two fords ever on her board. He made the decision in 1976 to leave the board because he felt that the foundation had drifted and it had drifted in ways women rights, civil rights issues. Rose taking up causes that made his running the company problematic. It was very difficult for him to wear both hats. Rose this was an example i always heard. The example drifted away from dorn donor intent. Rose that illustrates the point. Thats absolutely correct. The truth of the matter was that he was unhappy because ford was not doing some things that he wanted to do. We all know you create a board which hes proud of, he said foundation ups done a great job with the board i created i have very good relations with all of them and yet the ford board did not do the things he wanted. In his letter to alex, then chair of the board he said i think the foundations are doing great. I wish the foundation had done more to strengthen the cant es system in america. It was the main point he was criticizing. All the other points, the notion of drift away from intent is as i say in the book is really a false charge because remember, he was on the board of the Ford Foundation for 40 years. He served as president of the foundation, chairman of the foundation. He appointed the committee that wrote the commission of the foundation, he approved the say this drifted away fromand the intent. It just shows you cant be, you need to be independent. This is why i think bill gates has separated himself from the company. Its very hard to run an enterprise and at the same time run a philanthropy. And that was the challenge for ford was running the foundation caused a conflict for him because he was running ford motor company. And i think the cautionary tail is, to not try to do both and to decide youre either going to be a businessman and do that and then decide youre going to be a philanthropist but you cant at the same time leave both of those enterprises. The expression of that discontent came from many of the car dealers, the ford car dealers. Theyre the ones who were complaining about these modern things that the Ford Foundation was doing. Rose i would assume as a foundation, lives in the world, it looks at new problems and therefore its original intent would evolve. Yes. And it does. The Ford Foundation programs have evolved but in terms of the mix that was written by the committee that was created, everything i think that ford is doing now is right in line with that mission. Lets not a single exam example i know of that isnt. Rose from texas to university to simian to rockefeller to ford. Tell me, how do foundations create a system to judge performance so they can make wise decisions about how they spend their fumedz. You have to understand there is no single way to judge performance for much of what needs to happen in the world. We can do randomized control trials on a micro finance program or on a conditional Cash Transfer program. How do we create a randomized control trial to know if were making progress on Racial Justice in america. How do we know that we are em embeug in our cull architecture that makes us a more democratic society. How do we evaluate that. There are ways and there are qualitative what the experts call mixed methodologies that allow us to understand progress. But the risk is as einstein reminded us, there are many things that are important in the world that can cannot be meshet we must invest in them nonetheless. If we only invested in things which are quantifiable randomized control trial type interventions, we would not have seen the progress we have seen in the humanities for example. Or in the arts. Or in many creative advancements. Rose the foundation is best known or at least highly recognized for what it did in the green revolution. Got a nobel prize for it. Rose whats the Ford Foundations best similar kind of success in your judgment. First of all charlie its important to know the Ford Foundation was their partner and invested more money in the green revolution than the rockefeller did. I think the Ford Foundation is known most because we have been at the forefront of human achievement for the last 60 years particularly social progress. And particularly around issues that are difficult and that are at the heart of the american narrative and the global narrative and the fight for justice. So at ford we dont just talk about generosity, we talk about justice because there is a difference. Generosity as a philanthropist in some ways makes us comfortable and we know from the research makes us feel good. We feel good when we give money away. Justice actually makes us uncomfortable when we think about it because when we see a homeless person with Mental Illness on the street, we dont think this is a sad situation that is something these happened to this person. There was something unjust in the Richest Society in the world to have Homeless People with Mental Illness on our streets. We asked the question how do we have not more generosity but more justice in our society. I would add to that. Ford has not failed to try to measure these things. The best organizations in the field are like mdrc, Demonstration Research corporation was started by ford, its still supported by ford 40 years later. This is the organization that did the randomized control trials that ended up persuading congress mind you. Rose there are so many things done that make a difference in justice, in this sheer survivability of human beings that comes because somebody where put some money in foundation and somebody said theres a need where we can make a difference and the question is how can we make a difference not how we can make a profit, how we can make a difference. Those examples are the best reason for philanthropy. Yes. Rose its like in the federal budget for me in a sense, ive sat at this table for 25 years and listened to people. They are concerned about those who worry about weve done or havent done. Its not about wanting to do it to a large degree its about whether we have done it well. There are thousands of examples of foundations have put and gone into a space where no one was there. Thats right. Rose and theres no one there and they made a difference. If one believes that changig the federal Program Supporting poor people from welfare to work is a step forward and many people do and some people dont. The fact of the matter is thats what the Ford Foundation research supported and persuaded congress to do. Rose right. And that, there are a lot of people and that program that they created after setting that up is the Largest Program providing support for poor people at this point. Rose the book is called putting wealth to work. Joel fleishman and Darren Walker thank you. A pleasure. This was fun. Thank you very much. Good questions. Rose thank you for joining us. See you next time. For more about this program vift us online at pbs. Org and charlierose. Com. Captioning sponsored by Rose Communications captioned by Media Access Group at wgbh access. Wgbh. Org rose funding for charlie rose has been provided by and by bloomberg, a provider of multimedia news and Information Services worldwide. Youre watching pbs. Narrator warm. Cozy. Delicious. Breakfast is my favorite meal. I could eat it all day. In oaxaca, i visit an art school where magical creatures are being created. And a hearty breakfast is served to all. In my kitchen, im whipping up an oaxacan breakfast for my crew. The satisfaction of freshmade bread at home is so gigantic. Narrator fluffy, puffy pan de yema. Satisfying refried beans, oaxaca style. Scrumptious eggs in salsa martajada. This breakfast is the best reason to get out of bed. Is it your favorite meal . Depends what it is, if its stuff like this,